Provider based billing

1. Provider based billing 2019

2. Brian F. BertschPrincipal605.977.2722bbertsch@eidebailly.com

3. What is provider-based status? Provider-based status is a Medicare payment designation established by the Social Security Act that allows facilities owned by and integrated with a hospital to bill Medicare as a hospital outpatient department, resulting in these facilities generally receiving higher payments than freestanding facilities. CMS believes that provider-based facilities offer increased beneficiary access and a better integration of services resulting in improved quality of care. Associating provider-based facilities with a hospital requires following the same strict quality standards of the hospital as this designation calls for all operations to be under hospital ownership and control.

4. Who recognizes Provider Based Designation? Medicare Medicare Advantage Plans Some State Medicaid Programs – Not South Dakota Veterans Administration Tricare Railroad Medicare Check with your contracted payers to see if they recognize the Medicare designation of provider-based billing.

5. Provider Based Requirements Location Must be located within a 35 mile radius of the main hospital. Demonstrate the location serves the same patient population as the main hospital. Licensure Operate under the same license as the main hospital. Meet all applicable health and safety rules as main hospital. Clinical Integration Professional staff must have privileges at the hospital. Main hospital maintains same monitoring and oversight as for other hospital departments to include frequency, intensity and level of accountability. Main hospital committees are responsible for clinic medical activities including QA and UR. Medical directors report to the Chief Medical Officer of the hospital. Patient medical records integration between hospital and provider-based designated location.

6. Provider Based Requirements Financial Integration Financial operations are fully integrated with the main hospital showing shared income and expense. Cost Center of the main hospital by identification in trial balance. Cannot have commingling of space with visiting specialists. Public Awareness Signage, publications, websites and marketing must make it clear to the patient they are entering a location that is part of the main hospital.

7. Provider Based Requirements Obligations Comply with anti-dumping rules Must be billed with correct site-of-service Must comply with all terms of the hospital’s provider agreement. Comply with anti-discrimination provisions All Medicare patients treated as hospital outpatients for billing purposes Clinic patients subsequently admitted as inpatient subject to bundling provisions, except CAHs Must meet applicable health and safety rules

8. Location – Offsite PBD CAH (excludes RHC) Please be careful when trying to establish these “off-campus” so you continue to meet CAH requirements. 42 CFR 485.610 Condition of participation: Status and Location (CAH) (e) Off-campus and co-location requirements for CAHs. A CAH may continue to meet the location requirements of paragraph (c) of this section only if the CAH meets the following: (2) If a CAH or a necessary provider CAH operates an off-campus provider-based location, excluding an RHC as defined in § 405.2401(b) of this chapter, but including a department or remote location, as defined in § 413.65(a)(2) of this chapter, or an off-campus distinct part psychiatric or rehabilitation unit, as defined in § 485.647, that was created or acquired by the CAH on or after January 1, 2008, the CAH can continue to meet the location requirement of paragraph (c) of this section only if the off-campus provider-based location or off-campus distinct part unit is located more than a 35-mile drive (or, in the case of mountainous terrain or in areas with only secondary roads available, a 15-mile drive) from a hospital or another CAH. (3) If either a CAH or a CAH that has been designated as a necessary provider by the State does not meet the requirements in paragraph (e)(1) of this section, by co-locating with another hospital or CAH on or after January 1, 2008, or creates or acquires an off-campus provider-based location or off-campus distinct part unit on or after January 1, 2008, that does not meet the requirements in paragraph (e)(2) of this section, the CAH's provider agreement will be subject to termination in accordance with the provisions of §489.53(a)(3) of this subchapter, unless the CAH terminates the off-campus arrangement or the co-location arrangement, or both.

9. Why Attest? Protects you from the MAC recouping payments if found to not meet provider-based status. What happens when location is found to not meet provider-based status? No Self-attestment submitted All past provider-based payments could be recouped. Self-attestment submitted, but CMS denies designation CMS will estimate the appropriate payment as if services were reimbursed as non-provider-based. Amount recouped will be the difference between the payments made from the attestation filing date and the CMS estimated determination date. CMS approved provider-based status no longer meets criteria Facility is not held liable for overpayments. CMS will notify MAC and facility that provider-based status is no longer valid.

10. Attestation process Not required prior to billing for services in locations designated as provider-based. ALL off-campus locations must complete Attestation. Voluntary for on-campus (within 250 yards) Each on-campus or off-campus location must separately meet applicable rules for provider-based status. Sample attestation and supporting documents can be found in Program Memorandum A-03-030 Submit one copy to the Noridian (can be sent electronically) providerbasedattestations@noridian.com Once approved, the clinic will be designated as provider-based and you will receive a tie-in notice.

11. How does it work? The free-standing clinic becomes an outpatient department of the hospital for Medicare billing purposes. Two claims are submitted for each provider visit to the clinic. Hospital bills the facility fee – Medicare Part A UB-04 submitted by the hospital Charge associated with the facility’s operating costs Technical component of the services provided Clinic bills the professional fee – Medicare Part B CMS-1500 submitted by the provider Charge for the professional component of the services provided Payment reduction since the Practice Expense RVU is paid to the hospital

12. Chargemaster Build Know which services have a PC/TC indicator to determine which ones will split and which ones don’t. Reduced site of service payment? PC only codes, ie-surgeon professional charge TC only codes – injection, immunization Global billing codes that have a separate code for the PC and TC EKG Holter Monitor The sum of the PC and TC charges must match the charge amount billed to Non-Medicare patients. Verify the PC fee is higher than Medicare fee schedule Verify the TC is higher than the APC coinsurance amount Caution when increasing fees by a percentage amount which is being rounded that PC + TC continues to equal non-Medicare total charge.

13. Physician supervision Diagnostic Services – PPS – Follow requirements for individual tests in MPFS Diagnostic Services - CAH On-Campus outpatient department Physician must be present on the same campus & immediately available throughout the procedure. Off-Campus outpatient department Physician must be present in the off-campus provider-based department of the hospital & immediately available throughout the procedure. Therapeutic Services – PPS and CAH On-Campus outpatient department Physician must be present on the same campus & immediately available throughout the procedure. Off-Campus outpatient department Physician must be present in the off-campus provider-based department of the hospital & immediately available throughout the procedure.

14. PPS - Billing provider-based clinic services Bill all Medicare patients as hospital outpatients Comply with all terms of hospital’s provider agreements. Clinic patient subsequently admitted to hospital subject to same pre-admission bundling provisions as applied to all hospital outpatients. UB-04 Claim Form – Medicare Part A Type of Bill 013X Revenue Code 0510 with appropriate CPT for services provided Modifier PO – excepted provider-based department Modifier PN – nonexcepted provider-based department CMS-1500 Claim Form – Medicare Part B Non-RHC professional services place of service 19 when performed in off-campus outpatient department 22 when performed in on-campus outpatient department CMS-1500 Claim Form – All other payers Place of service 11(clinic) paid at full fee schedule rates

15. PPS Medicare reimbursement Technical Component (facility fee) Reimbursed on the full APC amount – excepted PBD Reimbursed at 40% of APC amount – nonexcepted PBD Patient deductible/coinsurance based on APC patient responsibility amount Professional Component (provider fee) Reimbursed on the Medicare Physician Fee Schedule under the “facility fee” column which reflects a 20-40% site-of-service reduction. Patient deductible/coinsurance amount is based on 20% of allowed amount.

16. CAH - Billing Provider Based Clinic Services Billed in the same manner as previous PPS slides but with TOB 085X. No PO or PN modifier. Technical Component (facility fee) Billed on UB-04 Revenue Code 0510 (clinic) Reimbursed at the CAH OP rate Patient deductible/coinsurance 20% of charges Professional Component (provider fee) Billed on CMS-1500 POS 19 or 22 Reimbursed on the Medicare Physician Fee Schedule as with free-standing clinic but with 20-40% reduction for site-of-service Patient deductible/coinsurance based on 20% of allowed amount

17. CAH – Method II Billing Provider-Based Method II billing of Outpatient professional services Both TC/PC are billed on the UB-04 with TOB 0851 Technical component of professional services Revenue Code 0510 = Clinic Professional component Revenue Code 0983 = Clinic Technical Component (facility fee) Revenue Code 0510 with appropriate CPT for services provided Reimbursed at the CAH OP rate Patient deductible/coinsurance 20% of charges Professional Component (provider fee) Reimbursed at 115% of the Medicare Physician Fee Schedule as with free-standing clinic but with 20-40% reduction for site-of-service Patient deductible/coinsurance based on 20% of allowed amount

18. RHC Billing under Provider-Based Professional services are not split into TC/PC amounts Billed on UB-04 under RHC NPI Type of Bill 0711 Revenue Code 052X (medical visit) or 0900 (mental health visit) Ancillary Services Laboratory/Radiology/TC of EKG and Holter Monitor billed on CAH UB-04 Type of Bill 085X Reimbursed at the CAH OP rate Patient deductible/coinsurance 20% of charged amount Additional services reported on RHC claim TOB 0711 includes: Venipuncture Drugs and administration fee Tetanus/Hepatitis B vaccinations and administration fee Supplies Exception Flu/Pneumo vaccine & administration Traditional Medicare listed on Cost Report Medicare Advantage plans flu/pneumo is separately billed Pharm D immunizations are not billable RHC may participate in TransactRx Program or patient may receive through pharmacy

19. Payment differential Comparison of Medicare and Beneficiary Costs for the same service at a Provider-Based and Freestanding Facility Reference: OIG Report - CMS is Taking Steps To Improve Oversight of Provider-Based Facilities, But Vulnerabilities Remain (OEI-04-12-00380)

20. Practice location reporting requirements Effective January 1, 2017 off-campus provider-based locations were to be reported on claim forms. Testing began July 23, 2018 Multiple rounds of testing have occurred since then. Validation edits will be activated on October 1, 2019 April, 2020 and claims will go into RTP (Return to Provide status) if service location information on file with Medicare doesn’t exactly match provider files. Edit Reason Code 34977 = Claim service facility address doesn’t match provider file Edit Reason Code 34978 = Off-campus location requires PO or PN modifier

21. Steps for service location readiness Readiness Activities Assure location is present on 855A in PECOS as additional location. Practice location screen available in DDE for verification. Report location address on claims exactly as reported on provider files. Look for things such as Road vs. Rd, Ste vs. Suite, Box One vs. Bx #1 Often easier to make minor changes in PECOS or 855A than to make billing system/clearinghouse changes Follow claims through the clearinghouse to assure location is flowing through to Medicare appropriately.

22. multiple locations - same date of service UB-04 electronic transmission Service location name/address (Box 1) reported in loop 2010AA Pay to name/address (Box 2 = Hospital) reported in loop 2010AB When all services are rendered at the billing provider address Report Hospital name only When all services are rendered at one off-campus location Report location in Box 1 and Hospital in Box 2 When there are services rendered at multiple locations If any services were at the Hospital, report Hospital only name If no services were at the Hospital, report provider-based location from the first registered encounter of the “from” date on the claim

23. Unique billing requirements Medicare provider-based billing is different than other payers so vendor must allow for separate billing rules/edits depending on claim type. Provider-based billing of a clinic visit vs. payers that are billed as free-standing clinic location RR Medicare the TC goes to Medicare Part A (Noridian) and PC goes to Medicare Part B (Palmetto GBA) Place of service for PC is different depending on payer. Medicare is 22 = outpatient hospital. Non-Medicare is 11 = clinic All Medicare ancillary services provided at the provider-based clinic location are to be billed on the UB-04. Single claim for multiple visits (provider-based location as well as hospital)

24. Unique billing requirements2 Medicare Secondary Payer Questionnaire (MSP) is required for all visits. “Incident to” does not apply to outpatient hospital services meaning direct supervision by an MD/DO/NP/PA is required. Provider immediately available to furnish assistance and direction NP/PA must bill under their own NPI resulting in decreased reimbursement (85% of MPFS) Services provided by ancillary staff can generate a TC or facility fee

25. Off-campus Provider-Based patient notice Written notification of provider-based designation must be presented to the beneficiary if the provider-based location is more than 250 yards from the main hospital building. Explain provider-based split billing Notification for multiple deductible/coinsurance amounts possible Revenue Cycle policies and procedures should outline the process being followed. How accounts are combined for same date-of-service. Multiple statements vs. one patient statement. Collection processes.

26. coding Combining services with the hospital account brings changes to the coding process. Who is responsible for coding of professional services? Who is responsible for selecting the level of service and how do we share this? Coding UB-04 professional services is different than CMS-1500 coding where you can report the diagnosis assigned to each line of service. Provider documentation should support the ICD-10 sequencing coding as follows: The first diagnosis is the primary condition for which the beneficiary is being seen (chief complaint). Acute conditions are listed above chronic, stable conditions. Signs and symptoms are listed if there is no definitive diagnosis during the encounter. Conditions which have been resolved or do not affect current treatment are not coded.

27. Medicare secondary payer (MSP) Same billing rules apply to MSP claims as when billed as primary. Submit claims to Medicare as if they were the primary payer. Billing system issues with creating different claim type than the one used for billing primary payer. Primary may have been billed on CMS-1500 and now the office visit must be split for billing to Medicare. Remittance advice issues with determining primary payment allocation when they paid as one line and Medicare professional charges are split into two. Prorate the single line payment from the primary Contact Medicare Advantage plan for billing instruction.

28. 2016 OIG Report findings The 2016 OIG report alerted CMS to overpayments being made to hospitals that were billing as off-campus provider based. Sample of 50 hospitals that hadn’t attested 17 owned 0-5 provider based facilities 17 owned 6-10 provider based facilities 16 owned 11+ provider based facilities 39 of the 50 facilities (78%) did not meet at least one provider-based requirement. Top 3 reasons they did not meet requirements & number of hospitals 25 weren’t meeting the administration and supervision requirements 24 were not operating under the control of the hospital 23 failed to demonstrate clinical services integration

29. CMS Proposed Rule Increasing Choices and Encouraging Site Neutrality Reduce payment differences between outpatient site of service Intent - allow patients to benefit from high-quality care at lower costs Receive care that is provided safely and clinically appropriate Addresses payments for clinic visits furnished in the off-campus hospital outpatient setting. Clinic visits have become the most common service billed under OPPS CMS & beneficiaries often pay more for the same clinic setting service. For any offsite PB Clinic (excepted & non-excepted), reduction in G0463 down to 40% of the APC. Looking to limit the growth of provider-based departments. Options to add new service line to existing provider-based location.

30. Outpatient therapeutic Services supervision Currently outpatient services (including designated provider-based clinic sites) cannot be billed as “incident to”. Provider direct supervision is required Provider must be present in location in order to bill CMS proposing change to the minimum required level of supervision. Applies to Hospitals and CAHs outpatient services Including designated provider-based locations Change from direct supervision to general supervision Under the providers overall direction and control Presence is not required during the performance of the procedure

31. Is provider-based still a benefit? PPS Hospital – New PBD On-Campus (250 yards) – still full payment (Reduced MPFS and APC) Off-Campus – do financial calculations 340B considerations

32. Is provider-based still a benefit? CAH Hospital On-Campus (250 yards) – still full payment (Reduced MPFS and Cost) Off-Campus – does it meet location requirements to keep CAH status?

33. QUESTIONS?

34. THANK YOU Brian F. Bertsch Principal bbertsch@eidebailly.com 605.977.2722