3.2.1 Capital Costs
TRICARE
will reimburse hospitals for their capital costs as reported annually
to the contractor (see below). Payment for capital costs will be
made annually. See
Chapter 3, Section 2 for
the procedures for paying capital costs.
3.2.1.1 TRICARE will reimburse 100%
of capital-related costs.
3.2.1.2 Allowable capital costs are
those specified in Medicare Regulation Section 413.130 of Title 42
Code of Federal Regulations (CFR).
3.2.1.3 To
obtain the total allowable capital costs from the Medicare cost
reports for initial and amended requests, the contractor shall add
the figures from Worksheet D, Part I, Column 3, lines 30-33, lines
34 and 35 if the cost report reflects intensive care unit costs,
and line 43, to the figures from Worksheet D, Part II, Column 1,
lines 50-76 and 88-93.
3.2.1.4 Services, facilities, or supplies
provided by supplying organizations. If services, facilities, or supplies
are provided to the hospital by a supplying organization related
to the hospital within the meaning of Medicare Regulation Section
413.17, then the hospital must include in its capital-related costs,
the capital-related costs of the supplying organization. However,
if the supplying organization is not related to the provider within
the meaning of 413.17, no part of the charge to the provider may
be considered a capital-related cost unless the services, facilities,
or supplies are capital-related in nature and:
3.2.1.4.1 The capital-related equipment
is leased or rented by the provider;
3.2.1.4.2 The capital-related equipment
is located on the provider’s premises; and
3.2.1.4.3 The capital-related portion
of the charge is separately specified in the charge to the provider.
3.2.2 Direct Medical Education Costs
TRICARE
will reimburse hospitals their actual direct medical education costs
as reported annually to the contractor (see below). Such direct
medical education costs must be for a teaching program approved
under Medicare Regulation Section 413.85. Payment for direct medical
education costs will be made annually and will be calculated using
the same steps required for calculating capital payments below.
Allowable direct medical education costs are those specified in
Medicare Regulation Section 413.85. See
Chapter 3, Section 2 for
the procedures for paying direct medical education costs.
3.2.2.1 Direct medical education costs
generally include:
3.2.2.1.1 Formally organized or planned
programs of study usually engaged in by providers in order to enhance
the quality of care in an institution.
3.2.2.1.2 Nursing schools.
3.2.2.1.3 Medical education of paraprofessionals
(e.g., radiological technicians).
3.2.2.2 Direct medical education costs
do not include:
3.2.2.2.1 On-the-job training or other
activities which do not involve the actual operation or support,
except through tuition or similar payments, of an approved education
program.
3.2.2.2.2 Patient education or general
health awareness programs offered as a service to the community
at large.
3.2.2.3 To obtain the total allowable
direct medical education costs from the Medicare cost reports on
all initial and amended requests the contractor shall add the figures
from Worksheet B, Part I, Columns 20-23, lines 30-33, lines 34 and
35 if the cost report reflects intensive care unit costs, 43; and 50-76;
and 88-93.
3.2.3 Determining
Amount Of Capital And Direct Medical Education (CAP/DME) Payment
In
order to account for payments by Other Health Insurance (OHI), TRICARE’
payment amounts for CAP/DME will be determined according to the
following steps. Throughout these calculations claims on which TRICARE
made no payment because OHI paid the full TRICARE-allowable amount
are not to be counted.
Step 1: Determine
the ratio of TRICARE inpatient days to total inpatient days using
the data described below. In determining total TRICARE inpatient
days the following are not to be included:
• Any days
determined to be not medically necessary, and
• Days included
on claims for which TRICARE made no payment because OHI paid the
full TRICARE-allowable amount.
Step 2: Multiply
the ratio from Step
1 by total allowable
capital costs.
Step 3: Reduce
the amount from Step
2 by the appropriate
capital reduction percentage(s). This is the total allowable TRICARE
capital payment for DRG discharges.
Step 4: Multiply
the ratio from Step
1 by total allowable
direct medical education costs. This is the total allowable TRICARE
direct medical education payment for DRG discharges.
Step 5: Combine the amounts from Steps
3 and
4.
This is the amount of TRICARE payment due the hospital for CAP/DME.
3.2.4 Payment Of CAP/DME Costs
3.2.4.1 General
All hospitals subject to the
TRICARE DRG-based payment system, except for children’s hospitals
(see below), may be reimbursed for allowed CAP/DME costs by submitting
a request and the applicable pages from the Medicare cost-report
to the TRICARE contractor.
3.2.4.1.1 Initial requests for payment
of CAP/DME shall be filed with the TRICARE contractor on or before
the last day of the 12th month following the close of the hospitals’
cost-reporting period. The request shall cover the one year period
corresponding to the hospital’s Medicare cost-reporting period. Thus,
for cost-reporting periods, requests for payment of CAP/DME must
be filed no later than 12 months following the close of the cost-reporting
period. For example, if a hospital’s cost-reporting period ends
on June 30, 2016, the request for payment shall be filed on or before
June 30, 2017. Those hospitals that are not Medicare participating
providers are to use an October 1 through September 30 fiscal year
for reporting CAP/DME costs.
3.2.4.1.1.1 An extension of the due date
for filing the initial request may only be granted if an extension
has been granted by the Centers for Medicare and Medicaid Services
(CMS) due to a provider’s operations being significantly adversely
affected due to extraordinary circumstances over which the provider
has no control, such as flood or fire, as described in Section 413.24
of Title 42 CFR.
3.2.4.1.1.2 All costs reported to the TRICARE
contractor must correspond to the costs reported on the hospital’s
Medicare cost report. If the costs change as a result of a subsequent
Medicare desk review, audit or appeal, the revised costs along with
the applicable pages from the amended Medicare cost report shall
be provided to the TRICARE contractor within 30 days of the date
the hospital is notified of the change. The request must be signed
by the hospital official responsible for verifying the amounts.
The Medicare Notice of Program Reimbursement (NPR) letter should
be submitted with the amended cost report.
3.2.4.1.1.3 The 30 day period is a means
of encouraging hospitals to report changes in its CAP/DME costs
in a timely manner. If the contractor receives an amended request
beyond the 30 days, it shall process the adjustment and inform the
provider of the importance of submitting timely amendments.
3.2.4.1.1.4 The hospital official is certifying
in the initial submission of the cost report that any changes resulting
from a subsequent Medicare audit will be promptly reported. Failure
to promptly report the changes resulting from a Medicare audit is
considered a misrepresentation of the cost report information. Such
a practice can be considered fraudulent, which may result in criminal
civil penalties or administrative sanctions of suspension or exclusion
as an authorized provider.
3.2.4.2 Information
Necessary For Payment Of CAP/DME Costs
The following information must
be reported to the contractor:
3.2.4.2.1 The hospital’s name.
3.2.4.2.2 The hospital’s address.
3.2.4.2.3 The hospital’s TRICARE provider
number.
3.2.4.2.4 The hospital’s Medicare provider
number.
3.2.4.2.5 The period covered--this must
correspond to the hospital’s Medicare cost-reporting period.
3.2.4.2.6 Total
inpatient days provided to all patients in units subject to DRG-based
payment.
3.2.4.2.7 Total
TRICARE inpatient days provided in units subject to DRG-based payment.
(This is to be only days which were “allowed” for payment. Therefore,
days which were determined to be not medically necessary are not
to be included.) Total inpatient days provided to active duty members
in units subject to DRG-based payment.
3.2.4.2.8 Total
allowable capital costs. This must correspond with the applicable
pages from the Medicare cost-report.
3.2.4.2.9 Total
allowable direct medical education costs. This must correspond with
the applicable pages from the Medicare cost-report.
3.2.4.2.10 Total
full-time equivalents for:
• Residents.
• Interns (see below).
3.2.4.2.11 Total inpatient beds (see below).
3.2.4.2.12 Title of official signing the
report.
3.2.4.2.13 Reporting date.
3.2.4.2.14 The report must contain a certification
statement that any changes to items in
paragraphs 3.2.4.2.6,
3.2.4.2.7,
3.2.4.2.8,
3.2.4.2.9,
and
3.2.4.2.10, which are a result of a review,
audit, or appeal of the provider’s Medicare cost-report, must be
reported to the contractor within 30 days of the date the hospital
is notified of the change.
3.2.4.2.15 All cost reports must be certified
by an officer or administrator of the provider. The general concept
is to notify the certifying official that misrepresentation or falsification
of any of the information in the cost report is punishable by fine
and/or imprisonment. The signing official must acknowledge this
as well as certify that the cost report filed, together with any
supporting documentation, is true, correct and complete based upon
the books and records of the provider.
3.2.4.3 Contractor Actions
3.2.4.3.1 Initial
requests for CAP/DME payment.
3.2.4.3.1.1 The contractor may, but is
not required, to provide inpatient day verification reports to hospitals
prior to an initial request being submitted.
3.2.4.3.1.2 The
contractor shall verify the number of TRICARE and active duty inpatient
days with its data. If the contractor’s data represents a greater
number of days than submitted on the hospital’s request, payment
shall be based on the contractor’s data. If the hospital’s request
represents a greater number of days than the contractor’s data,
the contractor shall notify the hospital of the discrepancy and
inform them payment will be based on the number of days it has on
file unless they can provide documentation substantiating the additional
days. The notification to the hospital must be made within 10 working
days of identification of the discrepancy and include the inpatient
day verification report.
3.2.4.3.1.3 The contractor shall wait until
the end of the following month to hear from the hospital. If the
hospital does not respond, the contractor shall make payment based
on its totals.
3.2.4.3.1.4 The contractor shall verify
the accuracy of the financial amounts listed for CAP/DME with the
applicable pages of the Medicare cost report. If the financial amounts
do not match, the contractor shall reimburse the hospital based
on the figures in the cost-report and notify the hospital of the
same.
3.2.4.3.1.5 The contractor must make the
CAP/DME payment to the hospital within 30 days of the initial request
unless notification has been sent to the hospital regarding a discrepancy
in the number of days as outlined in
paragraph 3.2.4.3.1.2.
3.2.4.3.2 Amended Requests for CAP/DME.
3.2.4.3.2.1 The contractor may, but is
not required, to provide inpatient day verification reports to hospitals
prior to an amended request being submitted.
3.2.4.3.2.2 The
contractor shall process amended payment requests based on changes
in the Medicare cost-report as a result of desk reviews, audits
and appeals. An adjustment shall not be processed unless there are
changes to items 6 through 10 on the initial CAP/DME reimbursement request.
The contractor shall not process amended requests for days only.
3.2.4.3.2.3 The contractor shall verify
the number of TRICARE and active duty inpatient days with its data.
If the contractor’s data represents a greater number of days than
submitted on the hospital’s request, payment shall be based on the
contractor’s data. If the hospital’s request represents a greater number
of days than the contractor’s data, the contractor shall notify
the hospital of the discrepancy and inform them payment will be
based on the number of days it has on file unless they can provide documentation
substantiating the additional days. The notification to the hospital
must be made within 10 working days of identification of the discrepancy
and include the inpatient day verification report.
3.2.4.3.2.4 The contractor shall wait until
the end of the following month to hear from the hospital. If the
hospital does not respond, the contractor shall make payment based
on its totals.
3.2.4.3.2.5 The contractor shall verify
the accuracy of the financial amounts listed for CAP/DME with the
applicable pages of the amended Medicare cost report. If the financial
amounts do not match, the contractor shall reimburse the hospital
based on the figures in the cost-report and notify the hospital
of the same.
3.2.4.3.2.6 The contractor shall make the
CAP/DME payment to the hospital within 30 days of the amended request
unless notification has been sent to the hospital regarding a discrepancy
in the number of days as outlined in
paragraph 3.2.4.3.2.2.
3.2.4.3.2.7 The contractor shall be responsible
for proactively researching the Medicare web site (
https://www.cms.gov/Research-Statistics-Data-and-Systems/Downloadable-Public-Use-Files/Cost-Reports/index.html)
to identify hospitals in their region that submitted amended Medicare
cost reports, obtaining copies of the amended cost reports from
hospitals that failed to submit them to the TRICARE contractor as
required, recalculating the CAP/DME costs based on the revised cost
report data, and initiating a collection action or notifying the
hospital if an underpayment was identified based on the results
of recalculation. The CMS post the Hospital Cost Report files 30
days after the end of each quarter.
3.2.4.3.2.8 The contractor shall complete
the “Annual Capital and Direct Medical Education Report” and submit
the information to the Contracting Officer (CO) and the Contracting
Officer’s Representative (COR). Details for reporting are identified
in DD Form 1423, Contract Data Requirements List (CDRL), located
in Section J of the applicable contract.
3.2.4.3.2.9 For a period of one year following
the report period, the “Quarterly Capital and Direct Medical Education
Over and Under Payment Report”, shall be updated on a calendar quarterly
basis to reflect collections that are received, or underpayments
refunded at the hospital’s request, after the end of the previous
calendar year report. The quarterly reports shall pertain only to
cases initiated in the calendar year being reported. Details for
reporting are identified in DD Form 1423, CDRL located in Section
J of the applicable contract.
3.2.4.4 Negotiated Rates. If a contract
between the prime contractor and a subcontractor or institutional
network provider does not specifically state the negotiated rate
including all costs that would otherwise be eligible for additional
payment, such as CAP/DME, the prime contractor shall reimburse these
costs to the subcontractors and institutional network providers
if a request for reimbursement is made.
3.2.4.5 CAP/DME costs for children’s
hospitals. Amounts for CAP/DME are included in both the hospital-specific
and the national children’s hospital differentials (see below).
The amounts are based on national average costs. No separate or
additional payment is allowed.
3.2.4.6 CAP/DME costs under TRICARE
for Life (TFL). TRICARE will make no payments for CAP/DME costs
for any claims on which Medicare makes payment. These costs are
included in the Medicare payment. TRICARE CAP/DME cost payments
will be made only on claims on which TRICARE is the primary payer
(e.g., claims for stays beyond 150 days), and in those cases payment
will be made following the procedures described above.
3.2.5 Children’s Hospital Differential
3.2.5.1 General
All DRG-based payments to children’s
hospitals are to be increased by adding the applicable children’s
hospital differential to the appropriate ASA prior to multiplying
by the DRG weight.
3.2.5.2 Qualifying
for the Children’s Hospital Differential
In order to qualify for a children’s
hospital differential adjustment, the hospital must be exempt from
the Medicare Prospective Payment System (PPS) as a children’s hospital.
If the hospital is not Medicare-participating, it must meet the
criteria in
32 CFR 199.6(b)(4)(i). In addition, more than
half of its inpatients must be individuals under the age of 18.
3.2.5.3
Calculation
of the Children’s Hospital Differentials
Differentials will be calculated
so that they are “revenue neutral” for children’s hospitals. When
calculating ASAs, DHA subtracts the appropriate ASA from the children’s
hospital ASAs, and these amounts are the children’s hospital differentials.
The differentials will not be subject to annual inflation updates
nor will they be recalculated except as provided below.
3.2.5.4 Differential Amounts
3.2.5.4.1 Calculation of the national
children’s hospital differentials. These differentials are calculated
using the procedures described in
paragraph 3.2.5.3, but based on a database
of only low-volume children’s hospitals.
3.2.5.4.2 Claims are reimbursed using
a single set of differentials which do not distinguish high-volume
and low-volume children’s hospitals. The differentials are:
|
|
Large Urban Areas
|
|
|
|
Labor portion
|
$1,945.99
|
|
|
|
Non-labor portion
|
+ 689.42
|
|
|
|
|
$2,635.41
|
3.2.6
Outliers
3.2.6.1
General
TRICARE
will adjust the DRG-based payment to a hospital for atypical cases.
These outliers are those cases that have either an unusually short
Length-Of-Stay (LOS) or involve extraordinarily high costs when
compared to most discharges classified in the same DRG. Recognition
of these outliers is particularly important, since the number of
TRICARE cases in many hospitals is relatively small, and there may
not be an opportunity to “average out” DRG-based payments over a
number of claims. Contractors will not be required to document or
verify the medical necessity of outliers prior to payment, since
outlier review will be part of the admission and quality review
system. However, in determining additional cost outlier payments
on all claims qualifying as a cost outlier, the contractor must
identify and reduce the billed charge for any non-covered items
such as comfort and convenience items (line N), as well as any duplicate
charges (line X) and services which can be separately billed (line 7)
such as professional fees, outpatient services, and solid organ
transplant acquisition costs. Comfort and convenience items are
defined as those optional items which the patient may elect at an
additional charge (i.e., television, guest trays, beautician services,
etc.), but are not medically necessary in the treatment of a patient’s
condition.
3.2.6.2 Provider
Reporting of Outliers
The provider
is to identify outliers on the CMS 1450 UB-04, Form Locator (FL)
24 - 30. Code 60 is to be used to report LOS outliers, and code
66 is to be used to signify that a cost outlier is not being requested.
If a claim qualifies as a cost outlier and code 66 is not entered
in the appropriate FL (i.e., it is blank or code 61), the contractor
is to accept this as a request for cost outlier payment by the hospital.
3.2.6.3 Short-Stay Outliers
The TRICARE DRG-based payment
system uses short-stay outliers and are reimbursed using a per diem
amount. All short-stay outliers must be identified by the contractor
when the claims are processed, and necessary adjustments to the
payment amounts must be made automatically.
• Any
discharge which has a LOS less than or equal to the greater of 1
or 1.94 standard deviations below the arithmetic mean LOS for that
DRG shall be classified as a short-stay outlier. In determining
the actual short-stay threshold, the calculation will be rounded
down to the nearest whole number, and any stay equal to or less
than the short-stay threshold will be considered a short-stay outlier.
• Short-stay
outliers will be reimbursed at 200% of the per diem rate for the
DRG for each covered day of the hospital stay, not to exceed the
DRG amount. The per diem rate shall equal the wage-adjusted DRG
amount divided by the arithmetic mean LOS for the DRG. The per diem
rate is to be calculated before the DRG-based amount is adjusted
for IDME. Cost outlier payments shall be paid on short stay outlier
cases that qualify as a cost outlier.
• Any
stay which qualifies as a short-stay outlier (a transfer cannot
qualify as a short-stay outlier), even if payment is limited to
the normal DRG amount, is to be considered and reported on the payment
records as a short-stay outlier. This will ensure that outlier data
is accurate and will prevent the beneficiary from paying an excessive
cost-share in certain circumstances.
3.2.6.4 Cost Outliers
3.2.6.4.1 The following steps shall be
followed when calculating cost outlier payments for all cases other
than neonates and children’s hospitals:
Standard
Cost = (Billed Charges x CCR)
Outlier
Payment = 80% of (Standard Cost - Threshold)
Total
Payments = Outlier Payments + (DRG Base Rate x (1 + (IDME))
Note: Noncovered charges should continue
to be subtracted from the billed charges prior to multiplying the
billed charges by the CCR.
3.2.6.4.1.1 The
CCR for admissions occurring on or after October 1, 2018, is 0.2514.
The CCR for admissions occurring on or after January 1, 2020, is
0.2567. The CCR for admissions occurring on or after January
1, 2021, is 0.2495.
3.2.6.4.1.2 The National Operating Standard
Cost as a Share of Total Costs (NOSCASTC) for calculating the cost-outlier
threshold for
FY 2019 is 0.925,
for
CY 2020 is 0.939, and for CY 2021 is 0.926.
3.2.6.4.2 For
FY 2019, a TRICARE fixed loss cost-outlier threshold is set at $23,812.
Effective October 1, 2018, the cost-outlier threshold shall be the
DRG-based amount (wage-adjusted) plus the IDME payment, plus the
flat rate of $23,812 (also wage-adjusted).
3.2.6.4.3 For
CY 2020, a TRICARE fixed loss cost-outlier threshold is set at $24,932.
Effective January 1, 2020, the cost-outlier threshold shall be the
DRG-based amount (wage-adjusted) plus the IDME payment, plus the
flat rate of $24,932 (also wage-adjusted).
3.2.6.4.4 For CY 2021,
a TRICARE fixed loss cost-outlier threshold is set at $26,913. Effective January
1, 2021, the cost-outlier threshold shall be the DRG-based amount
(wage-adjusted) plus the IDME payment, plus the flat rate of $26,913
(also wage-adjusted).
3.2.6.4.5 3.2.6.4.5 The
cost-outlier threshold shall be calculated as follows:
{[Fixed
Loss Threshold x ((Labor-Related Share x Applicable wage index) +
Non-labor-related share) x NOSCASTC] + (DRG Base Payment (wage-adjusted)
x (1 + IDME))}
Example: Using
FY 1999 figures {[10,129 x ((0.7110 x Applicable wage index) + 0.2890)
x 0.913] + (DRG Based Payment (wage-adjusted) x (1 + IDME))}
3.2.6.5 Burn Outliers
3.2.6.5.2 Burn cases which qualify as
short-stay outliers, regardless of the date of admission, will be
reimbursed according to the procedures for short-stay outliers.
3.2.6.5.3 Burn cases which qualify as
cost outliers will be reimbursed using a marginal cost factor of
90%.
3.2.6.5.4 For a burn outlier in a children’s
hospital, the appropriate children’s hospital outlier threshold
is to be used (see below), but the marginal cost factor is to be
either 60% or 90% according to the criteria above.
3.2.6.6 Children’s Hospital Outliers
The following special provisions
apply to cost outliers.
3.2.6.6.1 The threshold shall be the
same as that applied to other hospitals.
3.2.6.6.2 Effective
October 1, 2018, the standardized costs are calculated using a CCR
of 0.2719. Effective January 1, 2020, the standardized costs are
calculated using a CCR of 0.2774. Effective January 1,
2021, the standardized costs are calculated using a CCR of 0.2694. (This
is equivalent to the Medicare CCR increased to account for CAP/DME
costs.)
3.2.6.6.3 The
marginal cost factor shall be 80%.
3.2.6.6.5
The
NOSCASTC for calculating the cost-outlier threshold for FY 2019
is 0.925. The NOSCASTC for calculating the cost-outlier threshold
for CY 2020 is 0.939. The NOSCASTC for calculating the
cost-outlier threshold for CY 2021 is 0.926.
3.2.6.6.6 The following calculation shall
be used in determining cost outlier payments for children’s hospitals
and neonates:
Step 1: Computation of Standardized
Costs:
Billed Charges x CCR
(Non-covered
charges shall be subtracted from the billed charges prior to multiplying
the charges by the CCR.)
Step 2: Determination of Cost-Outlier
Threshold:
{[Fixed Loss Threshold x ((Labor-Related
Share x Applicable wage index) + Non-labor-related share) x NOSCASTC]
+ [DRG Based Payment (wage-adjusted) x (1 + IDME)]}
Step 3: Determination of Cost Outlier
Payment
[{(Standardized costs - Cost-Outlier
Threshold) x Marginal Cost Factor} x Adjustment Factor]
Step 4: Total Payments = Outlier Payments
+ [DRG Base Rate x (1 + IDME)]
3.2.6.7 Neonatal Outliers
Neonatal
outliers in hospitals subject to the TRICARE DRG-based payment system
(other than children’s hospitals) shall be determined under the
same rules applicable to children’s hospitals, except that the standardized
costs for cost outliers shall be calculated using the CCR of 0.64.
The CCR used to calculate cost outliers for neonates in acute care
hospitals shall be reduced to the same CCR used for all other acute
care hospitals.
3.2.7 IDME
adjustment
3.2.7.1 General
The DRG-based payments for
any hospital which has a teaching program approved under Medicare
Regulation Section 413.85, Title 42 CFR shall be adjusted to account
for IDME costs. The adjustment factor used shall be the one in effect
on the date of discharge (see below). The adjustment will be made
by multiplying the total DRG-based amount by 1.0 plus a hospital-specific
factor equal to:
• For admissions occurring during
FYs 2008 and subsequent years, the same formula shall be used except
the first number shall be 1.02.
3.2.7.2 Number of Interns and Residents
TRICARE
will use the number of interns and residents from CMS most recently
available Provider Specific File.
3.2.7.3 Number
of Beds
TRICARE
will use the number of beds from CMS’ most recently available Provider
Specific File.
3.2.7.4 Updates
of IDME Factors
3.2.7.4.1 TRICARE
will use the ratio of interns and residents to beds from CMS’ most
recently available Provider Specific File to update the IDME adjustment
factors. The ratio will be provided to the contractors to update
each hospital’s IDME adjustment factor at the same time as the annual
DRG update. The updated factors provided with the annual DRG update
shall be applied to claims with a date of discharge on or after January 1
of each year.
3.2.7.4.2 Other updates of IDME factors.
It is the contractor’s responsibility to update the IDME factor
if a hospital provides information (for the same base periods) which
indicates that the IDME factor provided by TRICARE with the DRG
update is incorrect or needs to be updated. An IDME factor is updated
based on the hospital submitting CMS Worksheet showing the number
of interns, residents, and beds. The effective date of these other
updates shall be the date payment is made to the hospital (check
issued) for its CAP/DME costs, but in no case can it be later than
30 days after the hospital submits the appropriate worksheet or
information. The contractor shall notify DHA of such IDME updates.
3.2.7.4.3 This alternative updating method
shall only apply to those hospitals subject to the Medicare Inpatient
Prospective Payment System (IPPS) as they are the only ones included
in the Provider Specific File.
3.2.7.5 Adjustment
for Children’s Hospitals
An IDME adjustment factor will
be applied to each payment to qualifying children’s hospitals. The
factors for children’s hospitals will be calculated using the same
formula as for other hospitals. The initial factor will be based
on the number of interns and residents and hospital bed size as
reported by the hospital to the contractor. If the hospital provides
the data to the contractor after payments have been made, the contractor
will not make any retroactive adjustments to previously paid claims,
but the amounts will be reconciled during the “hold harmless” process.
At the end of its fiscal year, a children’s hospital may request
that its adjustment factor be updated by providing the contractor
with the necessary information regarding its number of interns and
residents and beds. The number of interns, residents, and beds must
conform to the requirements above. The contractor is required to
update the factor within 30 days of receipt of the request from
the hospital, and the effective date shall conform to the policy
contained above.
3.2.7.5.1 Each year, the contractor shall
send a notice, as identified by DD Form 1423, CDRL, located in Section
J of the applicable contract, to each children’s hospital in its
Region, requesting updated information on its number of interns,
residents and beds, from the most recent cost report submitted to
CMS for July 1 through June 30, and advise them by July 1 of that
same year to provide the updated information to the contractor so
the requirement in
paragraph 3.2.7.5.2 shall be met.
3.2.7.5.2 The
contractor shall send the number of interns, residents, and beds
and the updated ratios for children’s hospitals, as identified by
DD Form 1423, CDRL, located in Section J of the applicable contract, to
DHA, Medical Benefits and Reimbursement Section (MB&RS), or
designee, by September 1 of each year to be used in DHA’s annual
DRG update calculations. These updated amounts will be included
in the files for the calendar year DRG update.
3.2.7.6 TRICARE for Life (TFL)
No adjustment for IDME costs
is to be made on any TFL claim on which Medicare has made any payment.
If TRICARE is the primary payer (e.g., claims for stays beyond 150
days) payments are to be adjusted for IDME in accordance with the
provisions of this section.
3.2.8 Present
On Admission (POA) Indicators and Hospital Acquired Conditions (HACs)
3.2.8.1 For services provided on or
after ICD-10 implementation:
3.2.8.1.1 Those inpatient acute care
hospitals that are paid under the TRICARE/CHAMPUS DRG-based payment
system shall report a POA indicator for both primary and secondary
diagnoses on inpatient acute care hospital claims. Providers shall
report POA indicators to TRICARE in the same manner they report
to the CMS, and in accordance with the UB-04 Data Specifications
Manual, and ICD-10-CM Official Guidelines for Coding and Reporting.
See the complete instructions in the UB-04 Data Specifications Manual
for specific instructions and examples. Specific instructions on
how to select the correct POA indicator for each diagnosis code
are included in the ICD-10-CM Official Guidelines for Coding and
Reporting.
3.2.8.1.2 There are five POA indicator
reporting options, as defined by the ICD-10-CM Official Coding Guidelines
for Coding and Reporting:
|
|
Y
|
=
|
Indicates that the condition
was present on admission.
|
|
|
W
|
=
|
Affirms that the provider has
determined based on data and clinical judgment that it is not possible
to document when the onset of the condition occurred.
|
|
|
N
|
=
|
Indicates that the condition
was not present on admission.
|
|
|
U
|
=
|
Indicates that the documentation
is insufficient to determine if the condition was present at the
time of admission.
|
|
|
1
|
=
|
(Definition prior to FY 2011.)
Signifies exemption from POA reporting. CMS established this code
as a workaround to blank reporting on the electronic 4010A1. A list
of exempt ICD-10-CM diagnosis codes is available in the ICD-10-CM
Official Coding Guidelines.
|
|
|
1
|
=
|
(Definition for FY 2011 and
subsequent years.) Unreported/not used. Exempt from POA reporting.
(This code is equivalent to a blank on the CMS 1450 UB-04; however,
it was determined that blanks are undesirable when submitting this data
via 4010A.)
|
3.2.8.2 HACs. TRICARE shall adopt those
HACs adopted by CMS. The HACs, and their respective diagnosis codes,
are posted at
http://www.health.mil/rates.
3.2.8.3 Provider responsibilities and
reporting requirements. For non-exempt providers, issues related
to inconsistent, missing, conflicting, or unclear documentation
must be resolved by the provider. POA is defined as present at the
time the order for inpatient admission occurs. Conditions that develop
during an outpatient encounter, including emergency department,
observation, or outpatient surgery, are considered as present on
admission.
3.2.8.4 The
contractor shall accept, validate, retain, pass, and store the POA
indicator.
3.2.8.5 Exempt
providers.
3.2.8.5.1 The following hospitals are
exempt from POA reports for TRICARE:
• Critical
Access Hospitals (CAHs)
• Long-Term Care (LTC) Hospitals
• State Waiver Hospitals, e.g.,
Maryland
• Cancer Hospitals
• Children’s Inpatient Hospitals
• Inpatient Rehabilitation Hospitals
• Psychiatric Hospitals and Psychiatric
Units
• Department of Veterans Affairs
(DVA)/Veterans Health Administration (VHA) Hospitals
3.2.8.5.2 The contractor shall identify
claims from those hospitals that are exempt from POA reporting,
and shall take the actions necessary to be sure that the TRICARE
grouper software does not apply HAC logic to the claim.
3.2.8.6 The DRG payment is considered
payment in full, and the hospital cannot bill the beneficiary for
any charges associated with the hospital-acquired complications
or charges because the DRG was demoted to a lesser-severity level.
3.2.8.7 Claims will be denied if a
non-exempt hospital does not report a valid POA indicator for each
diagnosis on the claim.
3.2.8.8 Replacement
Devices
3.2.8.8.1 TRICARE
is not responsible for the full cost of a replaced device if a hospital
receives a partial or full credit, either due to a recall or service
during the warranty period. Reimbursement in cases in which an implanted
device is replaced shall be made:
• At reduced
or no cost to the hospital; or
• With partial or full credit
for the removed device.
3.2.8.8.2 The following condition codes
49 and 50 allow TRICARE to identify and track claims billed for
replacement devices:
• Condition
Code 49. Product replacement within product lifecycle. Condition
code 49 is used to describe replacement of a product earlier than
the anticipated lifecycle due to an indication that the product
is not functioning properly - warranty.
• Condition
Code 50. Replacement of a product earlier than the anticipated lifecycle due
to an indication that the product is not functioning properly. Condition
code 50 is used to describe that the manufacturer or the U.S. Food
and Drug Administration (FDA) has identified the product for recall
and, therefore, replacement.
3.2.8.8.3 When a hospital receives a
credit for a replaced device that is 50% or greater than the cost
of the device, hospitals are required to bill the amount of the
credit in the amount portion for value code FD.
3.2.8.8.4 The contractor shall reduce
hospital reimbursement for those DRGs subject to the replacement
device policy, by the full or partial credit a provider received
for a replaced device. The specific DRGs subject to the replacement
device policy will be posted on TRICARE’s DRG web page at
http://www.health.mil/rates.
As necessary, the DRGs subject to the replacement device policy
will be updated as part of the annual DRG update.
3.2.8.8.5 Hospitals must use the combination
of condition code 49 or 50, along with value code FD to
correctly bill for a replacement device that was provided with a
credit or no cost. The condition code 49 or 50 will identify a replacement
device while value code FD will communicate to TRICARE
the amount of the credit, or cost reduction, received by the hospital
for the replaced device.
3.2.8.8.6 The contractor shall deduct
the partial/full credit amount, reported in the amount for value
code FD from the final DRG reimbursement when the assigned
DRG is one of the DRGs subject to the replacement device policy.
3.2.8.8.7 Once a DRG rate is determined,
any full/partial credit amount is deducted from the DRG reimbursement
rate. The beneficiary copayment/cost-share is then determined based
on the reduced rate.