(Medicare Claims Processing Manual)

OC A3: 1/25/03  OSC 70: 1/13/03 -  1/25/03  Reimbursement: Full DRG payment   5b.  Date of service: 1/1/03 -  1/31/03  Medically necessary days: 30   Covered charges: $55,000  Benefits available: 60 LTR   Covered days: 30   Noncovered days: 0   Coinsurance days used: 0  LTR days used: 30  Cost report days: 30  Reimbursement: Full DRG payment plus cost outlier based on $55,000 covered charges   5c.  Date of service: 1/1/03 -  1/31/03  Medically necessary days: 30   Covered charges: $53,000  Benefits available: 28 LTR   Covered days: 28   Noncovered days: 2   Coinsurance days used: 0  LTR days used: 28  Cost report days: 28  OC 47: 1/26/03   OC A3: 1/28/03  Reimbursement: Full DRG payment plus cost outlier based on $53,000 covered charges   150.18 - Provider Interim Payment (PIP)  (Rev. 1, 10- 01-03)  PIP applies to LTCH PPS.  Outlier payments in regards to PIP are handled the way they currently are under other inpatient PPS systems.  150.19 - Interim Billing  (Rev. 1231; Issued:  04- 27-07; Effective:  12 -03-07; Implementation:  12 -03-07)  Interim bills are allowed every 60 days.  Refer to Chapter 1, section 50.2 for specifics on interim billing under PPS.   Effective December 3, 2007, LTCHs are allowed to submit no- pay bills (TOB 110) once benefits exhaust, every 60 days.  They do not have to continually adjust bills until physical discharge or death once benefits exhaust.  The last bill shall contain a dis charge patient status code.   150.20  Intermediary Benefit Payment Report (IBPR)  (Rev. 1, 10- 01-03)  The IBPR report changes to reflect the payments for LTCHs going to PPS free -standing hospitals.  150.21 - Remittance Advices (RAs)  (Rev. 1, 10- 01-03)  Reason and remark codes already in existence for inpatient hospital PPS apply under this PPS.   150.22 - Medicare Summary Notices (MSNs)  (Rev. 1, 10- 01-03)  Use existing notices for inpatient hospital PPS for LTCH PPS.   150.23 - LTCH Pricer Software  (Rev. 1, 10- 01-03)  The CMS developed a LTCH Pricer program that calculates the Medicare payment rate.   Pricer software is electronically supplied to the Shared systems.  Pricer pays a short -stay outlier if the stay is between 1 day and up to and including 5/6 of the average length of stay for the LTC -DRG.    Pricer incorporates the five- year phase -in period for those providers that choose to be paid on the blended rate.   150.23.1 - Inputs/Outputs to Pricer  (Rev. 1231; Issued:  04- 27-07; Effective:  12- 03-07; Implementation:  12 -03-07)  Inputs    Provider Specific File Data; Fields -1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 12, 13, 14, 18, 19, 21, 22, and 25 (although this field refers to the operating cost/charge ratio, for LTCH, entered here will be a combined operating and capital cost/charge ratio).  Effec tive July 1, 2005, A/B MACs (A) shall no longer populate fields 12, 13, or 14.  Field 35 must be populated for all LTCHs.  Fields 33 and 38 shall be populated if applicable.  Effective July 1, 2006, data elements 23, 24, 27, 28, and 49 are required.  See t he section "Determining the Cost -to-Charge Ratio" below for determining the cost/charge ratio.   The facility -specific rate (Field 21) will be determined using the same methodology that would be used to determine the interim payment per discharge under the TEFRA system if the LTCH PPS were not being implemented.    Bill Data   o Provider #  o Patient Status   o Covered Charges   o Discharge Date (or benefits exhaust date if present (Occurrence Code A3, B3, or C3))   o Length of Stay (LOS)   o Covered Days   o Lifetime Reserve Days (LTR)   o DRG (from Grouper)   Outputs    PPS Return Code    MSA/CBSA (CBSAs will be returned for discharges on or after July 1, 2005).   Wage Index    Average LOS    Relative Weight    Final Payment Amount    DRG Adjusted Payment Amount    Federal Payment Amount    Outlier Payment Amount    Payment Amount    Facility Costs    LOS    Regular Days Used    LTR Days Used    Blend Year, 1 -5   Outlier Threshold    DRG   COLA   Calculation Version Code    National Labor Percent    National Non- Labor Percent    Standard Federal Rate    Budget Neutral Rate    New Facility -specific Rate  150.24 - Determining the Cost -to-Charge Ratio (Rev. 4390, Issued: 09- 06-19, Effective: 10 -01-19, Implementation: 10- 07-19)  For all LTCHs, effective October 1, 2003, Medicare contractors are to use a CCR from the latest final settled cost report or from the latest tentative settled cost report (whichever is from the later period) to determine a LTCHs CCR.   A. - Calculating an overall LTCH Medicare Cost -to-Charge Ratio   For the LTCH PPS outlier calculations (short stay and high cost), Medicares portion of hospital costs are determined by using a hospitals overall Medicare cost -to-charge ratio  (CCR).  At the end of the cost reporting period, the hospital prepares and submits a cost report to its Medicare contractor, which includes Medicare allowable costs and charges.  The Medicare contractor completes a preliminary review of the as -submitted co st report and issues a tentative settlement.  The cost report is later final s ettled, which may be based on a subsequent review, and a Notice of Program Reimbursement (NPR) is issued.  The Medicare contractor shall update the PSF using the CCR calculated from the final settled cost report or from the latest tentative settled cost report (whichever is from the later period).   Under the LTCH PPS, the following methodology shall be used to calculate a hospitals overall Medicare cost -to-charge ratio:   1) Identify total Medicare inpatient costs from Worksheet D -1, Part II, line 49 minus (Worksheet D, Part III, col. 8, lines 25 through 30 plus Worksheet D, Part IV, col. 7, line 101)   2) Identify total Medicare inpatient charges obtained from Worksheet D -4, Column 2, lines 25 through 30 plus line 103 from the cost report (where possible, these charges should be confirmed with the PS&R data).  3) Determine the LTCHs overall Medicare CCR by dividing the amount in step 1 by the amount in step 2.   B. - Use of Alternative Data in Determining  CCRs For LTCHs   Effective August 8, 2003, the CMS Central Office may direct Medicare contractors to use an alternative CCR if CMS believes this will result in a more accurate CCR.  Also, if the Medicare contractor finds evidence that indicates that using data from the lat est settled or tentatively settled cost report would not result in the most accurate CCR, then the Medicare contractor shall notify the CMS Regional Office and CMS Central Office to seek approval to use a CCR based on alternative data.  For example, a CCR may be revised more often if a change in a LTCHs operations occurs which materially affects a LTCHs costs and/or charges. The CMS Regional Office, in conjunction with the CMS Central Office, must approve the Medicare contractors request before the Medicare contractor may use a CCR based on alternative data.  Revised CCRs will be applied prospectively to all LTCH claims processed after the update.  Medicare contractors shall send notification to the CMS Central Office via email to outliersIPPS@cms.gov.  C. - Ongoing CCR Updates Using  CCRs From Tentative Settlements For Hospitals Subject to the LTCH PPS   Medicare contractors shall continue to update a LTCHs CCR (in the Provider Specific File) each time a more recent cost report is settled (either final or tentative). A revised CCR shall be entered into the Provider Specific File not later than 30 days after the date of the latest settlement used in calculating the CCR.   D. - Request for use of a Different CCR by CMS, the Medicare Contractor or the LTCH   Effective August 8, 2003, CMS (or the Medicare contractor) may specify an alternative CCR if it believes that the CCR being applied is inaccurate.  In addition, a LTCH will have the opportunity to request that a different CCR be applied in the event it bel ieves the CCR being applied is inaccurate.  The LTCH is required to present substantial evidence supporting its request. Such evidence should include documentation regarding its costs and charges that demonstrate its claim that an alternative ratio is more  accurate.  After the Medicare contractor has evaluated the evidence presented by the LTCH, the Medicare contractor notifies the CMS Regional Office and CMS Central Office of any such request.  The CMS Regional Office, in conjunction with the CMS Central Office, will approve or deny any request by the LTCH or Medicare contractor for use of a different CCR. Medicare contractors shall send requests via email to the CMS Central at outliersIPPS@cms.hhs.gov.   E. - Notification to Hospitals Under the LTCH PPS of a Change in the CCR   The Medicare contractor shall notify a LTCH whenever it makes a change to its CCR.  When a CCR is changed as a result of a tentative settlement or a final settlement, the change to the CCR can be included in the notice that is issued to each provider after a tentative or final settlement is completed.  Medicare contractors can also issue separate notification to a LTCH about a change to their CCR.  F. - Mergers, Conversions and Errors with CCRs   Effective April 1, 2011, for LTCHs that merge, Medicare contractors shall continue to use the CCR from the LTCH with the surviving provider number.  If a new provider number is issued, as explained in 150.25 below, Medicare contractors should use the Stat ewide average CCR because a new provider number indicates the creation of a new hospital (as stated in 42 CFR  412.525(a)(4)(iv)(C)(1) and 412.529(c)(3)(iv)(C)(1), a new hospital is defined as an entity that has not accepted assignment of an existing hospitals provider agreement).  However, the policy of 150.24 part B and C can be applied to determine an alternative to the Statewide average CCR.   For newly classified LTCHs, that is those hospitals (e.g., short term acute, psychiatric, or rehabilitation hospitals) that meet the requirements set forth in 42 CFR 412.23(e), or LTCHs that receive a new LTCH provider number, the Statewide average CCR sho uld be used until a CCR can be computed from the LTCHs cost report data, as described in part A of this section. However, as noted in part C above, the Medicare contractor or the LTCH may request use of a different CCR, such as a CCR based on the cost and charge data from the hospitals cost report immediately preceding its classification as a LTCH or receiving a new LTCH provider number. The Medicare contractor must verify the cost and charge data from that cost report. Use of the alternative CCR is subject to the approval of the CMS Central and Regional Offices. NOTE: A newly classified LTCH must request an alternative CCR and receive approval from the CMS Central Office prior to the effective date of the hospitals classification as a LTCH  in order for that alternative CCR to be effective beginning on the date of classification (as a LTCH).  If the request and approval for an alternative CCR occurs after the effective date of the LTCH classification, then the use of the alternative CCR will be effective prospectively beginning with the date of the approval of the alternative CCR request.