(Medicare Benefit Policy Manual)

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  4. Payment is allowed under the hospital outpatient prospective payment system for diagnostic services furnished at a facility that is designated as provider -based only when those services are furnished under the appropriate level of supervision specified in accordance with the definitions at 42 CFR 410.32(b)(3)(i), (b)(3)(ii), and (b)(3)(iii), and as described in Chapter 15 of this manual, Section 80 Requirements for Diagnostic X -ray, Diagnostic Laboratory, and Other Diagnostic Tests, as though they are being furnished in a physicians office or clinic setting.  With respect to individual diagnostic tests, the supervision levels listed in the quarterly updated Medicare Physician Fee Schedule (MPFS) Relative Value File apply.  For diagnostic services not listed in the MPFS, Medicare contractors, in consultation wit h their medical directors, define appropriate supervision levels in order to determine whether claims for these services are reasonable and necessary.   Future updates to the MPFS relative value files will be issued in future Recurring Update Notifications.   As specified at 42 CFR 410.28(f), for services furnished on or after February 21, 2002, the provisions of paragraphs (a) and (d)(2) through (d)(4), inclusive, of 42 CFR 410.32 apply to all diagnostic laboratory tests furnished by hospitals and CAHs to outpatients.   Physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives who operate within the scope of practice under State law may order and perform diagnostic tests, as discussed in 42 CFR 410.32(a)(2) and corresponding guida nce in chapter 15, section 80 of this manual.  However, this manual guidance and the long established regulation at 42 CFR 410.32(b)(1) also state that diagnostic x- ray and other diagnostic tests must be furnished under the appropriate level of supervision by a physician as defined in section 1861(r) of the Act.  Some of these non- physician practitioners may perform diagnostic tests without supervision, see the regulation at 410.32(b)(2) and 42 CFR 410.32(b)(3).  Thus, while physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives only require physician supervision included in any collaboration or supervision requirements particular to that type of practitioner when they personally perform a diagnostic test, these p ractitioners are not permitted to function as supervisory physicians for the purposes of other hospital staff performing diagnostic tests.  20.4.4 - Coverage of Outpatient Diagnostic Services Furnished on or After January 1, 2010 (Rev. 152, Issued: 12- 29-11, Effective: 01 -01-12, Implementation: 01- 03-12)  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.   As specified at 42 CFR 410.28(a), for services furnished on or after 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 service s (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; and   3. They would be covered as inpatient hospital services if furnished to an inpatient.  As specified at 42 CFR 410.28(e), payment is allowed under the hospital outpatient prospective payment system for diagnostic services only when those services are furnished under the appropriate level of supervision specified in accordance with the definitions in this manual and at 42 CFR 410.32(b)(3)(i), (b)(3)(ii), and (b)(3)(iii) of general, direct and personal supervision.  Physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives who operate within their scope of practice under State law may order and perform diagnostic tests, as discussed in 42 CFR 410.32(a)(2) and corresponding guidance in chapter 15, section 80 of this manual.  However, this guidance and the long established  regulation at 42 CFR 410.32(b)(1) also state that diagnostic x- ray and other diagnostic tests must be furnished under the appropriate level of supervision by a physician as defined in section 1861(r) of the Act and may not be supervised by nonphysician pr actitioners.  Sections 410.32(b)(2) and (3) provide certain exceptions that allow some diagnostic tests furnished by certain non- physician practitioners to be furnished without physician supervision.  While these nonphysician practitioners including physic ian assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives cannot provide the required physician supervision when other hospital staff are performing diagnostic tests, when these nonphysician practitioners personally perform a diagnostic service they must meet only the physician supervision requirements that are prescribed under the Medicare coverage rules at 42 CFR Part 410 for that type of practitioner when they directly provide a service.  For example, under section 410.75 nurse practitioners must work in collaboration with a physician, and under section 410.74 physician assistants must practice under the general supervision of a physician.  With respect to individual diagnostic tests, the supervision levels listed in the quarterly updated Medicare Physician Fee Schedule (PFS) Relative Value File apply.  For diagnostic services not listed in the PFS, Medicare contractors, in consultation with their medical directors, define appropriate supervision levels in order to determine whether claims for these services are reasonable and necessary.  Updates to the PFS Relative Value Files will be issued in future Recurring Update Notifications.  For guid ance regarding the numeric levels assigned to each CPT or HCPCS code in the PFS Relative Value File, see Chapter 15 of this manual, Section 80, Requirements for Diagnostic X -ray, Diagnostic Laboratory, and Other Diagnostic Tests.   For diagnostic services furnished during calendar year (CY) 2010 whether directly or under arrangement in the hospital or in an on- campus outpatient department of the hospital, as defined at 42 CFR 413.65, direct supervision means that the physician must  be present on the same campus where the services are being furnished.  For services furnished in an off -campus provider based department as defined at 42 CFR 413.65, he or she must be present within the off -campus provider based department.  The physician must be immediately available to furnish assistance and direction throughout the performance of the procedure.  The physician does not have to be present in the room when the procedure is performed.  In the hospital means the definition specified in 42CFR 410.27(g), which is areas in the main building(s) of the hospital or CAH that are under the ownership, financial, and administrative control of the hospital or CAH; that are operated as part of the hospital or CAH; and for which the hospital or CAH bill s the services furnished under the hospitals or CAHs CMS Certification Number.   For diagnostic services furnished during CY 2011 and following, whether directly or under arrangement in the hospital or in an on- campus or off -campus outpatient department of the hospital as defined at 42 CFR 413.65, direct supervision means that the physician must be immediately available to furnish assistance and direction throughout the performance of the procedure.  As discussed below, the physician is not required to be present in the room where the procedure is being performed or within any other physical boundary as long as he or she is immediately available.   For services furnished during CY 2010 and following under arrangement in nonhospital locations, direct supervision means the definition specified in the PFS at 42 CFR 410.32(b)(3)(ii).  The supervisory physician must remain present within the office suite where the service is being furnished and must be immediately available to furnish assistance and direction throughout the performance of the procedure.  The supervisory physician is not required to be present in the room where the procedure is being performed.   Immediate availability requires the immediate physical presence of the supervisory physician.  CMS has not specifically defined the word immediate in terms of time or distance; however, an example of a lack of immediate availability would be situations where the supervisory physician is performing another procedure or service that he or she could not interrupt.  Also, for services furnished on- campus, the supervisory physician may not be so physically distant on- campus from the location where hospital out patient services are being furnished that he or she could not intervene right away.  The hospital or supervisory physician must judge the supervisory physicians relative location to ensure that he or she is immediately available.   For services furnished in CY 2011 and following, which require direct supervision, the supervisory practitioner may be present in locations such as physician offices that are close to the hospital or provider based department of a hospital where the servic es are being furnished but are not located in actual hospital space, as long as the supervisory physician remains immediately available.  Similarly, as of CY 2011 for services requiring direct supervision, the supervisory practitioner may be present in a l ocation in or near an off-campus hospital building that houses multiple hospital provider based departments where the services are being furnished as long as the supervisory physician is immediately available.   The supervisory physician must have, within his or her State scope of practice and hospital -granted privileges, the knowledge, skills, ability, and privileges to perform the service or procedure.  Specially trained ancillary staff and technicians are the primary operators of some specialized diagnostic testing equipment, and while in such cases CMS does not expect the supervisory physician to operate this equipment instead of a technician, the physi cian that supervises the provision of the diagnostic servic e must be knowledgeable about the test and clinically able to furnish the test.  The supervisory responsibility is more than the capacity to respond to an emergency, and includes the ability to take over performance of a procedure or provide additional orders. CMS would not expect that the supervisory physician would make all decisions unilaterally without informing or consulting the patients treating physician or nonphysician practitioner.   In summary, the supervisory physician must be clinically appropriate to supervise the service or procedure.   As specified at 42 CFR 410.28(f), for services furnished on or after February 21, 2002, the provisions of paragraphs (a) and (d)(2) through (d)(4), inclusive, of 42 CFR 410.32 apply to all diagnostic laboratory tests furnished by hospitals and CAHs to outpatients.   20.4.5 - Outpatient Diagnostic Services Under Arrangements  (Rev. 143, Issued: 04- 29-11, Effective: 05 -31-11, Implementation: 05- 31-11)  When the hospital makes arrangements with others for diagnostic services, such services are covered under Part B as diagnostic tests whether furnished in the hospital or in other facilities.  Diagnostic services furnished under arrangement in on- campus hos pital locations, off -campus hospital locations, and in nonhospital locations must be furnished under the appropriate level of physician supervision according to the requirements of 42 CFR 410.28(e) and 410.32(b)(3), as discussed in the applicable sections above.   Independent laboratory services furnished to an outpatient under arrangements with the hospital are covered only under the "diagnostic laboratory tests" provisions of Part B (see Section 10, above), but are to be billed along with other services to outpati ents.  See Pub. 100-02, Medicare Benefit Policy Manual, Chapter 1, Inpatient Hospital Services, Section 50.3, for: (1) the definition of an independent clinical laboratory; (2) the requirements which such a laboratory must meet; and (3) instructions to t he A/B MAC (A) when it is not approved.  The cost to the hospital for diagnostic laboratory services for outpatients obtained under arrangements is the reasonable charge by the laboratory.   Laboratory services may also be furnished to a hospital outpatient under arrangements by: