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Critical Access Hospital (CAH) Services

Revised: 02-17-2016

  • Outpatient Interim Payment
  • Inpatient Payment
  • Professional Services
  • CRNA Services
  • Exhausted Medicare Benefits
  • Home Health Services
  • CD Services
  • Ambulance Services
  • Definitions
  • Legal References
  • Hospital Services Home Page
    Hospital In-reach Service Coordination (IRSC)

    Inpatient Hospital Authorization

    Inpatient Hospital Services

    Outpatient Hospital Services

    Throughout this section, “you” refers to a critical access hospital (CAH). A CAH is a hospital that is designated a CAH under Minnesota Statutes, section 144.1483.

    Minnesota Critical Access Hospital (CAH)

    Payment for outpatient, emergency and ambulatory surgery services you provide are made on a reasonable cost basis under the cost finding and allowable costs determined under the Medicare program according to Minnesota Statutes, section 256B.75(b).

    Outpatient Interim Payment

    Interim payment for outpatient services you provide will be at the Medicare Part B interim payment rate expressed as a percentage to be applied to covered charges subject to legislative decreases and increases. The intent of the interim payment is to approximate the actual cost as nearly as possible to minimize the retroactive adjustment that MHCP makes on the basis of actual costs.

    We will notify you of retroactive adjustments. A retroactive adjustment due to an underpayment will appear on the remittance advice (RA). A retroactive adjustment due to an overpayment will be recovered from payments for future services until fully repaid. Each payment credited against the overpayment will be noted on the RA.

    Critical Access Outpatient Billing

    For CAH outpatient services, valid types of bills (TOBs) are 851, 852, 853, 854 and 857. TOB 131 is not valid for CAH outpatient billing.

    Requirements for Healthcare Common Procedure Coding System (HCPCS) procedure coding and revenue code reporting follow Medicare guidelines. The following revenue codes require a HCPCS code:

  • • 0250
  • • 0260
  • • 0274
  • • 0300-0369
  • • 0400-0449
  • • 0460-0499
  • • 0530-0549
  • • 0610-0619
  • • 0636
  • • 0730-0759
  • • 0771
  • • 0920-0929
  • • 0940
  • • 0942
  • • 0964 (if qualified under the CRNA billing exemption under Medicare Part B)
  • Inpatient Payment

    Payment for inpatient hospital services continues under diagnosis-related group (DRG) prospective payment and not on a reasonable-cost basis. If you admit a recipient as an inpatient from one of your outpatient departments (for example, emergency department, ambulatory surgical center, observation status whether or not a bed is used), you must include charges from the outpatient services in the inpatient hospital billing. The date of admission you submit is the date outpatient services began.

    Professional Services

    You must bill for outpatient professional services using the 837P (professional) claim format. This claim format requirement does not impact Medicare crossover claims.

    CRNA Services

    Inpatient CRNA

    Hospitals must exclude certified registered nurse anesthetist (CRNA) charges from inpatient rates.

    Bill separately on the 837P for MHCP-enrolled CRNA services provided in an inpatient hospital setting by any of the following:

  • • A CRNA independent or employed by a physician
  • • A CRNA employed by a hospital
  • • An entity or group not enrolled as a hospital that is billing CRNA services
  • • All critical access hospital (CAH).
  • Refer to the MN–ITS User Guide for more detailed information on billing for CRNAs who are employees or independent CRNAs. Remove CRNA costs from the operating payment rate for inpatient rates.

    Outpatient CRNA

    For requirements for certified registered nurse anesthetist (CRNA) services, refer to the following:

  • • You must bill for outpatient CRNA services according to Medicare guidelines.
  • • If you have applied and qualified for the CRNA billing exemption under Medicare Part B, MHCP will pay for the services on a reasonable-cost basis. Bill for cost-based CRNA services using the 837I format using revenue code 0964 and the appropriate HCPCS procedure code.
  • • Send CRNA CMS Exemption letters to DHS.PSDRATES@STATE.MN.US
  • • If you do not qualify for the CRNA billing exemption under Medicare Part B, MHCP will pay you according to the MHCP fee schedule. Bill for the services using the 837P format using the appropriate HCPCS code(s). Refer to the “MHCP Enrolled CRNA” subsection in the Anesthesia Services section of the Provider Manual.
  • • The Medicare CRNA payment method may be different from the method you elected for inpatient services under MHCP. That is, you may have elected to remove CRNA costs from your MHCP inpatient rates under Minnesota Rules, part 9500.1105, subpart 1A(s), and have separate payment under the MHCP fee schedule.
  • Exhausted Medicare Benefits

    If you submit an MHCP inpatient claim because a recipient has exhausted Medicare Part A benefits but has Medicare Part B, use TOB 13X rather than 85X to submit for Medicare Part B payment. The Part B services will be paid as a Medicare crossover under Outpatient Prospective Payment System (OPPS) and offset against the MHCP inpatient payment.

    Home Health Services

    Home health services you provide are not paid based on a reasonable-cost basis. Home health services continue to be paid under the MHCP fee schedule using TOB 34X.

    CD Services

    Outpatient hospital services you bill under the Consolidated Chemical Dependency Treatment Fund (CCDTF) must use TOB 85X. Payment will be made according to CCDTF rates and not on the reasonable-cost basis.

    Ambulance Services

    Ambulance services you provide or that an entity you own and operate provides are not paid on the reasonable-cost basis. Ambulance services continue to be paid under the MHCP fee schedule.


    Refer to the Definitions section of the Provider Manual’s Hospital Services home page.

    Legal References

    Minnesota Statutes, section 256B.75(b) (Hospital Outpatient Reimbursement)
    Minnesota Rules, part 9500.1105, subp. 1A(s)
    (Basis of Payment for Inpatient Hospital Services)

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    Updated: 2/17/16 11:24 AM | Accessibility | Terms/Policy | Contact DHS | Top of Page | Updated: 2/17/16 11:24 AM