(Medicare Claims Processing Manual)

270 -  Billing for Hospital Outpatient Services Furnished by Clinical Social Workers (CSW)  270.1 -  Fee Schedule to be Used for Payment for CSW Services  270.2 -  Outpatient Mental Health Payment Limitation for CSW Services  270.3 -  Coinsurance and Deductible for CSW Services  280 -  Hospital -Based Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) Billing for Non RHC/FQHC Services  290 -  Outpatient Observation Services  290.1 -  Observation Services Overview  290.2 -  General Billing Requirements for Observation Services  290.2.1 -  Revenue Code Reporting 290.2.2 -  Reporting Hours of Observation  290.4 -  Billing and Payment for Observation Services Furnished Between January 1, 2006 and December 31, 2007 290.4.1 -  Billing and Payment for All Hospital Observation Services Furnished Between January 1, 2006 and December 31, 2007  290.4.2 -  Separate and Packaged Payment for Direct Referral for Observation Services Furnished Between January 1, 2006 and December 31, 2007 290.4.3 -  Separate and Packaged Payment for Observation Services Furnished Between January 1, 2006 and December 31, 2007  290.5 -  Billing and Payment for Observation Services Furnished on or After January 1, 2008  290.5.1 -  Billing and Payment for Observation Services Furnished Between January 1, 2008 and December 31, 2015  290.5.2 -  Billing and Payment for Direct Referral for Observation Care Furnished Beginning January 1, 2008  290.5.3 -  Billing and Payment for Observation Services Furnished Beginning January 1, 2016 290.6 -  Services Not Covered as Observation Services  300 -  Medical Nutrition Therapy (MNT) Services  300.1 -  General Conditions and Limitations on Coverage  300.2 -  Referrals for MNT Services  300.3 -  Dietitians and Nutritionists Performing MNT Services  300.4 -  Payment for MNT Services  300.5 -  General Claims Processing Information      300.5.1 -  Rural Health Centers (RHCs)/Federally Qualified Health Centers (FQHCs) Special Billing Instructions  300.6 -  Common Working File (CWF) Edits  310 -  Lung Volume Reduction Surgery  320 -  Outpatient Intravenous Insulin Treatment (OIVIT)  320.1 -  HCPCS Coding for OIVIT  320.2 -  Medicare Summary Notices (MSN), Reason Codes, and Remark Codes  10 - Hospital Outpatient Prospective Payment System (OPPS)  (Rev. 1, 10- 03-03) A-01-93  10.1 - Background  (Rev. 12423; Issued: 12- 20-23; Effective: 01 -01-24; Implementation: 01- 02-24)    Section  1833(t)  of the Social Security Act (the Act) as amended by 4533 of the  Balanced Budget Act (BBA) of 1997, authorizes CMS to implement a Medicare PPS for:    Hospital outpatient services, including partial hospitalization and intensive outpatient  services;     Certain Part B services furnished to hospital inpatients who have no Part A coverage;     Partial hospitalization and intensive outpatient  services furnished by CMHCs;     Hepatitis B vaccines and their administration, splints, cast, and antigens provided by HHAs that provide medical and other health services;     Hepatitis B vaccines and their administration provided by CORFs; and     Splints, casts, and antigens provided to hospice patients for treatment of nonterminal illness.    The Balanced Budget Refinement Act of 1999 (BBRA) contains a number of major provisions that affect the development of the OPPS.  These are:     Establish payments under OPPS in a budget neutral manner based on estimates of amounts payable in 1999 from the Part B Trust Fund and as beneficiary coinsurance under the system in effect prior to OPPS (Although the base rates were calculated using the 1999 amounts, these amounts are increased by the hospital inpatient market basket, minus one percent, to arrive at the amounts payable in the year 2000.  See 10.3 for Benefits and Improvement Protection Act (BIPA) changes in market basket updates.);     Extend the 5.8 percent reduction in operating costs and 10 percent reduction in capital costs (which had been due to sunset on December 31, 1999) through the first date the OPPS is implemented;     Require annual updating of the OPPS payment weights, rates, payment adjustments and groups;     Require annual consultation with an expert provider advisory panel in review and updating of payment groups;     Establish budget neutral outlier adjustments based on the charges, adjusted to costs, for all OPPS services included on the submitted outpatient bill for services furnished before January 1, 2002, and thereafter based on the individual services billed;     Provide transitional pass -through payment for the additional costs of new and current medical devices, drugs, and biologicals for at least two years but not more than three years;     Provide payment under OPPS for implantable devices including durable medical equipment (DME), prosthetics and those used in diagnostic testing;     Establish transitional payments to limit providers losses under OPPS; the additional payments are for 3 1/2 years for CMHCs and most hospitals, and permanent for the 10 cancer hospitals; and     Limit beneficiary coinsurance for an individual service paid under OPPS to the inpatient hospital deductible.    The Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA), which was signed into law on December 21, 2000, made a number of revisions to the Outpatient Prospective Payment System (OPPS).  These are:     Accelerated reductions of beneficiary copayments;     Increase in market basket update for 2001;     Transitional corridor provision for transitional outpatient payments (TOPs) for providers that did not file 1996 cost reports; and     Special transitional corridor treatment for childrens hospitals.    The Secretary has the authority under  1883(t)  of the Act to determine which services are included (with the exception of ambulance services for which a separate fee schedule is applicable starting April 1, 2002).  Medicare will continue to pay for clinical diagnostic laboratory services, orthotics, pr osthetics (except as noted above), and for take -home surgical dressings on their respective fee schedules.  Medicare will also continue to pay for chronic dialysis using the composite rate (certain CRNA services, PPV , and influenza vaccines and their admin istration, orphan drugs, and ESRD drugs and supplies are not included in the composite rate), for screening mammographies based on the current payment limitation, which changes to payment under the Medicare Physician Fee Schedule (MPFS), effective January 1, 2002, and for outpatient rehabilitation services (physical therapy including speech language pathology and occupational therapy) under the MPFS.  Acute dialysis, e.g., for poisoning, will be paid under OPPS.  The 10 cancer centers exempt from inpatient PPS are included in this system, but are eligible for hold harmless payment under the Transitional Corridor provision.    The Outpatient Prospective Payment System (OPPS) applies to all hospital outpatient departments except for hospitals that provide Part B only services to their inpatients;  Critical Access Hospitals (CAHs); Indian Health Service hospitals; hospitals located in American Samoa, Guam, and Saipan; hospitals located in the Virgin Islands; and effective January 1, 2017 non- excepted off -campus provider -based departments of a hospita l. The OPPS also applies to partial hospitalization and intensive outpatient  services furnished by Community Mental Health Centers (CMHCs).    Certain hospitals in Maryland that are paid under Maryland waiver provisions are also excluded from payment under OPPS but not from reporting Healthcare Common Procedure Coding System (HCPCS) and line item dates of service.   10.1.1 - Payment Status Indicators  (Rev. 1445; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  An OPPS payment status indicator is assigned to every HCPCS code.  The status indicator identifies whether the service described by the HCPCS code is paid under the OPPS and if so, whether payment is made separately or packaged.  The status indicator may also provide additional information about how the code is paid under the OPPS or under another payment system or fee schedule.  For example, services with status indicator A are paid under a fee schedule or payment system other than the OPPS.  Services with status indicator N are paid under the OPPS, but their payment is packaged into payment for a separately paid service.  Services with status indicator T are paid separately under OPPS but a multiple procedure payment reduction applies when two or more services with a status indicator of T are billed on the same date of service.   The full list of status indicators and their definitions is published in Addendum D1 of the OPPS/ASC proposed and final rules each year.  The status indicator for each HCPCS code is shown in OPPS Addendum B.  10.2 - APC Payment Groups (Rev. 1445; Issued:  02- 08-08; Effective:  01 -01-08; Implementation:  03 -10-08)  Each HCPCS code for which separate payment is made under the OPPS is assigned to an ambulatory payment classification (APC) group. The payment rate and coinsurance amount calculated for an APC apply to all of the services assigned to the APC.  A hospital may receive a number of APC payments for the services furnished to a patient on a single day; however, multiple surgical procedures  furnished on the same day are subject to discounting.  (See section 10.5 for discussion of multiple procedure discounting under the OPPS).   Services within an APC are similar clinically and with respect to hospital resource use. The law requires that the median cost for the highest cost service within the APC may not be more than 2 times the median cost for the lowest cost service in the APC, and the Secretary may make exceptions in unusual cases, such as low volume items and services.   This is commonly called the 2 times rule.  The median costs of services change from year to year as a result of changes in hospitals charge, changes to cost -to-charge ratios as determined from hospital cost reports, and changes in the frequency of services.  Therefore, the APC assignment of a service may change from one year to the next year as is needed to avoid a violation of the 2 times rule or to improve clinical and/or resource homogeneity of APCs.  This APC reconfiguration may result in significant changes in the payment rate for the APC and, therefore, for the service being billed.  10.2.1 - Composite APCs (Rev. 3941; Issued: 12- 22-17; Effective: 01 - 01-18; Implementation: 01 -02-18)  Composite APCs provide a single payment for a comprehensive diagnostic and/or treatment service that is defined, for purposes of the APC, as a service typically reported with multiple HCPCS codes.  When HCPCS codes that meet the criteria for payment of the composite APC are billed on the same date of service, CMS makes a single payment for all of the codes as a whole, rather than paying individually for each code.  See Addendum A at www.cms.hhs.gov/HospitalOutpatientPPS/  for the national unadjusted payment rates for these composite APCs.  10.2.2 - Cardiac Resynchronization Therapy  (Rev. 2386, Issued: 01- 13-12, Effective: 01 -01-12, Implementation: 01- 03-12)  Effective for services furnished on or after January 1, 2012, cardiac resynchronization therapy involving an implantable cardioverter defibrillator (CRT -D) will be recognized as a single, composite service combining implantable cardioverter defibrillator p rocedures (described by CPT code 33249 (Insertion or repositioning of electrode lead(s) for single or dual chamber pacing cardioverter -defibrillator and insertion of pulse generator  )) and pacing electrode insertion procedures (described by CPT code 33225 (Insertion of pacing electrode, cardiac venous system, for left ventricular pacing, at time of insertion of pacing cardioverter -defibrillator or pacemaker pulse generator (including upgrade to dual chamber system))) when performed on the same date of servi ce.  When these procedures appear on the same claim but with different dates of service, or appear on the claim without the other procedure, the standard APC assignment for each service will continue to be applied.