Skip to main content

Military Health System

Utility Navigation Links

TRICARE Reimbursement Manual 6010.61-M, April 1, 2015
Chapter 1
Section 20
State Agency Billing
Issue Date:  June 1, 1999
Authority:  32 CFR 199.8
Copyright:  CPT only © 2006 American Medical Association (or such other date of publication of CPT). All Rights Reserved.
General: When a beneficiary is eligible for both TRICARE and Medicaid, 32CFR 199.8 establishes TRICARE as the primary payor. To implement this provision, the contractor shall arrange Coordination Of Benefits (COB) procedures with those states that have current executed state agency billing agreements to facilitate the flow of claims and to try to achieve a reduction in the amount of effort required to reimburse the states for the funds they erroneously disbursed on behalf of the TRICARE-eligible beneficiary. Claims shall be signed by the recipient/beneficiary (patient) or by a designated state official on behalf of the patient. The state official may sign each claim individually or attach a signed statement to each batch of claims submitted for reimbursement. The contractor shall make disbursement directly to the state agency (or contractor acting as the agent for the state agency), following established TRICARE claims processing guidelines and requirements (see the TRICARE Operations Manual (TOM), Chapter 8). The contractor shall verify the signatures under the same rules and criteria as exist for verification of provider facsimile or authorized representative signatures (see the TOM, Chapter 8, Section 4. Medicaid claims are subject to normal claims processing requirements for establishment of eligibility.
2.1  Claims Processing Requirements/Exceptions
2.1.1  Claims Submission Procedures  The state agency must submit claims on an acceptable claim form, and attach a computer printout of the state agency’s record of the services and/or copies of the original bills. All required processing data must be submitted in an acceptable format. When the state agency and the contractor have the capability to exchange the data for claims processing in an electronic format, this shall be defined and included in the agreement between the contractor, TRICARE Dual Eligible Fiscal Intermediary Contract (TDEFIC) contractor, or TRICARE Pharmacy contractor, and the state agency (Addendum A).  Each batch of claims (if each claim is not individually signed) must be certified by an authorized state official. A transmittal document signed by an authorized state official identifying the claims covered by the certification shall accompany each batch of claims. For electronic claims, an encrypted or password protected e-mail (transmitted in a secure manner) with an electronic signature from an authorized state official identifying the claims covered by the certification shall either accompany the claims or be sent prior to submission. Patient names and sponsor Social Security Numbers (SSNs) shall also be included on the transmittal certification. When the password protected e-mail method is used, a subsequent e-mail message must be transmitted with the access password. For audit trail purposes, the contractor shall enter the Julian calendar date of receipt on the transmittal document and ensure that all included claims also receive the same Julian calendar date in the Internal Control Number (ICN).  The transmittal documents shall be retained in a readily accessible file or may be microcopied with the claims, if the contractor is microfilming its claims at the front end of its processing system.
2.1.2  Claims Adjudication
Except for the following, claims submitted by state agencies are subject to all applicable TRICARE requirements, limitations and definitions.
Durable Medical Equipment (DME) - Prescriptions Missing
Do not develop for this information unless there is no reasonable correlation between the diagnosis and the equipment on the claim. If the diagnosis is missing and there is no documentation on file to support the claim, return the claim for supporting diagnosis or prescription. Amount of payment will follow the basic guidelines of Section 11. As a general rule, if the state is paying rental on the equipment, TRICARE will pay the rental. If the state has paid for purchase, assume that to be cost advantageous and reimburse the state accordingly.
No COB Information
Waive if the state coordinates. Accept the certification from the authorized state official for documentation that, in absence of Other Health Insurance (OHI) information, there is no known OHI. If other insurance is present, it is necessary to know the amount paid by the OHI to properly reimburse the state for the amount they have actually paid, but not to exceed the amount TRICARE would have paid. If the contractor detects that OHI does exist, processing will be terminated and the claim will be returned to the state agency for action. It is the state agency’s responsibility to determine if an error has been made in submission or if the patient or provider may have committed a fraudulent act.
Lack of itemization on inpatient hospital bills; i.e., hospital detail is lacking
Beginning and ending dates of hospital stay are required. Breakdown of detailed services and supplies must be detailed enough to determine the Revenue Code major category. Contractors may assume the charges are for a semi-private room, in absence of evidence to the contrary, and report with Revenue Code 12X. In every instance, the Revenue Code in the Institutional Record must comply as required by the TRICARE Systems Manual (TSM), Chapter 2, Sections 3 through 8. Waiver of the requirement to develop for the breakdown of services does not excuse the contractor from coding the detail which is present on the claim.
No breakdown of service detail; e.g., multiple office visits or multiple lab services, etc.
Waive: For TEDs, the contractor is authorized to estimate frequency of the charge by using a reasonable approximation. For example, June 1 - 8, CPT procedure code 90050 with a $57.00 charge. Assume two office visits @ $28.50.
Quantity, strength, etc., missing on drug claims.
Waive: Pay as billed and assume that the state agency has a control system in place. If evidence develops to refute this assumption, contact the state agency for development of appropriate controls. Process drug claims from state agencies as if they were consolidated drug claims.
Diagnosis Missing
Waive on office visits (unless services appear to be for a routine physical or related to other excluded services); consultations; drugs; lab; x-ray; assistant surgeon and anesthesiology. For services provided on or before September 30, 2015, use International Classification of Diseases, 9th Revision, Clinical Modification (ICD-9-CM) code 799.9 in absence of a correct code. For services provided after the mandated date, as directed by Health and Human Services (HHS), for use ICD-10-CM implementation use code R69 or R99 in absence of a correct code.
Diagnosis Missing
Require on hospital, surgery, and mental health. For DME, if the record provides information other than a diagnosis which can reasonably support the payment, proceed. Return the incomplete claim, which requires a diagnosis, to the state for supporting information.
Timely Filing Limits
The state shall file no later than one year following the date of service: one year after the date the prescription was filled; one year after the date of discharge if the services were rendered during an inpatient admission; or one year after the state received the results of the annual data match from the Defense Manpower Data Center (DMDC), Defense Enrollment Eligibility Reporting System (DEERS) Division. For waivers, see the TOM, Chapter 8, Section 3, paragraph 2.0.
2.1.3  TRICARE Encounter Data (TED) Reporting of State Agency Claims
Claims received for state agencies will be processed with the Special Processing Code 1 on TEDs (see the TSM, Chapter 2). TED coding will follow the basic requirements for a participating claim with the state Medicaid agency designated as the payee. The amount paid by the Government must be reported in the Amount Paid by Government Contractor field.
2.1.4  Development with State Agencies
States are obligated to provide the data needed to process the claims they submit, including eligibility and other beneficiary information. In some cases, the contractor will need to develop data through DEERS or other in-house information to accurately process the claim. For other required data, or in case of failure to locate essential information, the contractor shall deny the claim. If a state routinely fails to submit required data on its claims, the contractor shall contact the state agency and request cooperation. TRICARE shall be advised of any such problems and the results of any contacts.
2.1.5  Duplicate Checking
Contractors shall ensure that precautions are taken to prevent duplicate payments, as provided in the TOM, Chapter 8, Section 9. In cases where the exact type of service data has not been provided, but a duplication of types of service is apparent; e.g., apparent duplication of lab and office services, the contractor shall attempt to resolve the case with the data available in-house. If the matter cannot be resolved, assume duplication and deny the claim. If the state agency has information to the contrary, it may resubmit with the necessary documentation to refute the assumption. If a beneficiary or provider has submitted claims for services directly to TRICARE and the same services have also been sent to the state for Medicaid payment, the possibility of fraud must be considered. Since the patient would have been TRICARE-eligible, any fraud would have been an offense against the state program. Return the claim to the state agency and advise them of the facts including that payment has been made by TRICARE. The contractor shall cooperate in any state investigation to the extent possible under TRICARE guidelines. In any case of doubt about what information can be released in an investigation, contact TRICARE for instructions.
2.1.6  Providers
Providers must be TRICARE-approved or TRICARE-eligible in accordance with the TOM, Chapter 2. If the provider named on the claim is not on the contractor provider files, but is in a category which is normally acceptable under TRICARE; e.g., a physician, psychologist, hospital, etc., the contractor shall follow normal procedures to certify. If the provider is not in a certifiable category under the contract, return the claim to the state.
2.1.7  Third Party Liability (TPL)
When submitting claims to TRICARE for recovery of payments made, the state agency should attach information regarding possible TPL for those claims which carry a diagnosis requiring development (see the TOM, Chapter 10). However, if the TPL data submitted is not adequate to provide all the information required, return the claim to the state agency to obtain the necessary information. If the state agency does not provide the necessary information within 35 days, the claim shall be denied. It is expected that the state agency will have a fully developed file to establish or to rule out possible TPL. If TPL is involved, the state should have exercised its subrogation rights and the state’s beneficiary claim file should reflect complete data, including the amount paid under TPL. Where TPL does exist, the TRICARE claim liability should be minimal. The contractor should not contact the beneficiary or the provider(s).
2.2  Reimbursement Procedures and Requirements
The contractor shall reimburse the State Medicaid Agency directly for all claims submitted by the agency providing an EOB for each claim, unless arrangements and agreement between the contractor and the state agency provide for a summary payment voucher. No EOB or other notice will be sent to either the beneficiary or the provider. The allowance determination shall be based on the amount billed to the Medicaid Agency by the provider of care. The contractor shall calculate the net amount which would have been payable by TRICARE including, when appropriate, the COB reduction, deductible and cost-share amounts in the determination. The state shall be paid the lesser of the amount it actually paid or the amount that TRICARE would have paid. The Medicaid billing by a provider is frequently less than the provider’s customary charge. These charges shall not be included in the determination of the prevailing charges for an area. If a provider of care subsequently bills, requesting payment for the difference between the Medicaid payment and the amount customarily billed, the claim shall be denied as a duplicate. No additional payment shall be made. If a service which would be allowable by TRICARE has been denied by Medicaid and is subsequently submitted by a provider of care, the charge shall be considered as any other claim.
- END -
Follow us on Instagram Follow us on LinkedIn Follow us on Facebook Follow us on Twitter Follow us on YouTube Sign up on GovDelivery