2.0 POLICY
In the case of a provider’s
failure to obtain a required preauthorization, the provider’s payment
shall be reduced by 10% of the amount otherwise allowable. Under
the managed care contracts, a network provider’s payment can be
subject to a greater than 10% reduction or a denial if the network
provider has agreed to such a reduction or denial in the agreement.
2.1 Types of Care Subject to Payment
Reduction
For a
provider’s failure to obtain a required preauthorization or preadmission
authorization, the provider’s payment will be reduced in connection
with the following types of care:
2.1.1 All non-emergency
mental health admissions to hospitals.
2.1.2 All admissions
for psychiatric residential treatment for children, and inpatient/residential Substance
Use Disorder (SUD) detoxification and rehabilitation, and psychiatric
partial hospitalization (Partial Hospitalization Program (PHP) care
prior to June 13, 2017). None of these can be considered emergency
care.
2.1.3 Psychoanalysis. It cannot be
considered as an emergency service.
2.1.4 Adjunctive
dental care.
2.1.5 Organ and stem cell transplants.
2.1.6 Skilled Nursing Facility (SNF)
care received in the U.S. and U.S. territories for TRICARE dual eligible
beneficiaries once TRICARE is primary payer.
2.1.7 Infusion drug therapy delivered
in the home.
2.1.8 Additional
procedures and services as prescribed by the contractors except
when the beneficiary has “other insurance” as provided in the TRICARE
Policy Manual (TPM),
Chapter 1, Section 6.1, paragraph 1.12, Note.
2.2 Applicability of Payment Reduction
This section shall apply to
participating (including network providers and participating Department
of Veterans Affairs (DVA)/Veterans Health Administration
(VHA) facilities) and nonparticipating providers. For
a provider’s failure to obtain the required preauthorization, the
payment reduction shall be subject to the policy in this section.
2.2.1 In the case of an admission
to a hospital, inpatient/residential Substance Use Disorder Rehabilitation
Facility (SUDRF), or Residential Treatment Center (RTC), or a PHP
(PHP care prior to June 13, 2017) (or a SNF) when applicable, for
network providers the payment reduction shall apply to the institutional
charges and any associated professional charges of the attending
or admitting provider. Services of other providers shall be subject
to the payment reduction as provided under the network provider
agreements, but not less than 10%.
2.2.2 The amount
of the reduction for non-network providers shall be 10% of the amount otherwise
allowable (consistent with
paragraphs 2.3,
2.4, and
2.5)
for services for which preauthorization should have been obtained,
but was not obtained.
2.2.3 The amount
of the reduction for network providers shall be in accordance with
the provider’s contract with the respective contractor, but not
less than 10%.
2.2.4 The payment
reduction shall apply under the Point of Service (POS) option.
2.3
Diagnosis
Related Group (DRG) Reimbursed Facilities
In the case of admissions reimbursed
under the DRG-based payment system, the reduction shall be taken
against the percentage (between 0 and 100%) of the total reimbursement
equal to the number of days of care provided without preauthorization,
divided by the total Length-Of-Stay (LOS) for the admission. See
the example in
Chapter 3, Section 4.
2.4
Non-DRG
Facilities/Units (Includes RTCs and Mental Health Per Diem Hospitals)
In the case of admissions to
non-DRG facilities/units, the reduction shall be taken only against
the days of care provided without preauthorization. See the example
in
Chapter 3, Section 4.
2.5
Care
Paid on Per-Service Basis
For the
care for which payment is on a per-service basis, e.g., outpatient
adjunctive dental care, the reduction shall be taken only against
the amount that relates to the services provided without prospective
authorization. See the example in
Chapter 3, Section 4.
2.6 Determination of Days/Services
Subject to Payment Reduction
For purposes of determining
the days/services which will be subject to the payment reduction,
the following shall apply:
2.6.1 When the
request for authorization is made prior to the admission but is
not received by the contractor until after the admission occurred,
the days for payment reduction shall be counted from the date of
admission to the date of receipt of the request by the contractor
(not counting the date of receipt). This includes alleged emergency
care subsequently found not to meet the emergency criteria.
2.6.2 When the request for authorization
is made to the contractor after the admission occurred, the days
for payment reduction shall be counted from the date of admission
to the date of approval of the request by the contractor (not counting
the date of approval).
2.6.3 For the
care paid on a per-service basis, e.g., outpatient adjunctive dental
care, payment reduction shall apply to those services/sessions provided
prior to receipt of the authorization request by the contractor.
2.7 Other Health Insurance (OHI)
and Beneficiary Cost-Share
2.7.1 When a
beneficiary has OHI that provides primary coverage, certain services
shall not be subject to payment reduction. See
paragraph 2.1.8.
2.7.2 The reduction of payment is
calculated based on the otherwise allowable amount (consistent with
paragraphs 2.3,
2.4,
and
2.5) before the application of deductible,
beneficiary cost-share, and OHI.
2.7.3 The beneficiary
is still required to pay a cost-share for the days or services for
which the payment is reduced. The beneficiary cost-share shall be
calculated applying the normal cost-share rules before the reduction
is taken.
2.7.4 The amount applied/credited
toward the deductible cannot be greater than the amount for which
the beneficiary remains liable after the Government payment.
2.8 Preauthorization Process
2.8.1 Preauthorization may be requested
from a contractor in person, by telephone, fax, or mail. The date
of receipt of a request shall be the date (business day) on which
a contractor receives the request to authorize the medical necessity
and appropriateness of care for which it has jurisdiction.
Note: The date a preauthorization
request is mailed to the contractor and postmarked shall determine
the date the request was made (not received). If a request for preauthorization
does not have a postmark, it shall be deemed made on the date received
by the contractor.
2.8.2 In general,
the decision regarding the preauthorization shall be issued by the
contractor within one business day of the receipt of a request from
the provider, and shall be followed with a written confirmation
(if initial notice is verbal).
2.8.3 A preauthorization
is valid for the period of time, appropriate to the type of care
involved. It shall state the number of days/type of care for which
it is valid. In general, preauthorizations will be valid for 30
days. If the services are not obtained within the number of days
specified, a new preauthorization request is required. For organ
and stem cell transplants the preauthorization shall remain in effect
as long as the beneficiary continues to meet the specific transplant
criteria set forth in the TPM, or until the approved transplant
occurs.
2.9 Patient Not Liable
The patient (or the patient’s
family) may not be billed for the amount of the payment reduction
due to the provider’s noncompliance with preauthorization requirements.
2.10 Emergency Admissions/Services
2.10.1 Payment reductions shall not
be applied in connection with bona fide emergency admissions or
services. The authorization required for a continuation of services
in connection with bona fide emergency admission will not be subject
to payment reduction.
2.10.2 Contractor having jurisdiction
for the medical review of the admission is required to review for
emergency when requested by the provider. In addition to the review
of alleged emergency admissions, the contractor is required to issue
an initial determination providing the review decision which is
appealable.
Note: Psychoanalysis
and all admissions for psychiatric residential treatment for children
or inpatient/residential SUD detoxification and rehabilitation are
the types of services/admissions requiring preauthorization that
cannot be considered as emergencies.
2.11 Waiver of Payment Reduction
2.11.1 The contractor may waive the
payment reduction only when a provider could not have known that
the patient was a TRICARE beneficiary, e.g., when there is a retroactive
eligibility determination by a Uniformed Service, or when the patient
does not disclose eligibility to the provider.
2.11.2 The criteria for determining
when a provider could have been expected to know of the preauthorization
requirements shall be the same as applied under the Waiver of Liability
provisions.
2.11.3 If at any time a payment reduction
is revised after claims processing, claim processors will follow
existing procedures for processing any resulting payment adjustments.
2.12 Appeal Rights
2.12.1 The days/services for which
the provider’s payment is reduced are approved days/services and
not subject to appeal.
2.12.2 The denial of a waiver request
and clerical/calculation errors in connection with the payment reduction
are not subject to appeal but are subject to administrative review
by the contractor upon request.
2.12.3 Adverse decisions regarding
alleged emergency admissions/services are appealable in cases involving
payment reductions following the normal appeal procedures.