(Medicare Claims Processing Manual)

When the hospital and not the beneficiary is liable for the cost of the Part A services (pursuant to the limitation on liability provision in Section 1879 of the Social Security Act), the beneficiary is not responsible for paying the deduc tible and coinsurance charges related to the denied Part A claim and the beneficiarys Medicare utilization record is not charged for the services and items furnished.  The hospital must refund any payments (including coinsurance and deductible) made by the beneficiary or third party for a denied Part A claim when the provider is held financially liable for that denial (see section 1879(b) of the Act; 42 CFR  411.402; and chapter 30  30.1.2, Beneficiary Determined to Be Without Liability and 30.2.2, P rovider/Practitioner/Supplier is Determined to Be Liable of this manual).    Medicare beneficiaries are liable for their usual Part B financial liability for services covered under Part B when Part A payment cannot be made, including Part B copayments for e ach payable Part B inpatient or Part B outpatient service.  The beneficiary is also liable for the cost of services not covered under Part B.   250 - Special Rules for Critical Access Hospital Outpatient Billing  (Rev. 1111, Issued: 11- 09-06, Effective: 04- 01-07, Implementation: 04- 02-07)  For cost reporting periods beginning before October 1, 2000, a CAH will be paid for outpatient services under the method in 250.1.  The BIPA legislation on payment for professional services at 115 percent of what would otherwise be paid under the fee schedule is effective for services furnished on or after July 1, 2001.  This provision was implemented with respect to cost reporting periods starting on or after October 1, 2001.   For cost reporting period beginning on or afte r October 1, 2001, the CAH will be paid under the method in item 1 below unless it elects to be paid under the method in 250.1 of this manual.  If a CAH elects payment under the elective method (cost -based facility payment plus fee schedule for professional services) for a cost reporting period, that election is effective for the entire cost reporting period to which it applies.  If the CAH wishes to make a new election or change a previous election, that election should be made in writing, made on an annual basis and delivered to the appropriate A/B MAC (A), at least 30 days in advance of the beginning of the affected cost reporting period.  All outpatient CAH services, other than pneumococcal pneumonia vaccines, influenza vaccines, administratio n of the vaccines, screening mammograms, and clinical diagnostic laboratory tests are subject to Part B deductible and coinsurance.  Regardless of the payment method applicable for a period, payment for outpatient CAH services is not subject to the followi ng payment principles:    Lesser of cost or charges,    Reasonable compensation equivalent (RCE) limits,    Any type of reduction to operating or capital costs under 42 CFR 413.124 or 413.30(j)(7) , or    Blended payment rates for ASC -type, radiology, and other diagnostic services.  See 250.4 below regarding payment for screening mammography services.   250.1 - Standard Method - Cost -Based Facility Services, With Billing of A/B MAC (B) for Professional Services (Rev. 2581, Issued: 11- 02-12, Effective: 04- 01-13, Implementation: 04- 01-13)   Effective for cost reporting periods beginning on or after January 1, 2004, payment for outpatient CAH services under this method will be made for the lesser of: 1) 80 percent of 101 percent of the reasonable cost of the CAH in furnishing those services, or 2) 101 percent of the reasonable cost of the CAH in furnishing those s ervices, less applicable Part B deductible and coinsurance amounts.   Payment for professional medical services furnished in a CAH to CAH outpatients is made by the A/B MAC (B)  on a fee schedule, charge, or other fee basis, as would apply if the services h ad been furnished in a hospital outpatient department. For purposes of CAH payment, professional medical services are defined as services provided by a physician or other practitioner, e.g., a physician assistant that could be billed directly to a A/B MAC (B)  under Part B of Medicare or a nurse practitioner that could be billed directly to a A/B MAC (B) under Part B of Medicare.   In general, payment for professional medical services, under the cost -based CAH payment plus professional services billed to the A/B MAC (B)  method should be made on the same basis as would apply if the services had been furnished in the outpatient departm ent of a hospital.   Bill type 85X is used for all outpatient services including services approved as ASC services. Non-patient laboratory specimens (those not meeting the criteria for reasonable cost payment in 250.6) will be billed on a 14X type of bill .   (See Section 250.6 -  Clinical Diagnostic Laboratory Tests Furnished by CAHs.)   250.1.1 - Special Instructions for Non -covered Time Increments in Standard Method Critical Access Hospitals (CAHs)  (Rev. 1921, Issued: 02- 19-10, Effective: 04- 01-10, Impleme ntation: 04 -05-10)  CAHs sometimes bill outpatient therapy services using HCPCS that by definition give specific time increments like those discussed in Chapter 5, sections 20 and 40.  However, standard method CAHs are not subject to payment on a fee basis  under the Medicare Physician Fee Schedule, therefore these CAHs should follow the instructions below if there is a need to bill non- covered increments.   When HCPCS codes required for reporting do not specify an increment of billing in their definition (i. e., 15 minute intervals), the unit for the line item is 1, and CAHs should follow the general instructions given for billing non- covered charges in Chapter 1, section 60, either by the line item or on no payment claims.  Several of the outpatient therapy H CPCS codes, however, are defined in specific time increments, and units reported on line items should be consistent with these definitions. In such cases, when both covered and non- covered increments are provided in the same visit on the same date of servi ce, CAHs should bill as follows:     Report covered and non- covered units in separate line items, even when part of the same visit, with one line item for all covered and non- covered increments in a visit, and another for all non- covered increments in that sa me visit;   Use ABN- related modifiers when appropriate to explain non- coverage and payment liability of specific lines (i.e., - GY, see Chapter 1, section 60 for details on these modifiers);    Do not report non- covered line items that are part of a partially covered service on a separate no payment claim (i.e., using condition code 21).  Instead, always report them on the same claim with the separate lines for the covered portion of the service. No payment claims received for the same date, same beneficiary, s ame provider and same therapy service as a for -payment claim will be rejected. A distinct reason code will make providers aware of the reason for the rejection, and they can correct their billing to have covered and non- covered portions of the same service on the same claim;    Do not report non- covered line items as part of the required reporting of value codes 50, 51 and 52 for covered visits (i.e., where all increments are non- covered and there are no covered charges for the line item, since these line items are either part of an already counted partially covered visit, or an entirely non -covered visit); and    Never split a single increment into a covered and non- covered portion.   250.2 - Optional Method for Outpatient Services:  Cost -Based Facility Services Plus 115 percent Fee Schedule Payment for Professional Services  (Rev. 3019, Issued: 08- 07-14, Effective: 01- 01-12, ICD -10: Upon Implementation of ICD-  10, Implementation: 09- 08-14, ICD -10: Upon Implementation of ICD - 10)  The BIPA legislation on payment for professional services at 115 percent of what would otherwise be paid under the fee schedule is effective for services furnished on or after July 1, 2001.  A CAH may elect to be paid for outpatient services in any cost reporting period under this method by filing a written election with the A/B MAC (A) on an annual basis at least 30 days before start of the Cost Reporting period to which the election applies.  An election of this payment method, once made for a cost reporting period, remains in effect for all of that period for the CAH.   Effective for cost reporting periods beginning on or after October 1, 2010 if a CAH elected the optional method for its most recent cost reporting period beginning before October 1, 2010 or chooses to elect the optional method on or after October 1, 2010, that election remains in place until it is terminated, an annual election is no longer required.  If a CAH elects the optional method on or after October 1, 2010, it must submit its request in writing to its A/B MAC (A) at least 30 days before the start of the first cost reporting period for which the election is effective.  That election will not terminate  unless the CAH submits a termination request to its A/B MAC (A) at least 30 days before the st art of its next cost reporting period.   The Medicare Prescription Drugs, Improvement, and Modernization Act (MMA) of 2003, changed the requirement that each practitioner rendering a service at a CAH that has elected the optional method, reassign their bill ing rights to that CAH.  This provision allows each practitioner to choose whether to reassign billing rights to the CAH or file claims for professional services through their A/B MAC (B).  The reassignment will remain in effect for that entire cost report ing period.  The individual practitioner must certify, using the Form CMS -855R, if he/she wishes to reassign their billing rights.  The CAH must then forward a copy of Form CMS -855R to the A/B MAC (A), and the A/B MACs (B) must have the practitioner sign a n attestation that clearly states that the practitioner will not bill the A/B MAC (A) or A/B MAC (B) for any services rendered at the CAH once the reassignment has been given to the CAH.  This attestation will remain at the CAH.   For CAHs that elected th e optional method before November 1, 2003, the provision is effective beginning on or after July 1, 2001.  For CAHs electing the optional method on or after November 1, 2003, the provision is effective for cost reporting periods beginning on or after July 1, 2004.  Under this election, a CAH will receive payment from their A/B MAC (A) for professional services furnished in that CAHs outpatient department. Professional services are those furnished by all licensed professionals who otherwise would be entitle d to bill the A/B MAC (B) under Part B.   Payment to the CAH for each outpatient visit (reassigned billing) will be the sum of the following:    For facility services, not including physician or other practitioner services, payment will be based on 101 percent of the reasonable costs of the services.  List the facility service(s) rendered to outpatients using the appropriate revenue code.  The A/B MAC will pay 101 percent of the reasonable costs for the outpatient services less applicable Part B deducti ble and coinsurance amounts, plus:    Show the professional services separately, along with the appropriate HCPCS code (physician or other practitioner) in one of the following revenue codes - 096X, 097X, or 098X.   The A/B MAC (A) uses the Medicare Physician Fee Schedule (MPFS) amounts to pay for all the physician/nonphysician practitioner services rendered in a CAH that elected the optional method.  Payment is based on the lesser of the actual charge or the facili ty-specific MPFS amount less deductible and coinsurance times 1.15; and    AK -  Service rendered in a CAH by a non -participating physician    For a non -participating physician service, a CAH must place modifier AK on the claim.  Payment is based on the lesser  of the actual charge or a reduced fee schedule amount of 95 percent. Payment is calculated as follows:    [(facility -specific MPFS amount times the non -participating physician reduction (0.95) minus (deductible and coinsurance] times 1.15.