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)/Veterans
Health Administration (VHA) 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.
3.6.3.5 To
hospice care. Claims should be coded 50 or 51 in FL 17 effective
October 1, 2018.
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.