3.0 POLICY
3.1 Hospital
Billing
Under the TRICARE DRG-based payment
system, hospitals are required to submit claims in accordance with
32 CFR 199.7(b). The contractor shall assign
the appropriate DRG to the claim based on the information contained
on the claim.
3.1.1 Hospital participation. As noted previously,
all hospitals which participate in Medicare are required to participate
on all inpatient claims.
3.1.2 Late charges. Any late charges
received by the contractor for a claim which has been processed
under the TRICARE DRG-based payment system shall be processed as
an adjustment. Generally, late charges will not result in any additional
payment, but they could affect payment by changing the DRG assigned
to the claim or by causing the claim to qualify as an outlier, or
they could affect the amount of the beneficiary’s cost-share.
3.1.3 Beneficiary-submitted
claims. If a beneficiary submits a claim which is determined to
be subject to the TRICARE DRG-based payment system (or for services
from an exempt hospital which is Medicare-participating), whether
for inpatient services or for related professional services rendered
by a hospital-based professional, the claim is to be returned (uncontrolled)
with the notation that all inpatient hospital claims must be submitted
by the provider.
3.2 Payment On A Per Discharge
Basis
Under the TRICARE DRG-based payment
system, hospitals are paid a predetermined amount per discharge
for inpatient hospital services furnished to TRICARE beneficiaries.
3.3 Pricing of
Claims
3.3.1 All
final claims with discharge dates of September 30, 2014, or earlier
that are reimbursed under the TRICARE DRG-based payment system are
to be priced using the rules, weights and rates in effect as of
the date of admission, regardless of when the claim is submitted.
All final claims with discharge dates of October 1, 2014, or later
that are reimbursed under the TRICARE DRG-based payment system are
to be priced using the rules, weights and rates in effect as of
the date of discharge. Interim claims with end date of care on or
after October 1, 2014, shall be priced using the rules, weights and
rates in effect as of the end date of care. (See the TRICARE Systems
Manual (TSM),
Chapter 2, Section 5.2.)
3.3.2 Contractors
shall maintain at least three years’ weights and rates, including
Indirect Medical Education (IDME) adjustment factors, wage indexes,
etc., in the contractor’s on-line system. If the claim filing deadline
has been waived and the date of discharge is more than three years
before the reprocessing date, the affected claim or adjustment is
to be priced using the earliest DRG weights and rates on the contractor’s
system.
3.4
Payment
In Full
The DRG-based amount paid for inpatient
hospital services is the total TRICARE payment for the inpatient
operating costs (as described in this section) incurred in furnishing
services covered by the TRICARE. The full prospective payment amount
is payable for each stay during which there is at least one covered
day of care, except as provided in
Section 8 for
short-stay outliers. Thus, certain items related or incidental to
the treatment of the patient, but which might not otherwise be covered,
are included in the DRG-based payment. For example, patient education
services such as nutrition counseling are not covered by TRICARE,
but if they are provided incidental to covered services, they are to
be considered included in the DRG-based payment. The hospital cannot
bill the beneficiary for the services, since they are included in
the overall treatment regimen for the admission. At the same time, the
contractor is not to reduce the DRG-based payment simply because
some non-covered services were rendered.
3.4.1 Services received from another
hospital. In those cases in which the hospital obtains certain services
from another hospital (e.g., computerized tomography services) no
additional payment is to be made to either hospital for the technical
component of the services. The technical component is to be considered
part of the DRG-based payment, and it is the discharging hospital’s
responsibility to make suitable payment arrangements with the other
hospital providing services. Of course, the professional component
of such services can be billed separately by the second hospital.
3.4.2 Interim
bills for unusually long Lengths-Of-Stay (LOS). Because the DRG-based
payment is the full payment for the claim, in most cases interim
bills will not be accepted. If an interim bill is submitted for
services subject to the TRICARE DRG-based payment system, it is
to be denied. The only exception to this is for certain qualifying
outlier cases.
3.4.2.1 In order to qualify for interim payments the
following conditions must be met:
• The patient has been
in the hospital at least 60 days.
• Multiple claims
for single individuals must be submitted in chronological order.
If a condition is not met, e.g., the claim
is received out of chronological order, the claim is to be denied.
3.4.2.2 A hospital
may request additional interim payments at intervals of at least
60 days after the date of the first interim bill.
3.4.2.3 Contractors
shall process the initial claim as a complete claim and each subsequent
claim as an adjustment. However, the interim claims are only a method
of facilitating cash flow to providers, and the final bill is still
the final accounting on the hospital stay. Therefore, upon receipt
of the final bill, the contractor shall review the entire claim
to ensure that it has been correctly paid and shall ensure that
the cost-share has been correctly determined. See the TSM,
Chapter 2, Section 1.1, paragraph 7.0 for
TRICARE Encounter Data (TED) record submission requirements for
interim hospital billings.
3.5 Inpatient Operating Costs
The TRICARE DRG-based payment system provides
a payment amount for inpatient operating costs, including:
3.5.1 Operating
costs for routine services, such as the costs of room, board, therapy
services (physical, speech, etc.), and routine nursing services
as well as supplies (e.g., pacemakers) necessary for the treatment
of the patient;
3.5.2 Operating costs for ancillary
services, such as radiology and laboratory services furnished to
hospital inpatients (the professional component of these services
is not included and can be billed separately);
3.5.3 Take-home
drugs for less than $40;
3.5.4 Special care unit operating
costs (intensive care type unit services); and
3.5.5 Malpractice
insurance costs related to services furnished to inpatients.
3.6
Discharges
And Transfers
3.6.1
Discharges
Subject to the provisions of
paragraphs 3.6.2 and
3.6.3,
a hospital inpatient is considered discharged from a hospital paid
under the TRICARE DRG-based payment system when:
3.6.1.1 The patient
is formally released from the hospital; or
3.6.1.2 The patient
dies in the hospital.
3.6.1.3 The patient
is transferred to a hospital or unit that is excluded from the TRICARE
DRG-based payment system under the provisions of
Section 4. Such
cases can be identified by Form Locator (FL) 17 on the Centers for
Medicare and Medicaid Services (CMS) 1450 UB-04 claim form and shall
be processed as a transfer, if the claim contains one of the qualifying
DRGs listed in
paragraph 3.6.4, and the patient is transferred
to one of the settings outlined in
paragraph 3.6.3.
3.6.2
Acute
Care Transfers
A discharge of a hospital
inpatient is considered to be a transfer for purposes of payment under
this subsection if the patient is readmitted the same day (unless
the readmission is unrelated to the initial discharge) to another
hospital that is:
3.6.2.1 Paid under
the TRICARE DRG-based payment system (such instances will result
in two or more claims); or
3.6.2.2 Excluded
from being paid under the TRICARE DRG-based payment system because
of participation in a statewide cost control program which is exempt
from the TRICARE DRG-based payment system under
Section 4 (such
instances will result in two or more claims); or
3.6.2.3 Authorized
as a Designated Provider (DP) [formerly Uniformed Services Treatment
Facilities (USTFs)] or a Department of Veterans Affairs (DVA) hospital.
3.6.3
Post-Acute
Care Transfers
A discharge of a hospital
inpatient is considered to be a transfer for purposes of this subsection
when the patient’s discharge is assigned to one of the qualifying
DRGs listed in
paragraph 3.6.4, and the discharge is made
under any of the following circumstances:
3.6.3.1 To a hospital
or distinct part hospital unit excluded from the TRICARE DRG-based
payment system as described in
Section 4. Claims
shall be coded 05, 62, 63, 85, 90, or 91 in FL 17 on the CMS 1450 UB-04
claim form. Effective April 1, 2004, claims shall be coded 65 or
93 in FL 17 for psychiatric hospitals and units.
3.6.3.2 To a Skilled
Nursing Facility (SNF). Claims shall be coded 03 or 83 in FL 17
on the CMS 1450 UB-04 claim form.
3.6.3.3 To home
under a written Plan Of Care (POC) for the provision of home health
services from a home health agency and those services begin within
three days after the date of discharge. Claims shall be coded 06
or 86 in FL 17 on the CMS 1450 UB-04 claim form. Claims coded 06
or 86 with a condition code of 42 or 43 in FL 18 shall be processed
as a discharge instead of a transfer.
3.6.3.4 Excluded
from being paid under the TRICARE DRG-based payment system as a
Critical Access Hospital (CAH) effective December 1, 2009.
3.6.4
Qualifying
DRGs
The qualifying DRGs, for purposes of
paragraph 3.6.3,
are listed on either the TRICARE DRG web site at
http://www.health.mil/rates or
listed in the applicable addendum for the respective fiscal year.
Addendum C reflects the current fiscal year and the two most recent
fiscal years.
3.6.6 Payment For
Transfers
3.6.6.1 General Rule. Except as provided in
paragraphs 3.6.6.2 and a hospital that transfers
an inpatient under circumstances described in
paragraphs 3.6.2 or
3.6.3,
is paid a graduated per diem rate for each day of the patient’s
stay in that hospital, not to exceed the TRICARE DRG-based payment amount
that would have been paid if the patient had been discharged to
another setting. The per diem rate is determined by dividing the
appropriate DRG rate by the geometric mean LOS for the specific DRG
to which the case is assigned. Payment is graduated by paying twice
the per diem amount for the first day of the stay, and the per diem
amount for each subsequent day, up to the full DRG amount. For neonatal
claims, other than normal newborns, payment is graduated by paying
twice the per diem amount for the first day of the stay, and 125%
of the per diem rate for each subsequent day, up to the full DRG
amount.
3.6.6.2 Special
rule for DRGs meeting specific criteria. A hospital that transfers
an inpatient under the circumstances described in
paragraph 3.6.3 and the transfer
is assigned to a DRG subject to the special rule for transfers as
listed in Addendum C with a “Yes” in the POST ACUTE column and a
“Yes” in the SPEC PAY column, shall be paid under the provisions
of
paragraphs 3.6.6.2.1 and
3.6.6.2.2. Addendum
C reflects the current fiscal year and the two most recent fiscal
years.
3.6.6.2.1 Fifty
percent (50%) of the DRG-based payment amount plus one-half of the
per diem payment for the DRG for day one (one-half the usual transfer
payment of double the per diem for day one).
3.6.6.2.2 Fifty
percent (50%) of the per diem for each subsequent day up to the
full DRG payment.
3.6.6.3 Outliers.
• A
transferring hospital may qualify for an additional payment for
extraordinary cases that meet the criteria for cost outliers as
described in
Section 8, paragraph 3.2.6.1. When calculating
the cost outlier payment, if the LOS exceeds the geometric mean
LOS, the cost outlier threshold shall be limited to the DRG-based
payment plus the fixed loss amount. The contractor shall readjudicate
claims affected by this change if brought to their attention by
any source.
• Refer
to
http://www.health.mil/rates for
payment details associated with outliers.
3.6.6.4 Transfer
assigned to DRG 601. If a transfer is classified into DRG 601 (Neonate,
transferred < 5 days old), the transferring hospital is paid
in full. DRGs for these descriptions can be found at
http://www.health.mil/rates.
3.7 Leave Of
Absence Days
3.7.1 General. Normally, a patient will leave a hospital
which is subject to the DRG-based payment system only as a result
of a discharge or a transfer. However, there are some circumstances where
a patient is admitted for care, and for some reason is sent home
temporarily before that care is completed. Hospitals may place patients
on a leave of absence when readmission is expected and the patient
does not require a hospital level of care during the interim period.
Examples of such situations include, but are not limited to:
• Situations
where surgery could not be scheduled immediately;
• A specific surgical
team was not available;
• Bilateral surgery
was planned;
• Further
treatment is indicated following diagnostic tests but cannot begin immediately;
• A change in the patient’s
condition requires that scheduled surgery be delayed for a short
time; or
• Test
results to confirm the need for surgery are delayed.
3.7.2 Billing
for leave of absence days. In billing for inpatient stays which
include a leave of absence, hospitals are to use the actual admission
and discharge dates and are to identify all leave of absence days
by using revenue code 18X for such days. Contractors shall disallow
all leave of absence days. A leave of absence will
be counted as a covered inpatient day (i.e., not disallowed as a
leave of absence day) if the patient returns to the facility by
midnight of the same day. Neither the Program nor the
beneficiary may be billed for days of leave.
3.7.3 DRG-based
payments for stays including leave of absence days. Placing a patient
on a leave of absence will not result in two DRG-based payments,
nor can any payment be made for leave of absence days. Only one
claim is to be submitted when the patient is formally discharged
(as opposed to being placed on leave of absence), and only one DRG-based
payment is to be made. The contractor shall ensure that the leave
of absence does not result in long-stay outlier days being paid
and that it does not increase the beneficiary’s cost-share.
3.7.4 Services
received while on leave of absence. The technical component of laboratory
tests obtained while on a leave of absence is included in the DRG-based
payment to the hospital. The professional component shall be cost-shared
as inpatient. Tests performed in a physician’s office or independent
laboratory are also included in the DRG-based payment.
3.7.5 Patient
dies while on leave of absence. If patient should die while on leave
of absence, the date the patient left the hospital shall be treated
as the date of discharge.
3.8 Area Wage Indexes
The labor-related portion of the ASA will be
adjusted to account for the differences in wages among geographic
areas and will correspond to the labor market areas used in the
Medicare PPS, and the actual indexes used will be those used in
the Medicare PPS. The wage index used is to be the one for the hospital’s
actual address--not for the hospital’s billing address.
3.9 Redesignation
Of Certain Hospitals To Other Wage Index Areas
The
TRICARE Program follows this statutory requirement for the Medicare
Prospective Payment System (PPS), and the CMS determines the areas
affected and wage indexes used.
3.9.1 A
hospital located in a rural county adjacent to one or more urban
areas shall be treated as being located in the urban area to which
the greatest number of workers commute. The area wage index for
the urban area shall be used for the rural county.
3.9.2 In
order to correct inequities resulting from application of the rules
in
paragraph 3.9.1, CMS modified the rules for
those rural hospitals deemed to be urban. The TRICARE Program has
also adopted these changes. Some of these hospitals continue to
use the urban area wage index, others use a wage index computed
specifically for the rural county, and others use the statewide
rural wage index.
3.9.3 Public Law 101-239 created
the Medicare Geographic Classification Review Board (MGCRB) to reclassify
individual hospitals to different wage index areas based on requests
from the hospitals. These reclassifications are intended to eliminate
the continuing inequities caused by the reclassification actions
described in
paragraphs 3.9.1 and
3.9.2. The TRICARE
Program has adopted these hospital-specific reclassifications.
3.9.4 The wage
index for an urban hospital may not be lower than the statewide
area rural wage index.