(Medicare Benefit Policy Manual)

The services billed to Part B must be reasonable and necessary and must meet all applicable Part B coverage and payment conditions.  Claims for these services must be filed no later than the close of the period ending 12 months or 1 calendar year after the date of service (see Pub. 100- 04, Medicare Claims Processing Manual, Chapter 1, 70, Time Limitations for Filing Part A and Part B Claims).  See Pub. 100 -04, Medicare Claims Processing Manual, chap ter 4, 240 for required bill types.  10.3 - Hospital Inpatient Services Paid Only Under Part B  (Rev. 182, Issued: 03- 21-14, Effective: 10 -01-13, Implementation: 04- 21-14)  The services listed in Chapter 15, 250 of this manual, Medical and Other Health Services Furnished to Inpatients of Hospitals and Skilled Nursing Facilities, when provided to a hospital inpatient, may be covered under Part B, even though the patient has Part A coverage for the hospital stay.  This is because these services are covered under Part B and are not covered under Part A.   In all hospitals, all other services provided to a hospital inpatient must be treated as an inpatient hospital service to be paid for under Part A, if Part A coverage is available and the beneficiary is entitled to Part A.  This is because every hospital m ust provide directly or arrange for any nonphysician service rendered to its inpatients, and a hospital can be paid under Part B for a service provided in this manner only if Part A coverage does not exist.   However, note that in order to have any Medicare coverage at all (Part A or Part B), any nonphysician service rendered to a hospital inpatient must be provided directly or arranged for by the hospital.  20 - Outpatient Hospital Services  (Rev. 12425; Issued: 12- 21-23: Effective: 01 -01-24; Implementation: 01- 02-24)   Hospitals provide two distinct types of services to outpatients: services that are diagnostic in nature, and other services that aid the physician in the treatment of the patient. Part B covers both the diagnostic and the therapeutic services furnished by hospitals to outpatients.  The rules in this section pertaining to the coverage of outpatient hospital services are not applicable to the following services.     Physical therapy, speech- language pathology or occupational therapy services when they are furnished as therapy meaning under a therapy plan of care.  See chapter 15, sections 220 and 230 of this manual, for coverage and payment rules for these services,  which are paid at the applicable amount under the physician fee schedule.     Services that are covered and paid under the End Stage Renal Disease Prospective Payment System.  See Chapter 11, End Stage Renal Disease (ESRD) of this manual, for rules on the coverage of these services.    For policies in addition to this section that apply to partial hospitalization services, see chapter 6, section 70.3 of this manual, and Pub. 100- 04, Medicare Claims Processing Manual, chapter 4, section 260. For policies in addition to this section that apply to intensive outpatient services, see chapter 6, section 70.4 of this manual, and Pub. 100- 04, Medicare Claims Processing Manual, chapter 4, section 261.   For rules on the coverage of services and supplies furnished incident to a physicians professional services in an office or physician- directed clinic setting, refer to Chapter 15, Covered Medical and Other Health Services, section 60 of this manual.   20.1 - Limitations on Coverage of Certain Services Furnished to Hospital Outpatients  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08) Sources:  42 CFR 410.42(a) and 64 FR 18536, April 7, 2000  20.1.1 - General Rule  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  Except as provided in section 20.1.2 of this chapter, Medicare Part B does not pay for any item or service that is furnished to a hospital outpatient, as defined in section 20.2, during an encounter, as defined in section 20.3, by an entity other than the hospital unless the hospital has arrangements with that entity to furnish that particular service to its patients.  The arrangements must provide that Medicare payment made to the hospital that arranged for the services discharges the liability of the bene ficiary or any other person to pay for those services.  See the Medicare General Information, Eligibility, and Entitlement Manual, Pub.100- 01, chapter 5, section 10.3 for the definition of arrangements.  For the purposes of this section, the term hospit al includes a Critical Access Hospital (CAH).   20.1.2 - Exception to Limitation  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  The limitation stated in section 20.1.1 does not apply to the following services:    Physicians professional services that meet the following conditions:   o The services are personally furnished for an individual beneficiary by a physician;   o The services contribute directly to the diagnosis or treatment of an individual beneficiary;   o The services ordinarily require performance by a physician;   o In the case of radiology or laboratory services, additional requirements in 42 CFR 415.120 and 415.130, respectively of the Code of Federal Regulations are met.    Physician assistant services, as defined in section 1861(s)(2)(K)(i) of the Social Security Act (the Act);    Nurse practitioner and clinical nurse specialist services, as defined in section 1861(s)(2)(K)(ii) of the Act;    Qualified psychologist services, as defined in section 1861(ii) of the Act;    Services of an anesthetist, as defined in regulations in 42 CFR 410.69;    Services furnished to SNF residents as defined in regulations in 42 CFR 411.15(p).   20.2 - Outpatient Defined  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  A hospital outpatient is a person who has not been admitted by the hospital as an inpatient but is registered on the hospital records as an outpatient and receives services (rather than supplies alone) from the hospital or CAH.  Where a tissue sample, blood sample, or specimen is taken by personnel that are neither employed nor arranged for by the hospital and is sent to the hospital for performance of tests, the tests are not outpatient hospital services since the patient does not directly receive services  from the hospital.  See s ection  70.5 for coverage of laboratory services furnished to nonhospital patients by a hospital laboratory unless the patient is also a registered hospital outpatient receiving outpatient services from the hospital on the same day and the hospital is not a CAH or Maryland waiver hospital.  Similarly, supplies provided by a hospital supply room for use by physicians in the treatment of private patients are not covered as an outpatient service since the patients receiving the supplies are not outpatients of the hos pital.  (See the Medicare Benefit Policy Manual, Pub. 100- 02, Chapter 1,Inpatient Hospital Services, section 10, for the definition of inpatient.)   Where the hospital uses the category "day patient," i.e., an individual who receives hospital services during the day and is not expected to be lodged in the hospital at midnight, the individual is considered an outpatient.  For information on outpatient observation status, refer to section 20.6 of this chapter and to the Medicare Claims Processing Manual, Pub.100- 04, chapter 4, section 290, Outpatient Observation Services.  For information on conditions when an inpatient admission may be changed to outpa tient status, refer to the Medicare Claims Processing Manual, Pub.100- 04, Chapter 1, General Billing Requirements, section 50.3.  The inpatient of a SNF may be considered the outpatient of a participating hospital.  However, the inpatient of a participating hospital cannot be considered an outpatient of that or any other hospital.  Outpatient hospital services furnished in the emergency room to a patient classified as dead on arrival are covered until pronouncement of death, if the hospital considers such patients as outpatients for record -keeping purposes and follows its usual out patient billing practice for such services to all patients, both Medicare and non- Medicare.  This coverage does not apply if the patient was pronounced dead prior to arrival at the hospital.  20.3 - Encounter Defined  (Rev. 101, Issued: 01- 16-09, Effective: 01 -01-09, Implementation: 01- 05-09) Source:  42 CFR 410.2 and 482.12   A hospital outpatient encounter is a direct personal contact between a patient and a physician, or other person who is authorized by State licensure law and, if applicable, by hospital or CAH staff bylaws, to order or furnish hospital services for diagnosis or treatment of the patient.   The conditions of participation for hospitals under 42 CFR 482.12(c)(1)(i) through (c)(1)(vi) require that every Medicare patient is under the care of a doctor of medicine or osteopathy, a doctor of dental surgery or dental medicine, a doctor of podiatric medicine, a doctor of optometry, a chiropractor, or a clinical psychologist; each practicing within the extent of the Act, the Code of Federal Regulations, and State law.  Further, 42 CFR 482.12(c)(4) requires that a doctor of medicine or osteopathy must be responsible for the care of each Medicare patient with respect to any medical or psychiatric condition that is present on admission or develops during hospitalization and is not specifically within the scope of practice of one of the other practitioners listed in 42 CFR 482.12(c)(1)(i) through (c)(1)(vi).   20.4 - Outpatient Diagnostic Services  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  20.4.1 - Diagnostic Services Defined  (Rev. 82; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  A service is diagnostic if it is an examination or procedure to which the patient is subjected, or which is performed on materials derived from a hospital outpatient, to obtain information to aid in the assessment of a medical condition or the identifica tion of a disease.  Among these examinations and tests are diagnostic laboratory services such as hematology and chemistry, diagnostic x- rays, isotope studies, EKGs, pulmonary function studies, thyroid function tests, psychological tests, and other tests given to determine the nature and severity of an ailment or injury.  20.4.2 - Reserved   20.4.3 - Coverage of Outpatient Diagnostic Services Furnished on or Before December 31, 2009  (Rev. 128, Issued: 05- 28-10, Effective: 07 -01-10, Implementation: 07- 06-10)  Covered diagnostic services to outpatients include the services of nurses, psychologists, technicians, drugs and biologicals necessary for diagnostic study, and the use of supplies and equipment.  When a hospital sends hospital personnel and hospital equipment to a patients home to furnish a diagnostic service, Medicare covers the service as if the patient had received the service in the hospital outpatient department.   For services furnished before August 1, 2000, hospital personnel may provide diagnostic services outside the hospital premises without the direct personal supervision of a physician.  For example, if a hospital laboratory technician is sent by the hospital  to a patients home to obtain a blood sample for testing in the hospitals laboratory, the technicians services are a covered hospital service even though a physician was not with the technician.   For services furnished on or after August 1, 2000, and before January 1, 2010, Medicare Part B makes payment for hospital or CAH diagnostic services furnished to outpatients, including drugs and biologicals required in the performance of the services (even if those drugs or biologicals are self -administered), if those services meet the following conditions:   1. They are furnished by the hospital or under arrangements made by the hospital or CAH with another entity (see section 20.1 of this chapter);   2. They are ordinarily furnished by, or under arrangements made by the hospital or CAH to its outpatients for the purpose of diagnostic study;   3. They would be covered as inpatient hospital services if furnished to an inpatient; and