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Critical Access Hospital (CAH) Services
Inpatient Hospital Authorization
Inpatient Hospital Services
Hospital In-reach Service Coordination (IRSC)
Outpatient hospital services are provided in a facility qualified to participate in Medicare. Outpatient hospital services must be medically necessary and provided by or under the supervision of a physician, dentist, or other provider having medical staff privileges in the facility.
A facility that meets the definition of and is licensed as a hospital or hospital clinic, is qualified to participate in Medicare, including a hospital that is part of the Federal Indian Health Service (IHS), and is designated by the federal government to provide acute care is eligible to be a provider of outpatient hospital services.
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All MHCP recipients are eligible to receive outpatient hospital services.
An outpatient hospital clinic is a nonemergency service providing diagnostic, preventive, curative and rehabilitative services on a scheduled basis.
In medically indicated situations when it is not in the best interest of the recipient to be physically moved to multiple outpatient hospital clinic sites due to the recipient’s physical or mental disability, the outpatient hospital facility may bill a specialty clinic facility fee for each distinctly different specialty clinic service that is brought to the recipient at one clinic site.
Outpatient observation services are covered when they are reasonable and necessary to treat or diagnose a recipient, and are independent of other procedures. Observation services are covered for up to 48 hours. MHCP will consider observation services for up to 72 hours for unusual circumstances when submitted with additional documentation. See the Noncovered Services section for when outpatient observation services are not covered.
Hospitals may bill for recipients who are direct admissions to observation. Direct observation is reportable once per observation stay.
A direct admission occurs when a physician in the community refers the recipient to the hospital for observation, bypassing the clinic or emergency department (ED).
Refer to Inpatient Hospital Services section on inpatient recipient’s MHCP eligibility beginning after the date of inpatient admission.
Refer to Inpatient Hospital Services for Authorization Denials
Service delivery does not drive coding selection. Report the one initial code with the highest level of service provided during that visit or day regardless of the time administered during the visit. After selection of the initial code, report all additional related services provided with add on, subsequent or concurrent codes. Refer to the following code information:
Cardiac rehabilitation is described by the U.S. Public Health Service as consisting of "comprehensive, long-term programs involving medical evaluation, prescribed exercise, cardiac risk factor modification, education, and counseling." Outpatient hospitals and physician-directed clinics with a Medicare-approved cardiac rehabilitation program may provide cardiac rehabilitation services to MHCP recipients.
A cardiac rehabilitation program is 36 sessions. Request authorization for additional sessions when more than 36 sessions will be provided.
MHCP follows Medicare criteria for cardiac rehabilitation services, which includes the following:
Prolonged IV therapy begins when the IV needle is in place, continues through the administration, and ends when the insertion site care is complete. The following are billable in addition to the prolonged IV therapy:
Blood transfusions require the actual number of units provided related to the specific product or procedure.
Pulse oximetry is considered part of the ED, ambulatory surgical center (ASC), or outpatient specialty clinic.
Mental health partial hospitalization is a covered service for adults and adolescents if the hospital has received MHCP approval for its partial hospitalization program. Refer to Partial Hospitalization Program for billing instructions.
Professional services (for example, anesthesiologist, physician) are covered in addition to outpatient hospital services. Other services, such as lab, radiology, supplies, injectable drugs, etc., may also be separately covered services when outpatient hospital services are provided. Refer to the specific service sections of this manual for coverage and billing policy.
The following outpatient hospital services are not covered and are ineligible for payment:
Ambulatory Payment Classification (APC) facility service payments are paid according to the most recent CMS APC system rates published in the Federal Register. The rates are listed in the column titled “Payment Rate.”
Outpatient observation services are not covered when they are provided according to the following:
Effective for dates of service on or after July 1, 2015, E&M services are priced using a composite rate when there are eight or more hours of observation. Refer to CMS MLN Matters MM8653 and MM9486.
Refer to the following billing requirements:
Copays apply to some services provided to MA recipients. Copay guidelines are listed in the Billing the Recipient section, under Copays and Family Deductible.
The copay for a nonemergency visit to a hospital-based emergency department will be deducted from the outpatient hospital facility claim. MHCP will use the type of admission in conjunction with the revenue code to determine whether the visit was considered an emergency visit or a nonemergency visit. MHCP will consider a type of admission equal to “1” in conjunction with revenue code 45X to be an emergency.
MHCP uses Medicare criteria for billing direct admission observation care. Follow these requirements:
Observation requires a physician’s order and must be part of the recipient’s records.
MHCP uses Medicare criteria for billing observation status care. Follow these requirements:
Bill the unusual observation service with modifier "22," and include an explanation of the unusual circumstances.
Multiple units are not reported when the number of units included in the code description is multiple and the number of units used is equal to or below the unit measurement of the code (this is reported as one unit).
Pulse oximetry is part of the Ambulatory Payment Classification (APC) payment. Pulse oximetry can be separately billed only when an E/M visit is the only other service provided.
Bill mental health partial hospitalization using one of the following HCPCS codes:
One unit equals one hour.
Refer to Definitions section of Hospital Services home page.
Minnesota Statutes 144.50 (Hospital, Licenses; Definitions)
Minnesota Statutes 256B.0625, subd.4 (Outpatient and Physician-directed clinic services)
Minnesota Statutes 256B.32 (Facility Fee Payment)
Minnesota Statutes 256.969; 256.9695
42 CFR 410.27 – (Outpatient hospital or CAH services and supplies incident to a physician or nonphysician practitioner service: Conditions)
42 CFR 410.49 (b)(3)(ii) – (Cardiac rehabilitation program and intensive cardiac rehabilitation program)
42 CFR 440.20 - (Outpatient hospital services and rural health clinic services)