(Medicare Claims Processing Manual)

Leave of Absence Carve- Out process from 50.2.2 applies.  Providers may submit Interim Bills daily, weekly, or monthly as long as the claims are submitted with the correct frequency code in the type of bill and sequentially.  For a hospice claim that is out of sequence, the FI searches their claims history. If the FI finds the prior claim has been received but has not been finalized (for instance, it has been suspended for additional development), they do not cause the out of s equence claim to be returned to the provider. Instead, they hold the out of sequence claim until the prior claim has been finalized and then process the out of sequence claim. If the prior hospice claim has not been received, the out of sequence hospice cl aim is returned to the provider with an error message as described above. FIs shall perform editing to ensure hospice claims are processed in sequence after any necessary medical review of the claims has been completed.   Since hospice claims received out of sequence do not pass all required edits, they do not meet the definition of clean claims defined in 80.2 below. As a result, they are not subject to the mandated claims processing timeliness standard and are not subj ect to interest payments. FIs will enter condition code 64 on the out of sequence claims they are holding when awaiting the processing of the prior claims to indicate that they are not clean claims.   50.2.4 - Reprocess Inpatient or Hospice Claims in Sequence  (Rev. 1, 10- 01-03)  3-3603.2, definition of spell of illness from MIM 3035 If a beneficiary, provider, or a secondary insurer notifies the FI that out -of-sequence processing increased the liability of the beneficiary or a secondary insurer, the FI confirm this through reviewing claims processed in its history and the Common Working File (CWF) records.  If liability is increased, FIs cancel the previously processed bills for that spell -of-illness and reprocess all bills in the spell- of-illness or benefit period in sequence.  This may require coordination with another FI where the beneficiary was an inpatient in different hospitals with different FIs or received hospice services from separate hospices with different FIs.  The CWF utilization record must be corrected to properly allocate full, coinsurance, and lifetime reserve days, as applicable.  The CWF utilization record must also be corrected to reflect the correct hospice periods.   This is an issue only when the beneficiary is an inpatient for more than 30 days (in the same or different facilities) during the spell of illness or benefit period. A spell of illness or benefit period is a period of time (consecutive days) during which c overed services furnished to a patient, up to certain specified maximum amounts, may be paid for by the hospital insurance plan.  This situation occurs most often when long- term care hospitals are involved.  For hospice claims, out of sequence processed claims must be reprocessed to maintain the integrity of hospice election periods.  If an FI is contacted by another FI or any regional office (RO), they cancel all affected claims and reprocess in accordance with the instructions from the lead FI or RO.   The lead FI is the one contacted by a provider, beneficiary, or other insurer complaining of improper payment as result of out -of-sequence billing.  The lead FI will coordinate actions with any other FIs involved to cancel and reprocess the bills, as neces sary.  For inpatient stays, the lead FI verifies that the provider, beneficiary, or other insurer was adversely affected and coordinates these actions directly with any other affected FI to cancel any out -of-sequence bills they processed and posted.  For hospice claims, the lead FI verifies an out -of-sequence claim(s) impacted the hospice election period. The lead FI coordinates actions to cancel any bills posted out -of-sequence directly with any other affected FI.  All FIs must reprocess all bills based on  the actual sequence of the beneficiarys stays at the various providers or on the actual sequence of hospice services.  The lead FI controls the sequence in which the bills are processed and posted to CWF.   If the lead FI experiences any difficulty with another FI, they contact their RO to coordinate with any necessary ROs for other affected FIs bills.   This approach is to be used only when the beneficiary, provider, or other insurer has increased liability as a result of out- of-sequence processing or when the hospice election periods are incorrect. It is not to be used if the liability stays the same, e.g., if deductible is applied on the second stay instead of the first, but there is no issue with regard to the effective date of supplementary coverage.   50.3 - When an Inpatient Admission May Be Changed to Outpatient Status  (Rev. 1760, Issued:  06 -23-09; Effective Date:  07 -01-09; Implementation Date:  07-06-09)  50.3.1 - Background  (Rev. 2296, Issued: 09- 02-11, Effective: 10 -01-11, Implementation: 10- 03-11)  Payment is made under the hospital Outpatient Prospective Payment System (OPPS) for Medicare Part B services furnished by hospitals subject to the OPPS, and under the applicable other payment methodologies for hospitals not subject to the OPPS. Outpatient  means a person who has not been admitted as an inpatient but who is registered on the hospital or critical access hospital (CAH) records as an outpatient and receives services (rather than supplies alone) directly from the hospital or CAH.   Under the hospital Condition of Participation (CoP) at 42 C.F.R. 482.12(c), patients are admitted to the hospital or CAH as inpatients only on the recommendation of a physician or licensed practitioner permitted by the State to admit patients to a hospita l.  In addition, every Medicare patient must be under the care of a physician or other type of practitioner listed in the regulation (the practitioner responsible for care of the patient). In some instances, a practitioner may order a beneficiary to be admitted as an inp atient, but upon reviewing the case, the hospitals utilization review (UR) committee determines that an inpatient level of care is not medically necessary.   Taking this into consideration, CMS obtained a condition code from the National Uniform Billing Committee (NUBC), effective April 1, 2004, that specifies:   Condition Code 44--Inpatient admission changed to outpatient  For use on outpatient claims only, when the physician ordered inpatient services, but upon internal utilization review performed before the claim was originally submitted, the hospital determin ed that the services did not meet its inpatient criteria.   The utilization review requirements for hospitals and CAH are found in their respective CoPs at 482.30 or 485.641. The hospital must ensure that all the UR activities, including the review of medical necessity of hospital admissions and continued stays required by 482.30(d), are fulfilled as described in the regulation.  Section 482.30(d) delineates requirements that hospitals must follow when making the determination as to whether an admission or discharge of a patient is or was medically necessary.  Re view of admissions may be performed before, at, or after hospital admission. More information about the hospital CoP may be found in Pub.100- 07, State Operations Manual, Appendix A - Survey Protocol, Regulations and Interpretive Guidelines for Hospitals.  Section 485.641 requires CAHs to have a similar program for the evaluation of all services they furnish, including the quality and appropriateness of diagnoses and treatments furnished by their staff physician and non- physician practitioners.  If in additi on to making a medical necessity determination (or evaluating the appropriateness of diagnosis and treatment in a CAH) a hospital or CAH wishes to change a patients status from inpatient to outpatient, the following requirements apply.  CMS set the policy for the use of Condition Code 44 to address those relatively infrequent occasions, such as a late -night weekend admission when no case manager is on duty to offer guidance, when internal review subsequently determines that an inpatient admission does not meet hospital criteria and that the patient would have been registered as an outpatient under ordinary circumstances. The State Operations Manual states that in no case may a non -physician make a final determination that a patients stay is not medically necessary or appropriate (see Appendix A -  Survey Protocol, Regulations and Interpretive Guidelines for Hospitals). However, CMS encourages and expects hospitals to employ case management staff to facilitate the application of hospital admission protocols and criteria, to facilitate communication between practitioners and the UR committee or Quality Improvement Organization (QIO), and to assist the UR committee in the decision- making process. Use of Condition Code 44 is not intended to serve as a substitute for adequate staffing of utilization management personnel or for continued education of physicians and hospital staff about each hospitals existing policies and admission protocols. As education and staffing efforts continue to progress, the need for hospitals to correct inappropriate admissions and to report Condition Code 44 should become increasingly rare.   50.3.2 - Policy and Billing Instructions for Condition Code 44  (Rev. 3086, Issued: 10- 03-14, Effective:  ICD -10: Upon Implementation of ICD -10, ASC X12: January 1, 2012, Implementation  ICD- 10: Upon Implementation of ICD -10; ASC X12: November 4, 2014)   In cases where a hospital or a CAHs UR committee determines that an inpatient admission does not meet the hospitals inpatient criteria, the hospital or CAH may change the beneficiarys status from inpatient to outpatient and submit an outpatient claim (b ill type 13x or 85x) for medically necessary Medicare Part B services that were furnished to the beneficiary, provided all of the following conditions are met:   1. The change in patient status from inpatient to outpatient is made prior to discharge or release, while the beneficiary is still a patient of the hospital;  2. The hospital has not submitted a claim to Medicare for the inpatient admission;   3. The practitioner responsible for the care of the patient and the UR committee concur with the decision; and   4. The concurrence of the practitioner responsible for the care of the patient and the UR committee is documented in the patients medical record.   While typically the full UR committee makes the decision for the committee that a change in patient status under Condition Code 44 is warranted, in accordance with 482.30(d)(1) one physician member of the UR committee may make the decision for the committee, provided he or she is a different person from the concurring practitioner who is responsible for the care of the patient.   When the hospital has determined that it may submit an outpatient claim according to the conditions described above, the entire episode of care should be billed as an outpatient episode of care on a 13x or 85x bill type and outpatient services that were or dered and furnished should be billed as appropriate.   Refer to Pub. 100- 04, Medicare Claims Processing Manual; Chapter 30, Financial Liability Protections; Section 20, Limitation On Liability (LOL) Under 1879 Where Medicare Claims Are Disallowed, for information regarding financial liability protections.  When the hospital submits a 13x or 85x bill for services furnished to a beneficiary whose status was changed from inpatient to outpatient, the hospital is required to report Condition Code 44 on the outpatient claim in one of Form Locators 24- 30, or in the  ASC X12 837 institutional claim format in Loop 2300, HI segment, with qualifier BG, on the outpatient claim. Additional information may be found in Chapter 25 of this manual, (Completing and Processing the Form CMS -1450 Data Set). Condition Code 44 is use d by CMS and QIOs to track and monitor these occurrences. The reporting of Condition Code 44 on a claim does not affect the amount of hospital outpatient payment that would otherwise be made for a hospital outpatient claim that did not require the reporting Condition Code 44.   One of the requirements for the use of Condition Code 44 is concurrence by the practitioner who is responsible for the care of the patient with the determination that an inpatient admission does not meet the hospitals admission criteria and that the patie nt should have been registered as an outpatient. This prerequisite for use of Condition Code 44 is consistent with the requirements in the CoP in 482.30 (d) of the regulations. This paragraph provides that the practitioner or practitioners responsible for  the care of the patient must be consulted and allowed to present their views before the UR committee or QIO makes its determination that an admission is not medically necessary. It may also be appropriate to include the practitioner who admitted the patie nt if this is a different person than the practitioner responsible for the care of the patient.