Medicare Benefit Policy Manual 
Chapter 1 - Inpatient Hospital Services Covered Under 
Part A 
 
Table of Contents 
(Rev. 10892, 08-06-21) 
Transmittals for Chapter 1 
1  Definition of Inpatient Hospital Services 
10 - Covered Inpatient Hospital Services Covered Under Part A 
10.1 - Bed and Board 
10.1.1 - Accommodations - General 
10.1.2 - Medical Necessity - Need for Isolation 
10.1.3 - Medical Necessity - Admission Required and Only Private Rooms 
Available 
10.1.4 - Charges for Deluxe Private Room 
10.1.5 - All Private Room Providers 
10.1.6 - Wards 
10.1.6.1 - Assignment Consistent With Program Purposes 
10.1.6.2 - Assignment Not Consistent With Program Purposes 
10.1.7 - Charges 
10.2  Hospital Inpatient Admission Order and Certification 
20 - Nursing and Other Services 
20.1 - Anesthetist Services 
20.2 - Medical Social Services to Meet the Patient's Medically Related Social 
Needs 
30 - Drugs and Biologicals 
30.1 - Drugs Included in the Drug Compendia 
30.2 - Approval by Pharmacy and Drug Therapeutics Committee 
30.3 - Combination Drugs 
30.4 - Drugs Specially Ordered for Inpatients 
30.5 - Drugs for Use Outside the Hospital 
40 - Supplies, Appliances, and Equipment 
50 - Other Diagnostic or Therapeutic Items or Services  50.1 - Therapeutic Items 
50.2 - Diagnostic Services of Psychologists and Physical Therapists 
50.3 - Diagnostic Services Furnished to an Inpatient by an Independent Clinical 
Laboratory Under Arrangements With the Hospital 
50.4 - Diagnostic Services Furnished a Hospital Inpatient Under Arrangement 
With the Laboratory of Another Participating Hospital 
60 - Services of Interns or Residents-In-Training 
70 - Inpatient Services in Connection With Dental Services 
80 - Health Care Associated With Pregnancy 
90 - Termination of Pregnancy 
100 - Treatment for Infertility 
110 - Inpatient Rehabilitation Facility (IRF) Services 
110.1 - Documentation Requirements 
110.1.1 - Required Preadmission Screening 
110.1.2 - Required Post-Admission Physician Evaluation 
110.1.3 - Required Individualized Overall Plan of Care 
110.1.4 - Required Admission Orders 
110.1.5 - Required Inpatient Rehabilitation Facility Patient Assessment 
Instrument (IRF-PAI) 
110.2 - Inpatient Rehabilitation Facility Medical Necessity Criteria 
110.2.1 - Multiple Therapy Disciplines 
110.2.2 - Intensive Level of Rehabilitation Services 
110.2.3 - Ability to Actively Participate in Intensive Rehabilitation 
Therapy Program 
110.2.4 - Physician Supervision 
110.2.5 - Interdisciplinary Team Approach to the Delivery of Care 
            110.2.6  IRF Waivers and Flexibilities During the Public Health     
                           Emergency for the COVID-19 Pandemic 
110.3 - Definition of Measurable Improvement 
120 - Services Related to and Required as a Result of Services Which Are Not Covered 
Under Medicare 
130 - Religious Nonmedical Health Care Institution (RNHCI) Services 
130.1 - Beneficiary Eligibility for RNHCI Services 
130.2 - Election of RNHCI Benefits 
130.2.1  Revocation of RNHCI Election  130.2.2  RNHCI Election After Prior Revocation 
130.3  Medicare Payment for RNHCI Services and Beneficiary Liability 
130.4 - Coverage of RNHCI Items Furnished in the Home 
130.4.1 - Coverage and Payment of Durable Medical Equipment Under the 
RNHCI Home Benefit 
130.4.2 - Coverage and Payment of Home Visits Under the RNHCI Home 
Benefit  1  Definition of Inpatient Hospital Services 
(Rev. 1, 10-01-03) 
 
Inpatient hospital services are defined in Title XVIII of the Social Security Act (the Act) 
and in the regulations (42 CFR 409.10): 
 
A.  Subject to the conditions, limitations, and exceptions set forth in this subpart, the term 
"inpatient hospital or inpatient CAH services" means the following services furnished to 
an inpatient of a participating hospital or of a participating CAH or, in the case of 
emergency services or services in foreign hospitals, to an inpatient of a qualified hospital: 
 
1.  Bed and board. 
 
2.  Nursing services and other related services. 
 
3.  Use of hospital or CAH facilities. 
 
4.  Medical social services. 
 
5.  Drugs, biologicals, supplies, appliances, and equipment. 
 
6.  Certain other diagnostic or therapeutic services. 
 
7.  Medical or surgical services provided by certain interns or residents-in- 
training. 
 
8.  Transportation services, including transport by ambulance. 
 
B.  Inpatient hospital services does not include the following types of services: 
 
1.  Posthospital SNF care, as described in 42 CFR 409.20, furnished by a hospital 
or a critical access hospital that has a swing-bed approval. 
 
2.  Nursing facility services, described in 42 CFR 440.155 that may be furnished 
as a Medicaid service under title XIX of the Act in a swing- bed hospital that 
has an approval to furnish nursing facility services. 
 
3.  Physician services that meet the requirements of 42 CFR 415.102(a) for 
payment on a fee schedule basis. 
 
4.  Physician assistant services, as defined in 1861(s)(2)(K)(i) of the Act. 
 
5.  Nurse practitioner and clinical nurse specialist services, as defined in 
1861(s)(2)(K)(ii) of the Act. 
 
6.  Certified nurse mid-wife services, as defined in 1861(gg) of the Act.   
7.  Qualified psychologist services, as defined in 1861(ii) of the Act. 
 
8.  Services of an anesthetist, as defined in 42 CFR 410.69. 
 
10 - Covered Inpatient Hospital Services Covered Under Part A 
(Rev. 234, Issued: 03-10-17, Effective: 01-01-16, Implementation: 06-12-17) 
 
Patients covered under hospital insurance are entitled to have payment made on their 
behalf for inpatient hospital services.  (Inpatient hospital services do not include extended 
care services provided by hospitals pursuant to swing bed approvals.  See Pub. 100-02, 
Chapter 8, 10.3, "Hospital Providers of Extended Care Services.").  However, both 
inpatient hospital and inpatient SNF benefits are provided under Part A - Hospital 
Insurance Benefits for the Aged and Disabled, of Title XVIII). 
 
Additional information concerning the following topics can be found in the following 
chapters of this manual: 
 
  Benefit Period is found in Chapter 3 
 
  Counting Inpatient Days is found in Chapter 3 
 
  Lifetime reserve days is found in Chapter 5 
 
  Related payment information is housed in the Provider Reimbursement Manual 
 
Blood must be furnished on a day which counts as a day of inpatient hospital services to 
be covered as a Part A service and to count toward the blood deductible.  Thus, blood is 
not covered under Part A and does not count toward the Part A blood deductible when 
furnished to an inpatient after the inpatient has exhausted all benefit days in a benefit 
period, or where the individual has elected not to use lifetime reserve days.  However, 
where the patient is discharged on their first day of entitlement or on the hospital's first 
day of participation, the hospital is permitted to submit a billing form with no 
accommodation charge, but with ancillary charges including blood. 
 
The records for all Medicare hospital inpatient discharges are maintained in CMS for 
statistical analysis and use in determining future Prospective Payment System (PPS) 
Diagnosis Related Group (DRG) classifications and rates. 
 
Non-PPS hospitals do not pay for noncovered services generally excluded from coverage 
in the Medicare Program.  This may result in denial of a part of the billed charges or in 
denial of the entire admission, depending upon circumstance.  In PPS hospitals, the 
following are also possible: 
  1.  In appropriately admitted cases where a noncovered procedure was performed, 
denied services may result in payment of a different DRG (i.e., one which 
excludes payment for the noncovered procedure); or  
 
2.  In appropriately admitted cases that become cost outlier cases, denied services 
may lead to denial of some or all of an outlier payment. 
 
The following examples illustrate this principle.  If care is noncovered because a patient 
does not need to be hospitalized, the A/B MAC Part A denies the admission and makes 
no Part A (i.e., PPS) payment unless paid under limitation on liability.  Under limitation 
on liability, Medicare payment may be made when the provider and the beneficiary were 
not aware the services were not necessary and could not reasonably be expected to know 
that the services were not necessary.  For detailed instructions, see Pub. 100-04, Medicare 
Claims Processing Manual, Chapter 30,"Limitation on Liability" section 20.  If a patient 
is appropriately hospitalized but receives (beyond routine services) only noncovered care, 
the admission is denied. 
 
NOTE:  The A/B MAC Part A does not deny an admission that includes covered care, 
even if noncovered care was also rendered.  Under PPS, Medicare assumes that it is 
paying for only the covered care rendered whenever covered services needed to treat 
and/or diagnose the illness were in fact provided. 
 
If a noncovered procedure is provided along with covered nonroutine care, a DRG 
change rather than an admission denial might occur.  If noncovered procedures are 
elevating costs into the cost outlier category, outlier payment is denied in whole or in 
part. 
 
When the hospital is included in PPS, most of the subsequent discussion regarding 
coverage of inpatient hospital services is relevant only in the context of determining the 
appropriateness of admissions, which DRG, if any, to pay, and the appropriateness of 
payment for any outlier cases. 
 
If a patient receives items or services in excess of, or more expensive than, those for 
which payment can be made, payment is made only for the covered items or services or 
for only the appropriate prospective payment amount.  This provision applies not only to 
inpatient services, but also to all hospital services under Parts A and B of the program.  If 
the items or services were requested by the patient, the hospital may charge him or her 
the difference between the amount customarily charged for the services requested and the 
amount customarily charged for covered services. 
 
An inpatient is a person who has been admitted to a hospital for bed occupancy for 
purposes of receiving inpatient hospital services (see 10.2 below).  Generally, a patient 
is considered an inpatient if formally admitted as inpatient with the expectation that he or 
she will require hospital care that is expected to span at least two midnights and occupy a 
bed even though it later develops that the patient can be discharged or transferred to 
another hospital and not actually use a hospital bed overnight.   
The physician or other practitioner responsible for a patient's care at the hospital is also 
responsible for deciding whether the patient should be admitted as an inpatient.  
Physicians should use the expectation of the patient to require hospital care that spans at 
least two midnights period as a benchmark, i.e., they should order admission for patients 
who are expected to require a hospital stay that crosses two midnights and the medical 
record supports that reasonable expectation.  However, the decision to admit a patient is a 
complex medical judgment which can be made only after the physician has considered a 
number of factors, including the patient's medical history and current medical needs, the 
types of facilities available to inpatients and to outpatients, the hospital's by-laws and 
admissions policies, and the relative appropriateness of treatment in each setting.  Factors 
to be considered when making the decision to admit include such things as: 
 
  The severity of the signs and symptoms exhibited by the patient; 
 
  The medical predictability of something adverse happening to the patient; 
 
  The need for diagnostic studies that appropriately are outpatient services (i.e., 
their performance does not ordinarily require the patient to remain at the hospital 
for 24 hours or more) to assist in assessing whether the patient should be 
admitted; and  
 
  The availability of diagnostic procedures at the time when and at the location 
where the patient presents. 
 
Admissions of particular patients are not covered or noncovered solely on the basis of the 
length of time the patient actually spends in the hospital.  In certain specific situations 
coverage of services on an inpatient or outpatient basis is determined by the following 
rules: 
 
Minor Surgery or Other Treatment - When patients with known diagnoses enter a 
hospital for a specific minor surgical procedure or other treatment that is expected to keep 
them in the hospital for only a few hours (less than 24), they are considered outpatients 
for coverage purposes regardless of: the hour they came to the hospital, whether they 
used a bed, and whether they remained in the hospital past midnight. 
 
Renal Dialysis - Renal dialysis treatments are usually covered only as outpatient services 
but may under certain circumstances be covered as inpatient services depending on the 
patient's condition.  Patients staying at home, who are ambulatory, whose conditions are 
stable and who come to the hospital for routine chronic dialysis treatments, and not for a 
diagnostic workup or a change in therapy, are considered outpatients.  On the other hand, 
patients undergoing short-term dialysis until their kidneys recover from an acute illness 
(acute dialysis), or persons with borderline renal failure who develop acute renal failure 
every time they have an illness and require dialysis (episodic dialysis) are usually 
inpatients.  A patient may begin dialysis as an inpatient and then progress to an outpatient 
status.   
Under original Medicare, the Quality Improvement Organization (QIO), for each hospital 
is responsible for deciding, during review of inpatient admissions on a case-by-case basis, 
whether the admission was medically necessary.  Medicare law authorizes the QIO to 
make these judgments, and the judgments are binding for purposes of Medicare coverage.  
In making these judgments, however, QIOs consider only the medical evidence which 
was available to the physician at the time an admission decision had to be made.  They do 
not take into account other information (e.g., test results) which became available only 
after admission, except in cases where considering the post-admission information would 
support a finding that an admission was medically necessary. 
 
Refer to chapters 4 and 7 of Pub. 100-10, Quality Improvement Organization Manual 
with regard to initial determinations for these services.  The QIO will review the swing 
bed services in these PPS hospitals as well. 
 
NOTE:  When patients requiring extended care services are admitted to beds in a 
hospital, they are considered inpatients of the hospital.  In such cases, the services 
furnished in the hospital will not be considered extended care services, and payment may 
not be made under the program for such services unless the services are extended care 
services furnished pursuant to a swing bed agreement granted to the hospital by the 
Secretary of Health and Human Services. 
 
10.1 - Bed and Board 
(Rev. 1, 10-01-03) 
A3-3101.1, HO-210.1 
 
10.1.1 - Accommodations - General 
(Rev. 1, 10-01-03) 
A3-3101.1.A, HO-210.1.A 
 
The program will pay the same amount for routine accommodations services whether the 
patient has a private room not medically necessary, a private room medically necessary 
(Medicare does not pay for deluxe accommodations in any case), a semiprivate room (2-, 
3-, or 4-bed accommodations), or ward accommodations, if its ward accommodations are 
consistent with program purposes (see 10.1.6 below). 
 
A provider having both private and semiprivate accommodations may nevertheless 
charge the patient a differential for a private room if: 
 
  The private room is not medically necessary; and  
 
  The patient (or relative or other person acting on their behalf) has requested the 
private room, and the provider informs them of the amount of charge at the time 
of the request. 
  The private room differential may not exceed the difference between the customary 
charge for the accommodations furnished and the most prevalent semiprivate 
accommodation rate at the time of the patient's admission. 
 
Where the provider bills for a private room as a covered service, i.e., shows the charge 
for the room as a covered charge on the Form CMS-1450, the A/B MAC (A) will deem 
the private room to be medically necessary.  Where the provider, on the other hand, 
shows a private differential as a noncovered charge, the A/B MAC (A) will assume that 
the private room is not medically necessary. 
 
If the beneficiary (or their representative) protests a charge for the private room on the 
grounds that the privacy was medically necessary, such protest will, if not in written 
form, be reduced to writing and forwarded to the A/B MAC (A).  The A/B MAC (A) will 
then develop the facts and make a specific determination regarding the medical necessity 
of the private room.  (If an A/B MAC (A) receives many protests of this kind, the 
provider may need guidance on what constitutes medical necessity for privacy).  If the 
protest is received after the claim is processed, it will be treated as a request for 
reconsideration. 
 
If at any time in the course of development (or thereafter within the period when the 
determination is not administratively final), the provider acknowledges that the private 
room was medically necessary; the A/B MAC (A) will make an immediate finding to this 
effect. 
 
Where it is necessary to develop the medical necessity of a private room, the guidelines 
in subsections 10.1.2 and 10.1.3 below will apply. 
 
10.1.2 - Medical Necessity - Need for Isolation 
(Rev. 1, 10-01-03) 
A3-3101.1.B, HO-210.1.B 
 
A private room is medically necessary where isolation of a beneficiary is required to 
avoid jeopardizing their health or recovery, or that of other patients who are likely to be 
alarmed or disturbed by the beneficiary's symptoms or treatment or subjected to infection 
by the beneficiary's communicable disease.  For example, communicable diseases, heart 
attacks, cerebra-vascular accidents, and psychotic episodes may require isolation of the 
patient for certain periods.  (See 10.1.3 below concerning medical necessity not based 
on need for isolation). 
 
In establishing the medical necessity for isolation, the date of the physician's written 
statement is not controlling, nor is the presence of a written statement.  The crucial 
question is whether a private room was ordered by the physician because it is necessary 
for the health of the patient himself or herself or of other patients.  In the absence of such 
an order, a patient who requested the room with knowledge of the amount of the charge 
may be charged appropriately, even though a physician subsequently submits a statement 
that the room was medically necessary.  There may be cases in which the physician's  written statement of medical necessity, though dated after admission or even after 
discharge, merely confirms an order made informally at or before the time the beneficiary 
was admitted to the private room (e.g., the physician made arrangements by phone for the 
patient's admission, gave the diagnosis, and stated the beneficiary would need a private 
room).  In such cases, assuming that the private room was medically necessary, the lack 
of a written statement by the physician, or the fact that the written statement was prepared 
after discharge, would not be controlling.  The patient may not be charged. 
 
10.1.3 - Medical Necessity - Admission Required and Only Private 
Rooms Available 
(Rev. 1, 10-01-03) 
A3-3101.1.C, HO-210.1.C 
 
A private room is considered to be medically necessary even though the beneficiary's 
condition does not require isolation if he/she needs immediate hospitalization (i.e., the 
beneficiary's medical condition is such that hospitalization cannot be deferred) and the 
hospital has no semiprivate or ward accommodations available at the time of admission. 
 
It need not be considered whether semiprivate or ward accommodations were available in 
some other accessible hospital.  Where medical necessity exists, the provider may not 
charge the beneficiary a private room differential until semiprivate or ward 
accommodations become available.  Thereafter the provider may transfer the patient to 
the nonprivate accommodations, or allow them to continue occupancy of the private 
room, subject to an appropriate differential charge (described in 10.1.1 above) if they 
request the private room with knowledge of the amount of the charge. 
 
If the admission could be deferred until semiprivate or ward accommodations become 
available, the beneficiary should be informed of the amount of the differential he/she 
must pay for a private room if he/she wishes to be admitted immediately.  The 
beneficiary may be charged the specified differential if he/she has been admitted to the 
private room at their request (or at the request of their representative) with knowledge of 
the amount of the charge. 
 
10.1.4 - Charges for Deluxe Private Room 
(Rev. 1, 10-01-03) 
A3-3101.1.D, HO-210.1.D 
 
Beneficiaries found to need a private room (either because they need isolation for 
medical reasons or because they need immediate admission when no other 
accommodations are available) may be assigned to any of the provider's private rooms.  
They do not have the right to insist on the private room of their choice, but their 
preferences should be given the same consideration as if they were paying all provider 
charges themselves.  The program does not, under any circumstances, pay for personal 
comfort items.  Thus, the program does not pay for deluxe accommodations and/or 
services.  These would include a suite, or a room substantially more spacious than is 
required for treatment, or specially equipped or decorated, or serviced for the comfort and  convenience of persons willing to pay a differential for such amenities.  If the beneficiary 
(or representative) requests such deluxe accommodations, the provider should advise that 
there will be a charge, not covered by Medicare, of a specified amount per day (not 
exceeding the differential defined in the next sentence); and may charge the beneficiary 
that amount for each day he/she occupies the deluxe accommodations.  The maximum 
amount the provider may charge the beneficiary for such accommodations is the 
differential between the most prevalent private room rate at the time of admission and the 
customary charge for the room occupied.  Beneficiaries may not be charged this 
differential if they (or their representative) do not request the deluxe accommodations. 
 
The beneficiary may not be charged such a differential in private room rates if that 
differential is based on factors other than personal comfort items.  Such factors might 
include differences between older and newer wings, proximity to lounge, elevators or 
nursing stations, desirable view, etc.  Such rooms are standard 1-bed units and not deluxe 
rooms for purposes of these instructions, even though the provider may call them deluxe 
and have a higher customary charge for them.  No additional charge may be imposed 
upon the beneficiary who is assigned to a room that may be somewhat more desirable 
because of these factors. 
 
10.1.5 - All Private Room Providers 
(Rev. 1, 10-01-03) 
A3-3101.E, HO-210.1.E 
 
If the patient is admitted to a provider which has only private accommodations, and no 
semiprivate or ward accommodations, medical necessity will be deemed to exist for the 
accommodations furnished.  Beneficiaries may not be subjected to an extra charge for a 
private room in an all-private room provider. 
 
10.1.6 - Wards 
(Rev. 1, 10-01-03) 
A3-3101.1.F, HO-210.1.F 
 
The law contemplates that Medicare patients should not be assigned to ward 
accommodations except at the patient's request or for a reason consistent with the 
purposes of the health insurance program. 
 
When ward accommodations are furnished at the patient's request or for a reason 
determined to be consistent with the program's purposes, payment will be based on the 
average per diem cost of routine services (see 10.1.1 above).  Where ward 
accommodations are assigned for other reasons, the law provides what may be a 
substantial penalty.  (See 10.1.6.2 below). 
 
Any request by the patient (or relative or other person responsible for his or her affairs) 
for ward accommodations must be obtained by the provider in writing and kept in its 
files. 
  10.1.6.1 - Assignment Consistent With Program Purposes 
(Rev. 1, 10-01-03) 
A3-3101.1.F.1, HO-210.1.F.1 
 
It is considered to be consistent with the program's purposes to assign the patient to ward 
accommodations if all semiprivate accommodations are occupied, or the facility has no 
semiprivate accommodations.  However, the patient must be moved to semiprivate 
accommodations if they become available during the stay. 
 
Some hospitals have a policy of placing in wards all patients who do not have private 
physicians.  Such a practice may be consistent with the purposes of the program if the 
A/B MAC (A) determines that the ward assignment inures to the benefit of the patient.  
In making this determination, the principal consideration is whether the assignment is 
likely to result in better medical treatment of the patient (e.g., it facilitates necessary 
medical and nursing supervision and treatment).  The A/B MAC (A) should ask a 
provider having this policy to submit a statement describing how the assignments are 
made, their purpose, and the effect on the care of patients so assigned. 
 
If the A/B MAC (A) makes a favorable determination on a practice affecting all ward 
assignments of Medicare patients in the institution, a reference should be made on the 
appropriate billing form for patients to whom the hospital assigned a ward pursuant to 
such practice. 
 
10.1.6.2 - Assignment Not Consistent With Program Purposes 
(Rev. 1, 10-01-03) 
A3-3101.1.F.2, HO-210.1.F.2 
 
It is not consistent with the purposes of the law to assign a patient ward accommodation 
based on their social or economic status, their national origin, race, or religion, or their 
entitlement to benefits as a Medicare patient, or any other such discriminatory reason.  It 
is also inconsistent with the purposes of the law to assign patients to ward 
accommodations merely for the convenience or financial advantage of the institution.  
Additionally, under DRGs, there no longer is a reduction to payment or an adjustment to 
the end of year settlement. 
 
10.1.7 - Charges 
(Rev. 1, 10-01-03) 
A3-3101.1.G, HO-210.1.G 
 
Customary charges means amounts which the hospital or skilled nursing facility is 
uniformly charging patients currently for specific services and accommodations.  The 
most prevalent rate or charge is the rate that applies to the greatest number of semiprivate 
or private beds in the institution. 
 
10.2  Hospital Inpatient Admission Order and Certification 
(Rev. 234, Issued: 03-10-17, Effective: 01-01-16, Implementation: 06-12-17)   
The order to admit as an inpatient (practitioner order) is a critical element in clarifying 
when an individual is considered an inpatient of a hospital, including a critical access 
hospital (CAH), and is therefore required for all hospital inpatient cases for hospital 
inpatient coverage and payment under Part A.  As a condition of payment for hospital 
inpatient services under Medicare Part A, according to section 1814(a) of the Social 
Security Act, CMS is requiring, only for long-stay cases and outlier cases, separate 
physician certification of the medical necessity that such services be provided on an 
inpatient basis.  The signed physician certification is considered, along with other 
documentation in the medical record, as evidence that hospital inpatient service(s) were 
reasonable and necessary. 
 
The following guidance applies to all inpatient hospital and CAH services unless 
otherwise specified.  For the remainder of this guidance, references to hospitals includes 
CAHs.  The complete requirements for the physician certification are found in 42 CFR 
Part 424 subpart B, and requirements for admission orders are found at 42 CFR 412.3. 
 
A.  Physician Certification.  Physician certification of inpatient services is required 
for cases that are 20 inpatient days or more (long-stay cases), for outlier cases of 
hospitals other than inpatient psychiatric facilities and for cases of CAHs.  (See 
CY 2015 Outpatient Prospective Payment System Final Rule, 79 FR 66997 and 
42 CFR 412 Subpart F, 42 CFR 424.13 and 42 CFR 424.15): 
 
1.  Content:  The physician certification includes the following information: 
 
a.  Reason for inpatient services:  The physician certifies the reasons for 
either (i) Continued hospitalization of the patient for inpatient medical 
treatment or medically required inpatient diagnostic study; or (ii) Special 
or unusual services for outlier cases under the applicable prospective 
payment system for inpatient services.  For example, documentation of an 
admitting diagnosis could fulfill this part of the certification requirement. 
 
b.  The estimated (or actual) time the beneficiary requires or required in the 
hospital:  The physician certifies the estimated time in the hospital the 
beneficiary requires (if the certification is completed prior to discharge) or 
the actual time in the hospital (if the certification is completed at 
discharge).  Estimated or actual length of stay is most commonly reflected 
in the progress notes where the practitioner discusses the assessment and 
plan.  For the purposes of meeting the requirement for certification, 
expected or actual length of stay may be documented in the order or a 
separate certification or recertification form, but it is also acceptable if 
discussed in the progress notes assessment and plan or as part of routine 
discharge planning. 
 
If the reason an inpatient is still in the hospital is that they are waiting for 
availability of a skilled nursing facility (SNF) bed, the regulations at 42  CFR 424.13(c) and 424.14(e) provide that a beneficiary who is already 
appropriately an inpatient can be kept in the hospital as an inpatient if the 
only reason they remain in the hospital is they are waiting for a post-acute 
SNF bed.  The physician may certify the need for continued inpatient 
admission on this basis. 
 
c.  The plans for posthospital care, if appropriate, and as provided in 42 CFR 
424.13. 
 
d.  For inpatient CAH services only, the physician must certify that the 
beneficiary may reasonably be expected to be discharged or transferred to 
a hospital within 96 hours after admission to the CAH. 
 
Time as an outpatient at the CAH does not count towards the 96 hour 
certification requirement.  The clock for the 96 hour certification 
requirement only begins once the individual is admitted to the CAH as an 
inpatient.  Time in a CAH swing-bed also does not count towards the 96 
hour certification requirement. 
 
The 96-hour certification requirement is based on an expectation at the 
time of admission.  If a physician certifies in good faith that an individual 
may reasonably be expected to be discharged or transferred to a hospital 
within 96 hours after admission to the CAH, and something unforeseen 
occurs that causes the individual to stay longer at the CAH, the CAH 
would be paid for that unforeseen extended inpatient stay as long as that 
individuals stay does not cause the CAH to exceed its 96-hour annual 
average condition of participation requirement.  However, if a physician 
cannot in good faith certify that an individual may reasonably be expected 
to be discharged or transferred within 96 hours after admission to the 
CAH, the CAH will not receive Medicare reimbursement for any portion 
of that individuals inpatient stay.  This would be determined based on a 
medical review of the case. 
 
All certification requirements must be completed, signed, and documented 
in the medical record no later than 1 day before the date on which the 
claim for payment for the inpatient CAH service is submitted, as provided 
in the FY15 IPPS Final Rule and 42 CFR 424.11 and 42 CFR 424.15. 
 
e.  Inpatient Rehabilitation Facilities (IRFs):  The documentation that IRFs 
are already required to complete to meet the IRF coverage requirements 
(such as the preadmission screening (including the physician review and 
concurrence), the post-admission physician evaluation, and the required 
admission orders) may be used to satisfy the certification and 
recertification statement requirements. 
  2.  Timing:  Outlier cases must be certified and recertified as provided in 42 CFR 
424.13.  Under extenuating circumstances, delayed initial certification or 
recertification of an outlier case may be acceptable as long as it does not 
extend past discharge.  For all other long stay cases, the certification must be 
signed and documented no later than 20 days into the inpatient portion of the 
hospital stay. 
 
3.  Authorization to sign the certification:  The certification or recertification 
may be signed only by one of the following: 
 
(1)  A physician who is a doctor of medicine or osteopathy. 
(2)  A dentist in the circumstances specified in 42 CFR 424.13(d). 
(3)  A doctor of podiatric medicine if his or her certification is consistent 
with the functions he or she is authorized to perform under state law. 
 
Certifications and recertifications must be signed by the physician responsible 
for the case, or by another physician who has knowledge of the case and who 
is authorized to do so by the responsible physician or by the hospitals 
medical staff (or by the dentist as provided in 42 CFR 424.11 and 42 CFR 
424.13).  CMS considers only the following physicians, podiatrists or dentists 
to have sufficient knowledge of the case to serve as the certifying physician:  
the admitting physician of record (attending) or a physician on call for him 
or her; a surgeon responsible for a major surgical procedure on the beneficiary 
or a surgeon on call for him or her; a dentist functioning as the admitting 
physician of record or as the surgeon responsible for a major dental procedure; 
and, in the specific case of a non physician non dentist admitting practitioner 
who is licensed by the state and has been granted privileges by the facility, a 
physician member of the hospital staff (such as a physician member of the 
utilization review committee) who has reviewed the case and who also enters 
into the record a complete certification statement that specifically contains all 
of the content elements discussed above.  The admitting physician of record 
may be an emergency department physician or hospitalist.  CMS does not 
require the certifying physician to have inpatient admission privileges at the 
hospital. 
 
4.  Format:  As specified in 42 CFR 424.11, no specific procedures or forms are 
required for certification and recertification statements.  The provider may 
adopt any method that permits verification.  The certification and 
recertification statements may be entered on forms, notes, or records that the 
appropriate individual signs, or on a special separate form.  Except as 
provided for delayed certifications, there must be a separate signed statement 
for each certification or recertification.  If all the required information is 
included in progress notes, the physician's statement could indicate that the 
individual's medical record contains the information required and that hospital 
inpatient services are or continue to be medically necessary. 
  B.  Inpatient Order:  A Medicare beneficiary is considered an inpatient of a hospital 
if formally admitted as an inpatient pursuant to an order for inpatient admission 
by an ordering practitioner.  As stated in the FY 2014 IPPS Final Rule, 78 FR 
50908 and 50941, and as conveyed in 42 CFR 482.24, if the order is not properly 
documented in the medical record prior to discharge, the hospital should not 
submit a claim for Part A payment.  Meeting the two midnight benchmark does 
not, in itself, render a beneficiary an inpatient or serve to qualify them for 
payment under Part A.  Rather, as provided in Medicare regulations, a beneficiary 
is considered an inpatient (and Part A payment may only be made) if they are 
formally admitted as such pursuant to an order for inpatient admission by an 
ordering practitioner. 
 
With regard to the time of discharge, a Medicare beneficiary is considered a 
patient of the hospital until the effectuation of activities typically specified by the 
ordering practitioner as having to occur prior to discharge (e.g., discharge after 
supper or discharge after voids).  Thus, discharge itself can but does not 
always coincide exactly with the time that the discharge order is written, rather it 
occurs when the ordering practitioners order for discharge is effectuated. 
 
1.  Content:  The ordering practitioners order contains the instruction that the 
beneficiary should be formally admitted for hospital inpatient care.  The order 
must specify admission for inpatient services.  Inpatient rehabilitation 
facilities (IRFs) must adhere to the admission requirements specified in 42 
CFR 412.622.  The two midnight benchmark does not apply in IRFs. 
 
2.  Qualifications of the ordering/admitting practitioner:  The order must be 
furnished by a physician or other practitioner (ordering practitioner) who is:  
(a) licensed by the state to admit inpatients to hospitals, (b) granted privileges 
by the hospital to admit inpatients to that specific facility, and (c) 
knowledgeable about the patients hospital course, medical plan of care, and 
current condition at the time of admission.  See section (B)(3) for a discussion 
of the requirements to be knowledgeable about the patients hospital course.  
The ordering practitioner makes the determination of medical necessity for 
inpatient care and renders the admission decision.  The ordering practitioner is 
not required to write the order but must authenticate (sign, or in the case of an 
initial order (under (B)(2)(a)) or a verbal order (under (B)(2)(b)), countersign) 
the order reflecting that he or she has made the decision to admit the patient 
for inpatient services. 
 
The admission decision (order) may not be delegated to another individual 
who is not authorized by the state to admit patients, or has not been granted 
admitting privileges by the hospital's medical staff.  However, a medical 
resident, physician assistant, nurse practitioner, or other non-physician 
practitioner may act as a proxy for the ordering practitioner provided they are 
authorized under state law to admit patients and the requirements outlined 
below are met (FY 14 IPPS Final Rule and 42 CFR 412.3(b)).   
a.  Residents and non-physician practitioners authorized to make initial 
admission decisions - Certain non-physician practitioners and residents 
working within their residency program are authorized by the state in 
which the hospital is located to admit inpatients, and are allowed by 
hospital by-laws or policies to do the same.  The ordering practitioner may 
allow these individuals to write inpatient admission orders on his or her 
behalf, if the ordering practitioner approves and accepts responsibility for 
the admission decision by authenticating (countersigning) the order prior 
to discharge.  (See (A)(2) for guidance regarding the definition of 
discharge time and (B)(3) for more guidance regarding knowledge of a 
patients hospital course).  In authenticating (countersigning) the order, the 
ordering practitioner approves and accepts responsibility for the admission 
decision.  This process may also be used for practitioners (such as 
emergency department physicians) who do not have admitting privileges 
but are authorized by the hospital to issue temporary or bridge inpatient 
admission orders. 
 
b.  Verbal orders- At some hospitals, individuals who lack the authority to 
admit inpatients under state laws and hospital by laws (such as a 
registered nurse) may nonetheless enter the inpatient admission order as a 
verbal order.  In these cases, the ordering practitioner directly 
communicates the inpatient admission order to staff as a verbal (not 
standing) order, and the ordering practitioner need not separately record 
the order to admit.  Following discussion with and at the direction of the 
ordering practitioner, a verbal order for inpatient admission may be 
documented by an individual who is not qualified to admit patients in his 
or her own right, as long as that documentation (transcription) of the order 
for inpatient admission is in accordance with state law including; scope
of practice laws, hospital policies, and medical staff bylaws, rules, and 
regulations.  In this case, the staff receiving the verbal order must  
document the verbal order in the medical record at the time it is received.  
The order must identify the ordering practitioner and must be 
authenticated (countersigned) by the ordering practitioner promptly and 
prior to discharge.  Example:  Admit to inpatient per Dr. Smith would 
be considered an acceptable method of identifying the ordering 
practitioner and would meet the verbal order requirement if the verbal 
order (1) is appropriately documented in the medical record by the 
individual receiving the verbal order when the order is received; and (2) is 
authenticated (countersigned) by Dr. Smith promptly, prior to discharge. 
 
c.  Standing orders and protocols - The inpatient admission order cannot be 
a standing order.  While Medicares rules do not prohibit use of a protocol 
or algorithm that is part of a protocol, only the ordering practitioner, or a 
resident or other practitioner acting on his or her behalf under section  (B)(2)(a) can make and take responsibility for the inpatient admission 
decision. 
 
d.  Commencement of inpatient status - Inpatient status begins at the time 
of formal admission by the hospital pursuant to the order, including an 
initial order (under (B)(2)(a)) or a verbal order (under (B)(2)(b)) that is 
authenticated (countersigned) timely, by authorized individuals, as 
required in this section.  If the practitioner responsible for authenticating 
(countersigning) an initial order or verbal order does not agree that 
inpatient admission was appropriate or valid (including an unauthorized 
verbal order), he or she should not authenticate (countersign) the order and 
the beneficiary is not considered to be an inpatient.  The hospital stay may 
be billed to Part B as a hospital outpatient encounter. 
 
3.  Knowledge of the patients hospital course: CMS considers only the 
following practitioners to have sufficient knowledge about the beneficiarys 
hospital course, medical plan of care, and current condition to serve as the 
ordering practitioner: the admitting physician of record (attending) or a 
physician on call for him or her, primary or covering hospitalists caring for the 
patient in the hospital, the beneficiarys primary care practitioner or a 
physician on call for the primary care practitioner, a surgeon responsible for a 
major surgical procedure on the beneficiary or a surgeon on call for him or 
her, emergency or clinic practitioners caring for the beneficiary at the point of 
inpatient admission, and other practitioners qualified to admit inpatients and 
actively treating the beneficiary at the point of the inpatient admission 
decision.  A utilization review committee physician functioning in that role 
does not have direct responsibility for the care of the patient and is therefore 
not considered to be sufficiently knowledgeable to order the inpatient 
admission.  The order must be written by one of the above practitioners 
directly involved with the care of the beneficiary, and a utilization committee 
physician may only write the order to admit if he or she is not acting in a 
utilization review capacity and fulfills one of the direct patient care roles, such 
as the attending physician.  Utilization review may not be conducted by any 
individual who was professionally involved in the care of the patient whose 
case is being reviewed (42 CFR 482.30(d)(3)). 
 
4.  Timing:  The order must be furnished at or before the time of the inpatient 
admission.  The order can be written in advance of the formal admission (e.g., 
for a pre scheduled surgery), but the inpatient admission does not occur until 
hospital care services are provided to the beneficiary.  Conversely, in the 
unusual case in which a patient is admitted as an inpatient prior to an order to 
admit and there is no documented verbal order, the inpatient stay should not 
be considered to commence until the inpatient admission order is documented.  
CMS does not permit retroactive orders.  Authentication by the ordering 
practitioner of the order (either by signature or, in the case of an initial order  under (B)(2)(a) or a verbal order under (B)(2)(b), countersignature) is required 
prior to discharge for all inpatient cases. 
 
5.  Specificity of the Order:  The regulations at 42 CFR 412.3 require that, as a 
condition of payment, an order for inpatient admission must be present in the 
medical record.  The preamble of the FY 2014 IPPS Final Rule at 78 FR 
50942 states, the order must specify the admitting practitioners 
recommendation to admit to inpatient, as an inpatient, for inpatient 
services, or similar language specifying his or her recommendation for 
inpatient care.  While CMS does not require specific language to be used on 
the inpatient admission order, it is in the interest of the hospital that the 
ordering practitioner use language that clearly expresses intent to admit the 
patient as inpatient that will be commonly understood by any individual who 
could potentially review documentation of the inpatient stay.  CMS does not 
recommend using language that may have specific meaning only to 
individuals that work in a particular hospital (e.g., admit to 7W) that will 
not be commonly understood by others outside of the hospital. 
 
If admission order language used to specify inpatient or outpatient status is 
ambiguous, the best course of action would be to obtain and document 
clarification from the ordering practitioner before initial Medicare billing 
(ideally before the beneficiary is discharged).  Under this policy, CMS will 
continue to treat orders that specify a typically outpatient or other limited 
service (e.g., admit to ER, to Observation, to Recovery, to Outpatient 
Surgery, to Day Surgery, or to Short Stay Surgery) as defining a non
inpatient service, and such orders will not be treated as meeting the inpatient 
admission requirements.  
 
The admission order is evidence of the decision by the ordering practitioner to 
admit the beneficiary to inpatient status.  In extremely rare circumstances, the 
order to admit may be missing or defective (that is, illegible, or incomplete, 
for example inpatient is not specified), yet the intent, decision, and 
recommendation of the ordering practitioner to admit the beneficiary as an 
inpatient can clearly be derived from the medical record.  In these extremely 
rare situations, contractors have been provided with discretion to determine 
that this information constructively satisfies the requirement that the hospital 
inpatient admission order be present in the medical record.  However, in order 
for the documentation to provide acceptable evidence to support the hospital 
inpatient admission, thus satisfying the requirement for the order, there can be 
no uncertainty regarding the intent, decision, and recommendation by the 
ordering practitioner to admit the beneficiary as an inpatient, and no 
reasonable possibility that the care could have been adequately provided in an 
outpatient setting. 
  This narrow and limited alternative method of satisfying the requirement for 
documentation of the inpatient admission order in the medical record should be extremely 
rare, and may only be applied at the discretion of the contractor. 
 
20 - Nursing and Other Services 
(Rev. 1, 10-01-03) 
A3-3101.2, HO-210.2 
 
Nursing and other related services, use of hospital facilities, and medical social services 
ordinarily furnished by the hospital for the care and treatment of inpatients are covered 
under hospital insurance and included in the Prospective Payment system payment. 
 
NOTE: The services of a private-duty nurse or other private-duty attendant are not 
covered.  Private-duty nurses or private-duty attendants are registered nurses, licensed 
practical nurses, or any other trained attendant whose services ordinarily are rendered to, 
and restricted to, a particular patient by arrangement between the patient and the private-
duty nurse or attendant.  Such persons are engaged or paid by an individual patient or by 
someone acting on their behalf, including a hospital that initially incurs the costs and 
looks to the patient for reimbursement for such noncovered services. 
 
Where the hospital acts on behalf of a patient, the services of the private-duty nurse or 
other attendant under such an arrangement are not inpatient hospital services regardless 
of the control which the hospital may exercise with respect to the services rendered by 
such private-duty nurse or attendant. 
 
20.1 - Anesthetist Services 
(Rev. 1, 10-01-03) 
A3-3101.2.A, HO-210.2.A 
 
If the hospital engages the services of a nurse anesthetist or other nonphysician 
anesthetist (either on a salary or fee-for-service basis) under arrangements which provide 
for billing to be made by the hospital, the cost of the service when provided to an 
inpatient could be covered under Part A.  (See the Medicare Claims Processing Manual 
for more information.) 
 
20.2 - Medical Social Services to Meet the Patient's Medically Related 
Social Needs 
(Rev. 1, 10-01-03) 
A3-3101.2.B, HO-210.2.B 
 
Medical social services are services which contribute meaningfully to the treatment of a 
patient's condition.  Such services include, but are not limited to: 
 
  Assessment of the social and emotional factors related to the patient's illness, need 
for care, response to treatment, and adjustment to care in the facility; 
    Appropriate action to obtain case work services to assist in resolving problems in 
these areas; and  
 
  Assessment of the relationship of the patient's medical and nursing requirements 
to their home situation, financial resources, and the community resources 
available to them in making the decision regarding their discharge. 
 
30 - Drugs and Biologicals 
(Rev. 1, 10-01-03) 
A3-3101.3, HO-210.3 
 
Drugs and biologicals for use in the hospital, which are ordinarily furnished by the 
hospital for the care and treatment of inpatients, are covered. 
 
Three basic requirements must be met for a drug or biological furnished by a hospital to 
be a covered hospital service: 
 
1.  The drug or biological must represent a cost to the institution in rendering 
services to the beneficiary; 
 
2.  The drug or biological must meet the statutory definition.  Under the statute, 
payment may be made for a drug or biological only where it is included, or 
approved for inclusion, in the latest official edition of the United States 
Pharmacopoeia-National Formulary (USP-NF), the United States Pharmacopoeia 
Drug Information (USP DI), or the American Dental Association (ADA) Guide to 
Dental Therapeutics, except for those drugs and biologicals unfavorably evaluated 
in the ADA Guide to Dental Therapeutics.  Combination drugs are also included 
in the definition of drugs if the combination itself or all of the therapeutic 
ingredients of the combination are included, or approved for inclusion, in any of 
the above drug compendia.  Drugs and biologicals are considered approved for 
inclusion in a compendium if approved under the established procedure by the 
professional organization responsible for revision of the compendium; or be 
approved by the pharmacy and drug therapeutics or equivalent committee of the 
medical staff of the hospital for use in the hospital; and 
 
3.  Use of the drug or biological must be safe and effective and otherwise reasonable 
and necessary as specified in the Medicare Benefit Policy Manual, Chapter 15, 
Covered Medical and Other Health Services, 50. 
 
Drugs or biologicals approved for marketing by the Food and Drug 
Administration (FDA) are considered safe and effective for purposes of this last 
requirement when used for indications specified in the labeling.  Therefore, use of 
an FDA-approved drug or biological is covered if: 
 
  It was administered on or after the date of the FDA's approval; 
    It is reasonable and necessary for the individual patient; and  
 
  All other applicable coverage requirements are met. 
 
Drugs and biologicals, which have not received final marketing approval by the FDA, are 
not covered unless CMS instructs the A/B MAC (A) to the contrary.  However, FDA-
approved drugs are used for indications other than those specified on the labeling.  As 
long as the FDA has not specified such use as nonapproved, coverage is determined 
taking into consideration the generally accepted medical practice in the community.  For 
example, the labeling of certain chemotherapeutic drugs indicates their use in the therapy 
of specified types of cancer.  However, based on experience and empirical evidence, 
physicians may prescribe these drugs for a wider range of cancer treatments than what is 
indicated in the labeling.  Local medical review policy may or may not grant coverage, 
depending on the circumstances. 
 
Determinations as to whether use of a drug or biological is reasonable and necessary for 
an individual patient are the responsibility of the Quality Improvement Organization 
(QIO), if this is part of the review for a PPS acute care admission.  However, if this is an 
excluded service claim being reviewed by the A/B MAC (A), the A/B MAC (A) reviews 
and makes a determination, unless it cannot and needs to refer it to the QIO for an initial 
determination. 
 
A hospital stay solely for the purpose of use of a drug or biological that is determined not 
reasonable and necessary is not covered. 
 
30.1 - Drugs Included in the Drug Compendia 
(Rev. 1, 10-01-03) 
A3-3101.2.A, HO-210.3.A 
 
Medicare covers only those drugs and biologicals included, or approved for inclusion, in 
the latest official edition or revision of the compendia as previously listed. 
 
Where a drug is excluded from coverage because it is unfavorably evaluated in either the 
AMA Drug Evaluations or Accepted Dental Therapeutics, the exclusion applies to all 
uses for which the drug or biological was so unfavorably evaluated. 
 
Drugs and biologicals are considered "approved for inclusion" in a compendium if 
approved under the procedure established by the professional organization responsible for 
revision of the compendium. 
 
30.2 - Approval by Pharmacy and Drug Therapeutics Committee 
(Rev. 1, 10-01-03) 
A3-3101.3.B, HO-210.3.B 
 
A pharmacy and drug therapeutics or equivalent committee is a medical staff committee 
that confers with the hospital pharmacist in the formulation of policies pertaining to  drugs.  Drugs and biologicals approved for use in the hospital by such a committee are 
covered only if the committee develops and maintains a formulary or list of drugs 
accepted for use in the hospital.  The committee need not function exclusively as a 
pharmacy and drug therapeutics committee but may also carry on other medical staff 
functions. 
 
Drugs and biologicals are considered approved for use in the hospital if selected for 
inclusion in the hospital drug list of formulary under the procedure of the committee 
established for that purpose.  Express approval is required; the fact that a drug or 
biological has not been specifically determined to be unacceptable for use in the hospital 
does not constitute approval. 
 
Drugs and biologicals are covered if approved for general use in the hospital, or if 
approved for use by a particular patient or group of patients.  Approval by a pharmacy 
and drug therapeutics committee is an alternative to approval for inclusion of the drug or 
biological in an approved drug compendium (see 30.1 above); such approval does not 
preclude the need for a determination of medical necessity.  An investigational drug is 
not considered to meet the reasonable and necessary test since its efficacy has not yet 
been established. 
 
The decision of individual hospitals should not transcend the determinations of the Food 
and Drug Administration and Public Health Service in respect to the safety and 
effectiveness of drugs.  Therefore, even if approved by an appropriate hospital 
committee, the reasonable cost of an investigational or other nonapproved drug or 
biological (e.g., Laetrile) cannot be reimbursed.  This exclusion from payment applies 
whether or not the drug or biological is administered during the course of an otherwise 
covered hospital stay, since payment may not be made for items and services that are not 
reasonable and necessary.  A hospital stay solely for the purpose of administering a drug 
or biological that is not reasonable and necessary, including an investigational drug or 
biological, is not covered and the drug or biological itself is not covered. 
 
30.3 - Combination Drugs 
(Rev. 1, 10-01-03) 
A3-3101.3.C, HO-210-3.C 
 
Combination drugs are covered if the combination itself or all of the therapeutic 
ingredients of the combination are included, or approved for inclusion, in any of the 
designated drug compendia.  Any combination drug approved for use in the hospital by 
the pharmacy and drug therapeutics or equivalent committee is covered. 
 
30.4 - Drugs Specially Ordered for Inpatients 
(Rev. 1, 10-01-03) 
A3-3101.3.D, HO-210.3.D 
  Coverage is not limited to drugs and biologicals routinely stocked by the hospital; a drug 
or biological not stocked by the hospital, which the hospital obtains for the patient from 
an outside source, such as a community pharmacy, can also be covered. 
 
Drugs and biologicals not included in the drug list or formulary maintained by the 
hospital's pharmacy and drug therapeutics committee may be covered if the hospital has a 
policy which permits such drugs to be furnished to a patient at the special request of a 
physician.  However, in order to be covered, such drugs and biologicals must be included, 
or approved for inclusion, in one of the designated drug compendia.  (In addition, a 
combination drug, or all of its therapeutic ingredients, would have to be included or 
approved for inclusion in one of the compendia.) 
 
30.5 - Drugs for Use Outside the Hospital 
(Rev. 1, 10-01-03) 
A3-3101.3.E, HO-210.3.E 
 
Drugs and biologicals furnished by a hospital to an inpatient for use outside the hospital 
are, in general, not covered as inpatient hospital services.  However, if the drug or 
biological is deemed medically necessary to permit or facilitate the patient's departure 
from the hospital, and a limited supply is required until the patient can obtain a 
continuing supply, the limited supply of the drug or biological is covered as an inpatient 
hospital service. 
 
40 - Supplies, Appliances, and Equipment 
(Rev. 1, 10-01-03) 
A3-3101.4, HO-210.4 
 
Supplies, appliances, and equipment, which are ordinarily furnished by the hospital for 
the care and treatment of the beneficiary solely during the inpatient hospital stay, are 
covered inpatient hospital services. 
 
Under certain circumstances, supplies, appliances, and equipment used during the 
beneficiary's inpatient stay are covered under Part A even though the supplies, appliances 
and equipment leave the hospital with the patient upon discharge.  These are 
circumstances in which it would be unreasonable or impossible from a medical 
standpoint to limit the patient's use of the item to the periods during which the individual 
is an inpatient.  Examples of items covered under this rule are: 
 
  Items permanently installed in or attached to the patient's body while an inpatient, 
such as cardiac valves, cardiac pacemakers, and artificial limbs; and  
 
  Items which are temporarily installed in or attached to the patient's body while an 
inpatient, and which are also necessary to permit or facilitate the patient's release 
from the hospital, such as tracheotomy or drainage tubes. 
  Hospital admission packs containing primarily toilet articles, such as soap, 
toothbrushes, toothpaste, and combs, are covered under Part A if routinely furnished by 
the hospital to all its inpatients.  If not routinely furnished to all patients, the packs are not 
covered.  In that situation, the hospital may charge beneficiaries for the pack, but only if 
they request it with knowledge of what they are requesting and what the charge to them 
will be. 
 
Supplies, appliances, and equipment furnished to an inpatient for use only outside the 
hospital are not, in general, covered as inpatient hospital services.  However, a temporary 
or disposable item, which is medically necessary to permit or facilitate the patient's 
departure from the hospital and is required until the patient can obtain a continuing 
supply, is covered as an inpatient hospital service. 
 
Oxygen furnished to hospital inpatients is covered under Part A as an inpatient supply. 
 
50 - Other Diagnostic or Therapeutic Items or Services 
(Rev. 1, 10-01-03) 
A3-3101.5, HO-210.5 
 
Other diagnostic or therapeutic items or services ordinarily furnished inpatients by the 
hospital or by others under arrangements made by the hospital are covered.  This 
category of covered services encompasses items and services not otherwise specifically 
listed as covered inpatient hospital services.  (See the Medicare Benefit Policy Manual, 
Chapter 15, Covered Medical and Other Health Services.) 
 
Such services to hospital inpatients may be covered under Part A even when furnished off 
the hospital premises.  For example, diagnostic or therapeutic services of an audiologist 
off the hospital premises are covered if billed for by the hospital under arrangements (see 
Pub 100-01, the Medicare General Information, Eligibility, and Entitlement Manual, 
Chapter 5, 10.3, for further information concerning under arrangements), if the 
services are furnished at a speech and hearing center, and if the audiologist meets the 
qualifications for an audiologist: 
 
  Is licensed if applicable by the State in which practicing; and 
 
  Is eligible for a certification of clinical competence in audiology granted by the 
American Speech and Hearing Association; or 
 
  Meets the education requirements for certification and is in the process of 
accumulating the supervised experience required for certification. 
 
50.1 - Therapeutic Items 
(Rev. 1, 10-01-03) 
A3-3101.5.A, HO-210.5 
  Therapeutic items, which are covered when ordinarily furnished by the hospital to its 
inpatients, or when ordinarily furnished to hospital inpatients by others under 
arrangements with them made by the hospital, include but are not limited to the 
following: 
 
  Surgical dressings, and splints, casts, and other devices used for the reduction of 
fractures and dislocations; 
 
  Prosthetic devices (other than dental) which replace all or part of an internal body 
organ (including contiguous tissue) or replace all or part of the function of a 
permanently inoperative or malfunctioning internal body organ; and  
 
  Leg, arm, back, and neck braces, trusses, and artificial legs, arms, and eyes. 
 
With respect to items that leave the hospital with the patient upon discharge, such as 
splints or casts, the rules for determining whether the item is covered are the same as the 
rules set forth above for supplies, appliances, and equipment. 
 
50.2 - Diagnostic Services of Psychologists and Physical Therapists 
(Rev. 1, 10-01-03) 
A3-3101.5.B, HO-210.5 
 
When a psychologist or physical therapist is a salaried member of the staff of a hospital, 
their diagnostic or therapeutic services to inpatients of that hospital are covered.  See the 
Medicare Claims Processing Manual for information on distinguishing between 
professional and technical services, and for information about billing and payment for 
nonphysician practitioners. 
 
50.3 - Diagnostic Services Furnished to an Inpatient by an Independent 
Clinical Laboratory Under Arrangements With the Hospital 
(Rev. 1, 10-01-03) 
A3-3101.5.C, HO-210.5 
 
Diagnostic services furnished to an inpatient by an independent clinical laboratory under 
arrangements with the hospital are reimbursable under hospital insurance provided the 
lab is certified by CLIA to perform the services. 
 
An independent laboratory is one which is independent both of an attending or 
consulting physician's office and also independent of any hospital which meets at least 
the requirements to qualify as an emergency hospital (e.g., maintains clinical records, has 
a utilization review plan, meets the health and safety requirements found necessary by the 
Secretary of Health and Human Services). 
 
A consulting physician is one whose services include history taking, examination of the 
patient and, in each case, furnishing to the attending physician an opinion regarding  diagnosis or treatment.  A physician providing clinical laboratory services for patients of 
other physicians is not considered to be a consulting physician. 
 
A laboratory operated by or under the supervision of a hospital (or the organized medical 
staff of the hospital) that does not meet at least the definition of an emergency hospital is 
considered to be an independent laboratory.  However, a laboratory serving hospital 
patients and operated on the premises of a hospital that meets the definition of an 
emergency hospital is presumed to be subject to the supervision of the hospital or its 
organized medical staff and is not an independent laboratory.  A laboratory that a 
physician or group of physicians maintains for performing diagnostic tests in connection 
with their own or the group practice is also not considered to be an independent 
laboratory. 
 
An out-of-hospital laboratory is ordinarily presumed to be independent unless there is 
written evidence establishing that it is operated by or under the supervision of a hospital 
that meets at least the definition of an emergency hospital or of the organized medical 
staff of such a hospital.  Refer to The Conditions of Participation for Hospitals found at 
42 CFR 482 and below for a description of independent lab approval requirements when 
the hospital is participating. 
 
Where a laboratory operated on hospital premises is claimed to be independent or where 
an out-of-hospital facility is designated as a hospital laboratory, the CMS regional office 
makes the determination concerning the laboratory's status. 
 
A clinical laboratory is a laboratory where microbiological, serological, chemical, 
hematological, radiobioassay, cytological, immunohematological, or pathological 
examinations are performed on materials derived from the human body, to provide 
information for the diagnosis, prevention, or treatment of a disease or assessment of a 
medical condition. 
 
The "Conditions of Participation for Hospitals (HIRM-1)" call for independent clinical 
laboratory services furnished under arrangements made by a hospital to be furnished only 
by a laboratory meeting the specified conditions for coverage under the program.  These 
require that: 
 
  Where State or applicable local law provides for licensing of independent clinical 
laboratories, the laboratory is either licensed under law or is approved as meeting 
the requirements for licensing by the State or local agency responsible for 
licensing laboratories; and  
 
  Such laboratories also meet the health and safety requirements prescribed by the 
Secretary of Health and Human Services.  (See The Conditions of Participation 
for Hospitals at 42 CFR 482). 
 
Where independent laboratory services are provided to patients of a participating hospital 
under arrangements with the hospital, the law does not require as a condition of payment  in an individual case that the independent laboratory be approved under the program.  In 
processing individual claims, the A/B MAC (A), therefore, need not verify that the 
services were obtained from an approved laboratory.  The A/B MAC (A) should make 
payment for laboratory services although it may know that the laboratory from which the 
hospital has obtained the service is not approved under the program.  However, it should 
promptly refer this information to the appropriate regional office for review of the 
determination of the hospital's compliance with the conditions of participation and for 
whatever action the regional office deems appropriate.  The above policy applies to PPS 
exempt hospitals. Note that under PPS, there is no separate payment for lab services 
furnished to inpatients. 
 
50.4 - Diagnostic Services Furnished a Hospital Inpatient Under 
Arrangement With the Laboratory of Another Participating Hospital 
(Rev. 1, 10-01-03) 
A3-3101.5.D, HO-210.5 
 
Diagnostic services furnished a hospital inpatient under arrangements with the laboratory 
of another participating hospital are reimbursable on a cost basis under Part A to the 
hospital obtaining the services if the hospital is PPS exempt.  If the hospital is not 
exempt, there is not separate payment for lab services furnished to inpatients. 
 
NOTE:  Where a PPS exempt hospital obtains diagnostic laboratory services for 
inpatients under arrangements described in 50.3 and 50.4 the cost to the hospital 
obtaining the services would be the reasonable charge for the laboratory's service. 
 
60 - Services of Interns or Residents-In-Training 
(Rev. 1, 10-01-03) 
A3-3101.6, HO-210.6 
 
Hospital insurance covers the reasonable cost of the services of medical or osteopathic 
interns or residents-in-training under a teaching program approved by the appropriate 
approving body. 
 
In the case of services of interns or residents-in-training in the field of dentistry in a 
hospital or osteopathic hospital, the teaching program must have the approval of the 
Council on Dental Education of the American Dental Association. 
 
The services of interns and residents-in-training in the field of podiatry who are in a 
residency program approved by the Council on Podiatric Medical Education of the 
American Podiatric Medical Association are covered on the same basis as the services of 
other interns and residents in other approved residency programs. 
 
70 - Inpatient Services in Connection With Dental Services 
(Rev. 1, 10-01-03) 
A3-3101.7, HO-210.7 
  When a patient is hospitalized for a dental procedure and the dentist's service is covered 
under Part B, the inpatient hospital services furnished are covered under Part A.  For 
example, both the professional services of the dentist and the inpatient hospital expenses 
are covered when the dentist reduces a jaw fracture of an inpatient at a participating 
hospital.  In addition, hospital inpatient services, which are necessary because of the 
patient's underlying medical condition and clinical status or the severity of a noncovered 
dental procedure, are covered. 
 
When the hospital services are covered, all ancillary services such as x-rays, 
administration of anesthesia, use of the operating room, etc., are covered. 
 
Regardless of whether the inpatient hospital services are covered, the medical services of 
physicians furnished in connection with noncovered dental services are not covered.  The 
services of an anesthesiologist, radiologist, or pathologist whose services are performed 
in connection with the care, treatment, filling, removal, or replacement of teeth or 
structures directly supporting teeth are not covered. 
 
80 - Health Care Associated With Pregnancy 
(Rev. 1, 10-01-03) 
A3-3101.12, HO-210.13 
 
Reasonable and necessary services associated with pregnancy are covered and 
reimbursable under the Medicare program.  Because pregnancy is a condition sufficiently 
at variance with the usual state of health, it is appropriate for a pregnant woman to seek 
medical care.  The increased possibility of illness or injury accompanying this condition 
is well recognized, and medical supervision is required throughout pregnancy and for a 
brief period beyond.  Skilled medical management is appropriate throughout the events of 
pregnancy, beginning with diagnosis of the condition, continuing through delivery, and 
ending after the necessary postnatal care.  Similarly, if the pregnancy terminates, whether 
spontaneously or for therapeutic reasons (i.e., where the life of the mother would be 
endangered if the fetus were brought to term), the need for skilled medical management 
and/or medical services is equally as important as in those cases carried to full term.  
After the infant is delivered, items and services furnished to the infant cannot be covered 
and reimbursed under the program on the basis of the mother's eligibility. 
 
90 - Termination of Pregnancy 
(Rev. 1, 10-01-03) 
B3-4276.1,.2 
 
Effective for services furnished on or after October 1, 1998, Medicare will cover 
abortions procedures in the following situations: 
 
1.  If the pregnancy is the result of an act or rape or incest; or 
 
2.  In the case where a woman suffers from a physical disorder, physical injury, or 
physical illness, including a life-endangering physical condition caused by the  pregnancy itself that would, as certified by a physician, place the woman in 
danger of death unless an abortion is performed. 
 
NOTE:  The "G7" modifier must be used with the following CPT codes in order for 
these services to be covered when the pregnancy resulted from rape or incest, or the 
pregnancy is certified by a physician as life threatening to the mother: 
 
59840  59841  59850 
59851  59852  59855 
59856  59857  59866 
 
100 - Treatment for Infertility 
(Rev. 1, 10-01-03) 
A3-3101.13 
 
Effective for services rendered on or after January 15, 1980, reasonable and necessary 
services associated with treatment for infertility are covered under Medicare.  Like 
pregnancy (see 80 above), infertility is a condition sufficiently at variance with the usual 
state of health to make it appropriate for a person who normally would be expected to be 
fertile to seek medical consultation and treatment.  A/B MACs (A) should coordinate 
with QIOs to see that utilization guidelines are established for this treatment if 
inappropriate utilization or abuse is suspected. 
 
110 - Inpatient Rehabilitation Facility (IRF) Services 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
The inpatient rehabilitation facility (IRF) benefit is designed to provide intensive 
rehabilitation therapy in a resource intensive inpatient hospital environment for patients 
who, due to the complexity of their nursing, medical management, and rehabilitation 
needs, require and can reasonably be expected to benefit from an inpatient stay and an 
interdisciplinary team approach to the delivery of rehabilitation care.  
 
The IRF benefit is not to be used as an alternative to completion of the full course of 
treatment in the referring hospital.  A patient who has not yet completed the full course of 
treatment in the referring hospital is expected to remain in the referring hospital, with 
appropriate rehabilitative treatment provided, until such time as the patient has completed 
the full course of treatment.  Though medical management can be performed in an IRF, 
patients must be able to actively participate in and benefit from the intensive 
rehabilitation therapy program provided in IRFs in order for an IRF claim to be 
considered reasonable and necessary, in accordance with 42 CFR   412.622(a)(3)(ii).  
Therefore, patients who are not able to actively participate in and benefit from the 
intensive rehabilitation therapy services because they are still completing their course of 
treatment in the referring hospital should remain in the referring hospital until they are 
able to do so.    
Conversely, the IRF benefit is not appropriate for patients who have completed their full 
course of treatment in the referring hospital, but do not require intensive rehabilitation. 
Medicare benefits are available for such patients in a less-intensive setting.  
 
IRF care is only considered by Medicare to be reasonable and necessary under 
1862(a)(1)(A) of the Social Security Act if the patient meets all of the requirements 
outlined in 42 CFR  412.622(a)(3), (4), and (5).  This is true regardless of whether the 
patient is treated in the IRF for 1 or more of the 13 medical conditions listed in 42 CFR  
412.29(b)(2) or not. Medicare requires determinations of whether IRF stays are 
reasonable and necessary to be based on an assessment of each beneficiary's individual 
care needs.  
 
For detailed guidance on the required qualifications of a therapist, required skills of a 
therapist, and medically necessary and appropriately documented therapy services, see 
Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, sections 220 and 230.  The 
policies in those sections describe a standard of care that should be consistent throughout 
the therapy disciplines, regardless of the setting of care. 
 
110.1 - Documentation Requirements 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
Part A/B Medicare Administrative Contractors (MACs) (A) must consider completion of 
the requirements at 42 CFR  412.622(a)(3), (4), and (5) in a patients IRF medical 
record when determining whether an IRF admission was reasonable and necessary. 
 
110.1.1 - Required Preadmission Screening 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
In accordance with 42 CFR  412.622(a)(4)(i) a preadmission screening is an evaluation 
of the patients condition and need for rehabilitation therapy and medical treatment that 
must be conducted by licensed or certified clinician(s) within the 48 hours immediately 
preceding the IRF admission.  A preadmission screening that includes all of the required 
elements, but that is conducted more than 48 hours immediately preceding the IRF 
admission, will be accepted as long as an update is conducted in person or by telephone 
to document the patients medical and functional status within the 48 hours immediately 
preceding the IRF admission in the patients medical record at the IRF.  The 
preadmission screening in the patients IRF medical record serves as the primary 
documentation by the IRF clinical staff of the patients status prior to admission and of 
the specific reasons that led the IRF clinical staff to conclude that the IRF admission 
would be reasonable and necessary.  As such, IRFs must make this documentation 
detailed and comprehensive. 
 
In accordance with 42 CFR  412.622(a)(4)(i)(B) the preadmission screening 
documentation must indicate the patients prior level of function (prior to the event or 
condition that led to the patients need for intensive rehabilitation therapy), expected  level of improvement, and the expected length of time necessary to achieve that level of 
improvement. It must also include an evaluation of the patients risk for clinical 
complications, the conditions that caused the need for rehabilitation, the treatments 
needed (i.e., physical therapy, occupational therapy, speech-language pathology, or 
prosthetics/orthotics), and anticipated discharge destination. 
 
If the patient is being transferred from a referring hospital, the preadmission screening 
could either be done in person or through a review of the patients medical records from 
the referring hospital (either paper or electronic format), as long as those medical records 
contain the necessary assessments to make a reasonable determination. However, a 
preadmission screening conducted entirely by telephone should generally include 
transmission of the patients medical records from the referring hospital to the IRF and a 
review of those records by licensed or certified clinical staff member in the IRF to ensure 
it includes a detailed and comprehensive review of the patients condition and medical 
history in accordance with 42 CFR  412.622(a)(4)(i)(B). 
 
The IRF should develop a thorough preadmission screening process for patients admitted 
to the IRF from the home or community-based environment, which should ensure that 
patient preadmission screenings include all of the required elements described in 42 CFR 
 412.622(a)(3), (4), and (5).  However, such admissions may not necessarily involve the 
use of medical records from a prior hospital stay in another inpatient hospital setting 
unless such records are pertinent to the individual patients situation.  
 
Individual elements of the preadmission screening may be evaluated by any clinician or 
group of clinicians designated by a rehabilitation physician, as long as the clinicians are 
licensed or certified to perform the evaluation.  Although clinical personnel are required 
to evaluate the preadmission screening information in accordance with 42 CFR  
412.622(a)(4)(i), each IRF may determine its own processes for collecting and compiling 
the preadmission screening information.  The focus of the review of the preadmission 
screening information will be on its completeness, accuracy, and the extent to which it 
supports the appropriateness of the IRF admission decision, not on how the process is 
organized. 
 
The rehabilitation physician need not be a salaried employee of the IRF, but must be a 
licensed physician who is determined by the IRF to have specialized training and 
experience in inpatient rehabilitation, in accordance with 42 CFR  412.622(c).  For ease 
of exposition throughout this document, this physician will be referred to as a 
rehabilitation physician. 
 
All findings of the preadmission screening should be conveyed to a rehabilitation 
physician prior to the IRF admission.  Additionally, in accordance with 42 CFR  
412.622(a)(4)(i), the rehabilitation physician must document that he or she has reviewed 
and concurs with the findings and results of the preadmission screening prior to the IRF 
admission.  
 
All preadmission screening documentation (including documents transmitted from the 
referring hospital or other prior inpatient hospital stay, if applicable) must be retained in  the patients medical record at the IRF per the regulation at 42 CFR  412.622(a)(4)(i). 
 
110.1.2 - Required Post-Admission Physician Evaluation 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
The post-admission physician evaluation documentation requirement, previously required 
pursuant to 42 CFR  412.622(a)(4)(ii), was removed in the FY 2021 IRF PPS Final Rule 
(85 FR 48424).  However, the history and physical is still required under the Conditions 
of Participation at 42 CFR  482.24(c)(4)(i)(A). 
 
110.1.3 - Required Individualized Overall Plan of Care 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
In accordance with 42 CFR  412.622(a)(4)(ii), information from the preadmission 
screening and other information garnered from the assessments of all therapy disciplines 
involved in treating the patient and other pertinent clinicians, must be synthesized by a 
rehabilitation physician to support a documented overall plan of care.  The overall plan of 
care should generally detail the patients medical prognosis and the anticipated 
interventions, functional outcomes, and discharge destination from the IRF stay, thereby 
supporting the medical necessity of the admission.  The anticipated interventions detailed 
in the overall plan of care should generally include the expected intensity (meaning 
number of hours per day), frequency (meaning number of days per week), and duration 
(meaning the total number of days during the IRF stay) of physical, occupational, speech-
language pathology, and prosthetic/orthotic therapies required by the patient during the 
IRF stay.  These expectations for the patients course of treatment should generally be 
based on consideration of the patients impairments, functional status, complicating 
conditions, and any other contributing factors.  
 
Whereas the individual assessments of appropriate clinical staff will contribute to the 
information contained in the overall plan of care, the rehabilitation physician is 
responsible (in accordance with 42 CFR  412.622(a)(4)(ii)) for developing the overall 
plan of care with input from the interdisciplinary team. 
 
In accordance with 42 CFR  412.622(a)(4)(ii), in order for the IRF admission to be 
considered reasonable and necessary, the overall plan of care must be completed within 
the first 4 days of the IRF admission; it must support the determination that the IRF 
admission is reasonable and necessary; and it must be retained in the patients medical 
record at the IRF. 
 
While CMS believes that it may be good practice to conduct the first interdisciplinary 
team meeting within the first 4 days of admission to develop the overall individualized 
plan of care, CMS believes that there may be other ways of developing the overall 
individualized plan of care.  Thus, IRFs may develop this required documentation using 
whatever internal processes they believe are most appropriate, provided that the 
documentation fulfills all relevant regulatory requirements. 
  110.1.4 - Required Admission Orders 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
At the time that each Medicare Part A fee-for-service patient is admitted to an IRF, a 
physician must generate admission orders for the patient's care as per the requirements at 
42 CFR  482.12(c)(2),  482.24(c), and  412.3.  These admission orders should 
generally be retained in the patients medical record at the IRF. 
 
110.1.5 - Required Inpatient Rehabilitation Facility Patient Assessment 
Instrument (IRF-PAI) 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
As per the requirements at 42 CFR  412.606(b), the IRF patient assessment instrument 
(IRF-PAI) forms should generally be included in the patients medical record at the IRF 
(either in electronic or paper format). 
 
110.2 - Inpatient Rehabilitation Facility Medical Necessity Criteria 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
In order for IRF care to be considered reasonable and necessary, the documentation in the 
patients IRF medical record (which must include the preadmission screening described 
in section 110.1.1, the overall plan of care described in section 110.1.3, and the admission 
orders described in section 110.1.4) must demonstrate a reasonable expectation that the 
following criteria were met at the time of admission to the IRF.  Certain exceptions to 
these requirements may apply due to conditions arising during the Public Health 
Emergency defined in 42 CFR  400.200.  These exceptions are described further in 
Section 110.2.6 of this manual. 
1.  The patient must require the active and ongoing therapeutic intervention of 
multiple therapy disciplines (physical therapy, occupational therapy, speech-
language pathology, or prosthetics/orthotics), one of which must be physical or 
occupational therapy. 
2.  The patient must generally require an intensive rehabilitation therapy program, as 
defined in section 110.2.2.  Under current industry standards, this intensive 
rehabilitation therapy program generally consists of at least 3 hours of therapy per 
day at least 5 days per week.  In certain well-documented cases, this intensive 
rehabilitation therapy program might instead consist of at least 15 hours of 
intensive rehabilitation therapy within a 7 consecutive calendar day period, 
beginning with the date of admission to the IRF. 
 
3.  The patient must reasonably be expected to actively participate in, and benefit 
significantly from, the intensive rehabilitation therapy program that is defined in 
section 110.2.2 at the time of admission to the IRF.  The patient can only be 
expected to benefit significantly from the intensive rehabilitation therapy program 
if the patients condition and functional status are such that the patient can 
reasonably be expected to make measurable improvement (that will be of 
practical value to improve the patients functional capacity or adaptation to  impairments) as a result of the rehabilitation treatment, as defined in section 
110.3, and if such improvement can be expected to be made within a prescribed 
period of time.  The patient need not be expected to achieve complete 
independence in the domain of self-care nor be expected to return to his or her 
prior level of functioning in order to meet this standard.  
 
4.  The patient must require physician supervision by a rehabilitation physician, 
defined as a licensed physician who is determined by the IRF to have specialized 
training and experience in inpatient rehabilitation.  The requirement for medical 
supervision means that the rehabilitation physician must conduct face-to-face 
visits with the patient at least 3 days per week throughout the patients stay in the 
IRF to assess the patient both medically and functionally, as well as to modify the 
course of treatment as needed to maximize the patients capacity to benefit from 
the rehabilitation process.  Beginning with the second week of admission to the 
IRF, a non-physician practitioner who is determined by the IRF to have 
specialized training and experience in inpatient rehabilitation may conduct 1of 
the 3 required face-to-face visits with the patient per week, provided that such 
duties are within the non-physician practitioners scope of practice under 
applicable state law.  In the first week of the patients IRF stay, the rehabilitation 
physician is required to visit the patients a minimum of three times to ensure that 
the patients plan of care is fully established and optimized to the patients care 
needs in the IRF.  For the second, third, fourth weeks of the stay, and beyond, 
CMS will continue to require Medicare fee-for-services beneficiaries in the IRFs 
to receive a minimum of three rehabilitation physician visits per week, but will 
allow non-physician practitioners to independently conduct one of these three 
minimum require visits per week. 
 
5.  The patient must require an intensive and coordinated interdisciplinary approach 
to providing rehabilitation, as defined in section 110.2.5. 
 
110.2.1 - Multiple Therapy Disciplines 
(Rev. 112, Issued: 10-23-09, Effective: 01-01-10, Implementation: 01-04-10) 
 
A primary distinction between the IRF environment and other rehabilitation settings is 
the interdisciplinary approach to providing rehabilitation therapy services in an IRF.  
Patients requiring only one discipline of therapy would not need this interdisciplinary 
approach to care.  For this reason, the information in the patients IRF medical record 
(especially the required documentation described in section 110.1) must document a 
reasonable expectation that, at the time of admission to the IRF, the patient required the 
active and ongoing therapeutic intervention of multiple therapy disciplines (physical 
therapy, occupational therapy, speech-language pathology, or prosthetics/orthotics), one 
of which must be physical or occupational therapy. 
 
110.2.2 - Intensive Level of Rehabilitation Services 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
  A primary distinction between the IRF environment and other rehabilitation settings is 
the intensity of rehabilitation therapy services provided in an IRF. For this reason, the 
information in the patients IRF medical record (especially the required documentation 
described in section 110.1) must document a reasonable expectation that at the time of 
admission to the IRF the patient generally required the intensive rehabilitation therapy 
services that are uniquely provided in IRFs. Although the intensity of rehabilitation 
services can be reflected in various ways, the generally-accepted standard by which the 
intensity of these services is typically demonstrated in IRFs is by the provision of 
intensive therapies at least 3 hours per day at least 5 days per week. However, this is not 
the only way that such intensity of services can be demonstrated (that is, CMS does not 
intend for this measure to be used as a rule of thumb for determining whether a 
particular IRF claim is reasonable and necessary). 
 
The intensity of therapy services provided in IRFs could also be demonstrated by the 
provision of 15 hours of therapy per week (that is, in a 7-consecutive calendar day period 
starting from the date of admission). For example, if a hypothetical IRF patient was 
admitted to an IRF for a hip fracture, but was also undergoing chemotherapy for an 
unrelated issue, the patient might not be able to tolerate therapy on a predictable basis due 
to the chemotherapy.  Thus, this hypothetical patient might be more effectively served by 
the provision of 4 hours of therapy 3 days per week and 1 12 hours of therapy on 2 (or 
more) other days per week in order to accommodate his or her chemotherapy schedule.  
Thus, IRFs may also demonstrate a patients need for intensive rehabilitation therapy 
services by showing that the patient required and could reasonably be expected to benefit 
from at least 15 hours of therapy per week (defined as a 7-consecutve calendar day 
period starting from the date of admission), as long as the reasons for the patients need 
for this program of intensive rehabilitation are well-documented in the patients IRF 
medical record and the overall amount of therapy can reasonably be expected to benefit 
the patient.  Many IRF patients will medically benefit from more than 3 hours of therapy 
per day or more than 15 hours of therapy per week, when all types of therapy are 
considered.  However, the intensity of therapy provided must be reasonable and 
necessary under section 1862(a)(1)(A) of the Act and must never exceed the patients 
level of need or tolerance, or compromise the patients safety.  See below for a brief 
exceptions policy for temporary and unexpected events. 
 
In accordance with 42 CFR  412.622(a)(3)(ii), the required therapy treatments must 
begin within 36 hours from midnight of the day of admission to the IRF.  Therapy 
evaluations are generally considered to constitute the beginning of the required therapy 
services. As such, they should generally be included in the total daily/weekly provision 
of therapies used to demonstrate the intensity of therapy services provided in an IRF.  
 
The standard of care for IRF patients is individualized (i.e., one-on-one) therapy.  Group 
therapies serve as an adjunct to individual therapies. In those instances in which group 
therapy better meets the patients needs on a limited basis, the situation/rationale that 
justifies group therapy should be specified in the patients medical record at the IRF. 
 
Brief Exceptions Policy - While patients requiring an IRF stay are expected to need and 
receive an intensive rehabilitation therapy program, as described above, this may not be  true for a limited number of days during a patients IRF stay because patients needs vary 
over time.  For example, if an unexpected clinical event occurs during the course of a 
patients IRF stay that limits the patients ability to participate in the intensive therapy 
program for a brief period not to exceed 3 consecutive days (e.g., extensive diagnostic 
tests off premises, prolonged intravenous infusion of chemotherapy or blood products, 
bed rest due to signs of deep vein thrombosis, exhaustion due to recent ambulance 
transportation, surgical procedure, etc.), the specific reasons for the break in the provision 
of therapy services should generally be documented in the patients IRF medical record.  
If these reasons are appropriately documented in the patients IRF medical record, such a 
break in service (of limited duration) should generally not affect the determination of the 
medical necessity of the IRF admission.  Thus, A/B MACs (A) may consider approving 
brief exceptions to the intensity of therapy requirement in these particular cases if they 
determine that the initial expectation of the patients active participation in intensive 
therapy during the IRF stay was based on a diligent preadmission screening, post-
admission physician evaluation, and overall plan of care that were based on reasonable 
conclusions. 
 
110.2.3 - Ability to Actively Participate in Intensive Rehabilitation 
Therapy Program 
(Rev. 112, Issued: 10-23-09, Effective: 01-01-10, Implementation: 01-04-10) 
 
The information in the patients IRF medical record (especially the required 
documentation described in section 110.1) must document a reasonable expectation that 
at the time of admission to the IRF the patients condition is such that the patient can 
reasonably be expected to actively participate in, and significantly benefit from, the 
intensive rehabilitation therapy program that is defined in section 110.2.2. 
 
110.2.4 - Physician Supervision 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
A primary distinction between the IRF environment and other rehabilitation settings is 
the high level of physician supervision that accompanies the provision of intensive 
rehabilitation therapy services.  For this reason, the information in the patients IRF 
medical record (especially the required documentation described in section 110.1) must 
document a reasonable expectation that at the time of admission to the IRF the patients 
medical management and rehabilitation needs require an inpatient stay and close 
physician involvement.  Close physician involvement in the patients care is 
demonstrated by documented face-to-face visits from a rehabilitation physician at least 3 
days per week throughout the patients IRF stay.  Beginning with the second week of 
admission to the IRF, a non-physician practitioner who is determined by the IRF to have 
specialized training and experience in inpatient rehabilitation may conduct 1 of the 3 
required face-to-face visits with the patient per week, provided that such duties are within 
the non-physician practitioners scope of practice under applicable state law.  In the first 
week of the patients IRF stay, the rehabilitation physician is required to visit patients a 
minimum of three times to ensure that the patients plan of care is fully established and 
optimized to the patients care needs in the IRF.  In the second, third, fourth weeks of the  stay, and beyond, CMS will continue to require Medicare fee-for-service beneficiaries in 
IRFs to receive a minimum of three rehabilitation physician visits per week, but will 
allow non-physician practitioners to independently conduct one of these three minimum 
required visits per week.  
 
The purpose of the face-to-face visits is to assess the patient both medically and 
functionally (with an emphasis on the important interactions between the patients 
medical and functional goals and progress), as well as to modify the course of treatment 
as needed to maximize the patients capacity to benefit from the rehabilitation process. 
Other physician specialties may treat and visit the patient, as needed, more often than 3 
days per week.  However, the requirement for IRF physician supervision is intended to 
ensure that IRF patients receive more comprehensive assessments of their functional 
goals and progress, in light of their medical conditions, by a rehabilitation physician who 
is determined by the IRF to have specialized training and experience in inpatient 
rehabilitation at least 3 times per week.  The required rehabilitation physician and non-
physician practitioner visits should generally be documented in the patients medical 
record at the IRF per the requirements at 42 CFR  482.24(4)(c)(vi). 
 
110.2.5 - Interdisciplinary Team Approach to the Delivery of Care 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
An IRF stay will only be considered reasonable and necessary if at the time of admission 
to the IRF the documentation in the patients IRF medical record indicates a reasonable 
expectation that the complexity of the patients nursing, medical management, and 
rehabilitation needs requires an inpatient stay and an interdisciplinary team approach to 
the delivery of rehabilitation care.  That is, the complexity of the patients condition must 
be such that the rehabilitation goals indicated in the preadmission screening, and the 
overall plan of care can only be achieved through periodic team conferencesat least 
once a weekof an interdisciplinary team of medical professionals (as defined below). 
 
Interdisciplinary services are those provided by a treatment team in which all of its 
members participate in a coordinated effort to benefit the patient and the patients 
significant others and caregivers. Interdisciplinary services, by definition, cannot be 
provided by only one discipline.  Though individual members of the interdisciplinary 
team work within their own scopes of practice, each professional is also expected to 
coordinate his or her efforts with team members of other specialties, as well as with the 
patient and the patients significant others and caregivers.  The purpose of the 
interdisciplinary team is to foster frequent, structured, and documented communication 
among disciplines to establish, prioritize, and achieve treatment goals. 
 
In accordance with the requirements at 42 CFR 412.622(a)(5), at a minimum, the 
interdisciplinary team must document participation by professionals from each of the 
following disciplines (each of whom must have current knowledge of the patient as 
documented in the medical record at the IRF):  
   A rehabilitation physician who is determined by the IRF to have specialized 
training and experience in inpatient rehabilitation;  
 
 A registered nurse with specialized training or experience in rehabilitation;  
 
 A social worker or a case manager (or both); and  
 
 A licensed or certified therapist from each therapy discipline involved in treating 
the patient.  
 
The interdisciplinary team must be led by a rehabilitation physician either in person or 
remotely via a mode of communication such as video or telephone conferencing, who is 
responsible for making the final decisions regarding the patients treatment in the IRF. 
This physician must document concurrence with all decisions made by the 
interdisciplinary team at each meeting.  
 
The periodic team conferencesheld a minimum of once per weekmust focus on: 
 
Assessing the individual's progress towards the rehabilitation goals;  
 
 Considering possible resolutions to any problems that could impede progress towards 
the goals;  
 
 Reassessing the validity of the rehabilitation goals previously established; and  
 
 Monitoring and revising the treatment plan, as needed.  
 
A team conference may be formal or informal; however, a review by the various team 
members of each other's notes does not constitute a team conference. It is expected that 
all treating professionals from the required disciplines will be at every meeting or, in the 
infrequent case of an absence, be represented by another person of the same discipline 
who has current knowledge of the patient. Documentation of each team conference 
should generally include the names and professional designations of the participants in 
the team conference.  Signatures from participants of the interdisciplinary team meeting 
are not required other than the rehabilitation physicians concurrence as noted above. 
The occurrence of the team conferences and the decisions made during such conferences, 
such as those concerning discharge planning and the need for any adjustment in goals or 
in the prescribed treatment program, must be recorded in the patients medical record in 
the IRF. The focus of the review of this requirement will be on the accuracy and quality 
of the information and decision-making, not on the internal processes used by the IRF in 
conducting the team conferences. 
 
 
 
  110.2.6  IRF Waivers and Flexibilities During the Public Health 
Emergency for the COVID-19 Pandemic 
(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) 
 
Inpatient Rehabilitation Facility (IRF) Flexibilities Issued on March 30, 2020 
 
On March 30, 2020, CMS issued the interim final rule Medicare and Medicaid 
Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health 
Emergency (CMS-1744-IFC).  This interim final rule removed the IRF post-admission 
physician evaluation requirement in 42 CFR  412.622(a)(4)(ii) for all Medicare Part A 
fee-for-service beneficiaries during the public health emergency (PHE) specified in 42 
CFR 400.200.  Thus, contractors shall not require documentation of post-admission 
physician evaluations in the IRF medical records for Medicare Part A fee-for-service 
beneficiaries during the PHE. As discussed in Section 110.1.2, CMS subsequently 
removed the post-admission physician evaluation documentation requirement entirely 
beginning with FY 2021 (e.g., for all IRF discharges beginning on or after October 1, 
2020). 
 
This interim final rule also revises the physician supervision requirement in 42 CFR  
412.622(a)(3)(iv) and  412.29(e) to permit physician visits in the IRF required under 
these provisions to be conducted via telehealth to safeguard the health and safety of 
Medicare beneficiaries and the rehabilitation physicians treating them during the PHE.  
Contractors shall allow rehabilitation physicians to use telehealth services as defined in 
section 1834(m)(4)(F) of the Act to conduct the required 3 physician visits per week 
during the PHE for the COVID-19 pandemic. 
 
IRF Flexibilities Issued on April 30, 2020 
 
On April 30, 2020, CMS issued the interim final rule Medicare and Medicaid Programs, 
Basic Health Program, and Exchanges; Additional Policy and Regulatory Revisions in 
Response to the COVID-19 Public Health Emergency and Delay of Certain Reporting 
Requirements for the Skilled Nursing Facility Quality Reporting Program (CMS-5531-
IFC).  This interim final rule, codified at 42 CFR  412.622(a)(3)(ii), waives the IRF 3-
hour rule in accordance with section 3711(a) of the CARES Act. 
 
As a result of the 3-hour rule waiver, contractors shall not review Medicare Part A 
fee-for-service beneficiaries admitted to IRFs during the PHE specified in section 
1135(g)(1)(B) of the Social Security Act for compliance with 42 CFR  412.622(a)(3)(ii).  
That is, Medicare Part A fee-for-service beneficiaries admitted to IRFs during the PHE 
do not need to receive at least 15 hours of intensive rehabilitation therapy per week.  This 
waiver applies to all patients admitted to IRFs during the PHE. 
 
This interim final rule also modifies the IRF coverage and classification requirements in 
42 CFR  412.29(d), (e), (h), and (i) and  412.622(a)(3)(i), (iii)  (iv), (4), and (5) for 
the public health emergency (PHE) during the COVID-19 pandemic, when all of the 
following criteria are satisfied at the time of admission to the IRF:   
  Patient is admitted to a freestanding IRF solely to alleviate acute care hospital 
bed capacity issues, and  
  IRF is located in a state (or region, as applicable) that is experiencing a surge 
during the Public Health Emergency, as defined in 42 CFR  400.200.  
 
The regulation at 42 CFR  412.622(c), as amended by the April 30, 2020 interim final 
rule, specifies that a state (or region, as applicable) that is experiencing a surge refers 
to a state region that is in Phase 1 of the presidential Guidelines for Opening Up 
America Again ((https://www.whitehouse.gov/openingamerica/), specifically, a state (or 
region, as applicable)  that satisfies all of the following, as determined by applicable 
state and local officials: 
1.   All vulnerable individuals continue to shelter in place.  
2.   Individuals continue social distancing.  
3.   Individuals avoid socializing in groups of more than 10.  
4.   Non-essential travel is minimized.  
5.   Visits to senior living facilities and hospitals are prohibited.  
6.   Schools and organized youth activities remain closed.  
 
The evolution of the Phase 1 criteria listed above are most likely to be clearly articulated 
by a states governor.  Further, contractors will need to be aware that there may not be a 
clearly posted phase for a state or community that aligns with the presidential 
Guidelines for Opening Up America Again cited at 42 CFR  412.622(c). 
 
Some of the criteria are likely to be in place across a number of phases, particularly the 
criteria in (i), (ii), and (iii).  An example of a more complicated criteria to apply is (iv).  
Non-essential travel can still be minimized, even after stay at home orders are lifted in an 
area to allow for additional access to health care services or to allow for additional 
commerce (such as manufacturing) to improve the overall economic circumstances of a 
region or state. There may also be circumstances where beach regions, which can 
provide more ability for social distancing, of a state are reopening whereas more 
concentrated population centers remain with higher restrictions.  Thus, contractors 
should apply the standard regionally, as applicable.  Furthermore, schools and 
organized youth activities may be closed simply because of the time of year (for instance, 
during the summer months). 
 
Additionally, contractors should recognize that, in some cases, states or regions can 
move to Phase 2 or Phase 3 of the plan and then return to Phase 1 if they experience 
another surge in cases. 
 
In the April 30, 2020 interim final rule, CMS instructed freestanding IRFs to add the 
letters DS to the end of their unique hospital patient identification numbers (the 
numbers that identify the patients medical records in the IRF) to identify patients who 
are being treated in a freestanding IRF hospital solely to alleviate inpatient bed capacity 
in a state that is experiencing a surge during the PHE for the COVID-19 pandemic. The 
modifier will be used to identify those patients for whom the requirements in 42 CFR   412.622(a)(3)(i), (iii), (iv), (4) and (5) do not apply.  Thus, contractors shall not review 
freestanding IRF patient medical records that have DS at the end of their unique 
hospital patient identifier numbers for meeting any of the following requirements: 
 
   Needing at least 2 forms of therapy (one of which must be physical or 
occupational therapy,  
   Being sufficiently stable to tolerate the IRF intensive rehabilitation therapy 
program,  
   Requiring close medical supervision by a rehabilitation physician, as 
demonstrated by at least 3 rehabilitation physician visits per week,  
   Having a preadmission screening,  
   Having an individualized overall plan of care, or  
   Having an interdisciplinary approach to care, including weekly interdisciplinary 
team meetings. 
 
In addition, as noted at 85 FR 27573 contractors shall not include freestanding IRF 
patient medical records that have DS at the end of their unique hospital patient 
identifier numbers when reviewing whether the IRF meets the following coverage 
requirements: 
 
   Has in effect a preadmission screening procedure,  
   Has in effect a procedure for ensuring that patients receive close medical 
supervision by a physician,  
   Has a plan of treatment for each patient, or  
   Uses an interdisciplinary approach to care.  
 
Contractors shall allow freestanding IRFs to be paid at the usual IRF prospective 
payment amounts for these patients. 
 
110.3 - Definition of Measurable Improvement 
(Rev. 179, Issued: 01-14-14, Effective: 01-07-14, Implementation: 01-07-14) 
 
A patient can only be expected to benefit significantly from an intensive rehabilitation 
therapy program provided in an IRF, as required in section 110.2.3, if the patients IRF 
medical record indicates a reasonable expectation that a measurable, practical 
improvement in the patients functional condition can be accomplished within a 
predetermined and reasonable period of time.  In general, the goal of IRF treatment is to 
enable the patients safe return to the home or community-based environment upon 
discharge from the IRF.  The patients IRF medical record is expected to indicate both the 
nature and degree of expected improvement and the expected length of time to achieve 
the improvement. 
 
Since discharge planning is an integral part of any rehabilitation program and must begin 
upon the patients admission to the IRF, an extended period of time for discharge from 
the IRF would not be reasonable and necessary after established goals have been reached 
or the determination has been made that further progress is unlikely.   
For an IRF stay to be considered reasonable and necessary, the patient does not have to 
be expected to achieve complete independence in the domain of self-care or return to his 
or her prior level of functioning.  However, to justify the need for a continued IRF stay, 
the documentation in the IRF medical record must demonstrate the patients ongoing 
requirement for an intensive level of rehabilitation services (as defined in section 110.2.1) 
and an inter-disciplinary team approach to care (as defined in section 110.2.2).  Further, 
the IRF medical record must also demonstrate that the patient is making functional 
improvements that are ongoing and sustainable, as well as of practical value, measured 
against his/her condition at the start of treatment.  Since in most instances the goal of an 
IRF stay is to enable a patients safe return to the home or community-based environment 
upon discharge, the patients treatment goals and achievements during an IRF admission 
are expected to reflect significant and timely progress toward this end result.  During 
most IRF stays, therefore, the emphasis of therapies would generally shift from 
traditional, patient-centered therapeutic services to patient/caregiver education, durable 
medical equipment training, and other similar therapies that prepare the patient for a safe 
discharge to the home or community-based environment. 
 
CMS notes that as evidenced by the criteria established above, an IRF claim could never 
be denied for the following reasons: (1) because a patient could not be expected to 
achieve complete independence in the domain of self-care or (2) because a patient could 
not be expected to return to his or her prior level of functioning. 
 
120 - Services Related to and Required as a Result of Services Which 
Are Not Covered Under Medicare 
(Rev. 189, Issued: 06-27-14, Effective: 05-30-14, Implementation: 06-29-14) 
 
Medical and hospital services are sometimes required to treat a condition that arises as a 
result of services that are not covered because they are determined to be not reasonable 
and necessary or because they are excluded from coverage for other reasons.  Services 
"related to" non-covered services (e.g., cosmetic surgery, non-covered organ transplants, 
non-covered artificial organ implants, etc.), including services related to follow-up care 
and complications of non-covered services which require treatment during a hospital stay 
in which the non-covered service was performed, are not covered services under 
Medicare.  Services "not related to" non-covered services are covered under Medicare. 
 
Following are examples of services "related to" and "not related to" non-covered services 
while the beneficiary is an inpatient: 
 
  A beneficiary was hospitalized for a non-covered service and broke a leg 
while in the hospital.  Services related to care of the broken leg during this 
stay is a clear example of "not related to" services and are covered under 
Medicare. 
 
  A beneficiary was admitted to the hospital for covered services, but during the 
course of hospitalization became a candidate for a non-covered transplant or  implant and actually received the transplant or implant during that hospital 
stay.  When the original admission was entirely unrelated to the diagnosis that 
led to a recommendation for a non-covered transplant or implant, the services 
related to the admitting condition would be covered. 
 
  A beneficiary was admitted to the hospital for covered services related to a 
condition which ultimately led to identification of a need for transplant and 
receipt of a transplant during the same hospital stay.  If, on the basis of the 
nature of the services and a comparison of the date they are received with the 
date on which the beneficiary is identified as a transplant candidate, the 
services could reasonably be attributed to preparation for the non-covered 
transplant, the services would be "related to" non-covered services and would 
also be non-covered. 
 
Following is an example of services received subsequent to a non-covered inpatient stay: 
 
After a beneficiary has been discharged from the hospital stay in which the beneficiary 
received non-covered services, medical and hospital services required to treat a condition 
or complication that arises as a result of the prior non-covered services may be covered 
when they are reasonable and necessary in all other respects.  Thus, coverage could be 
provided for subsequent inpatient stays or outpatient treatment ordinarily covered by 
Medicare, even if the need for treatment arose because of a previous non-covered 
procedure.  Some examples of services that may be found to be covered under this policy 
are the reversal of intestinal bypass surgery for obesity, complications from cosmetic 
surgery, removal of a non-covered bladder stimulator, or treatment of any infection at the 
surgical site of a non-covered transplant that occurred following discharge from the 
hospital. 
 
However, any subsequent services that could be expected to have been incorporated into 
a global fee are not covered.  Thus, where a patient undergoes cosmetic surgery and the 
treatment regimen calls for a series of postoperative visits to the surgeon for evaluating 
the patient's progress, these visits are not covered. 
 
130  Religious Nonmedical Health Care Institution (RNHCI) Services 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Section 1821 of the Social Security Act provides for coverage of services furnished in a 
Medicare qualified religious nonmedical health care institution (RNHCI), when the 
beneficiary meets specific coverage conditions.  The beneficiary must have a valid 
election for RNHCI services and would otherwise qualify for care in a conventional 
hospital or post hospital extended care facility that was not a religious nonmedical health 
care institution. 
 
The RNHCI benefit provides only for Part A inpatient services.  The Medicare program 
will only pay for nonmedical health care services furnished in RNHCIs, as defined in 
Section 1861(ss)(1) of the Act and 42 CFR 403 Subpart G.  The program does not pay for  supporting religious services or payment for the religious practitioner. The cost of 
religious items/services and the cost of using a religious practitioner is a personal 
financial responsibility and not covered by Medicare. 
 
130.1  Beneficiary Eligibility for RNHCI Services 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
A beneficiary may elect to receive care in an RNHCI based on his or her own religious 
convictions or to revoke that election at any time if for any reason he or she decides to 
pursue medical care. Section 1821(a) of the Act requires that as a condition for Part A 
Medicare coverage, the beneficiary must have a condition that would qualify under 
Medicare Part A for inpatient hospital services or extended care services furnished in a 
hospital or skilled nursing facility that is not an RNHCI if it were not for their religious 
convictions. 
 
When a beneficiary has an effective election on file with CMS but does not have a 
condition that would qualify for Medicare Part A inpatient hospital or posthospital 
extended care services if the beneficiary were an inpatient of a hospital or a resident of a 
SNF that is not an RNHCI, then services furnished in an RNHCI are not covered by 
Medicare.  A Medicare claim for services that were furnished to that beneficiary would 
be treated as a claim for noncovered services.  If the beneficiary only needs assistance 
with activities of daily living, then the beneficiary's condition could not be considered as 
meeting the Medicare Part A requirements.  Prior to submitting a claim to Medicare it is 
the responsibility of the RNHCIs utilization review committee to determine that the 
beneficiary meets the Medicare Part A requirements. 
 
If no valid election is filed or the election has been revoked and no new election is in 
effect, the beneficiary does not have Medicare coverage for services furnished in an 
RNHCI. Consequently, a Medicare claim for services furnished to such a beneficiary 
would also be treated as a claim for noncovered services. 
 
In those cases where a beneficiary is admitted to an RNHCI with a valid election, the 
submission of prior claim for medical services to the Common Working File will revoke 
the election during the course of the RNHCI stay.  If this is the first revocation, the 
beneficiary may make a new election without any disruption to the benefit.  If this, 
however, is the second or subsequent revocation, the applicable waiting period applies 
and the remainder of the stay is not covered by Medicare (see 130.2.2). 
 
130.2  Election of RNHCI Benefits 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
For an RNHCI to receive payment under the Medicare program, the beneficiary must 
make a written election to receive benefits under 1821 of the Act.  To elect religious 
nonmedical health care services, the beneficiary or the beneficiarys legal representative 
must attest that the individual is conscientiously opposed to acceptance of nonexcepted  medical treatment, and the individuals acceptance of such treatment would be 
inconsistent with the individuals sincere religious beliefs. 
 
Religious non-medical care or religious method of healing means health care furnished 
under established religious tenets that prohibit conventional or unconventional medical 
care for the treatment of a beneficiary, and the sole reliance on these religious tenets to 
fulfill a beneficiary's total health care needs. 
 
Medical care or treatment means health care furnished by or under the direction of a 
licensed physician that can involve diagnosing, treating, or preventing disease and other 
damage to the mind and body. It may involve the use of pharmaceuticals, diet, exercise, 
surgical intervention, and technical procedures. 
 
The signed and notarized election must include a statement that the receipt of 
nonexcepted medical services would constitute a revocation of the election and may limit 
further receipt of payment of religious nonmedical health care services.  The election is 
effective on the date it is signed, and it remains in effect until revoked in writing or by the 
receipt and filing of a claim for nonexcepted medical treatment. 
 
The completed election form must be filed with the specialty contractor, a copy retained 
by the RNHCI provider and a copy provided to the beneficiary.  See Pub. 100-04, 
Medicare Claims Processing Manual, Chapter 3, Section 170 for instructions on 
submission of elections to the specialty contractor. 
 
Section 1821 defines excepted medical treatment as medical care or treatment that is 
received involuntarily or is required under Federal, State or local law.  The term is 
intended to identify the kinds of medical services that can be provided to a beneficiary 
with an election for RNHCI services without revoking the election. 
 
Examples of excepted medical care include, but are not limited to the following: 
 
  A beneficiary that receives vaccinations required by a State or local jurisdiction.  
This is compliant behavior to meet government requirements and not considered as 
voluntarily seeking medical care or services; or 
 
  A beneficiary who is involved in an accident and receives medical attention at the 
accident scene, or in transport to the hospital, or at the hospital before being able to 
make their beliefs and wishes known; or 
 
  A beneficiary who is unconscious and receives emergency care and is hospitalized 
before  regaining  consciousness  or  being  able  to  locate  his  or  her  legal 
representative. 
 
Nonexcepted medical treatment is defined as medical care or treatment other than 
excepted medical treatment. The term is intended to define the kinds of medical services  that, if received by a beneficiary who has previously elected RNHCI services, would 
revoke the individual's election of services. 
 
Examples of nonexcepted medical care could include but are not limited to the following: 
 
  A beneficiary receiving medical diagnosis and/or treatment for persistent headaches 
and/or chest pains. 
 
  A beneficiary in an RNHCI who is transferring to a community hospital to have 
radiological studies and the reduction of a fracture. 
 
  A beneficiary with intractable back pain receiving medical, surgical, or chiropractic 
services. 
 
  A beneficiary who has requested a physician to prescribe a wheelchair or other 
durable medical equipment item. 
 
Note that the terms excepted and nonexcepted care represent mutually exclusive 
conditions under 1821 of the Social Security Act.  Medicare contractors may use the 
examples above in making determinations of excepted and nonexcepted care. 
 
130.2.1 - Revocation of RNHCI Election 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Revocation is the cancellation of the RNHCI election and can be achieved in two ways: 
either by submitting a written statement to the intermediary indicating the desire to cancel 
the election or by seeking nonexcepted medical care for which Medicare payment is 
sought. 
 
See Pub. 100-04, Medicare Claims Processing Manual, Chapter 3, Section 170 for 
instructions on submission of revocations to the specialty contractor.  See section 180 of 
that manual for a description of how Medicare non-specialty contractors revoke elections 
upon billing for nonexcepted services. 
 
130.2.2 - RNHCI Election After Prior Revocation 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
After an initial revocation, the individual may again file a written election to receive the 
religious nonmedical health care benefit. This second election takes effect immediately 
upon its execution. If an individual revokes a second election, the next (third) election 
cannot become effective until 1 year after the date of the most recent revocation. 
Subsequent elections are not effective until 5 years after the most recent revocation. Once 
an election is revoked, Medicare payment cannot be made to an RNHCI unless a valid 
election is filed. The RNHCI revocation does not interfere with the beneficiarys ability 
to seek other Medicare services within the limits of his/her Medicare coverage. 
  130.3 - Medicare Payment for RNHCI Services and Beneficiary 
Liability 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Medicare pays for RNHCI services under TEFRA payment rules (see Pub. 15-2, Provider 
Reimbursement Manual, chapter 30).  RNHCI services are subject to the inpatient 
hospital cash deductible, when applicable.  If services are for the 61st through 90th day of 
a benefit period or are for lifetime reserve days, RNHCI services are subject to 
coinsurance (see Pub. 100-01, Medicare General Information, Eligibility and Entitlement 
Manual, Chapter 3, Sections 10.1 and 10.2). 
 
Under normal Medicare rules, a provider of services may only bill a beneficiary 
deductible and coinsurance amounts. However, total Medicare payments to RNHCIs are 
subject to limits established in sections 1821(c)(2) (A) or (B) of the Act. In the event that 
the Medicare program reduces payments to RNHCIs based on these limits, RNHCIs may 
also bill beneficiaries an amount equal to any such reduction. 
 
130.4 - Coverage of RNHCI Items Furnished in the Home 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Prior to the passage of the Medicare Prescription Drug, Improvement and Modernization 
Act (MMA) of 2003, the Medicare programs RNHCI benefit was limited to inpatient 
services provided in an RNHCI facility.  The MMA revised sections 1821(a) and 1861 of 
the Social Security Act to extend coverage to RNHCI items and services that are 
provided in a beneficiarys home and that are comparable to items and services provided 
by a home health agency that is not an RNHCI. 
 
Beneficiaries elect the RNHCI benefit if they are conscientiously opposed to accepting 
most medical treatment, since accepting such services would be inconsistent with their 
sincere religious beliefs.  The Medicare home health benefit provides skilled nursing, 
physical therapy, occupational therapy, speech language pathology and home health aide 
services to eligible beneficiaries under a physicians plan of care.  The home health 
benefit also provides medical supplies, a covered osteoporosis drug and durable medical 
equipment (DME) while under a plan of care (see chapter 7). 
 
Medicare covers specified durable medical equipment and intermittent RNHCI nursing 
visits provided in the home to RNHCI beneficiaries.  These services comprise the RNHCI 
home benefit.  The remainder of the services covered under the Medicare home health 
benefit are medical in nature and must be provided under the order of a physician.  As 
such, these services conflict with RNHCI beneficiaries conscientious opposition to 
medical care. 
 
The RNHCI home benefit must exclude the same services that are excluded from the 
home health benefit, which include: drugs and biologicals; transportation; services that 
would not be covered as inpatient services; housekeeping services; services covered 
under the End Stage Renal Disease program; prosthetic devices; and medical social  services provided to family members.  These exclusions are defined at 42 CFR 409.49.  
Additionally, the RNHCI home benefit excludes the items or services provided by any 
HHA that is not an RNHCI; or any supplier, independent RNHCI nurse or aide that is 
working directly for a beneficiary rather than under arrangements with the RNHCI. 
 
Medicare requires a brief letter of intent from the provider in order to determine the 
number of RNHCIs that will be implementing the home service benefit. 
 
In the case where an RNHCI chooses to provide home services then only care on an 
intermittent basis, which is provided to an eligible beneficiary who is confined to their 
home for health reasons, will be covered under the home benefit.  The home benefit is not 
to be confused with hospice care, which may involve more frequent visits and can 
involve institutional services.  If for some reason the home serviced patient requires more 
than intermittent service, then institutional services may be required.  However, the 
patient would need to meet the criteria for admission to a RNHCI, or the patient would 
require another institutional setting not necessarily covered by Medicare. 
 
Similar to the inpatient RNHCI benefit, the physician role in certifying and ordering the 
home benefit is replaced with the use of the RNHCI utilization review committee to 
review the need for care and plan for initial and continued care in the home setting.  The 
home benefit will also require a prompt review of admission to the home service, since 
the patient must be fully eligible (have a health condition that keeps them confined to the 
home (42CFR409.42(a), have health needs that can be met with intermittent care, and 
have a valid election) before billable services can be rendered and Medicare payment 
requested.  Additionally the utilization review committee is responsible for review and 
approval of care plans and orders for DME items, and review of the need for the 
continuation of services. 
 
As in the original RNHCI benefit, Medicare will only pay for nonmedical services in the 
home, but not for those religious items or services provided by the RNHCI. 
 
Medicare covers these items and services for dates of service from January 1, 2005 
through December 30, 2006.   Total Medicare payments under this benefit for each 
calendar year during this period are limited to $700,000. 
 
130.4.1 - Coverage and Payment of Durable Medical Equipment Under 
the RNHCI Home Benefit 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Medicare covers a defined list of nonmedical DME items for RNHCI home services that 
are comparable to items used in the inpatient RNHCI setting and could be provided by an 
HHA.  The DME items include canes, crutches, walkers, commodes, a standard 
wheelchair, hospital beds, bedpans, and urinals.  Those RNHCIs offering home services 
may order these items without a physician order and without compromising the 
beneficiary election for RNHCI care.  The need for each item of DME ordered must be 
supported by the RNHCI patients plan of care for the home setting and the RNHCI  nurses notes for home services.  It must be noted that the benefit is applicable only to 
what we shall refer to as nonmedical DME items and does not include any of the 
related services provided by RNHCI staff members. 
 
The RNHCI shall establish a payment arrangement with one or more DME suppliers to 
obtain any of the items on the DME list (below) they may require for a beneficiary.  The 
supplier will provide the items and related instructions on use to the 
beneficiary/family/care giver.  The RNHCI will submit claims for these DME items to 
the RNHCI specialty FI. 
 
The RNHCI must stress to suppliers that DME claims are not to be submitted to the 
DMERC because this will cause the beneficiarys election for RNHCI care to be revoked. 
 
DME Items and HCPCS Codes for use by RNHCI Home Service Units Canes 
 
E0100 Cane, includes canes of all materials, adjustable or fixed, with tip 
 
E0105 Cane, quad or three prong, includes canes of all materials, adjustable or fixed with 
tip 
 
Crutches 
 
E0112 Crutches, underarm, wood, adjustable or fixed, pair, with pads, tips and handgrips 
 
E0113 Crutch underarm, wood, adjustable or fixed, pair, with pad, tip and handgrip 
 
E0114 Crutches, underarm, other than wood, adjustable or fixed, pair, with pads, tips and 
handgrips 
 
E0116 Crutch underarm, other than wood, adjustable or fixed, with pad, tip and handgrip 
 
Walkers 
 
E0130 Walker, rigid (pickup), adjustable or fixed height 
 
E0135 Walker, folding (pickup), adjustable or fixed height 
 
E0141 Walker, rigid, wheeled, adjustable or fixed height 
 
E0143 Walker, folding, wheeled, adjustable or fixed height 
 
Commodes 
 
E0163 Commode chair, stationary, with fixed arms 
 
E0167 Pail or pan for use with commode chair   
Wheelchairs 
 
K0001 Standard wheelchair 
 
Hospital Beds & Accessories 
 
E0250 Hospital bed, fixed height, with any type side rails, with mattress 
 
E0255 Hospital bed, variable height, hi-lo, with any type side rails, with mattress 
 
E0260 Hospital bed, semi-electric (head and foot adjustment), with any type side rails, 
with mattress 
 
E0275 Bed pan, standard, metal or plastic 
 
E0276 Bed pan, fracture, metal or plastic 
 
E0290 Hospital bed, fixed height, without side rails, with mattress 
 
E0292 Hospital bed, variable height, hi-lo, without side rails, with mattress 
 
E0325 Urinal; male, jug-type, any material 
 
E0326 Urinal; female, jug-type, any material 
 
Payment to RNHCIs for these specified DME items will be made based on the DME fee 
schedule.  Coinsurance applies to these items.  Deductible does not apply to these items. 
 
130.4.2 - Coverage and Payment of Home Visits Under the RNHCI 
Home Benefit 
(Rev. 45, Issued:  02-10-06; Effective:  05-11-06;Implementation:  05-11-06) 
 
Medicare covers intermittent RNHCI nursing visits provided in the home to RNHCI 
beneficiaries.  The RNHCI nursing personnel may be skilled in ministering to a 
beneficiarys religious needs (not covered by Medicare), but do not have the training or 
nursing skill sets required of credentialed/licensed health care professionals (e.g., 
registered nurse).  While RNHCI nurses may provide tender loving care, they are focused 
primarily on religious healing and meeting basic beneficiary needs for assistance with 
activities of daily living (e.g., bathing, toileting, dressing, ambulation), as part of creating 
a milieu for religious healing.  The care provided by an RNHCI nurse is not at the level 
of either a registered nurse or a licensed practical nurse.  The physical care provided by 
an RNHCI nurse is at a level that could be considered as supportive, but decidedly not 
skilled as defined by the Medicare program. 
  For purposes of payment for RNHCI nursing services in the home, the following services 
are comparable to the services of HHAs that are not RNHCIs (e.g., the RNHCI nurse and 
the home health aide share the following basic tasks): 
 
  Assist with activities of daily living which include: ambulation, bed to 
chair transfer, and assist with range of motion exercises; bathing, 
shampoo, nail care and dressing; feeding and nutrition; and toileting; 
 
  Light housekeeping, incident to visit 
 
  Documenting visit 
 
By comparison the home health aide will routinely perform additional medically oriented 
services (e.g., observation and reporting of existing medical conditions, taking and 
reporting vital signs, and using basic infection control procedures). 
 
Due to the uniqueness of RNHCI nursing in the Medicare program, Medicare pays for 
RNHCI nursing visits at a percentage of the HHAs low utilization payment adjustment 
(LUPA) rate for home health aides.  Only a visit by an RNHCI nurse to a home will be 
considered as billable to Medicare.  A visit is defined as an episode in which an RNHCI 
nurse will render physical care to an RHNCI beneficiary in the home setting.  The visit is 
a single billable unit that is not influenced by the number of involved caregivers or the 
duration of the episode.  The difference in skill levels and the incorporation of RNHCI 
religious activity (noncovered by Medicare) into a visit, resulted in a payment rate that is 
80% of the home health aide rate adjusted by metropolitan service area (MSA) wage 
index rate for the involved RNHCI. 
 
RNHCI nursing visits are paid using the LUPA system even in situations where the 
involved patient would not be classified as low utilization.  The HHAs have moved to 
PPS, which is constructed on the medical model and therefore inappropriate for RNHCI 
use.  The same labor/non-labor portions applied in the HHA PPS will be used for 
calculating the RNHCI nursing visit payments. 
 
Example of LUPA Payment:  An RNHCI in Baltimore, MD, provides twelve RNHCI 
nursing visits over the course of a 30 day period. 
 
1.  Home Health Aide Visit (National standardized rate for 2005)  $44.76 
 
2.  RNHCI Nurse Visit .................................(.80 * $ 44.76)  35.81 
 
3.  Calculate the labor portion of the Standardized  
     Budget Neutral Per-Visit Payment Amount for  
     1 RNHCI nurse visit..................................(.76775 * $.35.81)  27.49 
 
4.  Apply wage index factor for Baltimore, MD.....(.9907 * $ 27.49)   27.23 
  5.  Calculate the non-labor portion of the  
    Standardized Budget Neutral Per-Visit Payment  
    Amount for 1 RNHCI nurse visit...................(.23225 * $ 35.81)  8.32 
 
6.  SubtotalLow Utilization Payment Adjustment  
(LUPA) wage for 1 RNHCI nurse visit..............($ 27.49 + $ 8.32)  $35.55 
 
7.  Total - Calculate total Low Utilization Payment  
    Adjustment (LUPA) for 12 RNHCI nurse visits  
    provided during the 30-day episode ...   ............(12 * $ 35.55)  $426.60 
 
Step 1.  Take the HHA aide visit base rate ($ 44. 76) for the involved year (2005), from 
the HHA update published annually each November in the Federal Register. 
 
Step 2.  To calculate the RNHCI nurse visit base rate, multiply the HHA base rate ($ 
44.76) by the allowed percentage for an RNHCI nurse visit (.80%) to allow for 
religious activity and reduced physical care skill level = ($ 35.81) 
 
Step 3. To calculate the labor portion of the Standardized Budget Neutral Per-Visit 
Payment Amount for 1 RNHCI nurse visit, multiply the fixed allowance .76775 
by the RNHCI nurse visit rate ($ 35.81) = ($ 27.49) 
 
Step 4. Apply the wage index for the involved MSA from the HHA update published 
annually each November in the Federal Register (Baltimore, MD = .9907) 
multiplied by the labor portion of the RNHCI nurse visit ($ 27.49) = ($27.23). 
 
Step 5. To calculate the non-labor portion of the Standardized Budget Neutral Per-Visit 
Payment Amount for 1 RNHCI nurse visit, multiply the fixed allowance .23225 
by the RNHCI nurse visit rate ($ 35.81) = ($ 8.32) 
 
Step 6. To calculate the LUPA rate for 1 RNHCI nurse visit add the products from Step 4 
($27.49) and Step 5 ($ 8.32) = ($ 35.55) 
 
Step 7. To calculate the LUPA payment for RNHCI nurse visits to one beneficiary in a 30 
day period, multiply the product of Step 6 ($ 35.55) by the number of visits (12) = ($ 
426.60) 
  Transmittals Issued for this Chapter  Rev #  Issue Date  Subject  Impl Date  CR# 
R10892BP 08/06/2021  Internet Only Manual Updates to Publication  11/08/2021 12353 
(Pub.) 100-02 to Implement Updates to 
Policy and Correct Errors and Omissions 
(Inpatient Rehabilitation Facility (IRF) 
R234BP  03/10/2017  Clarification of Admission Order and  06/12/2017 9979 
Medical Review Requirements 
R232BP  12/22/2016  January 2017 Update of the Hospital  01/03/2017 9930 
Outpatient Prospective Payment System 
(OPPS) 
R179BP  01/14/2014  Manual Updates to Clarify Skilled Nursing  01/07/2014 8458 
Facility (SNF), Inpatient Rehabilitation 
Facility (IRF), Home Health (HH), and 
Outpatient (OPT) Coverage Pursuant to 
Jimmo vs. Sebelius 
R176BP  12/13/2013  Manual Updates to Clarify Skilled Nursing  01/07/2014 8458 
Facility (SNF), Inpatient Rehabilitation 
Facility (IRF), Home Health (HH), and 
Outpatient (OPT) Coverage Pursuant to 
Jimmo vs. Sebelius  Rescinded and replaced 
by Transmittal 179 
R119BP  01/05/2010  Coverage of Inpatient Rehabilitation Services  01/04/2010 6699 
R112BP  10/23/2009  Coverage of Inpatient Rehabilitation Services  01/04/2010 6699 
 Rescinded and replaced by Transmittal 119 
R45BP  02/10/2006  Revisions to Instructions for Contractors  05/11/2006 4218 
Other Than the Religious Nonmedical Health 
Care Institution (RNHCI) Specialty 
Contractor Regarding Claims for 
Beneficiaries with RNHCI Elections 
R25BP  11/05/2004  Implementation of Coverage of Religious  04/04/2005 3529 
Nonmedical Health Care Institution (RNHCI) 
Items and Services Furnished in the Home, 
MMA section 706.  R1BP  10/01/2003  Introduction to the Benefit Policy Manual  N/A  N/A 
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