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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101.

If a Medicare Part A claim for inpatient hospital services is denied because the inpatient admission was not reasonable and necessary, or if a hospital determines under 42 CFR 482.30(d) or 485.641 after a beneficiary is discharged that the beneficiary's inpatient admission was not reasonable and necessary, and if waiver of liability payment is not made, the hospital may be paid for the following Part B inpatient services that would have been reasonable and necessary if the beneficiary had been treated as a hospital outpatient rather than admitted as an inpatient, provided the beneficiary is enrolled in Medicare Part B:

1) Part B services paid under the outpatient prospective payment system (OPPS), excluding observation services and hospital outpatient visits that require an outpatient status. Hospitals that are excluded from payment under the OPPS are instead paid under their alternative payment methodology (e.g., reasonable cost, all inclusive rate, or Maryland waiver) for the services that are otherwise payable under the OPPS.

2) The following services excluded from OPPS payment, that are instead paid under the respective Part B fee schedules or prospectively determined rates for which payment is made for these services when provided to hospital outpatients:

a. Physical therapy services, speech-language pathology services, and occupational therapy services (see chapter 15, 220 and 230 of this manual, "Covered Medical and Other Health Services,").
b. Ambulance services.
c. Prosthetic devices, prosthetic supplies, and orthotic devices paid under the DMEPOS fee schedule (excludes implantable prosthetic devices (other than dental) which replace all or part of an internal body organ (including colostomy bags and supplies directly related to colostomy care) and replacement of such devices).
d. Durable medical equipment supplied by the hospital for the patient to take home, except durable medical equipment that is implantable.
e. Certain clinical diagnostic laboratory services.
f. Screening and diagnostic mammography services.
g. Annual wellness visit providing personalized prevention plan services.

You can find this rule in the Medicare Benefit Policy Manual Chapter 6, Section 10.1.

The rules state that when an inpatient admission is found to be not reasonable and necessary, the Centers for Medicare & Medicaid Services (CMS) will allow payment of all hospital services that were furnished and would have been reasonable and necessary if the beneficiary had been treated as an outpatient, rather than admitted to the hospital as an inpatient, except for those services that specifically require an outpatient status such as outpatient visits, emergency department visits, and observation services, that are, by definition, provided to hospital outpatients and not inpatients.

Hospitals may continue to bill Part B for outpatient services provided to the beneficiary prior to the point of inpatient admission in the 3-calendar day payment window prior to the admission, including those services that require an outpatient status. These services should be billed on a 131 Part B outpatient Type of Bill (TOB) and must be filed timely.

Services provided prior to the point of inpatient admission are outpatient services and may not be included on the 121 Part B inpatient claim; services provided after the point of admission are inpatient services and may not be included on the 131 Part B outpatient claim. Two complementary claims are therefore necessary if some services are provided before admission and others are provided after admission.

You can find this information in the Medicare Learning Network (MLN) Matters article Number: SE1333.

If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.

The Plan contract says that the Plan covers items and services in accordance with Medicare rules.