1.0 APPLICABILITY
1.1 This policy
is mandatory for reimbursement of services provided by either network
or non-network providers. However, alternative network reimbursement
methodologies are permitted when approved by the Defense Health
Agency (DHA) and specifically included in the network provider agreement.
1.2 Hospital reimbursement - outpatient
services for all services prior to implementation of the reasonable cost
method for Critical Access Hospitals (CAHs) and implementation of
the Outpatient Prospective Payment System (OPPS), and thereafter,
for services not otherwise reimbursed under hospital OPPS.
2.0 POLICY
2.1 When professional services
or diagnostic tests (e.g., laboratory, radiology, electrocardiogram
(EKG), electroencephalogram (EEG)) that have CHAMPUS Maximum Allowable
Charge (CMAC) pricing (
Chapter 5, Section 3)
are billed, the claim must have the appropriate Current Procedural
Terminology (CPT) coding and modifiers, if necessary. Otherwise,
the service shall be denied. If only the technical component is
provided by the hospital, the technical component of the appropriate
CMAC shall be used.
2.2 For
all other services, payment shall be made based on allowable charges
when the claim has Healthcare Common Procedure Coding System (HCPCS)
(Level I, II, III) coding information (these may include ambulance, Durable
Medical Equipment (DME) and supplies, drugs administered other than
oral method, and oxygen and related supplies). For claims development,
see TRICARE Operations Manual (TOM),
Chapter 8, Section 6. Other services without
allowable charges, such as facility charges, shall be paid as billed.
Facility charges shall have an HCPCS code on the claim for the specific
service provided, e.g., Evaluation and Management (E/M) code if
a visit, or surgical code if surgery. Only one facility charge (payment
at billed charges), e.g., 510 and 760 series revenue codes on the
same day, is allowed for a procedure or visit. For reimbursing drugs
administered other than oral method, see
Section 15.
Note: Each line item on the Centers
for Medicare and Medicaid Services (CMS) 1450 UB-04 claim form must
be submitted with a specific date of service to avoid claim denial.
The header dates of service on the CMS 1450 UB-04 may span, as long
as all lines include specific dates of service within the span on
the header.
2.3 When coding
information is provided, outpatient hospital services including
emergency and clinical services, clinical laboratory services (lab
codes with one level of CMAC pricing, commonly referred to as the
global rate, i.e., the same payment rate regardless of the site
of service, e.g., doctor’s office, hospital or lab), rehabilitation therapy,
venipuncture, and radiology services are paid using existing allowable
charges. Such services are reimbursed under the allowable charge
methodology that would also include the CMAC rates. In addition, venipuncture
services provided on an outpatient basis by institutional providers
other than hospitals are also paid on this basis. Professional services
billed on a CMS 1450 UB-04 will be paid at the professional CMAC
if billed with the professional service revenue code and enough
information to identify the rendering provider, or the claim will be
denied.
2.4 Freestanding Ambulatory Surgical
Center (ASC) services are to be reimbursed in accordance with
Chapter 9.
Note: All hospital based ASC claims
that are submitted to be paid under OPPS must be submitted with
a Type Of Bill (TOB) 13X. If a claim is submitted to be paid with
a TOB 83X the claim will be denied.
2.5 Outpatient
hospital services including professional services, provided in states
utilizing state developed rates applicable to all payers, e.g.,
Maryland, are paid at the rates established by the state. Since
hospitals are required to bill these rates, reimbursement for these
services is to be based on the billed charge.
2.6 Surgical outpatient procedures
which are not otherwise reimbursed under the hospital OPPS will
be subject to the same multiple procedure discounting guidelines
and modifier requirements as prescribed under OPPS for services
rendered on or after implementation of OPPS. Refer to
Section 16 and
Chapter 13, Section 3, for further
detail.
2.7 Industry standard modifiers
and condition codes may be billed on outpatient hospital claims
to further define the procedure code or indicate that certain reimbursement
situations may apply to the billing. Recognition and utilization
of modifiers and condition codes are essential for ensuring accurate
processing and payment of these claims.
2.8 Effective
December 1, 2009, hospital outpatient services provided in a CAH,
including ambulatory surgery services, shall be paid under the reasonable
cost method, reference
Chapter 15, Section 1.
2.9 Effective
January 1, 2011 through September 30, 2023 radiology services for
Cancer and Children’s Hospitals (CCH) are reimbursed using a blend
of facility-specific costs and the CMAC. The blend is based on a
42% weight for costs and a 58% weight for the technical portion
of the CMAC (calculated as 62% of the global fee).2.9.1 The contractor shall use the
following formula to calculate the TRICARE allowed amount for each hospital
outpatient radiology claim for hospital outpatient radiology services
provided on or after July 1, 2012:
0.42 (lower of costs or charges)
+ 0.58 (0.62 x global CMAC)
Costs = BC multiplied by the
CCR;
BC = billed
charge for that line item;
CCR = the hospital-specific
outpatient Cost-to-Charge Ratio;
Global CMAC = the global CMAC
for the CPT code (line item)
Note: The formula uses billed charges
if they are lower than costs, which essentially caps the CCR at
1.0.
2.9.2 DHA will provide the contractor
with the hospital outpatient Cost-to-Charge Ratio
(CCR) file annually around
the beginning of the calendar year. The CCR file will be effective
on the same day as the annual CMAC update. The file will include
the name of the hospital, the Medicare provider number, and the
hospital outpatient CCR.
2.9.3 Applicable discount and cost-sharing
shall be applied.
2.9.4 If there is no global CMAC
fee, the allowed amount shall be equal to the lesser of billed charges
or costs (billed charges multiplied by the CCR).
2.9.5 The blended rate methodology
applies to CPT, Fourth Edition (CPT-4) radiology codes 70010-79999 and
Healthcare Common Procedure Coding System (HCPCS) radiology codes
G0130 and G0202-G0235.
2.9.6 Claims auditing software bundling
edits shall be applied prior to calculating the blended rate.
2.9.7 Effective October 1,
2023, CCHs will no longer be paid using the blended rate for hospital
outpatient radiology claims. Instead, they will be subject to the
OPPS. See Chapter 13.
Blended rate materials will remain available for at least three
years on the DHA website for dates prior to October 1, 2023, at https://www.health.mil/Military-Health-Topics/Access-Cost-Quality-and-Safety/TRICARE-Health-Plan/Rates-and-Reimbursement/Blend-Rate-Method-for-Radiology-for-Cancer-and-Childrens-Hospitals.
For dates of service on or after October 1, 2023, where Medicare
has excluded a radiology service from OPPS (i.e., applies a status
indicator of A,
or subsequent similar status indicator), or where TRICARE covers
a radiology service that Medicare does not, and the service is not assigned
a status indicator or APC, payment shall be made on the basis of paragraph 2.1.