(Rev. 1, 09-11-02) The Health Insurance for the Aged and Disabled Act (title XVIII of the Social Security Act), known as "Medicare," has made available to nearly every American 65 years of age and older a broad program of health insurance designed to assist the nation's elderly to meet hospital, medical, and other health costs. Health insurance coverage has also been extended to persons under age 65 qualifying as disabled and those having end stage renal disease (ESRD) or Lou Gehrig's disease. The program includes two related health insurance programs--hospital insurance (HI) (Part A) and supplementary medical insurance (SMI) (Part B).

(Rev. 94, Issued: 10-16-15, Effective: 11-16-15, Implementation: 11-16-15) Hospital insurance is designed to help patients defray the expenses incurred by hospitalization and related care. In addition to inpatient hospital benefits, hospital insurance covers posthospital extended care in SNFs and posthospital care furnished by a home health agency in the patient's home. Blood clotting factors, for hemophilia patients competent to use such factors to control bleeding without medical or other supervision, and items related to the administration of such factors, are also a Part A benefit for beneficiaries in a covered Part A stay. The purpose of these additional benefits is to provide continued treatment after hospitalization and to encourage the appropriate use of more economical alternatives to inpatient hospital care. Program payments for services rendered to beneficiaries by providers (i.e., hospitals, SNFs, and home health agencies) are generally made to the provider. In each benefit period, payment may be made for up to 90 inpatient hospital days, and 100 days of posthospital extended care services. Hospices also provide Part A hospital insurance services such as short-term inpatient care. In order to be eligible to elect hospice care under Medicare, an individual must be entitled to Part A of Medicare and be certified as being terminally ill. An individual is considered to be terminally ill if the individual has a medical prognosis that his or her life expectancy is 6 months or less if the illness runs its normal course. The Part A benefit categories of inpatient hospital services and SNF services are each subject to separate and mutually exclusive day limits, so that the use of benefit days under one of these benefits does not affect the number of benefit days that remain available under the other. Accordingly, the 90 days of inpatient hospital benefits (plus 60 nonrenewable lifetime reserve days -- see Pub. 100-02, Medicare Benefit Policy Manual, chapter 5) that are available to a beneficiary in a hospital do not count against the 100 days of posthospital extended care benefits that are available in a SNF, and vice-versa.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) To qualify for home health benefits under either Part A or Part B of the program, a beneficiary must be confined to his/her home, under the care of a physician, and in need of skilled nursing services on an intermittent basis, physical therapy, or speech-language pathology services. Being "confined to the home" does not mean a beneficiary can never leave the home. See chapter 7 of the Benefit Policy publication for the definition of homebound. A beneficiary who requires one or more of these services in the treatment of his/her illness or injury and otherwise qualifies for home health benefits is eligible to have payment made on his/her behalf for the skilled nursing, physical therapy or speech-language pathology services he needs, as well as for any of the other home health services specified in the law. These services include occupational therapy, medical social services, the use of medical supplies and medical appliances, and the part-time or intermittent services of home health aides. Conversely, a patient who does not require intermittent skilled nursing or physical therapy or speech-language pathology services cannot qualify to have payment made under the program for any home health services furnished him. Excluded as home health services are the costs of housekeepers, food service arrangements, and transportation to outpatient facilities. To be covered, the home health services must be needed for a condition for which the patient required inpatient hospital services or extended care services. See the chapter 7 of the Benefit Policy publication for a description of services covered. Discharge from the hospital must have occurred in a month in which the patient has attained age 65 or was entitled to health insurance benefits under the disability or chronic renal disease provisions of the law. Home health services are services provided by a home health agency or by others under arrangements with such an agency. A home health agency is a public agency or private organization which is primarily engaged in providing skilled nursing and other therapeutic services. Where applicable the agency must be licensed under State or local law, or be approved by the State or local licensing agency as meeting the licensing standards. Examples of home health agencies are visiting nurse associations, official health agencies, and hospital-based home care programs. To participate in the health insurance program, a home health agency must meet certain other requirements included in the law as well as health and safety conditions prescribed by the Secretary of the Department of Health and Human Services. It may not qualify under hospital insurance, however, if it is primarily engaged in the treatment of mental diseases; such an agency may qualify only under supplementary medical insurance. Home health services are usually furnished on a visiting basis in a place of residence used as the individual's home. However, outpatient services in a hospital, SNF, or rehabilitation center are covered home health services, if arranged for by a home health agency, when equipment is required that cannot be made available in the patient's home. The services of an intern or resident-in-training are covered if the agency has an affiliation with or is under common control of a hospital providing such medical services and the agency bills for such services. Prior to July 1, 1981, home health services under hospital insurance included up to 100 home health visits, after the beginning of one benefit period and before the beginning of the next. The visits must have been furnished to a patient within 1 year of his/her most recent discharge from a hospital where he was an inpatient for at least 3 consecutive calendar days (counting the day of admission, but not the day of discharge). If, after his/her hospitalization, he had a covered stay in a SNF, the 1 year during which the patient may receive home health services began with the discharge from the SNF. A plan of treatment must have been established within 14 days after the hospital or SNF discharge. Home health services were also provided under supplementary medical insurance where the 100-visit limit under Part A was exceeded. Effective July 1, 1981, the 100-visit limitation under Parts A and B, and the prior inpatient stay requirement under Part A were eliminated. In addition, a person could qualify for home health services based on his or her need for skilled nursing services on an intermittent basis, physical therapy, speech-language pathology services, or occupational therapy. Effective December 1, 1981, occupational therapy was eliminated as a basis for entitlement to home health services. However, if a person has otherwise qualified for home health services because of the need for skilled nursing care, physical therapy or speech-language pathology services, the patient's eligibility for home health services may be extended solely on the basis of the continuing need for occupational therapy. Effective January 1, 1998, the first 100 visits must be paid under Part A if the beneficiary is entitled under Part A, and the remainder of the visits may be paid under Part B.

(Rev. 12425, Issued: 12-21-23, Effective: 01-01-24, Implementation: 01-02-24) To obtain SMI, an eligible individual must enroll during an enrollment period and pay the required premiums. An individual is eligible to enroll if they are entitled to HI or are 65 years of age and a citizen or resident alien who meets certain residence requirements. SMI provides for payment to participating providers for furnishing covered services after a yearly cash deductible is met. The voluntary medical insurance plan is designed to supplement the basic hospital insurance coverage. It provides coverage for home health visits not available under hospital insurance (e.g., no Part A entitlement or visits after the first 100 visits) and for medical and other health services. Payment may not be made under Part B for any service that may be paid under Part A. However, where payment is not possible under Part A (e.g., no Part A entitlement or benefits are exhausted) payment may be made under Part B if the service is covered. Subject to coverage and limitations described in the Benefit Policy Publication, the following services are covered under Part B. • Physicians' services; • Services and supplies (including drugs and biologicals which are not usually self- administered by the patient) furnished as an incident to a physician's professional service, of kinds which are commonly furnished in physicians' offices and are commonly either rendered without charge or included in the physicians' bills; • Hospital services (including drugs and biologicals which are not usually self- administered by the patient) incident to physicians' services rendered to outpatients and partial hospitalization or intensive outpatient services incident to such services; • Diagnostic services which are: (i) furnished to an individual as an outpatient by a hospital or by others under arrangements with them made by a hospital, and (ii) ordinarily furnished by such hospital (or by others under such arrangements) to its outpatients for the purpose of diagnostic study; • Outpatient physical therapy services, occupational therapy services, and speech-language pathology services; • Rural health clinic services and Federally qualified health center services; • Home dialysis supplies and equipment, self-care home dialysis support services, and institutional dialysis services and supplies; • Antigens (subject to quantity limitations prescribed in regulations by the Secretary) prepared by a physician, as defined in section 1861(r)(1) of the Act, for a particular patient, including antigens so prepared which are forwarded to another qualified person (including a rural health clinic) for administration to such patient, from time to time, by or under the supervision of another such physician; • Services furnished pursuant to a contract under section 1876 of the Act to a member of an eligible organization by a physician assistant or by a nurse practitioner and such services and supplies furnished as an incident to his/her service to such a member as would otherwise be covered under this part if furnished by a physician or as an incident to a physician's service; and, services furnished pursuant to a risk-sharing contract under section 1876(g) of the Act to a member of an eligible organization by a clinical psychologist (as defined by the Secretary) or by a clinical social worker, and such services and supplies furnished as an incident to such clinical psychologist's services or clinical social worker's services to such a member as would otherwise be covered under this part if furnished by a physician or as an incident to a physician's service; • Blood clotting factors, for hemophilia patients competent to use such factors to control bleeding without medical or other supervision, and items related to the administration of such factors, subject to utilization controls deemed necessary by the Secretary for the efficient use of such factors; • Prescription drugs used in immunosuppressive therapy furnished to an individual who receives an organ transplant for which payment is made under this title; • Services which would be physicians' services if furnished by a physician and which are performed by a physician assistant under the supervision of a physician and which the physician assistant is legally authorized to perform by the State in which the services are performed, and such services and supplies furnished as incident to such services as would be covered if furnished incident to a physician's professional service; and but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services. • Services which would be physicians' services if furnished by a physician and which are performed by a nurse practitioner or clinical nurse specialist working in collaboration with a physician which the nurse practitioner or clinical nurse specialist is legally authorized to perform by the State in which the services are performed, and such services and supplies furnished as an incident to such services as would be covered if furnished incident to a physician's professional service, but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services; • Certified nurse-midwife services; • Qualified psychologist services; • Clinical social worker services; • Erythropoietin for dialysis patients competent to use such drug without medical or other supervision with respect to the administration of such drug, subject to methods and standards established by the Secretary by regulation for the safe and effective use of such drug, and items related to the administration of such drug; • Prostate cancer screening tests; • An oral drug (which is approved by the Federal Food and Drug Administration) prescribed for use as an anticancer chemotherapeutic agent for a given indication, and containing an active ingredient (or ingredients), which is the same indication and active ingredient (or ingredients) as a drug which the A/B MAC (B) determines would be covered if the drug could not be self-administered; • Colorectal cancer screening tests; • Diabetes outpatient self-management training services; • An oral drug (which is approved by the Federal Food and Drug Administration) prescribed for use as an acute anti-emetic used as part of an anticancer chemotherapeutic regimen if the drug is administered by a physician (or as prescribed by a physician)-- (i) for use immediately before, at, or within 48 hours after the time of the administration of the anticancer chemotherapeutic agent; and (ii) as a full replacement for the anti-emetic therapy which would otherwise be administered intravenously; • Screening for glaucoma (as defined in subsection (uu)) for individuals determined to be at high risk for glaucoma, individuals with a family history of glaucoma and individuals with diabetes; • Medical nutrition therapy services in the case of a beneficiary with diabetes or a renal disease who-- (i) has not received diabetes outpatient self-management training services within a time period determined by the Secretary; (ii) is not receiving maintenance dialysis for which payment is made under section 1881 of the Act; and (iii) meets such other criteria determined by the Secretary after consideration of protocols established by dietitian or nutrition professional organizations; • Diagnostic X-ray tests (including tests under the supervision of a physician, furnished in a place of residence used as the patient's home, if the performance of such tests meets such conditions relating to health and safety as the Secretary may find necessary and including diagnostic mammography if conducted by a facility that has a certificate (or provisional certificate) issued under section 354 of the Public Health Service Act), diagnostic laboratory tests, and other diagnostic tests; X-ray, radium, and radioactive isotope therapy, including materials and services of technicians; • Surgical dressings, and splints, casts, and other devices used for reduction of fractures and dislocations; Durable medical equipment; • Ambulance service where the use of other methods of transportation is contraindicated by the individual's condition, but only to the extent provided in regulations; • Prosthetic and orthotic devices (other than dental) which replace all or part of an internal body organ (including colostomy bags and supplies directly related to colostomy care), including replacement of such devices, and including one pair of conventional eyeglasses or contact lenses furnished subsequent to each cataract surgery with insertion of an intraocular lens; • Leg, arm, back, and neck braces, and artificial legs, arms, and eyes, including replacements if required because of a change in the patient's physical condition; • Vaccines: (1) pneumococcal vaccine and its administration and, subject to section 4071(b) of the Omnibus Budget Reconciliation Act of 1987, (2) influenza vaccine and its administration; and (3) hepatitis B vaccine and its administration, furnished to an individual who is at high or intermediate risk of contracting hepatitis B; NOTE: A charge separate from the ESRD composite rate will be recognized and paid for administration of the vaccine to ESRD patients. NOTE: For Medicare program purposes, the hepatitis B vaccine may be administered upon the order of a doctor of medicine or osteopathy by home health agencies, SNFs, renal dialysis facilities (RDFs), hospital outpatient departments, persons recognized under the "incident to physicians' services" provision of law, and, of course, doctors of medicine and osteopathy. • Services of a certified registered nurse anesthetist; • Subject to section 4072(e) of the Omnibus Budget Reconciliation Act of 1987, extra- depth shoes with inserts or custom molded shoes with inserts for an individual with diabetes, if-- (1) the physician who is managing the individual's diabetic condition (a) documents that the individual has peripheral neuropathy with evidence of callus formation, a history of pre-ulcerative calluses, a history of previous ulceration, foot deformity, or previous amputation, or poor circulation, and (b) certifies that the individual needs such shoes under a comprehensive plan of care related to the individual's diabetic condition; (2) the particular type of shoes are prescribed by a podiatrist or other qualified physician (as established by the Secretary); and (3) the shoes are fitted and furnished by a podiatrist or other qualified individual (such as a pedorthist or orthotist, as established by the Secretary) who is not the physician described in (1) above (unless the Secretary finds that the physician is the only such qualified individual in the area); • Screening mammography; • Screening pap smear and screening pelvic exam; and • Bone mass measurement. • No diagnostic tests performed in any laboratory, including a laboratory that is part of a rural health clinic, or a hospital (which, for purposes of this sentence, means an institution considered a hospital for purposes of section 1814(d)) of the Act shall be included unless such laboratory- 1. Is situated in any State in which State or applicable local law provides for licensing of establishments of this nature, (1) is licensed pursuant to such law, or (2) is approved, by the agency of such State or locality responsible for licensing establishments of this nature, as meeting the standards established for such licensing; 2. Meets the certification requirements under section 353 of the Public Health Service Act; and 3. Meets such other conditions relating to the health and safety of individuals with respect to whom such tests are performed as the Secretary may find necessary. There shall be excluded from the diagnostic services specified any item or service which would not be included if it were furnished to an inpatient of a hospital. None of the items and services referred to in the preceding paragraphs of this subsection which are furnished to a patient of an institution which meets the definition of a hospital for purposes of section 1814(d) of the Act shall be included unless such other conditions are met as the Secretary may find necessary relating to health and safety of individuals with respect to whom such items and services are furnished.

(Rev. 1, 09-11-02) (See Claims Processing, Pub 100-04 for a description of the basis for payment for the various services.)

(Rev. 1, 09-11-02) The conduct of the program has been delegated by the Secretary of the Department of Health and Human Services to the Administrator of the Centers for Medicare & Medicaid Services (CMS). Congress has also provided substantial administrative roles for the States and for voluntary insurance organizations in recognition of their experience in the health care and insurance fields. The law does not permit the Federal Government to exercise supervision or control over the practice of medicine, the manner in which medical services are provided, and the administration or operation of medical facilities. The patient is free to choose any qualified institution, agency, or person offering him/her services. The responsibility for treatment and the control of care remains with the individual's physician and the hospital or other facility or agency furnishing services. The individual may keep or obtain any other health insurance he/she desires including the choice to enroll in a Medicare+Choice plan. More information about Medicare+Choice plans is in the Medicare Managed Care Manual.

(Rev. 1, 09-11-02) Part A is financed through separate payroll contributions paid by employees, employers, and self-employed persons. The proceeds are deposited to the account of the Federal Hospital Insurance Trust Fund, which is used only for hospital insurance benefits and administrative expenses. Federal employees and State and local employees who do not pay the full FICA tax must pay the HI portion; they are not eligible for monthly Social Security or railroad retirement benefits. The cost of providing Part A benefits to other persons who are not Social Security or railroad retirement beneficiaries is met by appropriations to the Federal Hospital Insurance Trust Fund from general revenues or through premium payments. Part B is financed by monthly premiums of those who voluntarily enroll in the program and by the Federal Government which makes contributions from general revenues. All premiums and Government contributions are deposited in a separate account known as the Federal Supplementary Medical Trust Fund. Money from this fund is used only to pay for Part B benefits and administrative expenses.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) Participating providers of Part A services under the supplementary medical insurance program (e.g., hospitals, SNFs, HHAs, hospices, outpatient physical therapy, comprehensive outpatient rehabilitation facilities (CORFs), occupational therapy and speech-language pathology providers, and renal dialysis facilities) must comply with the requirements of title VI of the Civil Rights Act of 1964. Under the provisions of that Act, a participating provider is prohibited from making a distinction on the grounds of race, color, or national origin, in the treatment of patients, the use of equipment, other facilities, and the assignment of personnel to provide services. The DHHS is responsible for investigating complaints of noncompliance.

(Rev. 1, 09-11-02) Providers and suppliers have an obligation, under law, to conform to the requirements of the Medicare program. Fraud and abuse committed against the program may be prosecuted under various provisions of the United States Code and could result in the imposition of restitution, fines, and, in some instances, imprisonment. In addition, there is also a range of administrative sanctions (such as exclusion from participation in the program) and civil monetary penalties that may be imposed when facts and circumstances warrant such action. Following are definitions and examples of fraud and abuse. These definitions and examples give a better understanding of the types of practices that are forbidden, under law, in the Medicare program.

(Rev. 1, 09-11-02) Fraud is defined as making false statements or representations of material facts in order to obtain some benefit or payment for which no entitlement would otherwise exist. These acts may be committed either for the person's own benefit or for the benefit of some other party. In order to prove that fraud has been committed against the Government, it is necessary to prove that fraudulent acts were performed knowingly, willfully, and intentionally. Examples of fraud include, but are not limited to, the following: • Billing for services that were not furnished and/or supplies not provided. This includes billing Medicare for appointments that the patient failed to keep; • Altering claims forms and/or receipts in order to receive a higher payment amount; • Duplicating billings that includes billing both the Medicare program and the beneficiary, Medicaid, or some other insurer in an effort to receive payment greater than allowed; • Offering, paying, soliciting, or receiving bribes, kickbacks, or rebates, directly or indirectly, in cash or in kind, in order to induce referrals of patients or the purchase of goods or services that may be paid for by the Medicare program; • Falsely representing the nature of the services furnished. This encompasses describing a noncovered service in a misleading way that makes it appear as if a covered service was actually furnished; • Billing a person who has Medicare coverage for services provided to another person not eligible for Medicare coverage; and • Using another person's Medicare card to obtain medical care.

(Rev. 1, 09-11-02) Abuse describes practices that, either directly or indirectly, result in unnecessary costs to the Medicare program. Many times abuse appears quite similar to fraud except that it is not possible to establish that abusive acts were committed knowingly, willfully, and intentionally. Following are three standards that CMS uses when judging whether abusive acts in billing were committed against the Medicare program: • Reasonable and necessary; • Conformance to professionally recognized standards; and • Provision at a fair price. Examples of abuse include, but are not limited to, the following: • Charging in excess for services or supplies; • Providing medically unnecessary services or services that do not meet professionally recognized standards; • Billing Medicare based on a higher fee schedule than for non-Medicare patients; • Submitting bills to Medicare that are the responsibility of other insurers under the Medicare secondary payer (MSP) regulation; and • Violating the participating physician/supplier agreement. Although these types of practices may initially be categorized as abusive in nature, under certain circumstances they may develop into fraud if there is evidence that the subject was knowingly and willfully conducting an abusive practice.

(Rev. 1, 09-11-02) The DHHS has overall responsibility for administering the hospital insurance and voluntary SMI programs. Two major agencies - CMS and the Public Health Service - are involved in specified administrative functions.

(Rev. 1, 09-11-02) The CMS is responsible for policy formulation. The central and regional offices are responsible for the general management and operation of the program. In brief, CMS's responsibilities include the following: • Determining an individual's entitlement to benefits in consultation with the Social Security Administration (SSA); • Determining the nature and duration of services for which a beneficiary's benefits may be paid; • Establishing, maintaining, and administering agreements with State agencies, providers of services, and A/B MACs (A) and (HHH); • Establishing operational policy for contractors; • Developing operational instructions and official interpretations of policy for contractors; • Formulating major policies regarding conditions of participation for providers in consultation with the Public Health Service; • Developing and maintaining statistical research and actuarial programs; and • Managing general finances of the program; and • Managing the Medicare Premium Collection Operation. The regional offices are responsible for assuring that contractors meet applicable Federal requirements under the provisions of their contracts. They also: • Provide liaison, direction, and technical assistance to contractors in the day-to-day management of their operations; • Interpret CMS guidelines, policies, and procedures applicable to contractor activities; • Analyze contractor budgets and spending patterns to assure that funds are economically and appropriately utilized; • Conduct assessments of contractor operations; • Review contractor actions; and • Provide feedback to each contractor.

(Rev. 1, 09-11-02) The Public Health Service is responsible for administering the professional health aspects of the program. In brief, its responsibilities include the following: • Consulting and recommending to CMS matters concerning the development of health and safety standards and other guidelines needed for determining whether providers of services meet the conditions of participation under the program; • Consulting and advising State agencies concerning the application of standards for providers; and • Coordinating programs and activities necessary in studying the utilization of services under the program.

(Rev. 1, 09-11-02) The States, by agreement with the Secretary, are assigned significant administrative functions to the extent that each is willing and capable of discharging such responsibilities.

(Rev. 1, 09-11-02) Facilities desiring to participate in either the Medicare or Medicaid programs must meet participation conditions for certification. State agencies certify to DHHS whether providers satisfy, and continue to satisfy, their respective conditions of participation in the Medicare and Medicaid programs. The Secretary, DHHS, certifies facilities requesting participation in the Medicare and Medicaid programs. States certify those facilities that request participation in the Medicaid program only. The State function of making certifications is intended to be a natural adjunct to ongoing State activities (such as the licensing of health care facilities and the setting of standards).

(Rev. 1, 09-11-02) A State consults with providers of services that need and request participation condition assistance. For Medicare participation, the Secretary, DHHS, must approve the consultation service rendered by the State certifying agency.

(Rev. 1, 09-11-02) A State coordinates activities with other State programs that involve payment for health care, quality of care, and location of health facilities. Coordinating these activities is essential in assuring effective and economical use of existing State facilities and trained personnel and to prevent duplication of effort.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) The A/B MAC (A) and (HHH) is a public or private agency or organization that has entered into an agreement with CMS to enroll legitimate providers into the Medicare program and process Medicare claims under both Part A and Part B services under the supplementary medical insurance program (e.g., hospitals, SNFs, HHAs, hospices, CORFs, OPTs, occupational therapy, and speech-language pathology providers, and ESRD facilities). A/B MACs (A) and (HHH) make payments to providers. The amount of payment to a provider is restricted to the lower of the billed charge, the reasonable cost of covered services or the fee schedule amount. Hospices are paid on a per diem amount that is prospectively set. SNFs and HHAs are paid based on a Prospective Payment System (PPS). (See Provider Reimbursement Manual, Part 1, §§2800ff.) Hospitals are paid based on the PPS. Under this system, Medicare payment is made at a predetermined, specific rate for each hospital discharge. This statement applies to inpatient for acute care hospitals and to inpatient rehabilitation hospitals. Whereas inpatient acute and rehab PPS payment is based on the discharge date, Outpatient PPS (OPPS) payments are based on Ambulatory Patient Classification payment for the date of service. The amount of payment to other types of providers is restricted to the lesser of (a) the reasonable cost of covered services and items; or (b) the billed charges with respect to such services; or (c) the fee schedule amount. In addition, A/B MACs (A) and (HHH) assist in applying safeguards against unnecessary use of covered services, furnish consultative services to serve as a center for communicating with providers, conduct audits of provider records, assist in the beneficiary appeals process, and provide information and advice to institutions and organizations that wish to qualify as providers of services. (See http://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative- Contractors/Home-Health-Hospice-Regions.html for a list of A/B MACs (A) and (HHH) and service areas.)

(Rev. ) CMS assigns MACs based upon jurisdictions as described in: http://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative- Contractors/MACJurisdictions.html There are no alternate selections permitted, effective with the implementation of MACs.

(Rev. ) All HHAs bill the assigned A/B MAC (HHH) and are paid by that MAC. In the case of HHAs and hospices based in another Medicare provider (e.g., a hospital or SNF), audit, cost report settlement, and other fiscal functions (such as setting interim payment rates) are performed by the A/B MAC (A) serving the parent provider.

(Rev. 1, 09-11-02) The law requires the Secretary, DHHS, to enter into contracts with A/B MACs (B) and DME MACs to serve in the operation and administration of the non-provider Part B program. A/B MACs (B) enroll physicians, non-physician health care practitioners and other entities that will submit claims to the A/B MAC (B), and process Medicare claims and make payments for services and supplies covered by Part B. Other major functions include, for example, controlling over-utilization and communicating with beneficiaries and the health community. DME MACs have been given the responsibility of processing durable medical equipment, prosthetic, orthotic, and supply (DMEPOS) claims. See Claims Processing Manual, chapter 1, for description of jurisdiction.

(Rev. 1, 09-11-02) Section 1153 of the Social Security Act (the Act) requires the Secretary to enter into contracts with physician-approved or physician-access organizations defined as PROs. The PROs are organizations who are responsible for monitoring the quality of care provided to Medicare patients by hospitals, SNFs, home health agencies, Medicare+Choice plans, and other types of health care providers. PRO review is governed by titles XI and XVIII of the Act as amended, and by regulations contained in: • 42 CFR 411 - Limitation on liability; • 42 CFR 412 - Outlier review, diagnosis related group (DRG) validation, and hospital notices of non coverage; • 42 CFR 417.605 - Immediate PRO review of Health Maintenance Organization (HMO)/Competitive Medical Plan (CMP) notices of discharge; • 42 CFR 422.622 - Immediate review of Medicare+Choice discharge notices; • 42 CFR 475 - Definition of eligible organizations and area designation; • 42 CFR 476 - Assumption and conduct of review; • 42 CFR 478 - PRO reconsideration and appeals; • 42 CFR 480 - Disclosure of information; • 42 CFR 482 - Hospital conditions of participation; and • 42 CFR 1004 - PRO recommendations of sanctions.

(Rev. 1, 09-11-02) The PROs review items or services provided to Medicare beneficiaries to determine: • Whether services provided or proposed to be provided are reasonable and medically necessary for the diagnosis and treatment of illness or injury, or to improve functioning of a malformed body member, or for prevention of an illness, or for the palliation and management of terminal illness; • Whether those services furnished or proposed to be furnished on an inpatient basis could be effectively furnished on an outpatient basis, or in an inpatient health care facility of a different type; • Medical necessity, reasonableness, and appropriateness of inpatient hospital care for which additional payment is sought under the outlier provisions of PPS; • Whether a hospital has misrepresented admission or discharge information, or has taken an action that results in the unnecessary admission of an individual entitled to benefits under Part A, unnecessary multiple admissions of an individual, or other inappropriate medical or other practices with respect to beneficiaries, or billing for services furnished to beneficiaries; • The validity of diagnostic and procedural information supplied by the provider to the A/B MAC (A) for payment purposes; • The completeness and adequacy of hospital care provided; and • Whether the quality of services meets professionally recognized standards of health care. These activities enable PROs to determine whether Medicare payment may be made for the services claimed and to identify and initiate corrective action where appropriate. PROs have the authority to deny Medicare payment for medically inappropriate and unnecessary admissions. They also investigate individual beneficiary complaints about the quality of care received.

(Rev. 1, 09-11-02) In addition to individual case review, PROs also help providers improve the overall approach to health care for Medicare beneficiaries. This function includes the following activities: • Using clinical and other data bases to examine patterns of care and outcomes, rather than focusing on isolated cases; • Identifying systemic variations of concern or interest by monitoring patterns of care and outcomes; • Working with providers to identify provider-specific root causes of systemic variations; and • Working cooperatively with the health care community to measurably improve the processes and outcomes of care for Medicare beneficiaries.

(Rev. 1, 09-11-02) A. Responsibilities Prior to Review The PROs are responsible for: • Specifying in their plan and instructions to practitioners and providers the type of evidence they require to document the care ordered or furnished to provide medically necessary, appropriate, and quality health care services; and • Applying professionally developed criteria for providing care, diagnosis, and treatment based upon typical patterns of practice within their geographic area to evaluate the medical necessity, quality, or appropriateness of services ordered or furnished. B. Ongoing Review Activities As a part of their ongoing review activities, PROs must: • Notify the appropriate agency of the State or Federal government when they become aware of situations which appear to be improper, but which do not fall within their review responsibilities (e.g., poor quality care in a renal dialysis center); • Use their authority or influence to enlist the support of other professional or Government agencies to ensure that all providers and practitioners for which they have review responsibilities comply with their obligations (see §1156 of the Act.); and • Perform beneficiary and physician outreach activities. C. Responsibilities as a Result of PRO Review To act upon information they obtain as a result of their review activities, PROs must: • Provide information on results of their review (e.g., annual report, periodic meetings with providers/practitioners); • Identify and seek correction of situations that, if continued, would result in violations under §1156 of the Act; • Submit reports to the Office of the Inspector General on providers and practitioners found to have substantially violated an obligation in a substantial number of cases, or to have grossly and flagrantly violated an obligation in one or more instances. This includes referring certain cases to State licensing boards. D. Additional Activities PROs perform all other activities specified in the Scope of Work, including any modifications, CMS regulations and instructions, and relevant statutory provisions. E. Payment Error Prevention Program (PEPP) In order to reduce inpatient PPS payment errors, PROs must initiate a program of Payment Error Prevention Projects (PEPPs). CMS defines the payment error rate as the number of dollars found to be paid in error out of the total of all dollars paid for inpatient PPS services. CMS provides State-specific error rates to PROs to evaluate performance.

(Rev. 1, 09-11-02) It is the obligation of any health care practitioner or other person who furnishes or orders health care items or services that may be reimbursed under Medicare, to ensure that to the extent of his or her authority, those services are: • Furnished economically and only when and to the extent medically necessary; • Of a quality that meets professionally recognized standards of health care; and • Supported by evidence of the medical necessity and quality of the services in the form and fashion that the reviewing PRO may reasonably require (including copies of the necessary documentation) to ensure that the practitioner or other person is meeting the obligations imposed by Section 1156(a) of the Act. These obligations apply whether payment is made directly to the provider (i.e., assignment) or to the beneficiary, or even if payment is not made.

(Rev. 1, 09-11-02) The PRO has ultimate responsibility for monitoring the compliance of practitioners and providers with statutory obligations. It is not relieved of any of the responsibility under the sanction regulations in the event of non-performance by an organization with which it has subcontracted for review. An organization with which the PRO subcontracts to carry out review functions is responsible for: • Ensuring that practitioners and other persons meet their obligations with respect to the items and services it reviews; and • Reporting to the PRO (primary contractor) those instances where it appears a violation of an obligation may have occurred or is occurring.

(Rev. 1, 09-11-02) The Social Security Act requires each provider, as a condition of participation under Medicare, to have a written overall plan and budget reflecting an annual operating budget and a capital expenditures plan (that covers at least a 3-year period including the year to which the operating budget is applicable). For this requirement, provider means hospital, critical access hospital, SNF, comprehensive outpatient rehabilitation facility, home health agency, or hospice program. The annual operating budget will include all anticipated income and expenses related to items which would under generally accepted accounting principles be considered income and expense items. The capital expenditure plan would be expected to include and identify in detail the anticipated sources of finance for, the objectives of, each anticipated expenditure in excess of $l00,000 related to acquisition of land, the improvement of land, buildings, and equipment, and the replacement, modernization, and expansion of the buildings and equipment which would, under generally accepted accounting principles, be considered capital items. The overall budget and plan will be prepared under the direction of the provider's governing body by a committee consisting of representatives of the governing body, administrative staff and if any, the medical staff. Further, it will be reviewed and updated at least annually. The purpose of the requirement is to assure that providers carry on budgeting and substance by the Government or any of its agents.

(Rev. 2, 2-6-04) The CMS Managed Modules contains scheduled release dates for software programs and pricing/coding files. Medicare contractors will be receiving subsequent quarterly updates of the CMS Managed Modules via a Recurring Update Notification. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R12425GI 12/21/2023 Enforcing Billing Requirements for Intensive Outpatient Program (IOP) Services with New Condition Code 92 - Additional Publication Update 01/02/2024 13496 R94GI 10/16/2015 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (2015) 11/16/2015 9336 R80GI 10/26/2012 Manual Updates to Clarify SNF Claims Processing 04/01/2013 8044 R42GI 11/09/2006 Swing Bed Hospital Updates 12/11/2006 5114 R28GI 08/12/2005 Conforming Changes for Change Request 3648 to Pub. 100-01 09/12/2005 3912 R02GI 02/06/2004 Scheduled Release for April Updates to Software Programs and Pricing/Coding Files 03/08/2004 3123 R01GI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 1, 09-11-02) Hospital insurance (HI), as well as supplementary medical insurance (SMI), is available to three basic groups of "insured individuals"- the aged, the disabled, and those with end stage renal disease. Following is an explanation of how an individual becomes "insured" as well as an explanation of the eligibility requirements for each group.

(Rev. 1, 09-11-02) To be eligible for premium-free HI, an individual must be "insured" based on his or her own earnings or those of a spouse, parent, or child. To be insured, the worker must have a specific number of quarters of coverage (QCs); the exact number required is dependent upon whether the person is filing for HI on the basis of age, disability, or end stage renal disease. QCs are earned through payment of payroll taxes under the Federal Insurance Contributions Act (FICA) during the person's working years. QCs earned by an individual who pays the full FICA tax are usable to insure the person for both monthly social security benefits and HI. Federal employees were exempt from payment of FICA taxes prior to January 1983. However, beginning in January 1983, Federal employees became subject to the HI portion of the FICA tax (those actually employed in January 1983 were also deemed to have earned HI quarters of coverage for their Federal service prior to January 1983). Also, Government employees who pay only the HI portion of the FICA tax are only insured for HI; they are not insured for monthly social security benefits. State and local Government employees hired after March 31, 1986, are eligible for Medicare coverage and must pay the HI portion of the FICA tax. A State may elect to cover employees hired prior to April 1986 for the Medicare portion of the FICA tax by requesting an agreement or modification of its existing agreement under section 218 of the Social Security Act.

(Rev. 1, 09-11-02) To be eligible for HI on the basis of age, a person must be age 65 or older and either eligible for monthly social security or railroad retirement cash benefits, or would be eligible for such benefits if the worker's Government QCs were regular social security QCs. An individual who is insured for monthly benefits need not actually file for benefits to receive HI benefits. If such a person continues to work beyond age 65, he or she may instead elect to file an application for HI only. Premium-free HI for the aged begins with the month in which the individual attains age 65, provided he or she files an application for HI or for cash benefits and HI within 6 months of the month in which he or she attains age 65. If the application is filed later than that, HI entitlement can be retroactive for only 6 months. An individual attains age 65 on the day before his or her 65th birthday. For example, if an individual is born on August 1, the attainment date is July 31, and HI begins with July 1. Entitlement generally does not end until death.

(Rev. 1, 09-11-02) A disabled person who is entitled to social security or railroad retirement benefits on the basis of disability is automatically entitled to HI after 24 months of entitlement to such benefits. Since there is a 5-month disability benefits waiting period, the person actually becomes entitled to HI after being disabled for 29 months. In addition, disabled persons who are not insured for monthly Social Security disability benefits but would be insured for such benefits if Government QCs were treated as social security QCs, are deemed to be entitled to disability benefits and automatically entitled to HI after being disabled for 29 months. The months in the Medicare qualifying period need not be consecutive so that months from a previous period of disability benefit entitlement generally may be counted in determining when the qualifying period requirement is met. HI entitlement on the basis of disability is available not only to the worker, but to the widow, widower, or child of a deceased, disabled, or retired worker if any of them become disabled within the meaning of the Social Security or Railroad Retirement Acts. If an individual recovers from a disability, HI entitlement ends with the month after the month he or she is notified of the disability termination. For example, if notification is November 15, entitlement ends December 31. However, if the individual's disability benefit entitlement ends only because he or she was working, HI entitlement may continue for up to 78 additional months.

(Rev. 1, 09-11-02) Individuals of any age with end stage renal disease (ESRD) who receive dialysis on a regular basis or a kidney transplant are eligible for HI (and are deemed enrolled for Supplementary Medical Insurance (SMI) unless such coverage is refused) if they file an application. They must also meet certain work requirements for insured status under the social security or railroad retirement programs, or be entitled to monthly social security benefits or an annuity under the Railroad Retirement Act, or be the spouse or dependent child of an insured or entitled person.

(Rev. 1, 09-11-02) Entitlement usually begins after a 3-month waiting period has been served, i.e., with the first day of the third month after the month in which a course of regular dialysis begins. Entitlement begins before the waiting period has expired if the individual receives a transplant or participates in a self-dialysis training program during the waiting period.

(Rev. 1, 09-11-02) Entitlement begins with the month the individual is admitted as an inpatient to a hospital for procedures in preparation for or in anticipation of a kidney transplant, provided the transplant surgery takes place within the following 2 months. If the transplant is delayed more than 2 months after the preparatory hospitalization, entitlement begins with the second month prior to the month of transplant. Under the Medicare, Medicaid, and State Children's Health Insurance Program (SCHIP) Benefits Improvement and Protection Act of 2000, Congress extended immunosuppressive drug benefits to lifetime, as long as the beneficiary is entitled to Medicare and was entitled to Medicare when his/her transplant took place.

(Rev. 1, 09-11-02) Entitlement begins with the first month of the course of dialysis if the individual is expected to complete the self-dialysis training program and self-dialyze thereafter.

(Rev. 1, 09-11-02) HI coverage based on ESRD ends with the earliest of the following dates: • The day an individual dies, • The last day of the 12th month after the month the course of dialysis is discontinued, unless the individual receives a kidney transplant during that period or begins another course of dialysis, or • The last day of the 36th month after the month the person receives a kidney transplant.

(Rev. 1, 09-11-02) If a person whose entitlement based on ESRD has ended begins a new course of regular dialysis or has a kidney transplant, reentitlement begins without a waiting period.

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) Individuals who want hospital insurance coverage but who are not otherwise eligible (i.e., do not qualify under either the regular or deemed insured provisions, in §§10.1, 10.2, 10.3, 10.4 in this chapter) may obtain such coverage by enrolling timely, paying a monthly premium, and upon meeting the following three requirements: • Attaining age 65, • Enrolling or already having enrolled in the SMI program, • Being a resident of the U.S., and either: o A citizen, or o An alien lawfully admitted for permanent residence who has resided continuously in the U.S. for the 5 years prior to the month of enrollment.

(Rev. 1, 09-11-02) Each year, the Secretary of the Department of Health and Human Services announces the amount of the hospital insurance premium payable for each month in the following calendar year. The applicable premium amount is 33/76 (about 43.4 percent) of the hospital insurance deductible for that calendar year. The premium is rounded to the nearest $1. An individual who is not entitled to free Part A and wishes this type of coverage must enroll him/herself during the appropriate enrollment period. A premium is due for each month of entitlement under Premium HI.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) The following subsections describe Medicare Part A premiums paid by other than the enrollee.

(Rev .11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) States that include the payment of Medicare Part A premiums for Qualifying Medicare Beneficiaries (QMBs) in their state buy-in agreements are known as Part A buy-in states. Individuals in Part A buy-in states can file for Premium Part A at any time, without regard to enrollment periods. Late enrollment penalties do not apply. Please see the Manual for State Payment of Medicare Premiums, chapter 1, sections 1.7 and 1.11 for additional information about Part A buy-in states.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) States that do not include the payment of Medicare Part A premiums for QMBs in their state buy-in agreements are known as group payer states. To become entitled to Part A, individuals in group payer states can file for premium Part A during their Initial Enrollment Period (IEP) or the General Enrollment Period (GEP). Part A premiums and any applicable late enrollment penalties are paid under a group payer arrangement. Please see the Manual for State Payment of Medicare Premiums, chapter 1, section 1.7 and 1.11 for additional information about Part A group payer states.

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) Persons may enroll for premium hospital insurance by filing a request during the IEP which begins the third month before the month of first eligibility and lasts for 7 months. The individual's IEP for premium hospital insurance is in most cases the same 7-month period as the IEP for SMI. The individual may enroll for hospital insurance when he or she enrolls for SMI, or later during his or her IEP. The beginning date of an individual's premium hospital insurance coverage period is determined by the rules applicable to SMI coverage based on an SMI enrollment during an IEP. (See chapter 2 §40 in this chapter.)

(Rev. 1, 09-11-02) Eligible persons who have not enrolled for premium hospital insurance during their IEP, or whose premium hospital insurance has been terminated, may enroll during a GEP (January 1 - March 31 of each year) if they are enrolling or have enrolled for SMI. As with SMI, an eligible person who enrolls for hospital insurance during a GEP will have hospital insurance coverage beginning the following July. The same restrictions on enrollment and reenrollment apply as in the SMI program. Individuals who enroll late may pay a 10 percent premium penalty.

(Rev. 1, 09-11-02) A beneficiary's entitlement under the provision terminates: • With the month of the individual's death, • With the last day of the third month following the premium billing month (for nonpayment of premiums), • With the end of the month following the month in which he or she files a voluntary request for termination, • With the month SMI coverage is terminated, or • With the month before the month in which he or she becomes entitled to hospital insurance under the regular or ESRD provisions. (See §2, §10.4 of this chapter.)

(Rev. 1, 09-11-02) Unlike the HI benefits program, which is largely financed by compulsory taxes on employers, employees, and the self-employed, the SMI benefits program is a voluntary program financed from premium payments by enrollees, together with contributions from funds appropriated by the Federal Government, and certain deductible and cost-sharing provisions.

(Rev. 1, 09-11-02) To obtain SMI coverage, eligible individuals must enroll in the plan during an enrollment period open to them and pay the required premiums. They are eligible to enroll if they are entitled to premium-free HI, or are age 65 and resident citizens or resident aliens. To qualify as a resident alien, an individual must have been lawfully admitted for permanent residence and have resided continuously in the United States during the 5 years immediately preceding the month of enrollment.

(Rev. 1, 09-11-02) Beneficiaries (except those residing in foreign countries or Puerto Rico) are deemed to have enrolled in SMI in the month before the month for which they are entitled to HI so that HI and SMI coverage start in the same month. Thus, monthly beneficiaries other than disability beneficiaries are deemed to enroll in the month before attainment of age 65. Disability beneficiaries are deemed to enroll in the 24th consecutive month of entitlement to disability benefits. Every potential "deemed" enrollee is given a reasonable opportunity (at least 2 months) to decline SMI enrollment by filing notice to this effect. He or she is deemed not to have enrolled and does not incur any premium liability. A refusal of SMI not timely filed is treated as a request for voluntary termination under existing disenrollment rules once it has been established that the individual does not wish to have SMI.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Enrollment is possible only during specified enrollment periods: • An individual's initial enrollment period (IEP) is of 7 months duration. It begins 3 full calendar months before and ends 3 full calendar months after the month in which the individual first meets all the requirements for enrollment. • A general enrollment period (GEP) occurs each year from January 1 through March 31. Coverage is effective the month following the month of enrollment. • Special enrollment periods (SEP) are available to enable certain individuals to enroll in Medicare outside of the IEP and the GEP.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Coverage begins on the first day of: • The month in which the individual first becomes eligible for SMI if enrollment takes place during the first 3 months of the initial enrollment period, • The month following the month of enrollment if enrollment occurs during the fourth through seventh month of the initial enrollment period.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Coverage begins the first day of the month following the month of enrollment.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) If an individual enrolls in SMI or premium HI while still covered under a GHP or LGHP or during the first full month when not enrolled in a GHP/LGHP based on current employment status, coverage begins either with: • The first day of the month of SMI or premium HI enrollment, or • At the individual's option, with the first day of any of the following 3 months. If the individual enrolls during any of the 7 remaining months of the special enrollment period, coverage begins with the first day of the month following the month of enrollment.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who do not enroll in Part B or Premium Part A when first eligible because they were performing volunteer service outside of the United States may enroll during this SEP. Eligible Individuals may enroll if: • They volunteered outside of the United States through a program that covers at least a 12-month period; and • Is sponsored by a tax exempt organization; and • The individual has (or had) health insurance that provided coverage to the individual while he or she was outside of the U.S. for the duration of the volunteer service. The SEP for volunteers is the 6-month period that begins the earlier of the first day of the month following the month for which the: • Individual was no longer serving as a volunteer outside of the United States; • Organization no longer has tax-exempt status; or • Individual no longer has health insurance that provides coverage outside of the United States. Coverage begins the first day of the month following enrollment.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who enroll in Part A based on disability or ESRD, but do not enroll in Part B because they were eligible for TRICARE standard or TRICARE prime, may enroll during this SEP. Eligible individuals are those who are: • Under age 65, and • Eligible for TRICARE Standard at the time of HI entitlement and: • A military retiree or military retiree family member, or • On active duty or a family member of an active duty service member with Medicare based on ESRD. Eligible individuals may enroll: • If notified of Medicare entitlement during the IEP -The month after the end of the IEP, or • If notified of Medicare entitlement after the IEP -The month of notification of Medicare entitlement. Coverage begins: If notified of Medicare entitlement during the IEP: • The month of enrollment, or • The first month after the end of the IEP If notified of Medicare entitlement after the IEP: • The month of enrollment, or • The month SMI terminated based on the refusal. If entitlement is based on ESRD, coverage begins: • The month of HI entitlement, or • The month of enrollment, or • The month after the end of the IEP.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals entitled to Medicare Part A based on disability, but who did not enroll in Part B because Medicare was the secondary payer for covered services, may enroll using this 7-month SEP. Eligible individuals may enroll with the later of: • The month in which the employer notifies the beneficiary that Medicare is the primary payer, or • The month Medicare becomes the primary payer. Coverage begins either: • The first day of the month of filing for Part B, or • During any month of the 7-month D-SEP, or • Retroactive to the month Medicare becomes the primary payer provided the beneficiary makes arrangements to pay the past due premiums; either by a lump sum payment or by monthly installments.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Effective January 1, 2023, the following SEPs for exceptional conditions are available for Premium Part A and Part B, respectively.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who do not enroll in Part B or Premium Part A when first eligible due to having an emergency or disaster as declared by a federal, state, or local government entity may enroll during this SEP. Eligible Individuals may enroll as early as: • The month of the emergency or disaster, or • Up to six months after the emergency or disaster has ended. NOTE: they may also be able to use this SEP if the disaster or emergency takes place where their authorized representative, legal guardian, or person who makes health care decisions on their behalf resides. The SEP begins the date an emergency or disaster is declared, or the start date identified in the emergency declaration, whichever is earlier. The SEP ends six months after the end of the date which is the later of: • The end date identified in the disaster or emergency declaration, or • The end date of any extensions or the date when the declaration has been determined to have ended or has been revoked, or • The date of the declaration, if such date is after the end of the disaster. Coverage begins the first day of the month following enrollment.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who do not enroll in Part B or Premium Part A when first eligible due to misrepresentation or reliance on incorrect information provided by their employer or GHP, agents or brokers of health plans, or any person authorized to act on behalf of such entity may enroll during this SEP. An eligible person must demonstrate (by documentation or written attestation) both of the following: • They did not enroll in Part B or Premium Part A during another enrollment period in which they were eligible based on information received from an employer or GHP, agents or brokers of health plans, or any person authorized to act on such organization’s behalf. • An employer, GHP, agent or broker of a health plan, or their representative materially misrepresented information or provided incorrect information relating to enrollment in Part B or Premium Part A. The SEP begins the day an individual notifies the Social Security Administration and ends six months later. Coverage begins the first day of the month following enrollment.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who do not enroll in Part B or Premium Part A when first eligible because they were incarcerated may enroll during the SEP. An eligible person can sign up anytime within the 12 months after their release from incarceration. The SEP begins the day an individual is released from the custody of penal authorities. However, individuals have the option to select a retroactive effective date (not to begin prior to their release date and not to exceed 6 months). If individuals choose this retroactive option, they will be responsible for paying Medicare premiums back to the date of coverage. Coverage begins the first day of the month following enrollment or up to six months retroactive.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals whose Medicaid eligibility terminated may enroll during this SEP. A person may be eligible based on this condition if they have: • Lost Medicaid entirely, • Missed a Medicare enrollment period, and • Their Medicaid coverage was terminated on or after January 1, 2023. The SEP begins when an individual is notified of an upcoming termination of Medicaid eligibility and ends six months after the Medicaid termination. Medicare benefits start the month after Medicare enrollment unless the individual elects a start date back to the first day of the month the individual lost Medicaid and agrees to pay all prior premiums. Note: Individuals who are still eligible for Medicaid, including a Medicare Savings Program, and have not received notice of an upcoming Medicaid termination are not eligible for this SEP.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) Individuals who do not enroll in Part B or Premium Part A when first eligible because conditions beyond their control caused them to miss an enrollment period may enroll during the SEP. This SEP is available for individuals whose unique conditions do not qualify for other SEPs. An eligible person must demonstrate (by documentation or written attestation) that conditions outside of their control that occurred on or after January 1, 2023, caused them to miss an enrollment period. An individual’s request for this SEP will only be granted in conditions that are truly exceptional in nature, and will not be used to grant individual’s enrollment due to forgetfulness, lack of knowledge, or failure to make premium payments. SSA will determine when this SEP begins on a case-by-case basis, but the SEP will end no less than 6 months after it begins. Coverage begins the first day of the month following enrollment.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) Under the State Buy-in program, states, the District of Columbia, and the U.S. territories may enter into buy-in agreements with CMS to enroll certain individuals who are dually eligible for Medicare and Medicaid into Medicare Part B and pay the premiums on their behalf. Most states have expanded their buy-in agreements to also include payments of Part A premiums for individuals who must pay a premium to enroll in Medicare Part A and who are eligible for the Qualified Medicare Beneficiary (QMB) eligibility group. State buy-in agreements maximize the number of full-benefit Medicaid recipients enrolled in Medicare, which ensures that Medicare pays primary to Medicaid. State buy-in agreements also facilitate enrollment in Medicare for low income individuals who are not eligible for full-benefit Medicaid coverage by paying Medicare premiums and cost sharing. Please see the Manual for State Payment of Medicare Premiums, chapter 1, section 1.2 for additional state buy-in information.

(Rev. 1, 09-11-02) An individual may notify CMS in writing, at any time, that he or she no longer wishes to participate in the supplementary medical insurance plan. Termination of coverage takes effect at the close of the calendar month following the calendar month in which the request for termination was filed. Enrollment under medical insurance is terminated because of nonpayment of premiums. Termination is effective with the end of the grace period provided for payment of premiums. (See chapter 2, §40.7.4 of this manual.) For individuals under age 65, enrollment is terminated because HI entitlement ended. SMI terminates at the same time as HI. If not terminated sooner, coverage ends with the beneficiary's death.

(Rev. 1, 09-11-02) An individual whose enrollment has terminated may reenroll only in a general enrollment period or a special enrollment period if the requirements are met.

(Rev. 1, 09-11-02) A premium is due for each month of entitlement under SMI. The SMI premium covers about one-fourth of the cost of the Part B program.

(Rev. 1, 09-11-02) In the third quarter of each calendar year, the Secretary of the Department of Health and Human Services announces the base premium for SMI coverage that is payable as of the following January 1. The SMI premium is the same for all enrollees even though the cost to the program is greater for ESRD enrollees and the disabled than it is for the aged. The SMI premium is refigured each year and is based on the lower of one-half of SMI program costs per aged enrollee or the general percentage by which social security benefits were increased during the calendar year in which the announcement occurs. (During the 5-year period, January 1984 through December 1988, the formula for computing the SMI premium has been modified to provide that the Part B premium reflects exactly one-fourth of the cost of the Part B program. Beginning with the premium announced for the period beginning January 1989, however, the method of computing the SMI premium reverts back to the pre-January 1984 rules.)

(Rev. 1, 09-11-02) The base premium that is announced by the Secretary is paid by most enrollees. However, it is increased for those who enroll late or reenroll after a prior termination of entitlement. The amount of the increase is 10 percent of the base rate for each full 12- month period during which the individual could have been but was not enrolled in the program. However, months in which an individual has GHP coverage based on current employment status are not counted as months in which the individual "could have been, but was not enrolled." This exception does not apply to individuals who are entitled to Medicare on the basis of ESRD.

(Rev. 1, 09-11-02) SMI premiums are collected from benefits payable (in order of priority) by the Railroad Retirement Board, SSA, or Office of Personnel Management (Civil Service) unless the individual is covered under a State buy-in agreement. If the individual is entitled to such benefits but the payments are in suspense, e.g., due to work deductions, he or she is billed for the amounts due. Uninsured beneficiaries are also billed directly for the premiums due. Premium bills are sent every 3 months unless the individual specifically requests a monthly bill or is also entitled to Premium - HI (in which case a monthly combined SMI- Premium-HI bill is sent).

(Rev. 1, 09-11-02) A grace period has been provided for payment of premiums by those who are billed directly. The period extends for 90 days after the month in which the bill is mailed. If the premiums are not received in that prescribed time, entitlement terminates at the end of the grace period. This 90-day grace period for paying overdue SMI premiums and continuing SMI coverage may be extended by CMS for good cause for up to an additional 90 days. Good cause, for example, is found if the enrollee was mentally or physically incapable of paying his or her premiums timely, or had some reasonable basis to believe that payment had been made, or the failure to pay was due to administrative error.

(Rev. 1, 09-11-02) If an extension to the grace period (additional 90 days; a total not to exceed 180 days) has been granted, an enrollee may retain SMI entitlement by paying all past due premiums if there was a good cause for his/her failure to pay premiums within the initial grace period.

(Rev. 1, 09-11-02) The following subsections describe premiums paid by other than the enrollee.

(Rev. 1, 09-11-02) Enrollees who are being billed directly for Medicare premiums may turn over their premium bills to a friend, relative, employer lodge, union or other organization to pay premiums on their behalf. The third party payer forwards the proper amount of payment for each enrollee to CMS's Premium Collection Center. Enrollees participating in this type of informal arrangement continue to receive their premium notice (Form CMS-500), and remain responsible for assuring that premiums paid on their behalf are paid timely in order to avoid termination of Medicare coverage.

(Rev. 1, 09-11-02) Individuals may be designated as the premium payer for an enrollee and receive the enrollee's premium bills, if it is judged to be in the enrollee's best interest (e.g., the enrollee is competent, but too physically ill or infirm to be able to handle such matters). The individual receiving the premium bill must be a relative or friend showing personal interest in the welfare of the enrollee.

(Rev. 1, 09-11-02) Employers, religious orders, lodges, unions or other organizations may enter into a formal agreement with CMS in order to receive a single bill and pay a lump sum for the premiums due from a group of individuals. Group payments under a formal group agreement may be made only on behalf of individuals who are already enrolled and are being billed for direct remittance. This type of arrangement is referred to as a "Formal Group Payer" arrangement. While included in a formal group payer arrangement, enrollees will no longer receive a premium notice (Form CMS-500). This arrangement is available only where the number of enrollees in the group is large enough to make it practicable to send one bill to the group payer and where the following conditions are also met: • Enrollees included under the formal group arrangement are directly billed for their premium, and are not having his/her premiums deducted from a Social Security, Railroad Retirement, or Civil Service benefit, or, are not having premiums paid by a State Medicaid agency under a State buy-in agreement; • The enrollee authorizes the formal group payer to pay premiums on his/her behalf; • The formal group payer has a minimum of 20 enrollees; and • The formal group payer agrees to submit premium payments via electronic funds transfer. If the formal group payer agreement is terminated, or if the group payer alerts CMS to remove an individual from the group payer arrangement, CMS will resume collection of premiums from the individual through the direct billing process.

(Rev. 1, 09-11-02) States or local Governments may pay a lump sum for the total amount of the SMI late enrollment premium surcharge for a group of individuals. In order to pay the premium surcharge, States or local Governmental entities are required to enter into a formal agreement with CMS. An individual is not billed for the premium surcharge portion of his/her SMI premium while under a premium surcharge agreement, however, he/she is billed for the base premium amount. If the enrollee is receiving a Social Security, Railroad Retirement, or Civil Service annuity, the agencies responsible for these programs will continue to withhold the base premium amount from the annuity. Enrollees who are billed directly for premiums will continue to receive a premium bill for the base premium amount. The ultimate responsibility for paying premiums rests with the enrollees.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) States pay the Part B premiums for any eligible individual specified in the state’s buy-in agreement. Under buy-in agreements, states can enroll individuals in Part B at any time without regard to Medicare enrollment periods or late enrollment penalties. Please see the Manual for State Payment of Medicare Premiums, chapter 1, section 1.4 for additional information about state payment of premiums under a buy-in agreement.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) If an individual did not enroll in premium Part A when first eligible, they may have to pay a higher monthly premium if they decide to enroll later. The monthly premium for Part A may increase up to 10%. The individual will have to pay the higher premium for twice the number of years the individual could have had Part A, but did not sign up. For individuals enrolling using the SEP Related to Coverage Under Group Health Plans, the premium Part A LEP is calculated by adding the months that have elapsed between the close of the individual’s IEP and the end of the month in which the individual enrolls. For enrollments after your IEP has ended, months where you had group health plan coverage are excluded from the LEP calculation. For individuals enrolling using an Exceptional Conditions SEP, the International Volunteers SEP, or the SEP for Certain TRICARE Beneficiaries, no LEP will be applied.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) If an individual did not sign up for Part B when first eligible, the individual may have to pay a late enrollment penalty for as long as the individual has Medicare. The individual’s monthly premium for Part B may go up 10% for each full 12-month period that the individual could have had Part B, but did not sign up for it. For individuals enrolling using the SEP Related to Coverage Under Group Health Plans, the Part B LEP is calculated by adding the months that have elapsed between the close of the individual’s IEP and the end of the month in which the individual enrolls. For enrollments after your IEP has ended, months where you had group health plan coverage are excluded from the LEP calculation. For individuals enrolling using an Exceptional Conditions SEP, the International Volunteers SEP, or the SEP for Certain TRICARE Beneficiaries, no LEP will be applied. For individuals enrolling using the D-SEP, the Part B LEP is calculated by adding all months during which the large group health plan (LGHP) was secondary payer beginning with the end of the IEP, or the date LGHP coverage began.

(Rev. 1, 09-11-02) CMS and SSA are authorized to take necessary action to correct an erroneous SMI or premium hospital insurance enrollment or nonenrollment which was based upon the action, inaction, or error of a Government officer, employee, or agent. The action may include designating special individual enrollment periods and premium adjustments. For the purpose of this provision, an individual's enrollment or nonenrollment in SMI is considered to have been prejudiced and due to the "action, inaction, or error" of an officer, employee, or agent of the Government, if there is an official record or other evidence showing that: • The individual took reasonable appropriate and timely measures to assert his or her rights, and • Due to administrative fault or other action, which may or may not have been erroneous at the time taken, his or her rights have been or are likely to be impaired unless relief is given. This authority applies to all Part B cases which have arisen since the Medicare program began on July 1, 1966. It is applied to cases that come to CMS's or SSA's attention; however, MACs should not search their files.

(Rev. 11646; Issued:10-19-22; Effective:01-01-23; Implementation:01-03-23) The Consolidated Appropriations Act of 2021 amended section 1836(b) of the Social Security Act to add a new form of coverage that provides solely for coverage of immunosuppressive drugs beginning January 1, 2023, for eligible individuals whose entitlement to Medicare based on End-Stage Renal Disease (ESRD) ends the 36th month after the month in which the individuals receive a successful kidney transplant. This new benefit is referred to as the Part B immunosuppressive drug benefit or “Part B- ID.” Beneficiaries enrolled in Part B-ID will not be covered for any other Medicare benefit or for any items or services other than Part B Immunosuppressive Drugs.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) An individual is eligible for Part B-ID if he or she: 1. Is or was entitled to Medicare Part A based on ESRD that ends 36 months after a successful kidney transplant; and 2. Attests that he or she is not enrolled in other health coverage that would make them ineligible for Part B-ID, as outlined in section 40.9.2. Every individual enrolling in Part B-ID must: i. Attest that they are not enrolled in other health coverage and do not expect to enroll in other coverage which would make them ineligible for Part B-ID; and ii. Agree to notify SSA within 60 days of enrolling in other health coverage. NOTE: An individual can inform SSA of other health coverage up to 6 months in advance

(Rev . 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) An individual who has other certain health coverage is not eligible for Part B-ID. Other health coverage includes: • Group Health Plans or Individual Health Plans; • Enrolled in the patient enrollment system of the Department of Veterans Affairs (VA) or otherwise eligible to receive immunosuppressive drugs from the VA; • TRICARE for Life; • Health Insurance Marketplace qualified health plans; and • Medicaid or State Children’s Health Insurance Program (CHIP) coverage that includes immunosuppressive drugs.

(Rev. 11646; Issued:10-19-22; Effective:01-01-23; Implementation:01-03-23) The effective date of an individual’s eligibility for the Part B-ID benefit depends on when their entitlement to Medicare Part A based on ESRD ends and when they submit the attestation described in section 40.9.1 of this chapter. When an individual’s Medicare Part A entitlement based on ESRD ends on or after January 1, 2023: • If they submit the attestation before the end of the 36th month after the month of the kidney transplant (i.e. before their Medicare Part A entitlement based on ESRD ends), Part B-ID begins effective at the start of the month after their Medicare Part A on the basis of ESRD ends. • If they submit the attestation after their Medicare Part A entitlement ends, Part B-ID begins at the start of the month following the month in which the attestation is submitted. When an individual’s Medicare Part A entitlement based on ESRD ends prior to January 1, 2023: • If they submit the attestation to enroll from October 1, 2022 through December 31, 2022, Part B-ID begins effective January 1, 2023. • If they submit the attestation to enroll after December 31, 2022, Part B-ID begins the following month.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) There are no enrollment periods associated with Part B-ID. Therefore, eligible individuals can enroll at any time without regard to Medicare enrollment periods. The earliest date on which they may initially enroll depends on when their Medicare Part A entitlement based on ESRD ends, under the following two scenarios: 1. When an individual’s Medicare Part A entitlement based on ESRD ends on or after January 1, 2023, they may enroll in Part B-ID any time after their Medicare Part A on the basis of ESRD entitlement ends. 2. When an individual’s Medicare Part A entitlement based on ESRD ends prior to January 1, 2023, they may enroll in Part B-ID beginning October 1, 2022 and their coverage will start the later of January 2023 or the month after they enroll. Individuals who had previously enrolled in Part B-ID can reenroll at any time if they meet the eligibility requirements in section 40.9.1. NOTE: Late enrollment penalties are not applicable to Part B-ID enrollment. Additional information is outlined under subsection 40.9.7 (Part B-ID Premiums).

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) Eligible individuals may enroll by: 1. calling SSA at 1-877-465-0355 and providing an oral attestation, or 2. completing and filing the Application for Enrollment in Part B-ID. Immunosuppressive Drug Coverage Form CMS-10798 and mailing it to the following address: SOCIAL SECURITY ADMINISTRATION OFFICE OF CENTRAL OPERATIONS PO Box 32914 BALTIMORE, MARYLAND 21298 Note: The Office of Central Operations Office of Disability Operations teleservice center (ODO TSC) will only be handling the telephonic enrollments and PC 7 will process the enrollment for Part B-ID.

(Rev. 11646; Issued:10-19-22; Effective:01-01-23; Implementation:01-03-23) 1. Individuals enrolled in other health coverage are required to notify SSA and terminate Part B-ID a. When a Part B-ID covered individual notifies SSA that they have enrolled in other coverage, and if not otherwise specified, Part B- ID terminates effective with the first day of the month following the month SSA receives the notification. b. If the individual states that their other health insurance begins in the future, the individual may request a termination date up to 6 months in the future. Example: If an individual enrolls in employer health coverage during an employer’s open enrollment period in October, for a January 1st effective date, the individual can submit their request for termination of the Part B-ID benefit in October or November, and not lose their Part B-ID benefit prior to the January 1st effective date. c. When a state ends buy-in for Part B-ID because an individual gained full Medicaid eligibility that includes immunosuppressive drug coverage, the individual must report this new eligibility to SSA and terminate Part B-ID coverage. If a Part B-ID covered individual fails to notify SSA of their enrollment in other health coverage, including employer and Medicaid, Part B-ID will terminate effective the first day of the month after the month in which SSA discovers the individual has other health coverage. 2. Voluntary termination request – In general, Part B-ID terminates effective with the first day of the month following the month in which we receive the request. There is an exception to this general rule for individuals who had state payment of their Part B-ID premium under a Medicare Savings Program (as described in section 40.9.9) and who are notified by SSA that their state will no longer pay their Medicare Part B-ID premiums. For these individuals the following entitlement end dates apply: a. If the individual files a voluntary termination request within 30 days after the date of the notice that state payment of premiums will end or has ended, the individual's Part B-ID entitlement ends on the last day of the last month for which the state paid the premium. b. If the individual files the voluntary termination request more than 30 days but not more than 6 months after state payment of Medicare Part B-ID premiums ends, Part B-ID entitlement ends on the last day of the month in which the request is filed. c. If the individual files the voluntary termination request later than the 6th month after state payment of Medicare Part B-ID premiums ends, entitlement ends at the end of the month after the month in which request is filed. We note that individuals who lose eligibility for state payment of Medicare Part B-ID premiums through a Medicare Savings Program will continue to be eligible for the Part B-ID benefit without interruption with the individual assuming responsibility for paying the Part B-ID premiums, unless they voluntarily terminate. The options for financial relief from Part B billing in SSA’s Program Operations Manual System (POMS), section HI.00815.042, also apply for the Part B-ID coverage here. 3. Death - Entitlement to Part B-ID continues into the month of death, up to and including the date of death. 4. Non-payment of premiums – Part B-ID coverage will terminate for non- payment of premiums following the same rules, including grace periods, used for Medicare Part B for monthly billing in sections 40.5 and 40.7.4 of this manual. Note that section 40.5 provides end of coverage information, and section 40.7.4 provides grace period payment information. 5. Individual becomes entitled to Medicare on another basis – In cases where a Part B-ID enrollee becomes eligible for Medicare based on age, disability, or ESRD, Part B-ID will terminate effective with the last day of the month prior to the month in which they become entitled on the other basis. Equitable relief for retroactivity may apply.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) Part B-ID premiums may be adjusted based on rounding, the income-related monthly adjusted amounts (IRMAA), and the hold harmless provision, but will not be increased based on late enrollment. If the individual is directly billed for premiums, billing will be on a monthly basis.

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) Individuals enrolled in the Part B-ID benefit can report other coverage and request to terminate their enrollment by either: 1. calling SSA at 1-877-465-0355 to disenroll over the phone to verbally request termination, or 2. completing and submitting Form CMS-1763, Request for Termination of Premium Hospital and/or Supplementary Medical Insurance, and mailing it to: SOCIAL SECURITY ADMINISTRATION OFFICE OF CENTRAL OPERATIONS PO Box 32914 BALTIMORE, MARYLAND 21298 3. any other request to SSA that shows the unequivocal desire to end coverage. Note: The Office of Central Operations Office of Disability Operations teleservice center (ODO TSC) only will handle the telephonic disenrollment and PC 7 will process the disenrollment for Part B-ID. When the individual is reporting other coverage and choosing a future termination date, a termination effective date that is more than 6 months in the future cannot be processed

(Rev. 11764; Issued 12-22-22; Implementation: 01-01-2023; Effective 01-03-23) Individuals enrolled in Part B-ID with limited income and resources may be eligible for assistance through the Medicare Savings Programs (MSPs). The MSPs include three eligibility groups that cover Part B-ID premiums and sometimes cost sharing, including: • Qualified Medicare Beneficiary (QMB) • Specified Low-Income Medicare Beneficiary (SLMB) • Qualifying Individuals (QI) There are two ways to enroll in the MSPs for the payment of the Part B-ID premiums. First, once enrolled in Part B-ID, individuals may apply for the MSPs and be determined eligible by their state for an MSP eligibility group based on Part B-ID. Second, individuals who are enrolled in an MSP group and lose Medicare entitlement based on ESRD 36 months after the month in which they receive a kidney transplant can transition to an MSP based on Part B-ID enrollment without a break in coverage if: (1)they attest that they do not have other health coverage as described in 40.9.1 by the end of the 36th month after the month in which they receive a kidney transplant; and (2) the state redetermines the individual’s Medicaid eligibility on all bases and does not otherwise find the individual ineligible for the MSP group.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 As part of health insurance electronic data processing, Medicare cards are issued by CMS to individuals who have established entitlement to health insurance. Below is an example of the Medicare card. New Medicare Card New Medicare Card Front New Medicare Card Back The Medicare card is used to identify the individual as being entitled and also serves as a source of information required to process Medicare claims or bills. It displays the beneficiary's name, Medicare number, and effective date of entitlement to hospital insurance and/or medical insurance. The Social Security Administration's Social Security Office assists in replacing a lost or destroyed Medicare cards.

(Rev. 12046, Issued:05-18-23, Effective:01-01-23, Implementation:06-21-23) The term Medicare beneficiary identifier (MBI) is a general term describing a beneficiary’s Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes.

(Rev. 1, 09-11-02) Medicare Part C, which is also known as Medicare+Choice, is a Medicare program that gives beneficiaries more choices among health plans. Everyone who has Medicare Parts A and B is eligible, except those who have end stage renal disease, and were not in a Medicare+Choice plan at the onset of this condition. Public Law 105-33, the Balanced Budget Act of 1997, establishes a new authority permitting contracts between CMS and a variety of different managed care and fee-for- service entities. The types of entities that may be granted contracts under this new authority include: • Coordinated care plans, including Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and Provider-Sponsored Organizations You may be asked to show this card when you get health care services. Only give your personal Medicare information to health care providers, your insurers, or people you trust who work with Medicare on your behalf. WARNING: Intentionally misusing this card may be considered fraud and/or other violation of federal law and is punishable by law. Es posible que le pidan que muestre esta tarjeta cuando reciba servicios de cuidado médico. Solamente dé su información personal de Medicare a los proveedores de salud, sus aseguradores o personas de su confianza que trabajan con Medicare en su nombre. ¡ADVERTENCIA! El mal uso intencional de esta tarjeta puede ser considerado como fraude y/u otra violación de la ley federal y es sancionada por la ley. 1-800-MEDICARE (1-800-633-4227 / TTY: 1-877-486-2048); Medicare.gov (PSOs). A PSO is defined as a public or private entity established by health care providers, which provide a substantial proportion of health care items and services directly through affiliated providers who share, directly or indirectly, substantial financial risk. • Religious fraternal benefit society plans which may restrict enrollment to members of the church, convention or group with which the society is affiliated. Payments to such plans may be adjusted, as appropriate to take into account the actuarial characteristics and experience of plan enrollees. • Private fee-for-service plans which reimburse providers on a fee-for-service basis, and are authorized to charge enrolled beneficiaries up to 115 percent of the plan's payment schedule (which may be different from the Medicare fee schedule). In addition to the Medicare+Choice contractors, beginning in January, 1999, up to 390,000 beneficiaries will have the choice (on a demonstration basis ending January 1, 2003) of enrolling in a Medical Savings Account (MSA) option. Under this option, beneficiaries would obtain high deductible health policies that pay for at least all Medicare-covered items and services after an enrollee meets the annual deductible of up to $6,000. The difference between the premiums for such high deductible policies and the applicable Medicare+Choice premium amount would be placed into an account for the beneficiary to use in meeting his or her deductible expenses. Past 1876 Contracts - HMO/CMP risk plans that remain in compliance with current contracting standards and comply with new requirements established under this statutory authority automatically transitioned into the Part C Medicare+Choice program. Section 1876 risk-based contractors were paid under a new Medicare+Choice payment methodology rather than the prior method in section 1876(a), and were subject to certain other Medicare+Choice provisions. The Secretary no longer accepts new 1876 risk applications. As of January 1, 1999, existing 1876 risk-based contracts were terminated, and plans in good standing transitioned to the Medicare+Choice program. Repeal of Cost Option - As of August 5, 1997, the Secretary is prohibited from entering into any new 1876 cost-based contracts, unless the plan is a Health Care Prepayment Plan with an agreement under section 1833 of the Social Security Act. The 1876 cost-based payment authority is repealed and all cost contracts are terminated as of December 31, 2002. Limited HCPP Option - Beginning January 1, 1999, the Secretary may only contract with those HCPPs that are sponsored by Union or Employer groups, or HCPPs that do not "provide, or arrange for the provision of, any inpatient hospital services ...." This amendment will result in the termination of section 1833 agreements with any organization that does not meet the new definition. CMS will establish transition rules for 1876 risk-based contractors that currently receive reimbursement on a cost basis for enrollees remaining under a previous HCPP agreement. For more information, see the Managed Care Manual. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R12046GI 05/18/2023 Update to the Internet Only Manual (IOM) Publication (Pub.) 100-01, IOM Chapter 2 Hospital Insurance and Supplementary Medical Insurance 06/21/2023 13189 R11764BP 12/22/2022 New Medicare Part B Immunosuppressant Drug Benefit (PBID) - Implementation 01/03/2023 12804 R11646GI 10/19/2022 New Medicare Part B Immunosuppressant Drug Benefit (PBID) – Implementation – Rescinded and Replaced by Transmittal 11764 01/03/2023 12804 07/28/2022 New Medicare Part B Immunosuppressant Drug Benefit (PBID) – Implementation SENSITIVE/CONTOVERSIAL DO NOT POST- Rescinded and Replaced by Transmittal 11646 01/03/2023 12804 R124GI 05/17/2019 Update to Publication (Pub.) 100-01 to Provide Language-Only Changes for the New Medicare Card Project 06/18/2019 11240 R01MGI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 1, 09-11-02) The patient is responsible for a deductible amount for inpatient hospital services in each benefit period. For each year after 1991, the Secretary of the Department of Health and Human Services (DHHS) is required to set the deductible and coinsurance amounts between September 1 and September 15 of the preceding year. The deductible will be set at an amount equal to the deductible for the preceding year, changed by the same percentage as applies to PPS payment rates, and adjusted to reflect changes in real case mix. The deductible and coinsurance amounts are shown in the chart in §10.3 of this chapter. The coinsurance amount is based on the deductible applicable for the calendar year in which the coinsurance days occur. The deductible is satisfied only by charges for covered Part A services. Expenses for covered services count toward the deductible on an incurred, rather than paid, basis. Expenses incurred in one benefit period cannot be applied toward the deductible in a later benefit period. Expenses incurred in meeting the blood deductible do not count toward the inpatient hospital deductible. A reduction in benefit days resulting from confinement in a psychiatric hospital, on and immediately preceding the date of entitlement, does not affect the amount of the deductible for which the patient is responsible. If the actual charge is less than the deductible and the customary charge, the customary charge is applied to the deductible. A beneficiary is not responsible for payment of the deductible for an inpatient stay if the provider has been determined to be liable because the care was not medically necessary or because the care provided was custodial.

(Rev. 1, 09-11-02) The following subsections describe coinsurance.

(Rev. 1, 09-11-02) In each benefit period, the patient is responsible for coinsurance amounts equal to: • One-fourth of the inpatient hospital deductible for each day of inpatient hospital services from the 61st through the 90th days; • One-half of the inpatient hospital deductible for each lifetime reserve day (the 91st through the 150th days of inpatient hospital services); and • One-eighth of the inpatient hospital deductible for each day of extended care services from the 21st through the 100th days. A beneficiary is not responsible for payment of the coinsurance for a stay if the provider has been determined to be liable because the care was not medically necessary or because the care provided was custodial. Use the chart in §10.3 of this chapter to determine the applicable coinsurance amounts. Where the actual charge to the patient for the 61st through the 90th days of inpatient hospital services is less than the applicable coinsurance amount, the coinsurance is the actual charge per day. Where the actual charge to the patient for lifetime reserve days is less than the coinsurance amount for those days, the beneficiary may be deemed to have elected not to use the days because he/she would not benefit from their utilization.

(Rev. 1, 09-11-02) The patient is responsible for 20 percent of the payment amount for DME furnished as a home health benefit.

(Rev. 12980; Issued:11-25-24; Effective: 01-01-25; Implementation: 01-06-25) The applicable inpatient deductible is the one in effect during the calendar year in which the patient's benefit period begins (i.e., in most cases, the year in which the first inpatient hospital services are furnished in the benefit period). Except for 1989, the coinsurance amount is based on the deductible applicable for the calendar year in which the coinsurance days occur. When Deductible and/or Coinsurance Are Applicable for Part A Inpatient Hospital- First 60 Days Deductible applicable equal to national average cost per day Inpatient Hospital- 61st thru 90th Day Coinsurance per day always equal to 1/4 of inpatient hospital deductible Inpatient Hospital- 60 Lifetime Reserve Days (nonrenewable) - 91st thru 150th day Coinsurance always equal to 1/2 of inpatient hospital deductible Skilled Nursing Facility 21st thru 100th Day Coinsurance always equal to 1/8 of inpatient hospital deductible Home Health Agency No Deductible No Coinsurance (except for 20 percent coinsurance for DME and prosthetics/ orthotics) Blood 1st 3 pints (or equivalent units of packed red blood cells) in a calendar year - combined Part A and B Hospice * a. Drugs and Biologicals b. Respite Care a. 5 percent of the cost determined by the drug copayment schedule (may not exceed $5 per prescription) b. 5 percent of the payment for a respite care day *Hospices may charge coinsurance for two services only, drugs and biologicals, and respite care. The amount of coinsurance for each prescription may not exceed $5.00. The amount for respite care may not exceed the inpatient deductible for the year in which the hospital coinsurance period began. Deductible and Coinsurance Amounts Year Part A Deductible, 1st 60 Days Part A Coinsurance, 61st- 90th Days Part A Coinsurance, 60 Lifetime Reserve Days Part A SNF Coinsurance 21st- 100th Days 1986 $492 123 246 61.50 1987 520 130 260 65.00 1988 540 135 270 67.50 1989 560 0 (1) 0 (1) 0(2) 1990 592 148 296 74.00 1991 628 157 314 78.50 1992 652 163 326 81.50 1993 676 169 338 84.50 1994 696 174 348 87.00 1995 716 179 358 89.50 1996 736 184 368 92.00 1997 760 190 380 92.00 1998 764 191 382 95.50 1999 768 192 384 96.00 2000 776 194 388 97.00 2001 792 198 396 99.00 2002 812 203 406 101.50 2003 840 210 420 105.00 2004 876 219 438 109.50 2005 912 228 456 114.00 2006 952 238 476 119.00 2007 992 248 496 124.00 2008 1,024 256 512 128.00 2009 1,068 267 534 133.50 2010 1,100 275 550 137.50 2011 1,132 283 566 141.50 2012 1,156 289 578 144.50 2013 1,184 296 592 148.00 2014 1,216 304 608 152.00 2015 1,260 315 630 157.50 2016 1,288 322 644 161.00 2017 1,316 329 658 164.50 2018 1,340 335 670 167.50 2019 1364 341 682 170.50 2020 1,408 352 704 176.00 2021 1,484 371 742 185.50 2022 1,556 389 778 194.50 2023 1,600 400 800 200.00 2024 1,632 408 816 204.00 2025 1,676 419 838 209.50 1. Coinsurance was not charged for inpatient hospital care in CY 1989 due to Catastrophic Coverage. The deductible was applied. 2. Under Catastrophic Coverage, a coinsurance payment of $25.50 was due for days 1-8 of SNF care. No SNF coinsurance was due after day 8 in 1989.

(Rev. 1, 09-11-02) A benefit period is a period of time for measuring the use of hospital insurance benefits. It is a period of consecutive days during which covered services furnished to a patient, up to certain specified maximum amounts, may be paid for by the hospital insurance plan. For example, a patient is eligible for 90 days of hospital care in a benefit period and 100 days of extended care services during the same benefit period. A patient may be eligible for as many as l50 days of hospital care in a benefit period if he/she draws on his/her lifetime reserve. As long as a person continues to be entitled to hospital insurance, there is no limit on the number of benefit periods he/she may have. The term "benefit period" is synonymous with spell of illness. Since the term "spell of illness" could connote a single illness or a particular "spell" of sickness, the term benefit period is used in communications with the public.

(Rev. 80, Issued: 10-26-12, Effective: 04-01-13, Implementation: 04-01-13) A benefit period begins with the first day (not included in a previous benefit period) on which a patient is furnished inpatient hospital or extended care services by a qualified provider in a month for which the patient is entitled to hospital insurance benefits. A provider qualified to start a benefit period is a hospital (including a psychiatric hospital) or SNF that meets all the requirements of the definition of such an institution. A hospital which meets all requirements in Chapter 5, §20 of this manual is also a qualified hospital for purposes of beginning a benefit period when it furnishes the patient covered inpatient emergency services. Thus, generally, the benefit period begins when covered inpatient services are initially furnished to an entitled individual. However, the noncovered services furnished by a nonparticipating provider can begin a spell of illness only if the provider is a qualified provider. A qualified provider is a hospital (including a psychiatric hospital) or a SNF which meets all requirements in the definition of such an institution even though it may not be participating. A qualified hospital in Canada or Mexico is also a qualified provider for purposes of beginning a benefit period when it furnishes covered inpatient hospital services. If a person is in a nonqualified institution and is subsequently transferred to a qualified hospital (general or psychiatric), his/her benefit period begins on admission to the qualified hospital. Admission to a qualified SNF or to the SNF level of care in a swing-bed hospital begins a benefit period even though payment for the services cannot be made because the prior hospitalization or thirty-day transfer requirement has not been met. It is also worth noting that the SNF benefit’s “thirty-day” transfer requirement has a medical appropriateness exception (described in Pub. 100-02, Medicare Benefit Policy Manual, chapter 8, section 20.2.2), under which the allowable interval between a beneficiary’s discharge from a qualifying prior hospitalization and the initiation of SNF care can exceed the normal 30-day timeframe; moreover, in a situation where the allowable interval under this exception is 60 days or longer, the subsequent commencement of extended care services in the SNF would serve to trigger the start of a new benefit period. Inpatient care in a Religious Non-Medical Health Care Institution (whether as hospital or extended care services) can begin or prolong a benefit period.

(Rev. 80, Issued: 10-26-12, Effective: 04-01-13, Implementation: 04-01-13) The benefit period ends with the close of a period of 60 consecutive days during which the patient was neither an inpatient of a hospital nor of a SNF. To determine the 60 consecutive day period, begin counting with the day the individual was discharged. (See §10.4.3.2 of this chapter for determining the end of a benefit period when an individual remains in a SNF.) As noted in section 10.4, the term “benefit period” is synonymous with spell of illness. However, the statutory language (at §1861(a) of the Social Security Act) that describes a benefit period as a “spell of illness” is sometimes misunderstood to mean that a benefit period is linked to a particular medical episode or type of condition, so that the onset of a new and entirely unrelated condition could serve to end a benefit period even in the absence of a 60-day break in the beneficiary’s “inpatient” status. In fact, the onset of a new condition is not, in itself, relevant to the ending of a benefit period, which can occur only through a 60-day break in inpatient status, as described above.

(Rev.10880, Issued: 08-06-21, Effective: 11-08- 21, Implementation: 11-08-21) It is important to note that a benefit period cannot end while a beneficiary is an inpatient (see §10.4.4) of an institution that meets the basic definition of a “hospital” at §1861(e)(1) of the Social Security Act (the Act), even if the hospital does not meet all of the additional requirements that are necessary for starting a benefit period, as discussed further in §10.4.3.1 below (see also §1861(e) following (9) of the Act and the regulations at 42 CFR 409.60(b)(1)). Similarly, a benefit period cannot end while a beneficiary is an inpatient (see §10.4.4) of an institution that meets the basic definition of a “SNF” at §1819(a)(1) of the Act, as discussed further in §10.4.3.2 below. As noted in §2164 of the State Operations Manual (Pub. 100-07), Chapter 2, all hospitals and SNFs that are Medicare-certified are automatically considered to meet the applicable basic definition in this context by reason of the Medicare certification itself. Moreover, even an institution (or portion of an institution) that is not certified for Medicare can serve to prolong an inpatient’s benefit period if it meets either the basic “hospital” or “SNF” definition discussed above.

(Rev. 1, 09-11-02) In order to end a benefit period, for at least 60 consecutive days, a beneficiary cannot have been in a hospital which meets the initial requirement in the definitions in Chapter 5, §20.1 through §20.7 of this publication. That is, the beneficiary cannot have been in a facility that is primarily engaged in providing, by or under the supervision of a physician(s), to inpatients: • Diagnostic and therapeutic services for medical diagnosis, treatment, and care of injured, disabled, or sick persons or rehabilitation services for injured, disabled, or sick persons; or • Psychiatric services for the diagnosis and treatment of mentally ill persons. A stay in a hospital outside the United States prolongs a benefit period. It may be assumed, in the absence of evidence to the contrary, that: • A foreign hospital in which a beneficiary spent one or more days meets the requirement of the definition in Chapter 5, §20 of this manual; and • The beneficiary's statement about length and place of stay is correct.

(Rev.10880, Issued: 08-06-21, Effective: 11-08- 21, Implementation: 11-08-21 Similarly, to end a benefit period, a beneficiary cannot have been an inpatient (see §10.4.4) of a SNF for at least 60 consecutive days; where SNF is defined in accordance with §§1861(a)(2) and 1819(a)(1) of the Social Security Act as a facility which is primarily engaged in providing skilled nursing care and related services to residents who require medical or nursing care, or rehabilitation services for the rehabilitation of injured, disabled, or sick persons. As indicated above in §10.4.3, all Medicare-certified SNFs (including Medicare-certified distinct part SNFs) are automatically considered to meet this basic “SNF” definition by reason of the Medicare certification itself. See §2166 of the State Operations Manual (Pub. 100-07), Chapter 2, for the administrative criteria used in determining whether the basic “SNF” definition is met by a nursing home that is not Medicare-certified (including the noncertified portion of an institution that also contains a Medicare-certified distinct part SNF). Examples: An individual may be discharged from and readmitted to a hospital or SNF several times during a benefit period and still be in the same benefit period if 60 consecutive days have not elapsed between discharge and readmission. The stays need not be for related physical or mental conditions. Example 1: X was born 8/9/1936. On 7/28/2001, X entered a participating general hospital. After he/she had been in the hospital for 2 weeks, X was discharged on 8/11/2001. On his/her doctor’s orders, X entered a participating SNF on 8/15/2001, and remained an inpatient there (see §10.4.4) until his/her discharge on 10/27/2001. He/she had no further inpatient stays in 2001. X’s benefit period began on 8/1/2001, the first day of the month he/she attained age 65 and was entitled to hospital insurance. The benefit period ended 12/25/2001, the end of the 60-day period beginning with the date of his/her last discharge. Example 2: Y, over age 65, entered a participating general hospital on 8/28/2000 for treatment of a heart condition. He/she was discharged on 9/11/2000. On 10/3/2000, Y entered a Medicaid-only nursing facility, and remained an inpatient of this facility (see §10.4.4) until his/her discharge on 11/17/2000. On 12/26/2000, Y was again admitted to a participating hospital because of injuries suffered in an accident. He/she was discharged on 1/13/2001 and had no further inpatient stays in 2001. Y’s benefit period began on 8/28/2000. His/her stay in the nursing facility began less than 60 days after his/her hospital stay and the benefit period was continued because he/she remained an inpatient there (see §10.4.4) even though Medicare did not cover the stay. The subsequent hospital stay began less than 60 days after the nursing facility stay and continued the benefit period although the condition treated was unrelated to his/her prior stays. The benefit period ended on 3/14/2001, the end of the 60-day period beginning with the day of last discharge. Example 3: Z, over age 65 and entitled to hospital insurance benefits, was admitted to General Hospital on 8/l/2000 and discharged on 8/10/2000, having received nonemergency hospital services. General Hospital met all the requirements in the definition of a hospital except those concerning utilization review and health and safety. While General Hospital met the minimum requirements of an emergency hospital, Z’s benefit period did not begin with his/her admission to this hospital because: 1. The hospital did not meet all of the requirements in the definition of a hospital; and 2. Although the hospital satisfied the minimum requirements for coverage of emergency services, Z did not receive emergency inpatient care there. (As noted previously, a stay in an emergency hospital does not begin a benefit period unless it actually involves the receipt of covered inpatient emergency services; by contrast, even a nonemergency stay in such a hospital can serve as a qualifying hospital stay for purposes of coverage under the posthospital extended care benefit.) Z was admitted to Haven Convalescent Home on 8/20/2000 and remained an inpatient of the home (see §10.4.4) until his/her discharge on 3/1/2001. He/she had no further inpatient stays in 2001. Haven Convalescent Home became a participating SNF on 1/1/2001. Z's benefit period began 1/1/2001, the day Haven Convalescent Home was determined to be a qualified SNF. The services Z received from that date through discharge were extended care services even though they were not covered and, therefore, not charged against Z’s Medicare SNF utilization. (The services were not covered posthospital extended care services because Z was not admitted to a participating SNF within 30 days after discharge from the hospital.) Z’s benefit period ended 4/29/2001, the end of the 60- day period beginning with the date of his discharge from the convalescent home.

(Rev. 80, Issued: 10-26-12, Effective: 04-01-13, Implementation: 04-01-13) Generally, a beneficiary is an inpatient of a hospital if the beneficiary is receiving inpatient services in the hospital (i.e., not on an outpatient basis). The type of care actually received is not relevant. However, a different definition of inpatient applies in determining the end of a benefit period for a beneficiary in a SNF, under which such a beneficiary is considered an inpatient in this context only if the beneficiary's care in the SNF meets certain skilled level of care standards. Specifically, the beneficiary must need and receive a skilled level of care while in the SNF. This means that in order to have been an “inpatient” for benefit period purposes while in a SNF, the beneficiary must have required and received skilled services on a daily basis which could, as a practical matter, only have been provided in a SNF on an inpatient basis. (Under the regulations at 42 CFR 409.60(b)(2), an additional level of care criterion at 42 CFR 409.31(b)(2)--requiring that the SNF care must in some way relate back to a condition that was present during the beneficiary’s qualifying hospital stay--does not apply to benefit period determinations.) If these provisions were not met during the prior SNF stay, the beneficiary was not an inpatient of the SNF for purposes of prolonging the benefit period. Conversely, a beneficiary would remain an SNF “inpatient” in this context (thus prolonging his or her current benefit period) for as long as the beneficiary continues receiving a skilled level of care in the SNF--even if Part A payment has ended due to the beneficiary’s exhaustion of SNF benefits. Use the following presumptions for determining whether the skilled level of care standards were met during a prior SNF stay. Presumption 1: A beneficiary's care in a SNF met the skilled level of care standards if a Medicare SNF claim was paid for the care, unless such payment was made under limitation on liability rules. Presumption 2: A beneficiary's care in a SNF met the skilled level of care standards if a SNF claim was paid for the services provided in the SNF under the special Medicare limitation on liability rules pursuant to placement in a non-certified bed. Presumption 3: A beneficiary's care in a SNF did not meet the skilled level of care standards if a claim was paid for the services provided in the SNF pursuant to the general Medicare limitation on liability rules. (This presumption does not apply to placement in a non-certified bed. For claims paid under these special provisions, see Presumption 2.) Presumption 4: A beneficiary's care in a Medicaid nursing facility (NF) did not meet the skilled level of care standards if a Medicaid claim for the services provided in the NF was denied on the grounds that the services received were not at the NF level of care (even if paid under applicable Medicaid administratively necessary days provisions which result in payment for care not meeting the NF level of care requirements). Presumption 5: A beneficiary's care in a SNF met the skilled level of care standards if a Medicare SNF claim for the services provided in the SNF was denied on grounds other than that the services were not at the skilled level of care. Presumption 6: A beneficiary's care in a SNF did not meet the skilled level of care standards if a Medicare claim for the services provided in the SNF was denied on the grounds that the services were not at the skilled level of care and no limitation of liability payment was made. Presumption 7: A beneficiary's care in a SNF did not meet the skilled level of care standards if no Medicare or Medicaid claim was submitted by the SNF. Presumptions 1 through 4 cannot be rebutted. Thus, prior Medicare and Medicaid claim determinations that necessarily required a level of care determination for the time period under consideration are binding for purposes of a later benefit period calculation. Presumptions 5 through 7 can be rebutted by the beneficiary showing that the level of care needed or received is other than that which the presumption dictates. Presumption 6 can be rebutted because the Medicare skilled level of care definition for coverage purposes is broader than the skilled level of care definition used here for benefit period determinations. Specifically, the requirement referred to in Chapter 4, §40.2 regarding prior hospital care related to the SNF care is included in the Medicare SNF coverage requirements but is not included in the standard for benefit period determinations. Therefore, Medicare payment could have been denied for a SNF stay on level of care grounds (i.e., not even waiver payment was made) because of noncompliance with that requirement, even though skilled level of care requirements for benefit period determinations were in fact met by the SNF stay. Consequently, when Medicare SNF payment is denied on level of care grounds, the beneficiary must be given the opportunity to demonstrate that he/she still needed and received a skilled level of care for purposes of benefit period determinations. NOTE: Effective October 1, 1990, the levels of care that were previously covered separately under the Medicaid SNF and intermediate care facility (ICF) benefits are combined in a single Medicaid nursing facility (NF) benefit. Thus, the Medicaid NF benefit includes essentially the same type of skilled care covered by Medicare's SNF benefit, but it includes less intensive care as well. This means that when a person is found not to require at least a Medicaid NF level of care (as under Presumption 4), it can be presumed that he or she also does not meet the Medicare skilled level of care standards. However, since the NF benefit can include care that is less intensive than Medicare SNF care, merely establishing that a person does require NF level care does not necessarily mean that he or she also meets the Medicare skilled level of care standards. Determining whether an individual who requires NF level care also meets the Medicare skilled level of care standards requires an actual examination of the medical evidence and cannot be accomplished through the simple use of a presumption. Therefore, the previous references to Medicaid claims have been deleted from those presumptions which establish that an individual does meet the Medicare standards. Medicare no-payment bills submitted by a SNF result in Medicare program payment determinations (i.e., denials). Therefore, such no-payment bills trigger the appropriate presumptions. This also applies in any State where the Medicaid program utilizes no- payment bills which lead to Medicaid program payment determinations. If a SNF erroneously fails to submit a Medicare claim (albeit a no-pay claim) when Medicare rules require such submission, A/B MACs (A) request a SNF to submit one. Once the no-pay bill is submitted and denied, the applicable presumption (other than presumption 7) is triggered. If a patient is moving from a SNF level of care to a non-SNF level of care in a facility certified to provide SNF care, occurrence code 22 (date active care ended) is used to signify the beginning of the no-pay period on the bill and trigger the appropriate presumptions. Where the presumptions are rebuttable (i.e., 5 through 7), rebuttal showings are permitted at both A/B MAC (A) determination levels under 42 CFR 405, Subpart G (i.e., a rebuttal showing regarding the status of a prior SNF stay is made at the time that an inpatient claim is submitted and/or at the reconsideration level). A/B MACs (A) evaluate rebuttal documentation even if the presumption being rebutted was triggered by a Medicaid denial. This special rule for determining whether a beneficiary in a SNF is an inpatient for benefit period purposes is applicable in all cases where a prior SNF stay affects benefit period status, not only when a beneficiary is in exhausted or copay status and is seeking to renew a benefit period. The rule has equal application where it results in the beneficiary starting a new benefit period and paying a new deductible without receiving an increase in the amount of Medicare benefits paid.

(Rev. 1, 09-11-02) Supplementary Medical Insurance is described in the following subsections.

(Rev. 1, 09-11-02) The SMI plan includes coverage for expenses incurred for the services described in Chapter 1, §10.3: Payment may not be made under Part B for services furnished an individual entitled to have payment made for those services under Part A, e.g., if the expenses incurred were to satisfy a Part A deductible or coinsurance amount, or if payment would be made under Part A except for the lack of request for payment or physician certification.

(Rev. 12980; Issued:11-25-24; Effective: 01-01-25; Implementation: 01-06-25) In each calendar year, a cash deductible must be satisfied before payment can be made under SMI. (See 20.4 of this chapter for exceptions.) Calendar Year Deductible 1966 – 1972 $50 1973 – 1981 $60 1982 – 1990 $75 1991 – 2004 $100 2005 $110 2006 $124 2007 $131 2008 $135 2009 $135 2010 $155 2011 $162 2012 $140 2013 $147 2014 $147 2015 $147 2016 $166 2017 $183 2018 $183 2019 $185 2020 $198 2021 $203 2022 $233 2023 $226 2024 $240 2025 $257 Expenses count toward the deductible on the basis of incurred, rather than paid expenses, and are based on Medicare allowed amounts. Non-covered expenses do not count toward the deductible. Even though an individual is not entitled to Part B benefits for the entire calendar year (i.e., insurance coverage begins after the first month of a year or the individual dies before the last month of the year), he or she is still subject to the full deductible for that year. Medical expenses incurred in the portion of the year preceding entitlement to medical insurance are not credited toward the deductible. The date of service generally determines when expenses were incurred, but expenses are allocated to the deductible in the order in which the bills are received. Services not subject to the deductible cannot be used to satisfy the deductible. Pro Rata Amounts Pro Rata Amounts First Month Second Month 2012 $100.20 $39.80 2013 $103.95 $43.05 2014 $114.99 $32.01 2015 $114.99 $32.01 2016 $118.86 $47.14 2017 $125.73 $57.27 2018 $126.88 $56.12 2019 $133.57 $51.43 2020 $140.46 $57.54 2021 $145.31 $57.69 2022 $150.66 $82.34 2023 $154.95 $71.05 2024 $161.71 $78.29 2025 $170.32 $86.68 The Part B deductible is split into pro rata amounts. The purpose of the pro rata amount is to provide beneficiaries who are enrolled in managed care plans the benefit of assuming they have paid their deductible as if they were not enrolled in a managed care plan. The pro rata amount does not apply only to just the first two months of the year but rather for the number of months after first enrollment in a managed care plan that is necessary to cover the Part B deductible. Each year starts the deduction for the pro rata amount over again.

(Rev. 1, 09-11-02) After the deductible has been satisfied, coinsurance of 20 percent is usually applicable. For providers and suppliers that bill A/B MAC(A) or (HHH), the 20 percent may be based on the allowed amount, billed charges, or a preset rate per service (APC), depending upon the type of service. See Claims Processing instructions for a description of coinsurance calculation for each benefit type. Physicians and other suppliers will be paid 80 percent of allowed amount under the fee schedule amounts or in some instances reasonable charges incurred during the balance of the calendar year. The patient is responsible for a coinsurance amount equal to 20 percent of the fee schedule amounts or reasonable charges for the items and services. (See §20.4 of this chapter for exceptions.)

(Rev. 11, Issued: 10-22-04, Effective: 11-22-04, Implementation: 11-22-04) There is no deductible for screening mammography effective for services January 1, 1998 and later. Neither the annual deductible nor the 20 percent coinsurance apply with respect to: • Parts A and B home health services, except that there is a coinsurance of 20 percent of the payment amount for supplies, drugs, DME and prosthetics /orthotics furnished as a home health benefit; • Clinical diagnostic laboratory tests (including specimen collection fees) performed or supervised by a physician, laboratory, or other entity paid on an assigned basis; • Pneumococcal vaccine and its administration; • Influenza vaccine and its administration; and • Services or items denied as medically unnecessary. NOTE: Services which are not subject to the deductible cannot be used to satisfy the deductible.

(Rev. 12, Issued: 10-22-04, Effective: 04-01-05, Implementation: 04-04-05) Under 1879 of the Act, a beneficiary is not responsible for payment of the Part B deductible or coinsurance for items or services that are neither reasonable and necessary to diagnose or treat the illness or injury, nor to improve the functioning of a malformed body member. If the provider knew, or should have known, that Medicare considered such services medically unnecessary, but failed to inform the beneficiary before furnishing them, the provider is held liable for their cost. If the beneficiary made payment for such items or services, he/she can be indemnified for them. In most cases, however, funds can be collected while awaiting the outcome of review of a demand bill for institutional services-- See Publication 100-04, Chapter 1, §60.3, See §60.3.1 in the same chapter for specific information on limitations on collecting funds from beneficiaries in SNF Part A stays. In general, see Chapter 30 of that publication for information on limitation of liability.

(Rev. 1, 09-11-02) Program payment may not be made for the first 3 pints of whole blood or equivalent units of packed red cells received under Part A and Part B combined in a calendar year. However, blood processing (e.g., administration, storage) is not subject to the deductible. The blood deductibles are in addition to any other applicable deductible and coinsurance amounts for which the patient is responsible. The deductible applies only to the first 3 pints of blood furnished in a calendar year, even if more than one provider furnished blood.

(Rev. 1, 09-11-02) Blood must be furnished on a Medicare covered day in a hospital or SNF to be counted under Part A. Blood furnished to an inpatient after benefits exhausted or before entitlement is not counted toward the combined deductible. Blood furnished during a lifetime extension election period is counted toward the combined A/B 3 pint total.

(Rev. 1, 09-11-02) Blood is furnished on an outpatient basis or is subject to the Part B blood deductible and is counted toward the combined limit. It should be noted that payment for blood may be made to the hospital under Part B only for blood furnished in an outpatient setting. Blood is not covered for inpatient Part B services.

(Rev. 18, Issued: 03-04-05, Effective: 07-01-05, Implementation: 07-05-05) The blood deductibles apply only to whole blood and packed red cells. The term whole blood means human blood from which none of the liquid or cellular components have been removed. Where packed red cells are furnished, a unit of packed red cells is considered equivalent to a pint of whole blood. Other components of blood such as platelets, fibrinogen, plasma, gamma globulin, and serum albumin are not subject to the blood deductible. However, these components of blood are covered as biologicals. Refer to Pub. 100-04, Medicare Claims Processing Manual, chapter 4, §231 regarding billing for blood and blood products under the Hospital Outpatient Prospective Payment System (OPPS).

(Rev. 1, 09-11-02) A provider may charge the beneficiary or a third party its customary charge for whole blood or units of packed red cells which are subject to either the Part A or Part B blood deductible, unless the individual, another person, or a blood bank replaces the blood or arranges to have it replaced.

(Rev. 1, 09-11-02) For replacement purposes, a pint of whole blood is considered equivalent to a unit of packed red cells. A deductible pint of whole blood or unit of packed red cells is considered replaced when a medically acceptable pint or unit is given or offered to the provider or, at the provider's request, to its blood supplier. Accordingly, where an individual or a blood bank offers blood as a replacement for a deductible pint or unit furnished a Medicare beneficiary, the provider may not charge the beneficiary for the blood, whether or not the provider or its blood supplier accepts the replacement offer. Thus a provider may not charge a beneficiary merely because it is the policy of the provider or its blood supplier not to accept blood from a particular source which has offered to replace blood on behalf of the beneficiary. However, a provider would not be barred from charging a beneficiary for deductible blood, if there is a reasonable basis for believing that replacement blood offered by or on behalf of the beneficiary would endanger the health of a recipient or that the prospective donor's health would be endangered by making a blood donation. Once a provider accepts a pint of replacement blood from a beneficiary or another individual acting on his/her behalf, the blood is deemed to have been replaced, and, the beneficiary may not be charged for the blood, even though the replacement blood is later found to be unfit and has to be discarded. When a provider accepts blood donated in advance, in anticipation of need by a specific beneficiary, whether the beneficiary's own blood, that is, an autologous donation, or blood furnished by another individual or blood assurance group, such donations are considered replacement for pints or units subsequently furnished the beneficiary.

(Rev. 12980; Issued:11-25-24; Effective: 01-01-25; Implementation: 01-06-25) The Centers for Medicare and Medicaid Services (CMS) updates the Part B premium each year. These adjustments are made according to formulas set by statute. By law, the monthly Part B premium must be sufficient to cover 25 percent of the program’s costs, including the costs of maintaining a reserve against unexpected spending increases. The federal government pays the remaining 75 percent. Below are the annual Part B premium amounts from Calendar Year (CY) 1996 to 2006. For these years, and years prior to 1996, the Part B premium is a single established rate for all beneficiaries. Year Part B Premium 1996 $42.50 1997 $43.80 1998 $43.80 1999 $45.50 2000 $45.50 2001 $50.00 2002 $54.00 2003 $58.70 2004 $66.60 2005 $78.20 2006 $88.50 Beginning on January 1, 2007, the Part B premium is based on the income of the beneficiary. See the following Change Requests (CRs) for more information. For 2008, see CR 5345 at http://www.cms.hhs.gov/transmittals/downloads/R41GI.pdf For 2008, see CR 5830 at http://www.cms.hhs.gov/transmittals/downloads/R49GI.pdf For 2009, see CR 6258 at http://www.cms.hhs.gov/transmittals/downloads/R56GI.pdf For 2010, see CR 6690 found on the “2009 Transmittals” page at http://www.cms.hhs.gov/Transmittals/2009Trans/list.asp For 2011, see CR 7224 found on the “2010 Transmittals” page at http://www.cms.gov/Transmittals/2010Trans/list. asp For 2012, see CR 7567 found on the “2011 Transmittals” page at http://www.cms.gov/Transmittals/2011Trans/list. asp For 2013, see CR 8052 found on the “2012 Transmittals” page at http://www.cms.gov/Transmittals/2012Trans/list. asp For 2014, see CR 8527 found on the “2013 Transmittals” page at http://www.cms.gov/Transmittals/2013Trans/list. asp For 2015, see CR 8982 found on the “2014 Transmittals” page at http://www.cms.gov/Transmittals/2014Trans/list. asp For 2016, see CR 9410 found on the “2015 Transmittals” page at http://www.cms.gov/Transmittals/2015Trans/list. asp For 2017, see CR 9902 found on the “2016 Transmittals” page at http://www.cms.gov/Transmittals/2016Trans/list.a sp For 2018, see CR 10405 found on the “2017 Transmittals” page at http://www.cms.gov/Transmittals/2017Trans/list.a sp For 2019, see CR 11025 found on the “2018 Transmittals” page at http://www.cms.gov/Transmittals/2018Trans/list.a sp For 2020, see CR 11542 found on the “2019 Transmittals” page at http://www.cms.gov/Transmittals/2019Trans/list.a sp For 2021, see CR 12024 found on the “2020 Transmittals” page at http://www.cms.gov/Transmittals/2020Trans/list.a sp For 2022, see CR 12507 found on the “2021 Transmittals” page at http://www.cms.gov/Transmittals/2021Trans/list.a sp For 2023, see CR 12903 found on the “2022 Transmittals” page at http://www.cms.gov/Transmittals/2022Trans/list.a sp For 2024, see CR 13365 found on the “2023 Transmittals” page at http://www.cms.gov/Transmittals/2023Trans/list.a sp For 2025, see CR 13796 found on the “2024 Transmittals” page at http://www.cms.gov/Transmittals/2024Trans/list.a sp

(Rev. 60, Issued: 10-30-09, Effective: 01-01-10, Implementation: 01-04-10) Regardless of the actual expenses a beneficiary incurs in connection with the treatment of mental, psychoneurotic, and personality disorders while the beneficiary is not an inpatient of a hospital at the time such expenses are incurred, the amount of those expenses that may be recognized for Part B deductible and payment purposes is limited to 62.5 percent of the Medicare approved amount for those services. The limitation is called the outpatient mental health treatment limitation (the limitation). The 62.5 percent limitation has been in place since the inception of the Medicare Part B program and it will remain effective at this percentage amount until January 1, 2010. However, effective January 1, 2010, through January 1, 2014, the limitation will be phased out as follows: • January 1, 2010 – December 31, 2011, the limitation percentage is 68.75%. (Medicare pays 55% and the patient pays 45%). • January 1, 2012 – December 31, 2012, the limitation percentage is 75%. (Medicare pays 60% and the patient pays 40%). • January 1, 2013 – December 31, 2013, the limitation percentage is 81.25%. (Medicare pays 65% and the patient pays 35%). • January 1, 2014 – onward, the limitation percentage is 100%. (Medicare pays 80% and the patient pays 20%). For additional details concerning the outpatient mental health treatment limitation, please see the Medicare Claims Processing Manual, Publication 100-04, chapter 9, section 60 and chapter 12, section 210.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) Coverage of outpatient physical therapy, occupational therapy, and speech-language pathology services under Part B has been limited in some years. For descriptions of these limitations see Pub 100-04, Chapter 5, §10.2. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R12980GI 11/25/2024 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2025 01/06/2025 13796 R12963GI 11/15/2024 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2025- Rescinded and replaced by Transmittal 12980 01/06/2025 13796 R12307GI 10/19/2023 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2024 01/02/2023 13365 R11641GI 10/13/2022 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2023 01/03/2023 12903 R11136GI 11/30/2021 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2022 01/03/2022 12507 R10880GI 08/06/2021 Internet Only Manual Updates to Pub. 100- 01, 100-02, and 100-04 to Implement Consolidated Appropriations Act Changes and Correct Errors and Omissions (SNF) 11/08/2021 12009 R10469GI 11/20/2020 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2021 01/04/2021 12024 11/22/2019 Update to Medicare Deductible, Coinsurance and Premium Rates for 2020 01/06/2020 11542 R119GI 11/02/2018 Update to Medicare Deductible, Coinsurance and Premium Rates for 2019 01/07/2019 11025 R111GI 12/08/2017 Update to Medicare Deductible, Coinsurance and Premium Rates for 2018 01/02/2018 10405 R103GI 12/02/2016 Update to Medicare Deductible, Coinsurance and Premium Rates for 2017 01/03/2017 9902 R96GI 11/25/2015 Update to Medicare Deductible, Coinsurance and Premium Rates for 2016 01/04/2016 9410 R89GI 11/21/2014 Update to Medicare Deductible, Coinsurance and Premium Rates for 2015 01/05/2015 8982 R82GI 11/15/2013 Update to Medicare Deductible, Coinsurance and Premium Rates for 2014 01/06/2014 8527 R81GI 12/07/2012 Update to Medicare Deductible, Coinsurance and Premium Rates for 2013 01/07/2013 8052 R80GI 10/26/2012 Manual Updates to Clarify SNF Claims Processing 04/01/2013 8044 R74GI 12/16/2011 Update to Medicare Deductible, Coinsurance and Premium Rates for 2011 01/03/2012 7567 R72GI 11/18/2011 Update to Medicare Deductible, Coinsurance and Premium Rates for 2011 – Rescinded and replaced by Transmittal 74 01/03/2012 7567 R65GI 11/19/2010 Update to Medicare Deductible, Coinsurance and Premium Rates for 2011 01/03/2011 7224 R61GI 11/13/2009 Update to Medicare Deductible, Coinsurance and Premium Rates for 2010 01/04/2010 6690 R60GI 10/30/2009 Outpatient Mental Health Treatment Limitation 01/04/2010 6686 R56GI 11/17/2008 Update to Medicare Deductible, Coinsurance and Premium Rates for 2009 01/05/2009 6258 R55GI 11/07/2008 Update to Medicare Deductible, Coinsurance and Premium Rates for 2009 - Rescinded and replaced by Transmittal 56 01/05/2009 6258 R49GI 12/14/2007 Update to Medicare Deductible, Coinsurance and Premium Rates for 2008 01/07/2008 5830 R41GI 10/27/2006 Update to Medicare Deductible, Coinsurance and Premium Rates for 2007 01/02/2007 5345 R31GI 11/04/2005 Update to Medicare Deductible, Coinsurance and Premium Rates for 2006 01/03/2006 4132 R28GI 08/12/2005 Conforming Changes for Change Request 3648 to Pub. 100-01 09/12/2005 3912 R18GI 03/04/2005 Billing for Blood and Blood Products Under the Hospital Outpatient Prospective Payment System (OPPS) 07/05/2005 3681 R12GI 10/22/2004 New Policy and Refinements on Billing Noncovered Charges to Fiscal Intermediaries (FIs) 04/04/2005 3416 R11GI 10/22/2004 Manual Revision Regarding Waiver of Annual Deductible and Coinsurance for Both ASC Facility, and ASC/Hospital Outpatient Department Physician Services 11/22/2004 3471 R10GI 09/10/2004 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year 2005 01/03/2005 3463 R09GI 09/03/2004 Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year 2005 01/03/2005 3463 R03GI 03/12/2004 New Part B Annual Deductible 01/03/2005 3121 R01GI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 1, 09-11-02) Payments may be made for covered hospital services only if a physician certifies and recertifies to the medical necessity for the services at designated intervals of the hospital inpatient stay. Appropriate supporting material may be required. The physician certification or recertification statement must be based on a current evaluation of the patient's condition. For patients admitted to a general hospital, regardless of whether the patients are under PPS, a physician certification is not required at the time of admission for patient services. For services continued over a period of time or for a day outlier case (i.e., an appropriately admitted case results in an extraordinarily long stay) or for a PPS cost outlier case (i.e., an appropriately admitted case results in the expenditure of extraordinary resources), a physician must certify or recertify the continued need for the services at specified intervals. (See § 80 for timing of physician certification and recertification.) Psychiatric and tuberculosis hospitals (which are excluded from PPS) are required to obtain a physician certification on admission. Hospitals do not transmit physician certification and recertification statements to the A/B MAC (A) or to CMS. The hospital must itself certify on the appropriate billing form that the required physician certification and recertification statements have been obtained and are on file. The physician certification and recertification statements are retained in the hospital's file where they are available for verification if needed. A hospital must also have available in its files a written description of the procedure it adopts on the timing of certifications and recertifications, i.e., the intervals at which the necessary certification statements are required and whether review of long stay cases by the utilization review committee may serve as an alternative to recertification by a physician in the case of the second or subsequent recertification.

(Rev. 1, 09-11-02) If a hospital fails to obtain the required certification or recertification statements in an individual case, program payments may not be made in that case. If the hospital's failure to obtain a certification or recertification is not due to a question as to the necessity for the services, but rather to the physician's refusal to certify based on other grounds (e.g., he/she objects in principle to the concept of certification and recertification), the hospital may not bill the program or the beneficiary for covered items or services. The provider agreement precludes the hospital from charging the patient for covered items and services.

(Rev. 1, 09-11-02) A certification or recertification statement must be signed by the attending physician responsible for the case or by another physician who has knowledge of the case and is authorized to do so by the attending physician, or by a member of the hospital's medical staff with knowledge of the case. Ordinarily for purposes of certification and recertification, a "physician" must meet the definition in Chapter 5, §70 and §70.3.

(Rev. 1, 09-11-02) The attending doctor of dental surgery or of dental medicine is authorized to certify that the patient's underlying medical condition and clinical status or the severity of the dental procedure requires the patient to be admitted to the hospital for the performance of the dental procedure; and to recertify the patient's continuing need for hospitalization when required. This applies even if the dental procedure is not covered.

(Rev. 1, 09-11-02) A certification or recertification statement must contain the following information: • An adequate written record of the reason for either; o Continued hospitalization of the patient for medical treatment or for medically required inpatient diagnostic study, or o Special or unusual services for cost outlier cases for hospitals under the prospective payment system (PPS); • The estimated period of time the patient will need to remain in the hospital and, for cost outlier cases, the period of time for which the special or unusual services will be required; and • Any plans for posthospital care.

(Rev. 1, 09-11-02) The individual hospital determines the method by which certifications and recertifications are to be obtained and the format of the statement. Thus, the medical and administrative staffs of each hospital may adopt the form and procedure they find most convenient and appropriate. There is no requirement that the certification or recertification be entered on any specific form or handled in any specific way, as long as the approach adopted by the hospital permits the A/B MAC (A) to determine that the certification and recertification requirements are, in fact, met. The certification or recertification could, therefore, be entered or preprinted on a form the physician already has to sign; or a separate form could be used. If all the required information is included in progress NOTEs, the physician's statement could indicate that the individual's medical record contains the information required and that continued hospitalization is medically necessary.

(Rev. 94, Issued: 10-16-15, Effective: 11-16-15, Implementation: 11-16-15) A physician who certifies or recertifies to the need for continued inpatient stay should use the same criteria that apply to the hospital's utilization review committee. These criteria include not only medical necessity, but also the availability of out-of-hospital facilities and services which will assume continuity of care. In accordance with the regulations at 42 CFR 424.13(c), a physician should certify or recertify need for continued hospitalization if the physician finds that the patient could receive treatment in a SNF but no bed is available in the participating SNF. Where the basis for the certification or recertification is the need for continued inpatient care because of the lack of SNF accommodations, the certification or recertification should so state. The physician is expected to continue efforts to place the patient in a participating SNF as soon as the bed becomes available. Coverage of these additional, “alternate placement” days in the hospital can continue until the earliest of the following events occurs: • A bed becomes available in a participating SNF; • The beneficiary’s care needs drop below SNF-level; or • The beneficiary has exhausted all of the available days of Part A inpatient hospital benefits in that benefit period.

(Rev. 1, 09-11-02) For cases not subject to PPS and for PPS day outlier cases, a separate recertification statement is not necessary where the requirements for the second or subsequent recertification are satisfied by review of a stay of extended duration, pursuant to the hospital's UR plan. However, it is necessary to satisfy the certification and recertification content standards. It would be sufficient if records of the UR committee show that consideration was given to the three items required for certifications and recertifications: the reasons for continued hospitalization (e.g., consideration was given to the need for special or unusual care in cost outlier status under PPS), estimated time the patient will need to remain in the hospital (e.g., the time period during which such special or unusual care would be needed), and plans for posthospital care.

(Rev. 1, 09-11-02) The timing of certifications and recertifications is described in the following subsections.

(Rev. 1, 09-11-02) For services furnished to beneficiaries admitted on or after January 1, 1970, the initial certifications are required no later than as of the 12th day of hospitalization. A hospital may at its option, provide for the certification to be made earlier, or it may vary the timing of the certification within the 12-day period by diagnostic or clinical categories. The first recertification is required no later than as of the 18th day of hospitalization. Subsequent recertifications must be made at intervals established by the UR committee (on a case-by-case basis), but in no event may the interval between recertifications exceed 30 days. The UR committee will be reviewing long-stay cases and may be in the best position to decide when subsequent recertifications are needed. A hospital can, if it wishes, coordinate its physician recertifications with the process of review by the UR committee of longstay cases not subject to PPS, and for PPS day- outlier cases. At the option of the hospital, review of a stay of extended duration under the hospital's utilization review plan may take the place of the second and any subsequent physician recertifications. (Such review may be the initial review, or a second or subsequent review of an extended case by the UR committee.) Where review of an extended stay case by the UR committee is deemed to take the place of a physician recertification, it would be possible for the recertification to be made later than the specified day, because the review of an extended duration case may be made at any time within the 7-day period following the last day of the period of extended duration defined in the utilization review plan. Such a recertification will be treated as a delayed recertification; however, no explanation for the normal delay is required.

(Rev. 1, 09-11-02) For cases subject to the prospective payment system (PPS), certification is not required at the time of admission for inpatient services. The admission is reviewed by a hospital review organization upon discharge of the patient. For outlier cases certification is required as follows: • For day-outlier cases (now discontinued), certification was required no later than 1 day after the hospital reasonably assumes that the case meets the established outlier criteria, or no later than 20 days into the hospital stay, whichever is earlier. The first and subsequent recertifications are required at intervals established by the utilization review committee, on a case-by-case basis if it so chooses, but not less than every 30 days. • For cost-outlier cases, if possible, certification must be made before the hospital incurs cost for which it will seek cost outlier payment. However, certification is required no later than the date on which the hospital requests cost outlier payment or 20 days into the hospital stay, whichever is earlier. For cost-outlier cases, the first and subsequent recertifications are required at intervals established by the UR committee, on a case-by-case basis if it chooses. As previously stated the UR committee will be reviewing long-stay cases and may be in the best position to decide when subsequent recertifications are needed. Review by the UR committee used in place of recertification for PPS day outlier cases is considered timely if performed within 7 days after the physician recertification would have been required.

(Rev. 98, Issued: 05-13-16, Effective: 08-15-16, Implementation: 08-15-16) The requirements for physician certification and recertification for inpatient psychiatric facility services are similar to the requirements for certification and recertification for inpatient hospital services. However, there is an additional certification requirement. In accordance with 42 CFR 424.14, all IPFs (distinct part units of acute care hospitals, CAHs, and psychiatric hospitals) are required to meet the following certification and recertification requirements. At the time of admission or as soon thereafter as is reasonable and practicable, a physician (the admitting physician or a medical staff member with knowledge of the case) must certify the medical necessity for inpatient psychiatric hospital services. The first recertification is required as of the 12th day of hospitalization. Subsequent recertifications will be required at intervals established by the hospital’s utilization review committee (on a case-by-case basis), but no less frequently than every 30 days. There is also a difference in the content of the certification and recertification. In certification the physician is required to document that the inpatient psychiatric facility admission was medically necessary for either: (1) treatment which could reasonably be expected to improve the patient's condition, or (2) diagnostic study. The physician's recertification should satisfy all of the requirements noted below: 1. That inpatient psychiatric hospital services furnished since the previous certification or recertification were, and continue to be, medically necessary for either: a. Treatment which could reasonably be expected to improve the patient's condition; or, b. Diagnostic study; 2. The hospital records indicate that the services furnished were either intensive treatment services, admission and related services necessary for diagnostic study, or equivalent services, and 3. Effective July 1, 2006, physicians will also be required to recertify that the patient continues to need, on a daily basis, active treatment furnished directly by or requiring the supervision of inpatient psychiatric facility personnel. The format of all certifications and recertifications and the method by which they are obtained is determined by the individual facility. No specific procedures or forms are required. The provider may adopt any method that permits verification of all the IPFs requirements to continue treatment. For example, the recertification may be entered on provider generated forms, in progress notes, or in the records (relating to the stay in question) and must be signed by a physician. Claim denials may not be made for failure to use a certification or recertification form or failure to use particular language or format, provided that the medical record demonstrates that the content requirements given at Pub. 100-02, Medicare Benefit Policy Manual, Chapter 2, §30.2.1 are met. For convenience, the period covered by the physician's certification and recertification is referred to a period during which the patient was receiving active treatment. If the patient remains in the hospital but the period of "active treatment" ends (e.g., because the treatment cannot reasonably be expected to improve the patient's condition, or because intensive treatment services are not being furnished), program payment can no longer be made even though the patient has not yet exhausted his/her benefits. Where the period of "active treatment" ends, the physician is to indicate the ending date in making his recertification. If "active treatment" thereafter resumes, the physician should indicate, in making his recertification, the date on which it resumed.

(Rev 98, Issued: 05-13-16, Effective: 08-15-16, Implementation: 08-15-16) IPFs are expected to obtain timely certifications and recertifications. However, delayed certifications and recertifications will be honored where, for instance, there have been an oversight or lapse, and a legitimate reason for the delay as noted in Pub. 100-01, §20.1. Denial of payment for lack of the required certification and recertification is considered a technical denial, which means a statutory requirement has not been met. Consequently, if an appropriate certification is later produced, the denial shall be overturned. Reopenings of technical denial decisions may be initiated by the contractor or the provider. In addition to compliance with the appropriate certification and recertification content requirements, delayed certification and recertification must include an explanation for the delay and any medical or other evidence which the IPF considers relevant for purposes of explaining the delay. The IPF will determine the format of the delayed certifications and recertifications, and the method by which they are obtained. A delayed certification may be included with one or more recertifications on a single signed document. Separate signed documents for each delayed certification and recertification are not required as they would be if timely certification and recertification had been completed. For all IPF services, a delayed certification may not extend past discharge. IPF certification or recertification documentation may only be signed by a physician.

(Rev. 12425, Issued: 12-21-23, Effective: 01-01-24, Implementation: 01-02-24) A physician must certify that medical and other health services covered by medical insurance which were provided by (or under arrangement made by) the hospital were medically required. Physician certification is not required for the following outpatient services furnished on or after January 3, 1968: • Hospital services and supplies incident to physicians' services rendered to outpatients; and • Diagnostic services furnished by a hospital or which the hospital arranges to have furnished in other facilities operated by or under the supervision of the hospital or its medical staff. Hospitals must obtain a physician's certification with respect to other services furnished to outpatients. Primarily, this means that a certification statement is needed for diagnostic services furnished under arrangements by a facility that is not operated by or under the supervision of the hospital or its organized medical staff, e.g., services obtained from an independent laboratory. This certification requires a brief description of the services and the signature of the physician. It needs to be made only once for a course of treatment. Where services are provided on a continuing basis, such as a course of radium treatments, the physician's certification may be made at the beginning or end of the course of treatment, or at any other time during the period of treatment. There is no requirement that the certification be entered on any specific form or handled in any specific way, as long as the approach adopted by the hospital permits the A/B MAC (A) to determine that the certification requirement is in fact met. Therefore, the certification could be entered or pre-printed on a form the physician already has to sign; or a separate certification form could be used. In addition, physician's certifications are required for the rental and purchase of durable medical equipment (see §70), outpatient therapy, i.e., physical therapy, occupational therapy and speech-language pathology services (see Pub. 100-02, Chapter 15, §220), partial hospitalization services (see Pub. 100-02, Chapter 6, § 70.3), and intensive outpatient services (see Pub. 100-02, Chapter 6, § 70.4). The Physician Certification Statement requirements for all ambulance providers (hospital-owned and operated) and suppliers (independently-owned and operated) are located at 42 CFR §410.40 (d) (2) and §410.40 (d) (3).

(Rev. 1, 09-11-02) Hospitals are expected to obtain timely certification and recertification statements. However, delayed certifications and recertifications will be honored where, for example, there has been an oversight or lapse. In addition to complying with the appropriate content requirements, delayed certifications and recertifications must include an explanation for the delay and any medical or other evidence which the hospital considers relevant for purposes of explaining the delay. The hospital will determine the format of delayed certification and recertification statements, and the method by which they are obtained. A delayed certification and recertification may appear in one statement; separate signed statements for each certification and recertification would not be required as they would if timely certification and recertification had been made.

(Rev. 1, 09-11-02) If an individual is admitted to a hospital (including a psychiatric hospital) before he/she is entitled to hospital insurance benefits (for example, before attainment of age 65), no certification is required as of the date of admission or entitlement. Certifications and recertifications are required as of the time they would be required if the patient had been admitted to the hospital on the day he/she became entitled. (The time limits for certification and recertification are computed from the date of entitlement instead of the date of admission.)

(Rev. 10757; Issued: 05-11-21; Effective: 03-01-20; Implementation: 08-11-21) In addition to the content below, refer to Pub. 100-02, Medicare Benefit Policy Manual, chapter 7, section 30.5 for a complete description of the requirements that must be met in order to certify and recertify patient eligibility for Medicare home health services.

(Rev. 10757; Issued: 05-11-21; Effective: 03-01-20; Implementation: 08-11-21) Under both the hospital insurance and the supplementary medical insurance programs, no payment can be made for covered home health services that a home health agency (HHA) provides unless a physician or allowed practitioner certifies that: • Home health services are needed because the individual is confined to his/her home; • The individual needs intermittent skilled nursing care, physical therapy and/or speech-language pathology services. Where a patient’s sole skilled service need is for skilled oversight of unskilled services, the physician or allowed practitioner must include a brief narrative describing the clinical justification of this need as part of the certification, or as a signed addendum to the certification; • A plan for furnishing such services to the individual has been established and is periodically reviewed by a physician or allowed practitioner; • The services are or were furnished while the individual was under the care of a physician or allowed practitioner; and • The individual had a face-to-face encounter with a physician or an allowed non- physician practitioner no more than 90 days prior to or within 30 days after the start of home health care and the encounter was related to the primary reason the patient requires home health services in accordance with requirements described in Pub. 100-02, Medicare Benefit Policy Manual, chapter 7, section 30.5.1.1. The certifying physician or allowed practitioner must also document the date of the encounter. Certifications must be obtained at the time the plan of care is established or as soon thereafter as possible. The physician or allowed practitioner must sign and date the plan of care (POC) and the certification prior to the claim being submitted for payment; rubber signature stamps are not acceptable. The plan of care may be signed by another physician or allowed practitioner who is authorized by the certifying physician or certifying allowed practitioner who established the plan of care, to care for his/her patients in his/her absence. The HHA is responsible for ensuring that the physician or allowed non- physician practitioner who signs the plan of care and recertification statement was authorized by the physician or allowed practitioner who established the plan of care and completed the certification for his/her patient in his/her absence. While the regulations specify that documents must be signed, they do not prohibit the transmission of the POC, oral order, or certification via facsimile machine. The HHA is not required to have the original signature on file. However, the HHA is responsible for obtaining original signatures if an issue surfaces that would require verification of an original signature. Home health agencies that maintain patient records by computer rather than hard copy may use electronic signatures. However, all such entries must be appropriately authenticated and dated. Authentication must include signatures, written initials, or computer secure entry by a unique identifier of a primary author who has reviewed and approved the entry. The HHA must have safeguards to prevent unauthorized access to the records and a process for reconstruction of the records upon request from the Medicare contractor, state surveyor, or other authorized personnel, in the event of a system breakdown. See §10.1 for the effects of failure to certify or recertify.

(Rev. 92, Issued: 04-22-15, Effective: 01-01-15, Implementation: 05-11-15) There is no requirement that the certification or recertification be entered on any specific form or handled in any specific way as long as the Medicare contractor can determine, where necessary, that the certification and recertification requirements are met. The certification by the physician must be retained by the HHA. The following instructions pertain to required documentation of the certification and recertification period. The HHA enters the month, day, year, e.g., MMDDYYYY that identifies the period covered by the physician's POC. The "From" date for the initial certification must match the start of care (SOC) date. The "through" date is up to and including the last day of the episode which is not the first day of the subsequent episode. The "through" date can be up to, but never exceed a total of 60 days that includes the SOC date plus 59 days. Example: Initial certification "From" date 10012000; Initial certification "through" date 11292000; Re-certification "From" date 11302000; Re-certification "through" date 01282001. NOTE: Services delivered on 11292000 are covered in the initial certification episode.

(Rev. 92, Issued: 04-22-15, Effective: 01-01-15, Implementation: 05-11-15) Under both the hospital insurance and supplementary medical insurance programs, when services are continued past an initial 60-day episode of care, the physician must recertify at intervals of at least once every 60 days that there is a continuing need for services in accordance with requirements described in Pub. 100-02, Medicare Benefit Policy Manual, chapter 7, section 30.5.2. The recertification should be obtained at the time the plan of care is reviewed since the same interval (at least once every 60 days) is required for the review of the plan. The physician must include an estimate of how much longer the skilled services will be required and must certify that: 1. The home health services are or were needed because the patient is or was confined to the home as defined in Pub. 100-02, Medicare Benefit Policy Manual, chapter 7, section 30.1; 2. The patient needs or needed skilled nursing services on an intermittent basis (other than solely venipuncture for the purposes of obtaining a blood sample), or physical therapy, or speech-language pathology services; or continues to need occupational therapy after the need for skilled nursing care, physical therapy, or speech-language pathology services ceased. Where a patient’s sole skilled service need is for skilled oversight of unskilled services (management and evaluation of the care plan as defined in Pub. 100-02, Medicare Benefit Policy Manual, chapter 7, section 40.1.2.2), the physician must include a brief narrative describing the clinical justification of this need as part of the recertification, or as a signed addendum to the recertification; 3. A plan of care has been established and is periodically reviewed by a physician; and 4. The services are or were furnished while the patient is or was under the care of a physician. Recertifications must be signed by the physician who reviews the plan of care. The form of the recertification and the manner of obtaining timely recertifications are up to the individual agency.

(Rev. 101, Issued: 09-16-16, Effective: 10-18-16, Implementation: 10-18-16) Payment for covered posthospital extended care services may be made only if a physician (or, as discussed in §40.1 of this chapter, a physician extender) makes the required certification and, where services are furnished over a period of time, the required recertification regarding the services furnished. The skilled nursing facility is responsible for obtaining the required certification and recertification statements and for retaining them in file for verifications, if needed, by the A/B MAC (A). The skilled nursing facility determines the method by which the certification and recertification statements are to be obtained. There is no requirement that a specific procedure or specific forms be used, as long as the approach adopted by the facility permits a verification to be made that the certification and recertification requirements are in fact met. Certification and recertification statements may be entered on or included in forms, NOTEs, or other records that would normally be signed in caring for a patient, or a separate form may be used. Except as otherwise specified, each certification and recertification statement is to be separately signed. See Pub. 100-08, Medicare Program Integrity Manual, chapter 6, section 6.3 regarding medical review of certification and recertification in SNFs. If the facility's failure to obtain a certification or recertification is not due to a question as to the necessity for the services, but rather to the physician's or physician extender’s refusal to certify based on other grounds (e.g., an objection in principle to the concept of certification and recertification), the facility may not bill the program or the beneficiary for covered items or services. The provider agreement, which the facility files with the Secretary, precludes it from charging the patient for covered items and services. If a physician or physician extender refuses to certify because, in his/her opinion, the patient does not, as a practical matter, require daily skilled care for an ongoing condition for which he/she was receiving inpatient hospital services (or for a new condition that arose while in the SNF for treatment of that ongoing condition), the services are not covered and the facility can bill the patient directly. The reason for the refusal to make the certification must be documented in the facility records. For such documentation to be adequate, there must be some statement in the facility's records, signed by a physician or a responsible facility official, indicating that the patient's physician or physician extender feels that the patient does not, as a practical matter, require daily skilled care for an ongoing condition for which he/she was receiving inpatient hospital services (or for a new condition that arose while in the SNF for treatment of that ongoing condition).

(Rev. 120, Issued: 11-02-18, Effective: 12- 04-18, Implementation: 12- 04-18) A certification or recertification statement must be signed by the attending physician or a physician on the staff of the skilled nursing facility who has knowledge of the case, or by a physician extender (that is, a nurse practitioner, a clinical nurse specialist or, effective with items and services furnished on or after January 1, 2011, a physician assistant) who does not have a direct or indirect employment relationship with the facility, but who is working in collaboration with the physician. See Pub. 100-02, Medicare Benefit Policy Manual at chapter 8, §40.1, for a discussion of “direct” and “indirect” employment relationships in this context, and at chapter 15, §190.C (for physician assistants), §200.D (for nurse practitioners), and §210.D (for clinical nurse specialists), regarding the required collaboration between the physician and the physician extender. Ordinarily, for purposes of certification and recertification, a “physician” must meet the definition contained in Chapter 5, §70 of this manual.

(Rev. 126, Issued: 10-04-19, Effective: 11-05-19, Implementation: 11-05-19) The certification must clearly indicate that posthospital extended care services were required to be given on an inpatient basis because of the individual's need for skilled care on a daily basis for an ongoing condition for which he/she was receiving inpatient hospital services prior to transfer to the SNF (or for a new condition that arose while in the SNF for treatment of that ongoing condition). Alternatively, under the regulations at 42 CFR 424.20(a)(1)(ii), the initial certification can simply affirm that the individual has been correctly assigned one of the case-mix classifiers that CMS designates as representing the required SNF level of care, as provided in the regulations at 42 CFR 409.30 (see Pub. 100-02, Medicare Benefit Policy Manual, chapter 8, §30.1, for a discussion of the administrative level of care presumption under the SNF PPS). Certifications must be obtained at the time of admission, or as soon thereafter as is reasonable and practicable (see Pub.100-04, Medicare Claims Processing Manual, Chapter 6, §120.2, regarding the circumstances under which a resumption of SNF care following a temporary break in SNF coverage would be considered a new “admission” under the SNF PPS’s Interrupted Stay policy). The routine admission procedure followed by a physician would not be sufficient certification of the necessity for posthospital extended care services for purposes of the program. If ambulance service is furnished by a skilled nursing facility, an additional certification is required. It may be furnished by any physician who has sufficient knowledge of the patient's case, including the physician who requested the ambulance or the physician who examined the patient upon his arrival at the facility. The physician must certify that the ambulance service was medically required.

(Rev. 1, 09-11-02) The recertification statement must contain an adequate written record of the reasons for the continued need for extended care services, the estimated period of time required for the patient to remain in the facility, and any plans, where appropriate, for home care. The recertification statement made by the physician does not have to include this entire statement if, for example, all of the required information is in fact included in progress. NOTE: In such a case, the physician's statement could indicate that the individual's medical record contains the required information and that continued posthospital extended care services are medically necessary. A statement reciting only that continued extended care services are medically necessary is not, in and of itself, sufficient. If the circumstances require it, the first recertification and any subsequent recertifications must state that the continued need for extended care services is for a condition requiring such services which arose after the transfer from the hospital and while the patient was still in the facility for treatment of the condition(s) for which he/she had received inpatient hospital services.

(Rev. 1, 09-11-02) The first recertification must be made no later than the l4th day of inpatient extended care services. A skilled nursing facility can, at its option, provide for the first recertification to be made earlier, or it can vary the timing of the first recertification within the l4-day period by diagnostic or clinical categories. Subsequent recertifications must be made at intervals not exceeding 30 days. Such recertifications may be made at shorter intervals as established by the utilization review committee and the skilled nursing facility. At the option of the skilled nursing facility, review of a stay of extended duration, pursuant to the facility's utilization review plan (if a UR review plan is in place), may take the place of the second and any subsequent physician recertifications. The skilled nursing facility should have available in its files a written description of the procedure it adopts with respect to the timing of recertifications. The procedure should specify the intervals at which recertifications are required, and whether review of long-stay cases by the utilization review committee serves as an alternative to recertification by a physician in the case of the second or subsequent recertifications.

(Rev. 1, 09-11-02) Skilled nursing facilities are expected to obtain timely certification and recertification statements. However, delayed certifications and recertifications will be honored where, for example, there has been an isolated oversight or lapse. In addition to complying with the content requirements, delayed certifications and recertifications must include an explanation for the delay and any medical or other evidence which the skilled nursing facility considers relevant for purposes of explaining the delay. The facility will determine the format of delayed certification and recertification statements, and the method by which they are obtained. A delayed certification and recertification may appear in one statement; separate signed statements for each certification and recertification would not be required as they would if timely certification and recertification had been made.

(Rev. 1, 09-11-02) Skilled nursing facilities do not have to transmit certification and recertification statements to the A/B MAC (A); instead, the facility must itself certify, in the admission and billing form that the required physician certification and recertification statements have been obtained and are on file.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) For certification and recertification of outpatient physical therapy, occupational therapy and speech-language pathology services see Pub. 100-02, Chapter 15, §220.1.3.

(Rev. 68, Issued: 04-22-11, Effective: 01-01-11, Implementation: 05-12-11)) The hospice must obtain written certification of terminal illness for each period of hospice care received by an individual. For the initial 90-day period, the hospice must obtain written certification statements from the medical director of the hospice or the physician member of the hospice interdisciplinary group, and the individual's attending physician (if the individual has one). The certification must specify that the individual's prognosis is for a life expectancy of 6 months or less if the terminal illness runs its normal course. Recertification for subsequent periods only requires the written certification by the hospice medical director or the physician member of the hospice interdisciplinary group. Certifications and recertifications must be dated and signed by the physician and must include the benefit periods to which they apply. Certifications and recertifications must include a brief narrative explanation of the clinical findings that supports a life expectancy of 6 months or less. If written certification is not obtained within 2 calendar days of the initiation of hospice care, a verbal certification must be obtained within the 2 days. A written certification from the medical director of the hospice or the physician member of the interdisciplinary group must be on file in the beneficiary's record prior to the submission of a claim to the Medicare contractor. If these requirements are not met, no payment may be made for the days prior to certification. Instead payment will begin with the day certification is obtained, i.e., the date verbal certification is obtained. Certifications and recertifications may be completed up to 15 days before the next benefit period begins. For recertifications on or after January 1, 2011, a hospice physician or hospice nurse practitioner must have a face-to-face encounter with each hospice patient prior to the beginning of the patient’s third benefit period, and prior to each subsequent benefit period. Failure to meet the face-to-face encounter requirements results in a failure by the hospice to meet the patient’s recertification of terminal illness eligibility requirement. The patient would cease to be eligible for the benefit. See Pub. 100-02, Medicare Benefit Policy Manual, Chapter 9, Section 20.1, Timing and Content of Certification.

(Rev. 1, 09-11-02) The DME supplier must retain a copy of the physician's order for DME in its files; and in some cases must furnish a Certificate of Medical Necessity to the DME MAC.

(Rev. 84, Issued: 04-04-14, Effective: 05-05-14, Implementation: 05-05-14) The following is a table summarizing the certification/recertification signature requirements and timeframes for various provider types. Please review sections above for more detailed information on Certifications/Recertifications and their required content: Provider Type Who Signs Certification Certification Timeframe Recertification Hospital Inpatient Attending physician or by another physician with knowledge of the case with authorization from attending physician or by a member of hospital's medical staff with knowledge of the case. No later than the 12th day of hospitalization Interval between recertifications not to exceed 30 days SNF Attending physician or physician on staff at SNF with knowledge of case, or physician extender as discussed in §40.1 of this chapter Obtain at time of admission or shortly thereafter First recertification no later than the 14th day of inpatient extended care services. Subsequent at intervals not exceeding 30 days. HHA Attending physician Obtain at time POC is established or shortly thereafter Physician must recertify at least once every 60 days Hospice For initial 90-day period, must obtain written certification statements from medical director of hospice or physician member of the hospice interdisciplinary group and the attending physician. If written certification is not obtained within 2 calendar days of the initiation of hospice care, a verbal certification must be obtained. Must be obtained for each period of hospice care; written certification by hospice medical director or physician member of interdisciplinary group. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R12425GI 12/21/2023 Enforcing Billing Requirements for Intensive Outpatient Program (IOP) Services with New Condition Code 92 - Additional Publication Update 01/02/2024 13496 R10757GI 05/11/2021 Physician Certification and Recertification of Services Manual Update to Incorporate Allowed Practitioners into Home Health Policy 08/11/2021 12222 R126GI 10/04/2019 Manual Updates for CR11152 Implementation of the Skilled Nursing Facility (SNF) Patient Driven Payment Model (PDPM) 11/05/2019 11454 R120GI 11/02/2018 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) (2018 Q4) 12/04/2018 11004 R114GI 03/16/2018 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) (2018) 06/19/2018 10512 R101GI 09/16/2016 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) 10/18/2016 9748 R98GI 05/13/2016 Clarification of Inpatient Psychiatric Facilities (IPF) Requirements for Certification, Recertification and Delayed/Lapsed Certification and Recertification 08/15/2016 9522 R94GI 10/16/2015 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (2015) 11/16/2015 9336 R92GI 04/22/2015 Manual Updates to Clarify Requirements for Physician Certification and Recertification of Patient Eligibility for Home Health Services 05/11/2015 9119 R91GI 04/10/2015 Manual Updates to Clarify Requirements for Physician Certification and Recertification of Patient Eligibility for Home Health Services – Rescinded and replaced by Transmittal 92 05/11/2015 9119 R84GI 04/04/2014 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions 05/05/2014 8669 R76GI 01/13/2012 Allowing Physician Assistants to Perform Skilled Nursing Facility (SNF) Level of Care Certifications and Recertifications 02/13/2012 7701 R68GI 04/22/2011 Physician Certification and Recertification of Services Manual Changes 05/12/2011 7377 R50GI 12/21/2007 Revision to Certification for Hospital Services Covered by the Supplementary Hospital Insurance Program as it Pertains to Ambulance Services 01/07/2008 5833 R47GI 08/17/2007 Revision to Certification for Hospital Services Covered by the Supplementary Medical Insurance Program as it Pertains to Ambulance Services 09/17/2007 5684 R39GI 06/09/2006 Update-Inpatient Psychiatric Facilities Prospective Payment System (IPF PPS) Rate Year 2007 07/03/2006 5129 R28GI 08/12/2005 Conforming Changes for Change Request 3648 to Pub. 100-01 09/12/2005 3912 R01MGI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 12425, Issued: 12-21-23, Effective: 01-01-24, Implementation: 01-02-24) Section 1866(e) of the Social Security Act defines the term "provider of services" (or provider) as: (1) A clinic, rehabilitation agency, or public health agency if, in the case of a clinic or rehabilitation agency, such clinic or agency meets the requirements of section 1861(p)(4)(A) (or meets the requirements of such section through the operation of section 1861(g)), or if, in the case of a public health agency, such agency meets the requirements of section 1861(p)(4)(B) (or meets the requirements of such section through the operation of section 1861(g)), but only with respect to the furnishing of outpatient physical therapy services (as therein defined) or (through the operation of section 1861(g)) with respect to the furnishing of outpatient occupational therapy services; and (2) A community mental health center (as defined in section 1861(ff)(3)(B)), but only with respect to the furnishing of partial hospitalization services (as described in section 1861(ff)(1)) or intensive outpatient services (as described in section 1861(ff)(4)). Definitions of providers, physicians, practitioners, and suppliers, and a description of the requirements that each must meet in order for their services to be considered covered are described in the following sections.

(Rev. 12425, Issued: 12-21-23, Effective: 01-01-24, Implementation: 01-02-24) The following provider types must have provider agreements under Medicare: • Hospitals, • Skilled nursing facilities (SNFs), • Home health agencies (HHAs), • Clinics, rehabilitation agencies, and public health agencies, • Comprehensive outpatient rehabilitation facilities (CORFs), • Hospices, • Critical access hospitals (CAHs), and • Community mental health centers (CMHCs). Clinics, rehabilitation agencies, and public health agencies may enter into provider agreements only for furnishing outpatient therapy services as defined in section 10 above. CMHCs may enter into provider agreements only to furnish partial hospitalization or intensive outpatient services. The term "provider agreement" is defined in 42 CFR 489.3 as an agreement between CMS and one of these providers specified in this section to provide services and to comply with the requirements of section 1866 of the Act. A provider which has executed an agreement becomes qualified to participate after the agreement is accepted. When the agreement is made retroactive, the provider must comply with the terms of the agreement and the provisions of title XVIII and regulations issued thereunder as of the retroactive date. For payment to be made to the provider for covered items and services it furnishes on or after the effective date of the agreement, the provider must have a record keeping capability sufficient to determine the costs of services furnished to Medicare beneficiaries. Provider agreements require the providers to comply with regulations. Therefore, new provider agreements are not made when regulations change. Providers as defined in this section may also function as suppliers and bill the program for other services provided as suppliers if they meet the applicable requirements for supplying the specific service.

(Rev. 58, Issued: 03-06-09, Effective: 06-08-09, Implementation: 06-08-09) Section 1866 of the Act and 42 CFR 489 require the provider to agree to the following: 1. To limit its charges to beneficiaries and to other individuals on their behalf to: • The deductible and coinsurance amounts (see §10.1.2 for details; • The blood deductible (see §10.1.4 for details); and • Services requested by the beneficiary. (See §10.1.5) 2. To return any amounts incorrectly collected from a beneficiary or any other person on the beneficiary's behalf; 3. To notify the A/B MAC (A) or (HHH) promptly if it hires an individual who at any time during the preceding year was employed in a managerial, accounting, auditing, or similar capacity by a MAC; 4. In the case of a hospital or a Critical Access Hospital (CAH), either to furnish directly or to make arrangements (as defined in §10.3 of this chapter) for all Medicare-covered services to inpatients of a hospital or a CAH except the following: • Physicians' services that meet the criteria of 42 CFR 405.550(b) for payment on a reasonable charge basis; • Physician assistant services, as defined in section 1861(s)(2)(K)(I) of the Act, that are furnished after December 31, 1990; • Certified nurse-midwife services, as defined in section 1861(ff) of the Act, that are furnished after December 31, 1990; • Qualified psychologist services, as defined in section 1861(ii) of the Act, that are furnished after December 31, 1990; and • Services of an anesthetist, as defined in 42 CFR 410.69. 5. In the case of a hospital or CAH that furnishes inpatient hospital services or inpatient CAH services for which payment may be made under Medicare, to maintain an agreement with a PRO for that organization to review the admissions, quality, appropriateness, and diagnostic information related to those inpatient services. The requirement of this paragraph applies only if, for the area in which the hospital or CAH is located, there is a PRO that has a contract with CMS under Part B of title XI of the Act; 6. To maintain a system that, during the admission process, identifies any primary payers other than Medicare so that incorrect billing and Medicare overpayments can be prevented; 7. To bill other primary payers before billing; 8. If the provider receives payment for the same services from Medicare and another payer that is primary to Medicare, to reimburse Medicare any overpaid amount within 60 days; 9. If the provider receives, from a payer that is primary to Medicare, a payment that is reduced because the provider failed to file a proper claim; to reimburse Medicare any overpaid amount up to the amount that would have been paid had the provider filed a proper claim timely. 10. In the State of Oregon, because of a court decision, and in the absence of a reversal on appeal or a statutory clarification overturning the decision, hospitals may bill liability insurers first. However, if the liability insurer does not pay "promptly," the hospital must withdraw its claim or lien and bill Medicare for covered services; 11. In the case of home health agencies, to offer to furnish catheters, catheter supplies, ostomy bags, and supplies related to ostomy care to any individual who requires them as part of their furnishing of home health services; 12. In the case of hospital emergency department services that provide for medical screening to determine if an emergency medical condition exists, CMS guidelines provided in CFR 42 489.24(d) for transfer of patients to other facilities should be followed; 13. In the case of hospital emergency department services report to CMS or the State Survey Agency any time it has reason to believe it may have received an individual who has been transferred in an unstable emergency medical condition from another hospital in violation of the requirements of CFR 42 489.24(d); 14. In the case of inpatient hospital services for admissions on and after January 1, 1987, to participate in the Tricare program; 15. In the case of inpatient hospital services for admissions on and after July 1, 1987, to admit veterans whose admission is authorized by the VA and to meet related VA admission and payment requirements; 16. In the case of a hospital, to give each beneficiary a notice about his or her discharge rights at or about the time of the individual's admission; 17. In the case of a hospital with an emergency department: • To post conspicuously in any emergency department or in a place or places likely to be noticed by all individuals entering the emergency department, as well as those individuals waiting for examination and treatment in areas other than traditional emergency departments (that is, entrance, admitting area, waiting room, treatment area), a sign (in a form specified by the Secretary) specifying rights of individuals under Section 1867 of the Act with respect to examination and treatment for emergency medical conditions and women in labor; and • To post conspicuously information indicating whether or not the hospital or critical access hospital participates in the Medicaid program under a State plan approved under title XIX; 18. In the case of a hospital with an emergency department (including both the transferring and receiving hospitals), to maintain: • Medical and other records related to individuals transferred to or from the hospital for a period of 5 years from the date of the transfer; • A list of physicians who are on call for duty after the initial examination to provide treatment necessary to stabilize an individual with an emergency medical condition; and • A central log on each individual who comes to the emergency department seeking assistance and whether he or she refused treatment, was refused treatment, or whether he or she was transferred, admitted and treated, stabilized and transferred, or discharged. 19. Effective December 1, 1991, in the case of a hospital to comply with the advance directive provisions of 4206 of OBRA 1990. Hospitals must, in accordance with written policies and procedures, for all adult individuals: • Inform them, in writing, of State laws regarding advance directives; • Inform them, in writing, of its policies regarding the implementation of advance directives (including a clear and concise explanation of a conscientious objection, to the extent that State law permits for a hospital or any agent of a hospital that, as a matter of conscience, cannot implement an advance directive); • Document in the individual's medical record whether the individual has executed an advance directive; • Not condition the provision of care or otherwise discriminate against an individual based on whether that individual has executed an advance directive (since the law does not require the individual to do so); and • Educate staff and the community on issues concerning advance directives. 20. Effective October 1, 2007, CMS revised the regulations governing provider agreements that require hospitals to disclose physician ownership information to patients when a referring physician (or his or her immediate family member) has an ownership interest in the hospital. Pursuant to 42 CFR 489.20(u), hospitals must: (1) furnish written notice to each patient at the beginning of the patient’s hospital stay or outpatient visit that the hospital is a physician-owned hospital, in order to assist the patient in making an informed decision regarding his or her care. The notice must disclose the fact that the hospital meets the Federal definition of a physician-owned hospital and that the list of physician owners or immediate family members of physicians is available upon request and must be provided to the patient at the time of the request; and (2) require each physician who is a member of the hospital’s medical staff to agree, as a condition of continued medical staff membership or admitting privileges, to disclose in writing to all patients the physician refers to the hospital any ownership or investment interest in the hospital held by the physician or held by an immediate family member of the physician. Disclosure must be made at the time of the referral. Effective October 1, 2008, hospitals that do not have any physician owners who refer patients to the hospital are exempt from the disclosure requirements (See 42 CFR 489.20(v)). In addition, CMS may deny a provider agreement to a hospital that does not have procedures in place to notify patients of physician ownership in the hospital (See 42 CFR 489.12).

(Rev. 1, 09-11-02) This section is a further explanation of §10.1.1 above. The provider may charge the beneficiary or his or her representative: • The amount of the inpatient hospital deductible or, if less, the actual charges for the services; • The amount of inpatient hospital coinsurance applicable for each day the individual is furnished inpatient hospital services after the 60th day, during a benefit period; • The posthospital extended care coinsurance amount; and • In the case of durable medical equipment (DME) furnished as a home health service, 20 percent of the fee schedule amount.

(Rev. 1, 09-11-02) This section is a further explanation of §10.1.1 above. The provider may charge the beneficiary or other person on his or her behalf: the $100 deductible and 20 percent of the customary (insofar as reasonable) charges in excess of that deductible. For hospital outpatient services, the allowable deductible charges depend on whether the hospital can determine the beneficiary's deductible status. If the hospital is unable to determine the deductible status, it may charge the beneficiary its full customary charges up to $100. If the beneficiary provides official information as to deductible status, the hospital may charge only the unmet portion of the deductible. The hospital is required to indicate on the claim the amounts collected. In the case of DME furnished as a home health service under Medicare Part B, the coinsurance is 20 percent of the fee schedule amount for the services, with the following exception: If the DME is used, purchased by, or on behalf of the beneficiary at a price at least 25 percent less than the reasonable charge for comparable new equipment, no coinsurance is required.

(Rev. 18, Issued: 03-04-05, Effective: 07-01-05, Implementation: 07-05-05) This section is a further explanation of §10.1.1. A provider may charge the beneficiary (or other person on his or her behalf) only for the first three pints of blood or units of packed red cells furnished during the calendar year. The charges may not exceed the provider's customary charges. The provider may not charge for any whole blood or packed red cells in any of the following circumstances: • The provider obtained the blood or red cells at no charge other than a processing or service charge; • The blood or packed red cells have been replaced; or • The provider (or its blood supplier) receives from an individual, or a blood bank, a replacement offer. This offer is applicable if the replacement blood would not endanger the health of a recipient and if the prospective donor's health would not be endangered by making a blood donation. In this case the provider is precluded from charging even if it or its blood supplier rejects the replacement offer. • Refer to Pub. 100-04, Medicare Claims Processing Manual, chapter 4, §231 regarding billing for blood and blood products under the Hospital Outpatient Prospective Payment System (OPPS).

(Rev. 1, 09-11-02) This section is a further explanation of §10.1.1. If services furnished at the request of a beneficiary (or his or her representative) are more expensive than, or in excess of, services covered under Medicare, a provider may charge the beneficiary an amount that does not exceed the difference between (1) the provider's customary charges for the services furnished; and (2) the provider's customary charges for the kinds and amounts of services that are covered under Medicare. A provider may not charge for these services unless they have been requested by the beneficiary (or his or her representative) and may not require a beneficiary to request services as a condition of admission. To avoid misunderstanding and disputes, a provider must inform any beneficiary who requests a service for which a charge will be made that there will be a specified charge for that service.

(Rev. 1, 09-11-02) A provider that customarily furnishes an individual items or services that are more expensive than the items or services determined to be necessary in the efficient delivery of needed health services, may charge an individual entitled to benefits under Medicare for such more expensive items or services even though not requested by the individual. The charge, however, may not exceed the amount by which the cost of (or, if less, the customary charges for) more expensive items or services furnished by such provider in the second cost reporting period immediately preceding the cost reporting period in which such charges are imposed, exceeds the applicable limit imposed under the provisions of 42 CFR 413.30. This charge may be made only if: • The A/B MAC (A) or (HHH) determines that the charges have been calculated properly in accordance with the provisions of this regulation section; • The services are not emergency services as defined in §20.1 or §20.2 of this chapter; • The admitting physician has no direct or indirect financial interest in such provider; • CMS has provided notice to the public through notice in a newspaper of general circulation servicing the provider's locality and such other notice as the Secretary may require, of any charges the provider is authorized to impose on individuals entitled to benefits under Medicare on account of costs in excess of the costs determined to be necessary in the efficient delivery of needed health services under Medicare; and • The provider has identified such charges to such individual or person acting on his/her behalf as charges to meet the costs in excess of the costs determined to be necessary in the efficient delivery of needed health services under Medicare.

(Rev. 1, 09-11-02) This section is a further explanation of §10.1.1. A hospital receiving payment for a covered hospital stay under: • Either a State reimbursement control system approved under 1886 (c) of the Act; or • A demonstration project authorized under section 402(a) of Pub. L. 90 - 248 (42 U.S.C. 1395b - 1) or section 222(a) of Pub. L. 92 - 603 (42 U.S.C.1395b - 1 (NOTE)); and • Would otherwise be subject to the prospective payment system set forth in part 412 of this chapter, may also charge a beneficiary for custodial care and medically unnecessary services described in CFR CUR 412.42(c), after the conditions of 412.42(c)(1) through(c)(4) are met.

(Rev. 1, 09-11-02) This section is a further explanation of §10.1.1. A provider that has not filed a proper claim and has received a reduced payment because of this from a payer primary to Medicare agrees: • To bill Medicare for an amount no greater than would have been payable as secondary payment if the primary insurer's payment had been based on a proper claim; and • To charge the beneficiary only (a) the amount it would have been entitled to charge if it had filed a proper claim and received payment based on such a claim; and (b) an amount equal to any third-party payment reduction attributable to failure to file a proper claim, but only if the provider can show that: o It failed to file a proper claim solely because the beneficiary, for any reason other than mental or physical incapacity, failed to give the provider the necessary information; or o The beneficiary, who was responsible for filing a proper claim, failed to do so for any reason other than mental or physical incapacity.

(Rev. 1, 09-11-02) Effective December 1, 1991, participating hospitals must comply with the advance directive provisions of §4206 of OBRA 1990. Therefore, an agreement per §1866 of the Act with a hospital includes that the hospital must, in accordance with written policies and procedures, for all adult individuals: inform them, in writing, of state laws regarding advance directives; inform them, in writing, of its policies regarding the implementation of advance directives (including a clear and concise explanation of a conscientious objection, to the extent that state law permits for a hospital or any agent of a hospital that, as a matter of conscience, cannot implement an advance directive); document in the individual's medical record whether the individual has executed an advance directive; not condition the provision of care or otherwise discriminate against an individual based on whether that individual has executed an advance directive (since the law does not require the individual to do so); and educate staff and the community on issues concerning advance directives.

Section 6018(a)(2) of the Omnibus Budget Reconciliation Act of 1989 (OBRA §89), effective July 1, 1990, requires hospitals with emergency departments to post signs which specify the rights (under section 1867 of the Social Security Act) of women in labor and individuals with emergency medical conditions to examination and treatment. To comply with these requirements, hospitals must post signs that meet the following criteria: • At a minimum, the signs must specify the rights of unstable individuals with emergency conditions and women in labor who come to the emergency department for health care services; • It must indicate whether the facility participates in the Medicaid program; • The wording of the sign must be clear and in simple terms understandable by the population serviced; • Print the signs in English and other major languages that are common to the population of the area serviced; • The letters within the signs must be clearly readable at a distance of at least 20 feet or the expected vantage point of the emergency department patrons; and • Post signs in a place or places likely to be noticed by all individuals entering the emergency department, as well as those individuals waiting for examination and treatment (e.g., entrance, admitting area, waiting room, treatment area). The sample below may be adapted, contains sufficient information to satisfy these requirements, and may be adapted to satisfy the visibility requirement. IT'S THE LAW! IF YOU HAVE A MEDICAL EMERGENCY OR ARE IN LABOR YOU HAVE THE RIGHT TO RECEIVE, WITHIN THE CAPABILITIES OF THIS HOSPITAL'S STAFF AND FACILITIES: An appropriate medical SCREENING EXAMINATION Necessary STABILIZING TREATMENT (including treatment for an unborn child) And if necessary An appropriate TRANSFER to another facility Even if YOU CANNOT PAY OR DO NOT HAVE MEDICAL INSURANCE OR YOU ARE NOT ENTITLED TO MEDICARE OR MEDICAID This hospital (does/does not) participate in the Medicaid program

(Rev. 120, Issued: 11-02-18, Effective: 12- 04-18, Implementation: 12- 04-18 The participation of a provider of services, which voluntarily files an agreement to participate in the health insurance program, contemplates that such provider will admit Medicare beneficiaries for care and treatment, and upon admission, will provide them with such services as are ordinarily furnished by the provider to its patients generally. A provider may have restrictions on the types of services it makes available and/or the types of health conditions it accepts, or may establish other criteria relating to the admission of persons for care and treatment. However, the law does not contemplate that such restrictions or criteria will apply only to Medicare beneficiaries as a class. It does contemplate, however, that if such restrictions or criteria apply to Medicare beneficiaries, they will be applied in the same manner in which they are applied to all other persons seeking care and treatment by the provider. Thus, a provider admission or patient policy or practice which is not consistent with the objective contemplated in the law may be used by CMS as a basis for termination of the agreement for cause (see the regulations at 42 CFR 489.53(a)(2), and also see Pub. 100-04, Medicare Claims Processing Manual, chapter 1, §30.1.3).

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) A provider may have others furnish certain covered items and services to their patients through arrangements under which receipt of payment by the provider for the services discharges the liability of the beneficiary or any other person to pay for the service. In permitting providers to furnish services under arrangements, it was not intended that the provider merely serve as a billing mechanism for the other party. Accordingly, for services provided under arrangements to be covered, the provider must exercise professional responsibility over the arranged-for services. The provider's professional supervision over arranged-for services requires application of many of the same quality controls as are applied to services furnished by salaried employees. The provider must accept the patient for treatment in accordance with its admission policies, and maintain a complete and timely clinical record on the patient, which includes diagnoses, medical history, physician's orders, and progress NOTEs relating to all services received, and must maintain liaison with the attending physician regarding the progress of the patient and the need for revised orders. In the case of home health services and outpatient physical therapy or speech-language pathology services, the provider must ensure that the required plan of treatment is periodically reviewed by the physician and secure from the physician the required certifications and recertifications. Additionally, the provider (other than a SNF) must ensure that the medical necessity of such services is reviewed on a sample basis by the utilization review (UR) committee if one is in place, the facility's health professional staff, or an outside UR group. (Effective October 1, 1990, a SNF is no longer required to have a plan for UR.) The provider, including a SNF that conducts optional UR services, is responsible for medical necessity decisions made under arrangement by an outside group.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) An agreement with a hospital, HHA, hospice, and (for the purposes of furnishing outpatient physical therapy, occupational therapy, or speech-language pathology services) a clinic, a rehabilitation agency, or public health agency is not time limited and has no fixed expiration date. The agreement remains in effect until such time as there is a voluntary termination, or involuntary termination, or a change of ownership.

(Rev. 1, 09-11-02) All agreements with SNFs are required to be for a specified term of up to l2 full calendar months with fixed expiration dates. In appropriate situations, the agreement may also contain a cancellation clause. Therefore, when it is determined that a SNF is eligible and that its agreement for participation in the Medicare program will be accepted for filing, the term of the agreement will be determined in the following manner: A. No Deficiencies - If a SNF is certified as being in full compliance with all standards contained in the requirements for participation for SNFs, the term of the agreement is, as appropriate to the period of certification for it has been approved, for a term of up to 12 full calendar months. B. Deficiencies - If a SNF is certified as not being in full compliance, the term of the agreement is, as appropriate to the period of certification or conditional period of certification for which it has been approved: 1. For a term which expires no later than the close of the 60th day following the last day of the time period specified in the written plan providing for the correction of deficiencies in meeting the requirements for participation, provided that such term does not exceed 12 full calendar months or 2. Provide a conditional term of up to 12 full calendar months, subject to a cancellation clause that the agreement may be canceled on a predetermined date (no later than the close of the 60th day following the last day of the time period specified in the written plan providing for the correction of deficiencies in meeting the requirements for participation), provided that date will occur within the 12-month term. If the health and safety of Medicare patients are not jeopardized, the term of an agreement may be extended for 2 full calendar months when necessary to prevent irreparable harm to the facility, to prevent hardship to Medicare beneficiaries furnished care, or if it is impracticable within the term of the agreement to determine whether the SNF is complying with the provisions of the Act and regulations issued thereunder.

(Rev. 1, 09-11-02) Agreements between RHCs/FQHCs and CMS are generally for a term of 1 year. They may be annually renewed by mutual agreement of the RHC/FQHC and CMS, i.e., a new agreement need not be signed each year. Special circumstances may result in a term of less than 1 year for an initial agreement, e.g., a clinic or center may wish the agreement year to run concurrently with the RHC/FQHC's fiscal year or have some other technical considerations.

(Rev. 1, 09-11-02) Upon acceptance for participation, a provider becomes responsible for remaining in compliance with the terms of the agreement and the provisions of title XVIII and regulations issued thereunder. Where the agreement is made retroactive, the provider must comply with its responsibilities as of the retroactive date. Payment to the provider for covered items and services it furnishes on or after the effective date of the agreement will require that the provider have a recordkeeping capability sufficient for determining the cost of services furnished Medicare beneficiaries. The termination of participation (see §10.6 of this chapter) does not immediately abrogate all of the provider's responsibilities and in specific matters a responsibility may extend beyond the effective date of termination. For example, the provider continues to be responsible (as applicable) for those provisions of the law and regulations which provide for program coverage to remain in effect for specified periods of time beyond the effective termination date, for those beneficiaries who were accepted for care and treatment by the provider before such date. The provider also continues to be responsible for filing a final cost report and/or the repayment of any overpayment, as these actions relate to final program cost settlement after termination.

(Rev. 1, 09-11-02) A provider may voluntarily terminate its participation in the program or have it terminated by the Secretary for cause.

(Rev. 1, 09-11-02) A provider may terminate its agreement (and in the case of a SNF, it may terminate its agreement prior to the close of the specified term of its agreement) by filing with the Secretary a written notice of its intention to terminate the agreement. The Secretary may accept the termination date stated in the notice (the date must be the first day of a month and, in the case of a SNF, must occur within the specified term of such facility's agreement) or set a different date. However, the termination date set by the Secretary may not be more than 6 months from the date the provider's notice is filed.

(Rev. 1, 09-11-02) The Secretary may terminate an agreement (and in the case of a SNF, he/she may terminate its agreement prior to the close of the specified term of the agreement) with a provider if it is determined that the provider: • Is not complying substantially with the provisions of the agreement or with the applicable provisions of title XVIII of the Act and regulations; • No longer meets the appropriate requirements for participation; • Has failed to supply information which is necessary to determine whether payments are due or were due and the amounts of such payments; or • Refuses to permit examinations of fiscal and other records, including medical records. The cancellation of a SNF agreement at the close of the predetermined date stated in the cancellation clause contained in such agreement (see §10.6.2 of this chapter) is viewed as an involuntary termination of the agreement by the Secretary for cause. Such actions involve a finding that the SNF has not satisfactorily completed its written plan providing for the correction of deficiencies with respect to one or more of the standards in the applicable requirements for participation, or that the facility has not made substantial effort and progress in correcting such deficiencies. A provider which is dissatisfied with the Secretary's determination terminating its agreement is entitled to request a hearing thereon in accordance with the appeals procedures contained in 42 CFR Part 498. There is no reconsideration step before the opportunity for a hearing. NOTE: The involuntary termination of a hospital's approval authorizing it to provide extended care services, i.e., to be a swing bed facility, does not automatically result in the involuntary termination of the hospital's agreement relating to the provision of hospital services.

(Rev. 1, 09-11-02) All agreements with skilled nursing facilities are required to be for a specified term of up to 12 full calendar months with fixed expiration dates. The agreement expires at the close of the last day of its specified term and is not automatically renewable from term to term. When the term of an agreement is extended (see §10.6.3 of this chapter), the close of the last day of its specified term is the close of the day of the extension of the agreement. Thus, when the term of an agreement is extended, the provider's participation in the program continues, and the agreement does not expire until the close of the last day to which it has been extended. Since an agreement with a SNF is not automatically renewable from term to term, each term agreement with a SNF requires that the SNF qualify for participation and that its agreement be accepted for filing. A participating SNF may, however, continue its participation under the agreement form previously accepted for filing, provided the SNF continues to qualify for participation and the agreement form is again accepted for filing and renewed for a term which begins on the date immediately following the close of the last day of the prior term of the agreement. When the requirements for participation continue to be met, there is no limit to the number of times that the SNF's agreement form may again be accepted and renewed for a specified term. When the time-limited agreement (including an agreement which has had its term extended) is renewed on the day immediately following the close of the last day of its term, the expiration of the agreement is not considered a termination of participation in the program. However, once an agreement with a SNF is (1) not renewed, or (2) voluntarily terminated by the SNF, or (3) involuntarily terminated (including cancellations) by the Secretary, the previously accepted agreement cannot again be accepted and renewed. In such cases, the SNF is required to execute and file a new agreement if it is again found eligible to participate in the Medicare program. The effective date of the new agreement must be determined in accordance with regulatory provisions (42 CFR 489.13). The Secretary's determination not to accept and renew a SNF agreement is a determination relating to the qualifications of the SNF in the period immediately following the close of the SNF's existing agreement and the SNF is entitled to request a reconsideration of the determination in accordance with the appeals procedure contained in 42 CFR part 405, subpart 0. Such determinations involve a finding that: • Based on a State agency resurvey and recertification, the SNF will not be approved for a period of certification because it is out of compliance with one or more requirements for participation; • Based on a State agency resurvey and recertification, the SNF continues to be out of compliance with the same standard(s) in the requirements for participation as were found out of compliance during the term of the agreement and the facility will not be approved for a new period of certification; or • The SNF has violated the terms of its agreement or the provisions of title XVIII or regulations promulgated thereunder. In cases of nonrenewal by the Secretary, the A/B MAC (A)'s role is the same as for involuntary terminations.

(Rev. 42, Issued: 11-09-06, Effective: N/A, Implementation: 12-11-06) Effective with the date a provider agreement (or swing bed approval) terminates no payment is made to the provider under such agreement for the following: A. Hospital 1. Termination-Hospital Agreement - Inpatient hospital services (including inpatient psychiatric hospital services) and swing bed extended care services furnished on or after the effective date of the hospital's termination, except that payment can continue to be made for up to 30 days of inpatient hospital services and/or swing bed extended care services (total of no more than 30 days) furnished on or after the termination date to beneficiaries who were admitted (at either the acute or extended care level) prior to the termination date. 2. Termination-Swing Bed Approval - Swing bed extended care services furnished on or after the effective date of the termination of the hospital's swing bed approval, except that payment can continue for up to 30 days of extended care services furnished on or after the termination date to beneficiaries who were admitted (at either the acute or extended care level) prior to the termination date. B. Skilled Nursing Facility 1. Termination-SNF - Posthospital extended care services furnished on or after the effective date of termination of the agreement, where such agreement has been voluntarily terminated by the provider (see §10.6.1 of this chapter) or involuntarily terminated by the Secretary for cause (see §10.6.2 of this chapter), except that payment can continue to be made for up to 30 days of posthospital extended care services furnished on and after the termination date to beneficiaries who were admitted prior to the termination date. C. HHA and Hospice Payment may be made for services under a plan of treatment for up to 30 days following the effective termination date of a home health agency or hospice if the plan was established before the termination date. D. Providers - Termination See Medicare Claims Processing Manual Chapter 1 for billing instructions concerning other items and services, including outpatient physical therapy or speech-language pathology and diagnostic services, furnished on or after the effective date of termination on or after the day following the close of such agreement.

(Rev. 1, 09-11-02) When an organization having a provider agreement undergoes a change of ownership, the agreement is automatically assigned to the new owner. A participating provider which plans to change ownership should give advance notice of its intention so that necessary action can be taken in the event the newly-owned institution does not wish to participate in the Medicare program. A participating provider which plans to enter into a lease arrangement (in whole, or in part) should also give advance notice of its intention. A change of ownership would occur for example: • Where a sole proprietor transfers title to an enterprise to another party; • Where, in the case of a partnership, the addition, removal, or substitution of a partner effects a termination of such partnership and creates a successor partnership or other entity; • Where an incorporated provider merges with an incorporated institution which is not participating in the program and the nonparticipating institution is the surviving corporation or where two or more corporate providers consolidate and such consolidation results in the creation of a new corporate entity; or • Where an unincorporated provider (a sole proprietorship or partnership) becomes incorporated. Whenever A/B MACs (A) learn of an impending change of ownership, or possible change of ownership, they inform the regional office immediately. They refer any questions they may have concerning change of ownership situations to the regional office.

(Rev. 42, Issued: 11-09-06, Effective: N/A, Implementation: 12-11-06) A hospital (other than psychiatric) means an institution which is primarily engaged in providing, by or under the supervision of physicians, to inpatients, diagnostic and therapeutic services for medical diagnosis, treatment, and care of injured, disabled, or sick persons; or rehabilitation services for the rehabilitation of injured, disabled, or sick persons. To be eligible to participate in Medicare, a hospital must also be an institution which: • Maintains clinical records on all patients; • Has bylaws in effect with respect to its staff of physicians; • Has a requirement that every patient must be under the care of a physician; • Provides 24-hour nursing service rendered or supervised by a registered professional nurse, and has a licensed practical nurse or registered professional nurse on duty at all times; • Has in effect a hospital utilization review plan; • Is licensed or is approved by the State or local licensing agency as meeting the standards established for such licensing; and • Meets other health and safety requirements found necessary by the Secretary of Health, and Human Services. (These additional requirements may not be higher than comparable ones prescribed for accreditation by the Joint Commission on Accreditation of Hospitals with exceptions specified in the law). Such an institution, if approved to participate as a hospital, may also be approved as a swing bed facility pursuant to demonstration authority or if the hospital is a rural hospital with less than 100 beds. (See §30.3 below.)

(Rev. 1, 09-11-02) Payment may be made for certain Part A inpatient hospital services and Part B outpatient hospital services provided in a nonparticipating U.S. hospital where they are necessary to prevent the death or serious impairment of the health of the individual. Because of the threat to the life or health of the individual, the use of the most accessible hospital equipped to furnish such services is necessary. The determination of emergency services depends upon three separate findings: • The hospital meets the definition of an emergency hospital (see §20.2 of this chapter), • The services meet the definition of emergency services (see Claims Processing Manual, Chapter 3, §110), and • The hospital is substantially more accessible from the site of the emergency than is the nearest participating hospital.

(Rev. 1, 09-11-02) An emergency services hospital is a nonparticipating hospital which meets the requirements of the law's definition of a "hospital" relating to full-time nursing services and licensure under State or applicable local law. (A Federal hospital need not be licensed under State or local licensing laws to meet the definition of emergency hospital.) In addition, the hospital must be primarily engaged in providing, under the supervision of doctors of medicine or osteopathy, services of the type that §20.1 describes in defining the term hospital, and must not be primarily engaged in providing skilled nursing care and related services for patients who require medical or nursing care. (See the definition of a SNF in §30 of this chapter.) Psychiatric hospitals that meet these requirements can qualify as emergency hospitals. Inpatient hospital services and related physician and ambulance services furnished outside the U.S. are covered under the limited conditions in Medicare Claims Processing Manual Chapter 1.

(Rev. 1, 09-11-02) A psychiatric hospital is an institution which is primarily engaged in providing by or under the supervision of a physician, psychiatric services for the diagnosis and treatment of mentally ill persons. To be eligible for participation in the program as a psychiatric hospital, it must meet the Medicare conditions of participation for hospitals or be deemed to meet those conditions based on accreditation by the Joint Commission on Accreditation of Hospitals (JCAH), have a utilization review plan, and comply with additional staffing and medical record requirements necessary to carry out an active program of treatment and intensive care.

(Rev. 1, 09-11-02) Under certain conditions a distinct part of a psychiatric institution may be certified as a psychiatric or general hospital.

(Rev. 1, 09-11-02) A distinct part of a psychiatric institution can be certified as a psychiatric hospital if it meets the conditions of participation even though the institution of which it is a part does not. If the distinct part meets requirements equivalent to the accreditation requirements of the JCAH, it can qualify under the program even though the institution itself is not accredited.

(Rev. 1, 09-11-02) A general hospital facility within a psychiatric hospital may be certified as a general hospital independent of the institution as a whole provided the general facility is a self- contained operational entity distinct from the rest of the institution. The general hospital facility would be regarded as a separate institution for this purpose since the law does not provide for certifying a "distinct part' of an institution as a general hospital. Services furnished in a separately certified general hospital facility are not subject to any of the benefit limitations applicable to the other parts of the institution, i.e., the reduction in benefit days in the first spell of illness and the 190-day lifetime maximum on inpatient services in psychiatric hospitals.

(Rev. 1, 09-11-02) There is no provision for a psychiatric wing of a general hospital to be certified as a psychiatric hospital. The distinct part provisions apply only to psychiatric institutions and not to general hospitals. However, this does not prevent the certification of a psychiatric hospital which is a part of a medical center or other large complex, provided the hospital operates as a separate functioning entity, i.e., it is located in a separate building, wing, or part of a building, has its own administration and maintains separate fiscal records.

(Rev. 1, 09-11-02) A SNF is an institution or a distinct part of an institution (see §30.1 of this chapter), such as a skilled nursing home or rehabilitation center, which has a transfer agreement in effect with one or more participating hospitals (see §30.2 of this chapter for transfer agreements and §10.1 of this chapter, for definition of a participating hospital) and which: • Is primarily engaged in providing skilled nursing care and related services for residents who require medical or nursing care; or rehabilitation services for the rehabilitation of injured, disabled, or sick persons, and • Meets the requirements for participation in 1819(a) through 1819 (d) as amended by 4201 of OBRA 1987 of the Social Security Act and in regulations at 42 CFR 483, B. A qualified SNF is one that meets all the requirements in the preceding definition. For Medicare purposes, the term SNF does not include any institution which is primarily for the care and treatment of mental diseases. (This restriction does not apply to title XIX (Medicaid)). Also, the term "skilled nursing facility" does not include swing bed hospitals authorized to provide and be paid for extended care services. Swing bed hospitals must meet many of the same requirements that apply to SNFs (for more details regarding swing bed hospitals, see §30.3.)

(Rev. 1, 09-11-02) The term "distinct part" refers to a portion of an institution or institutional complex (e.g., a nursing home or a hospital) that is certified to provide SNF and/or Nursing Facility (NF) services. To qualify for participation in the program as a distinct part SNF of an institution, it must be physically separate from the rest of the institution, i.e., it must represent an entire physically identifiable unit consisting of all the beds within that unit, such as a separate building, floor, wing, or ward. A distinct part must be fiscally separate for cost reporting purposes. Although it is required that the distinct part be identifiable as a separate unit within the institution, it need not necessarily be confined to a single location within the institution's physical plant. The distinct part may, for example, consist of several floors or wards which are scattered throughout several different buildings within the institutional complex. In each case, however, the patients of the distinct part must be located in units which are physically separate from those units housing all other patients of the institution. Various beds scattered throughout the institution do not comprise a distinct part for purposes of being approved by Medicare as a SNF. An institution or institutional complex can only be certified with one distinct part SNF and/or one distinct part NF. A hospital-based SNF is by definition a distinct part. Multiple certifications within the same institution or institutional complex are strictly prohibited. The distinct part must consist of all beds within the designated area. Where an institution or institutional complex owns and operates a SNF and/or a NF distinct part, that SNF and/or NF distinct part is a single distinct part even if it is operated at various locations throughout the institution or institutional complex. The aggregate of the SNF and/or NF locations represents a single distinct part subprovider, not multiple subproviders, and must be assigned a single provider number.

(Rev. 114, Issued: 03-16-18, Effective: 06-19-18, Implementation: 06-19-18) To participate in the program, a SNF must have a written transfer agreement with one or more participating hospitals (see §10.1 of this chapter) providing for the transfer of patients between the hospital and the SNF, and for the interchange of medical and other information. If an otherwise qualified SNF has attempted in good faith, but without success, to enter into a transfer agreement, this requirement may be waived by the State agency. (See 42 CFR 483.70(j) for the detailed requirements for transfer agreements.)

(Rev.114, Issued: 03-16-18, Effective: 06-19-18, Implementation: 06-19-18) In order to address the shortage of rural SNF beds for Medicare patients, rural hospitals with fewer than 100 beds may be reimbursed under Medicare Part A for furnishing post hospital extended care services to Medicare beneficiaries if the hospital has obtained a swing bed approval from the Department of Health and Human Services. Such a hospital, known as a swing bed hospital, can "swing" its beds between hospital and SNF levels of care, on an as needed basis. In accordance with §1883 of the Act, rural hospitals with fewer than 100 beds must make application and request approval to be a swing bed hospital from the regional office. In order to obtain swing bed approval, the hospital must: • As noted above, be located in a rural area (i.e., located outside of an "urbanized area," as defined by the Census Bureau and based on the most recent census, see 42 CFR 482.58(a)(2)) and have fewer than 100 beds (excluding intensive care-type beds and newborn bassinets) • Have a Medicare provider agreement, as a hospital; • Be substantially in compliance with the SNF participation requirements identified in 42 CFR 482.58; (most other SNF participation requirements would be largely met by virtue of the facility's compliance with comparable hospital conditions); • Not have in effect a 24-hour nursing waiver granted under 42 CFR 488.54(c); and • Not have had a swing bed approval terminated within the 2 years previous to application for swing bed participation. However, the Department may grant swing bed approval, on a demonstration basis, with hospitals meeting all of the statutory requirements except bed size and geographic location. Prior to October 1, 1990, a swing-bed hospital could also furnish intermediate care facility (ICF) type services to non-Medicare patients. Effective with services furnished on or after October 1, 1990, the distinction between SNFs and ICFs for certifying a facility for the Medicaid program was eliminated. Thus, for purposes of the Medicaid program, facilities may no longer be certified as ICFs but instead may be certified only as nursing facilities (NFs) and can provide services as defined in §1919(a)(1) of the Act. Effective October 1, 1990, such services furnished by swing-bed hospitals to Medicaid and to other non-Medicare patients are referred to as NF-type services. See §10.3 of Pub. 100-02, Medicare Benefit Policy Manual, chapter 8, for additional information on Part A coverage of SNF-level swing-bed services as extended care services.

(Rev. 35, Issued: 02-10-06; Effective/Implementation Dates: 05-11-06) In order for a Medicare or Medicaid provider to meet the definition of an RNHCI, it must satisfy the ten qualifying provisions as contained in Section 1861(ss)(1) of the Act. Section 1861(ss)(1) of the Act states that an RNHCI means an institution that: 1. Is described in Subsection (c)(3) of Section 501 of the Internal Revenue Code of 1986 and is exempt from taxes under Subsection (a) of that section. The inability to either gain or retain this status will disqualify an institution from participation as an RNHCI. 2. Is lawfully operated under all applicable Federal, State, and local laws and regulations. Federal law supersedes State and local laws unless the State and local requirements are more stringent than the Federal requirements. 3. Furnishes only nonmedical nursing items and services to patients who choose to rely solely upon a religious method of healing and for whom the acceptance of medical services would be inconsistent with their religious beliefs. Medicare does not cover the religious component of the healing. 4. Furnishes nonmedical items and services exclusively through nonmedical nursing personnel who are experienced in caring for the physical needs of these patients. This care frequently involves: assistance in moving, turning, positioning, and ambulation; meeting nutritional needs; and comfort and support measures. 5. Furnishes nonmedical items and services to inpatients on a 24-hour basis. 6. Does not furnish, on the basis of its religious beliefs, through its personnel or otherwise, medical items and services (including any medical screening, examination, diagnosis, prognosis, treatment, or the administration of drugs) for its patients. 7. Is not owned by, under common ownership with, or has an ownership interest of 5 percent or more in, a provider of medical treatment or services, and is not affiliated with a provider of medical treatment or services, or with an individual who has an ownership interest of 5 percent or more in, a provider of medical treatment or services. For purposes of this requirement, an affiliation does not exist in the circumstances described in Section 1861(ss)(4) of the Act or 42 CFR 403.738(c). 8. Has in effect a utilization review plan that: • Provides for review of admissions to the institution, of the duration of stays, of cases of continuous extended duration, and of the items and services furnished by the institution; • Requires that the reviews be made by an appropriate committee of the institution that includes the individuals responsible for overall administration and for supervision of nursing personnel at the institution; • Provides that records be maintained of the meetings, decisions, and actions of the committee; and • Meets other requirements as the Secretary finds necessary to establish an effective utilization review plan. 9. Provides information the Secretary may require to implement Section 1821 of the Act, including information relating to quality of care and coverage determinations. 10. Meets other requirements the Secretary finds necessary in the interest of the health and safety of individuals who are furnished services in the institution. These requirements include the conditions of participation in 42 CFR 403, Subpart G. An RNHCI must meet or exceed the conditions of participation in order to qualify as a Medicare provider. The RNHCI must also have a valid provider agreement with CMS.

(Rev. 28; Issued: 08-12-05; Effective/Implementation: 09-12-05) A home health agency is a public agency or private organization, or a subdivision of such an agency or organization, which meets the following requirements: • It is primarily engaged in providing skilled nursing services and other therapeutic services, such as physical therapy, occupational therapy, or speech-language pathology, medical social services, and home health aide services. A public or voluntary nonprofit health agency may qualify by: o Furnishing both skilled nursing and at least one other therapeutic service directly to patients, or o Furnishing directly either skilled nursing services or at least one other therapeutic service and having arrangements with another public or voluntary nonprofit agency to furnish the services which it does not provide directly. NOTE: A proprietary agency can qualify only by providing directly both skilled nursing services and at least one other therapeutic service. • It has policies established by a professional group associated with the agency or organization (including at least one physician and at least one registered professional nurse) to govern the services, and provides for supervision of such services by a physician or a registered professional nurse; • It maintains clinical records on all patients; • It is licensed in accordance with State or local law or is approved by the State or local licensing agency as meeting the licensing standards (where State or local law provides for the licensing of such agencies or organizations); and • It meets other conditions found by the Secretary of the Department of Health and Human Services to be necessary for health and safety. A private organization which is not exempt from Federal income taxation under section 501 of the Internal Revenue Code of 1954 (sometimes referred to as a "proprietary" organization) must be licensed pursuant to State law. If the State has no licensing law for such organizations, a proprietary agency cannot participate in the health insurance program. For services under hospital insurance, the term "home health agency" does not include any agency or organization which is primarily for the care and treatment of mental disease. There is no such restriction under supplementary medical insurance.

(Rev. 1, 09-11-02) When the subdivision of an agency, such as the home care department of a hospital or the nursing division of a health department, wishes to participate as a home health agency, the subdivision must meet the conditions of participation and must maintain records in such a way that subdivision activities and expenditures attributable to services provided under the health insurance program are identifiable.

(Rev. 19, Issued: 03-11-05, Effective/Implementation: N/A) A. A home health agency (HHA) may have others furnish covered items or services through arrangements under which receipt of payment by the HHA for the services discharges the liability of the patient or any other person to pay for the services. Whether the items and services are provided by the HHA itself or by another agency under arrangement, both must agree not to charge the patient for covered items and services and must also agree to return money incorrectly collected. In permitting HHAs to furnish services under arrangements, it was not intended that the agency merely serve as a billing mechanism for the other party. Accordingly, for services provided under arrangements to be covered, the agency must exercise professional responsibility over the arranged-for services and ensure compliance with the home health conditions of participation. The agency's professional supervision over arranged-for services requires application of many of the same quality controls as are applied to services furnished by salaried employees. The agency must accept the patient for treatment in accordance with its administration policies, maintain a complete and timely clinical record of the patient that includes diagnosis, medical history, physician's orders, and progress notes relating to all services received; maintain liaison with the attending physician with regard to the progress of the patient and to assure that the required plan of treatment is periodically reviewed by the physician; secure from the physician the required certifications and recertifications; and ensure that the medical necessity of such services is reviewed on a sample basis by the agency's staff or an outside review group. There are three situations in which an HHA may have arrangements with another health organization or person to provide home health services to patients: • Where an agency or organization, in order to be approved to participate in the program, makes arrangements with another organization or individual to provide the nursing or other therapeutic services that it cannot provide directly; • Where an agency that is already approved for participation, makes arrangements with others to provide services or items it does not provide directly; and • Where an agency that is already approved for participation makes arrangements with a hospital, skilled nursing facility, or rehabilitation center for services on an outpatient basis because the services involve the use of equipment that cannot be made available to the patient in his/her place of residence. B. If an agency's subdivision (acting in its capacity as an HHA) makes an arrangement with its parent agency for the provision of certain items or services, there need not be a contract or formal agreement. If, however, the arrangement is made between the HHA and another provider participating in the health insurance program (hospital, skilled nursing facility, or HHA, and, in the case of physical therapy, occupational therapy, or speech-language pathology services, clinics, rehabilitation agencies, and public health agencies), there must be a written statement regarding the services to be provided and the financial arrangements. C. If the arrangements are with an agency or organization that is not a qualified provider of services, there must be a written contract that includes all of the following: 1. A description of the services to be provided. 2. The duration of the agreement and how frequently it is to be reviewed. 3. A description of how personnel will be supervised. 4. A statement that the contracting organization will provide services in accordance with the plan of care established by the patient's physician in conjunction with the HHA's staff. 5. A description of the contracting organization's standards for personnel, including qualifications, functions, supervision, and inservice training. 6. A description of the method of determining reasonable costs and reimbursement by the HHA for the specific services to be provided by the contracting organization. 7. An assurance that the contracting organization will comply with title VI of the Civil Rights Act. • If an HHA notifies a beneficiary of noncoverage of services that another party has been furnishing under arrangements entered into by the agency, the initial notice, in and of itself, does not negate the contract between the agency and the other party. Unless the evidence shows that the contract has been formally terminated, the beneficiary is still considered to be the agency's patient and the other party to be the representative of the agency. Consequently, if upon initial notice that a service is no longer covered the other party continues to provide services to the patient, the other party is considered to be furnishing the services under arrangements with the home health agency, absent evidence to the contrary. Thus, if a beneficiary appeals the noncoverage of any or all of the arranged for services furnished after the notice, and a ruling is made in favor of the beneficiary, those services ruled on favorably would be reimbursable since they would constitute services furnished under arrangements by a certified HHA. If the denial is sustained, however, the other party cannot bill the beneficiary for the denied services since the HHA, not the other party, is responsible for the care rendered.

(Rev. 1, 09-11-02) If an agency's subdivision (acting in its capacity as an HHA) makes an arrangement with its parent agency for the provision of certain items or services, there need not be a contract or formal agreement. If, however, the arrangement is made between the HHA and another provider participating in the health insurance program (hospital, skilled nursing facility, or HHA, and, in the case of physical therapy, occupational therapy, or speech-language pathology services, clinics, rehabilitation agencies, and public health agencies), there must be a written statement regarding the services to be provided and the financial arrangements. If the arrangements are with an agency or organization that is not a qualified provider of services, there must be a written contract that includes all of the following: • A description of the services to be provided; • The duration of the agreement and how frequently it is to be reviewed; • A description of how personnel will be supervised; • A statement that the contracting organization will provide services in accordance with the plan of care established by the patient's physician in conjunction with the HHA's staff; • A description of the contracting organization's standards for personnel, including qualifications, functions, supervision, and inservice training; • A description of the method of determining reasonable costs and reimbursement by the HHA for the specific services to be provided by the contracting organization; and • An assurance that the contracting organization will comply with title VI of the Civil Rights Act.

(Rev. 1, 09-11-02) If an HHA notifies a beneficiary of noncoverage of services that another party has been furnishing under arrangements entered into by the agency, the initial notice, in and of itself, does not negate the contract between the agency and the other party. Unless the evidence shows that the contract has been formally terminated, the beneficiary is still considered to be the agency's patient and the other party to be the representative of the agency. Consequently, if upon initial notice that a service is no longer covered the other party continues to provide services to the patient, the other party is considered to be furnishing the services under arrangement.

(Rev. 19, Issued: 03-11-05, Effective/Implementation: N/A) When the services are of such a nature that they cannot be administered at the patient's residence and are administered at a rehabilitation center which is not participating in the program as a hospital, skilled nursing facility, or home health agency, the rehabilitation center must meet certain standards. The physical plant and equipment of such a rehabilitation center must meet all applicable State and local legal requirements for construction, safety, health, and design, including safety, sanitation and fire regulations, building codes, and ordinances. Given the statutory definition, a community mental health center is not considered a rehabilitation center.

(Rev. 1, 09-11-02) A hospice is a public agency or private organization or a subdivision of either that is primarily engaged in providing care to terminally ill individuals and meets the conditions of participation for hospices, and has a valid provider agreement.

(Rev. 1, 09-11-02) When a subdivision of an organization, such as the home care department of a hospital, wishes to participate as a hospice, the subdivision must meet the hospice conditions of participation and must maintain records in such a way that activities and expenditures attributable to services provided under the hospice program are identifiable.

(Rev. 1, 09-11-02) Hospices are required to provide core services directly, that is, nursing services, medical social services, and counseling. Other covered services may be provided under arrangement.

(Rev. 1, 09-11-02) Physician means doctor of medicine, doctor of osteopathy (including osteopathic practitioner), doctor of dental surgery or dental medicine (within the limitations in subsection §70.2 ), doctor of podiatric medicine (within the limitations in subsection §70.3), or doctor of optometry (within the limitations of subsection §70.5), and, with respect to certain specified treatment, a doctor of chiropractic legally authorized to practice by a State in which he/she performs this function. The services performed by a physician within these definitions are subject to any limitations imposed by the State on the scope of practice. The issuance by a State of a license to practice medicine constitutes legal authorization. Temporary State licenses also constitute legal authorization to practice medicine. If State law authorizes local political subdivisions to establish higher standards for medical practitioners than those set by the State licensing board, the local standards determine whether a particular physician has legal authorization. If State licensing law limits the scope of practice of a particular type of medical practitioner, only the services within the limitations are covered. The issuance by a State of a license to practice medicine constitutes legal authorization. Temporary State licenses also constitute legal authorization to practice medicine. If State law authorizes local political subdivisions to establish higher standards for medical practitioners than those set by the State licensing board, the local standards determine whether a particular physician has legal authorization. If State licensing law limits the scope of practice of a particular type of medical practitioner, only the services within the limitations are covered. NOTE: The term physician does not include such practitioners as a Christian Science practitioner or naturopath.

(Rev. 1, 09-11-02) The requirement that a doctor of medicine be legally authorized to practice medicine and surgery by the State in which he/she performs his/her services means a physician is licensed to practice medicine and surgery. A doctor of osteopathy who is legally authorized to practice medicine and surgery by the State in which he/she performs his/her services qualifies as a physician. In addition, a licensed osteopath or osteopathic practitioner qualifies as a physician to the extent that he/she performs services within the scope of his/her practice as defined by State law.

(Rev. 1, 09-11-02) A dentist qualifies as a physician if he/she is a doctor of dental surgery or of dental medicine who is legally authorized to practice dentistry by the State in which he/she performs such function and who is acting within the scope of his/her license when he/she performs such functions. Such services include any otherwise covered service that may legally and alternatively be performed by doctors of medicine, osteopathy and dentistry; e.g., dental examinations to detect infections prior to certain surgical procedures, treatment of oral infections and interpretations of diagnostic X-ray examinations in connection with covered services. Because the general exclusion of payment for dental services has not been withdrawn, payment for the services of dentists is also limited to those procedures which are not primarily provided for the care, treatment, removal, or replacement of teeth or structures directly supporting the teeth. The coverage of any given dental service is not affected by the professional designation of the physician rendering the service; i.e., an excluded dental service remains excluded and a covered dental service is still covered whether furnished by a dentist or a doctor of medicine or osteopathy.

(Rev. 1, 09-11-02) A doctor of podiatric medicine is a physician, but only with respect to those functions which he/she is legally authorized to perform in the State in which he/she performs them. The professional services furnished by a doctor of podiatric medicine within the scope of his/her applicable State license (except services which are specifically excluded) are physician's services payable on a reasonable charge basis under Part B. Where permissible by State law, these services include ordering laboratory tests that are reasonably related to the legal scope of podiatric practice, that are reasonable and necessary for the diagnosis or treatment of a patient's condition and are not in connection with excluded services, such as treatment of flat foot and routine foot care. A doctor of podiatric medicine may hold any of the following professional degrees: Pod. D. or D. P. (Doctor of Podiatry), D.S.C. (Doctor of Surgical Chiropody), D.P.M. (Doctor of Podiatric Medicine), D.S.P. (Doctor of Surgical Podiatry), Graduate in Podiatry, Master Chiropodist, Graduate Chiropodist, or in some instances another podiatry degree. Within a particular State, all individuals holding any of these degrees are licensed to perform the same functions; however, there are variations from State to State as to the authorized scope of podiatric practice. For purposes of the Medicare program, a doctor of podiatric medicine is considered a physician for any of the following purposes: • Making the required physician certification and recertification of the medical necessity for services; • Having a patient in a home health agency under his/her care, and establishing and periodically reviewing a home health plan of treatment; or • Serving as a member of a Utilization Review (UR) committee, but only if at least two of the physicians on the UR committee are doctors of medicine or osteopathy. The performance of these functions must be consistent with the scope of the professional services provided by a doctor of podiatric medicine as authorized by applicable State law. A doctor of podiatric medicine is not a physician for the purpose of performing any of the physician activities required to qualify an institution or organization as a SNF.

(Rev. 1, 09-11-02) There are many physicians performing services in hospitals operated by the Federal Government, e.g., military, Veterans Administration, and Public Health Service hospitals. Normally, the services provided by a physician in a Federal hospital are not payable except when the hospital provides services to the public as a community institution. A physician working in the scope of his/her Federal employment is considered a physician even though he/she may not have a license to practice in the State in which he/she is employed.

(Rev. 1, 09-11-02) A. Services Furnished Through March 31, 1987 Prior to April 1, 1987, a doctor of optometry who was legally authorized to practice optometry by the State in which he or she performed such a function was considered a physician under Medicare, but only for the purpose of services related to the condition of aphakia. Aphakia is defined as the absence of the natural crystalline lens of the eye, whether or not an intraocular lens has been implanted. The services performed by optometrists within this definition were subject to limitations set by the State relating to the scope of practice of optometry. The following are examples of examination services which were covered when furnished by optometrists if related to the condition of aphakia: case history, external examination, ophthalmoscopy, biomicroscopy, tonometry, visual fields, ocular motility, binocular function, and evaluation for contact lenses, if the optometrist furnishing these services is legally authorized to perform them. B. Services Furnished After March 31, 1987 Effective April 1, 1987, a doctor of optometry is considered a physician with respect to all services the optometrist is authorized to perform under State law or regulation. To be covered under Medicare, the services must be medically reasonable and necessary for the diagnosis or treatment of illness or injury, and must meet all applicable coverage requirements. (See Benefit Policy Manual for information concerning exclusions from coverage that apply to vision care services.)

(Rev. 1, 09-11-02) A. General A licensed chiropractor who meets uniform minimum standards (see subsection C) is a physician for specified services. Coverage extends only to treatment by means of manual manipulation of the spine to correct a subluxation demonstrated by X-ray, provided such treatment is legal in the State where performed. All other services furnished or ordered by chiropractors are not covered. An X-ray obtained by a chiropractor for his or her own diagnostic purposes before commencing treatment may suffice for claims documentation purposes. This means that if a chiropractor orders, takes, or interprets an X-ray to demonstrate a subluxation of the spine, the X-ray can be used for claims processing purposes. However, there is no coverage or payment for these services or for any other diagnostic or therapeutic service ordered or furnished by the chiropractor. In addition, in performing manual manipulation of the spine, some chiropractors use manual devices that are hand-held with the thrust of the force of the device being controlled manually. While such manual manipulation may be covered, there is no separate payment permitted for use of this device. B. Licensure and Authorization to Practice A chiropractor must be licensed or legally authorized to furnish chiropractic services by the State or jurisdiction in which the services are furnished. C. Uniform Minimum Standards l. Prior to July 1, 1974, Chiropractors licensed or authorized to practice prior to July 1, 1974, and those individuals who commenced their studies in a chiropractic college before that date must meet all of the following minimum standards to render payable services under the program: a. Preliminary education equal to the requirements for graduation from an accredited high school or other secondary school; b. Graduation from a college of chiropractic approved by the State's chiropractic examiners that included the completion of a course of study covering a period of not less than 3 school years of 6 months each year in actual continuous attendance covering adequate course of study in the subjects of anatomy, physiology, symptomatology and diagnosis, hygiene and sanitation, chemistry, histology, pathology, and principles and practice of chiropractic, including clinical instruction in vertebral palpation, nerve tracing and adjusting; and c. Passage of an examination prescribed by the State's chiropractic examiners covering the subjects listed in subsection b. 2. After June 30, 1974 - Individuals commencing their studies in a chiropractic college after June 30, 1974, must meet all of the following additional requirements: a. Satisfactory completion of 2 years of pre-chiropractic study at the college level; b. Satisfactory completion of a 4-year course of 8 months each year (instead of a 3-year course of 6 months each year) at a college or school of chiropractic that includes not less than 4,000 hours in the scientific and chiropractic courses specified in subsection 1.b, plus courses in the use and effect of X-ray and chiropractic analysis; and c. The practitioner must be over 21 years of age.

(Rev. 1, 09-11-02) A. General For Medicare purposes, the terms "interns" and "residents" include physicians participating in approved graduate training programs and physicians who are not in approved programs but who are authorized to practice only in a hospital setting; e.g., individuals with temporary or restricted licenses, or unlicensed graduates of foreign medical schools. Where a senior resident has a staff or faculty appointment or is designated, for example, a "fellow," it does not change the resident's status for the purposes of Medicare coverage and payment. As a general rule, services of interns and residents are paid as provider services by the A/B MAC (A). B. Services Furnished by Interns and Residents Within the Scope of an Approved Training Program Medical and surgical services furnished by interns and residents within the scope of their training program are covered as provider services. Effective with services furnished on or after July 1, 1987, this includes services furnished in a setting which is not part of the provider where a hospital has agreed to incur all or substantially all of the costs of training in the nonprovider facility. The Medicare A/B MAC (A) is required to notify the A/B MAC (B) of such agreements. Where the provider does not incur all or substantially all of the training costs and the services are performed by a licensed physician, the services are payable on a fee schedule basis by the A/B MAC (B). Prior to July 1, 1987, the covered services of interns and residents were paid by the A/B MAC (B) on a reasonable charge basis as physician services if furnished by a licensed physician off the provider premises regardless of who incurred the training costs. C. Services Furnished by Interns and Residents Outside the Scope of an Approved Training Program-Moonlighting Medical and surgical services furnished by interns and residents that are not related to their training program, and are performed outside the facility where they have their training program, are covered as physicians' services and paid on a fee schedule or reasonable charge basis where the requirements in the first 2 bullets below are met. Medical and surgical services furnished by interns and residents that are not related to their training program, and are performed in an outpatient department or emergency room of the hospital where they have their training program, are covered as physicians' services and paid on a fee schedule or reasonable charge basis where the following criteria are met: • The services are identifiable physicians' services, the nature of which requires performance by a physician in person and which contributes to the diagnosis or treatment of the patient's condition; • The intern or resident is fully licensed to practice medicine, osteopathy, dentistry, or podiatry by the State in which the services are performed; and • The services performed can be separately identified from those services that are required as part of the training program. When these criteria are met, the services are considered to have been furnished by the individuals in their capacity as physicians and not in their capacity as interns and residents.

(Rev. 1, 09-11-02) An HMO for Medicare purposes is a public or private organization that provides, either directly or through arrangement with others, comprehensive health services to enrolled members. An HMO must service those who live within a specified service area. It must provide services based on a predetermined periodic rate or periodic per capita rate basis without regard to the frequency or extent of covered services it furnishes. An HMO must also meet other statutory requirements. An HMO's service area is a geographic area in which a full range of its services are offered to its members. This geographic area differs from an HMO's enrollment area since it may include locations outside its service area where it offers less than its full range of services. (For example, an HMO may cover house calls in emergencies in its service area but not for members who live outside the service area.) Section 1876 of the Act allows a Medicare beneficiary eligible for Part A and Part B, or Part B only, to choose to have covered items and services furnished through a Medicare qualified HMO. An HMO enters into a contract with the Secretary in order to participate under Medicare.

(Rev. 1, 09-11-02) NOTE: We anticipate adding to this section as we find the need to define other terms.

(Rev. 1, 09-11-02) The term supplier means an entity that is qualified to furnish health services covered by Medicare, other than providers, physicians, and practitioners. The following suppliers must meet the conditions in order to receive Medicare payment: ambulatory surgical centers (ASCs), independent physical therapists, mammography facilities, DMEPOS suppliers, independent occupational therapists, clinical laboratories, portable X-ray suppliers, dialysis facilities, rural health clinics, and Federally-qualified health centers. An ASC is a distinct entity that operates exclusively for the purpose of furnishing outpatient surgical services to patients. It enters into an agreement with CMS to do so. An ASC is either independent (i.e., not a part of a provider of services or any other facility), or operated by a hospital (i.e., under the common ownership, licensure, or control of a hospital). A DME supplier is an entity that furnishes DME and has a number assigned by the National Supplier Clearinghouse.

(Rev. 1, 09-11-02) Laboratory means a facility for the biological, microbiological, serological, chemical, immuno-hematological, hematological, biophysical, cytological, pathological, or other examination of materials derived from the human body for the purpose of providing information for the diagnosis, prevention, or treatment of any disease or impairment of, or the assessment of the health of, human beings. These examinations also include procedures to determine, measure, or otherwise describe the presence or absence of various substances or organisms in the body. Facilities only collecting or preparing specimens (or both) or only serving as a mailing service and not performing testing are not considered laboratories.

(Rev. 1, 09-11-02) Practitioners except for physicians are health professionals who may deliver covered Medicare services if the services are incident to a physician's service or if there is specific authorization in the law. The following practitioners may deliver services without direct physician supervision: nurse practitioners and physician assistants in rural health clinics, designated manpower shortage area or HMOs, qualified clinical psychologists, clinical social workers, certified nurse midwives, and certified registered nurse anesthetists.

(Rev. 1, 09-11-02) A group practice is a group of two or more physicians and non-physician practitioners legally organized in a partnership, professional corporation, foundation, not-for-profit corporation, faculty practice plan, or similar association: • In which each physician who is a member of the group provides substantially the full range of services which the physician routinely provides (including medical care, consultation, diagnosis, or treatment) through the joint use of shared office space, facilities, equipment, and personnel; • For which substantially all of the services of the physicians who are members of the group are provided through the group and are billed in the name of the group and amounts so received are treated as receipts of the group; • In which the overhead expenses of and the income from the practice are distributed in accordance with methods previously determined by members of the group; and • Which meets such other standards as the Secretary may impose by regulation to implement §1877(h)(4) of the Social Security Act. The group practice definition also applies to health care practitioners. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R12425GI 12/21/2023 Enforcing Billing Requirements for Intensive Outpatient Program (IOP) Services with New Condition Code 92 - Additional Publication Update 01/01/2024 13496 R120GI 11/02/2018 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) (2018 Q4) 12/04/2018 11004 R114GI 03/16/2018 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) (2018) 06/19/2018 10512 R101GI 09/16/2016 Internet Only Manual Updates to Pub. 100-01, 100-02 and 100-04 to Correct Errors and Omissions (SNF) 10/18/2016 9748 R58GI 03/06/2009 Disclosure of Physician Ownership in Hospitals 06/08/2009 6306 R42GI 11/09/2006 Swing bed Hospital Updates 12/11/2006 5114 R35GI 02/10/2006 Revisions to Instructions for Contractors Other Than the Religious Nonmedical Health Care Institution (RNHCI) Specialty Contractor Regarding Claims for Beneficiaries with RNHCI Elections 05/11/2006 4218 R28GI 08/12/2005 Conforming Changes for Change Request 3648 for Pub. 100-01 09/12/2005 3912 R19GI 03/11/2005 Definition of Home Health Agency N/A 3698 R18GI 03/04/2005 Billing for Blood and Blood Products Under the Hospital Outpatient Prospective Payment System (OPPS) 07/05/2005 3681 R01MGI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 1, 09-11-02) A. General The purpose of the Privacy Act of 1974 is to provide safeguards for individuals against an invasion of privacy by Federal agencies. Among other things, Federal agencies are required to permit an individual to: • Determine what records pertaining to the individual are collected, used, or disseminated by such agencies; • Prevent records pertaining to the individual obtained by Federal agencies for a specific purpose from being used for another purpose without the individual's consent; and • Gain access to information pertaining to the individual in Federal agency records, and to correct such records when appropriate. Contractors considered to be Federal agencies for purposes of administering the Privacy Act must comply with its provisions. Contractors must: • Inform each individual from whom information is requested of their rights under the Privacy Act; • Describe the method of accessing an individual's records; • Prepare a method of accounting for disclosures; and • Devise a method of reviewing records at the request of individuals and making corrections if appropriate. Additional information concerning Medicare privacy policies can be accessed on the CMS Web site under the Privacy Policy link at the bottom of the web page. B. Definition of "Individual" "Individual" means a living person on whom CMS has any personal (as opposed to business) information. "Individual" does not include so-called persons such as sole proprietorships, partnerships, or corporations. Except for disclosure of and access to medical information about minors, a parent or legal guardian of a minor, or a legal guardian of someone the court has declared incompetent, has the same rights as the individual to the individual's records. No one may act on behalf of an individual who has not been declared incompetent by a court or gain access to his/her records under the Privacy Act without the individual's written consent. C. Physicians' and Suppliers' Rights to Access Under the Privacy Act Providers, physicians, and suppliers as business entities do not have access to business information about themselves under the Privacy Act, since the Privacy Act concerns individuals only. However, a physician or other supplier who is also an individual has the same access rights as any other individual to personal information maintained about themselves. Purely business information which is retrievable by the physician's unique identifier is not subject to the Privacy Act, but it may be disclosed to the physician to the extent that we would not deny the physician the information under the Freedom of Information Act (FOIA). D. Informing Individuals of Rights The contractor must inform the individual of his/her rights under the Privacy Act when it solicits any information directly from the beneficiary in connection with a Medicare claim. This would usually be a result of the failure of the individual or provider to furnish all the information required on a claims form. When information is collected by telephone, the contractor will give the individual a brief oral explanation. When information is requested by mail a written notice is used. E. Method of Accessing Individual Records - General The law requires that an agency must inform an individual, upon request, whether a system of records contains a record pertaining to the individual, permit the individual to review such record and to be accompanied for the purpose of reviewing the record by a person of his or her choice. Further, the individual is permitted to obtain a copy of such record in a comprehensible form at a reasonable cost. There is a charge of 10 cents per page with all fees under $25 waived. There is no charge for searching; nor is there a charge for a copy furnished as a means of permitting an individual access to their records. Each requester shall be asked for proof of identity as well as such general information as is necessary to determine where and how to look for records about the data subject Within 10 working days of receiving a request, the contractor must decide whether to release the records. The requested information must be furnished within 30 working days unless good cause exists. An example of "good cause" would be an inactive record filed in a records center that cannot be obtained within 30 days. The requester should be told of the delay and given an approximate date to expect the information. If an individual's request for information concerning themselves is not in the contractor's files, the contractor should advise the individual that it does not have the information and, if available elsewhere, that it is forwarding the request to the office which has it. The contractor should furnish any requested information available if the request cannot be satisfied in full. The contractor should identify requests under the Privacy Act that require referral to CMS for data in central office systems. As required by the Privacy Act, the contractor should send the request for processing, along with a copy of the interim response, to the systems manager listed in the Annual Publication: Systems of Records. F. Methods of Accessing Individual Medical Records The official responsible for the records, or their designated medical officer, may disclose medical information directly to the individual if the official determines, based on review of the medical evidence, that such disclosure is not likely to have an adverse effect. In such cases the responsible official will give the requested information to the individual and annotate the record to show that the disclosure was made. If the responsible official determines that direct disclosure of the medical record would be likely to have an adverse effect on the individual or does not consider themselves qualified to make such a determination, the official will disclose the medical information to the representative designated in writing by the individual. The representative must be a medical professional (licensed medical practitioner or nurse) who would be willing to review the record and discuss it with the individual. The contractor will retain a record showing the reason for its determination and a copy of the correspondence transmitting the information to the individual or to his/her medical representative. If there is sensitive medical information in the records and the individual refuses to name a medical professional or cannot afford the fee for the service, or if the designated medical professional refuses to serve, the contractor will refer the file to the CMS regional office. G. Disclosure of Medical Information Relating to Minors In order to protect the privacy of a minor, a parent or authorized guardian who requests access to the minor's medical record may not be given direct access to the record. Contractors shall ask a parent or guardian who requests access to such a record to designate a physician or other professional (other than a family member) to whom the record may be sent. The physician or health professional to whom the record is sent will be asked by the contractor to consider the effect that the disclosure of the record to the parent or guardian would have on the minor in determining whether the record should be made available to the parent or guardian. The contractor will prepare a response to the parent or guardian in substantially the following form: We have completed processing your request for access to the medical records of (name)__________________________, a minor The medical records have been sent to (name and address of designated health professional) in accordance with your instructions In each case where a minor's medical records are sent to a physician or health professional, reasonable efforts will be made by the contractor to so inform the minor. In the event the parent or guardian refuses to name a medical professional or cannot afford the fee for the service or the designated medical professional refuses to serve, the contractor will refer the file to the CMS regional office for appropriate action. H. Disclosure to Third Parties The Privacy Act permits disclosure to any third party with the written consent of the individual to whom the record pertains. It also permits disclosure in certain instances without the individual's consent. However, the contractor must not disclose information unless the disclosure is specifically authorized in this chapter, or the individual has consented to the disclosure in writing, or the CMS regional office authorizes the disclosure. I. Disclosures with Consent Except for those disclosures discussed below in §10L of this chapter, Disclosure Without Consent, information may not be disclosed without the written consent of the subject individual, or their legal guardian, or, in the case of a minor, their parent (a parent or legal guardian of a minor may not consent to the disclosure of medical information about the minor). Other persons, regardless of relationship (except members of Congress and representative payees), may not receive information about the individual without their consent. In addition, a person who receives information about an individual with the individual's consent may not authorize disclosure of that information to someone else. Awkward situations may develop from a refusal, in compliance with the Privacy Act, to divulge information to the child or spouse of an aged or infirm individual. In order to avoid lengthy and unproductive correspondence, the requester should be advised that the Privacy Act precludes our disclosing any information to anyone other than the individual to whom the information pertains without the specific written consent of that individual, but that the requested information will be sent directly to the individual concerned with an explanation of the inquiry received on their behalf. J. Disclosures to Members of Congress Information requested by members of Congress and their staffs may be disclosed as follows: • Where a member of Congress (or a staff member) inquires on behalf of a constituent, the contractor may respond to the member of Congress (MC) without the written consent of the individual, but must make a record of the disclosure. • Where the MC's inquiry is on behalf of a relative of the subject individual (but the inquirer is not the legal guardian of the individual, or the parent of the individual minor), the contractor should advise the MC that it can respond directly only to the individual unless the individual furnishes written consent to release the information about themselves to the MC (if we respond directly to the individual or with their consent, no accounting record is required). Where the inquirer is the legal guardian, or the parent of a minor, the contractor may disclose the information to the MC, but must make a record of the disclosure. • Where the MC's inquiry is in writing and does not indicate whether the request is from the subject individual, the contractor will contact the MC, usually by telephone, to clarify the situation. A copy of the reply (or a report of telephone call if the response is by telephone) will provide an adequate accounting record. The record should show the date of disclosure, the information disclosed, and to whom the disclosure was made. The contractor should file this record by name or social security claim number so that retrieval may be made expeditiously. K. Disclosure to Representative Payees An SSA-appointed representative payee is entitled to receive information on, or act on, behalf of a beneficiary to the extent necessary to protect the beneficiary's rights under title II or XVIII. L. Disclosure without Consent Below are listed the situations in which data on identifiable individuals may be released without the individual's consent. The disclosure is permitted if the disclosure would be: • To DHHS employees and officers who need the records to perform their duties; • Required by the FOIA; • To the Bureau of Census; • For research purposes under certain circumstances; • To the National Archives; • For law enforcement activities if the activity is authorized by law and the request is from the head of the agency and specifies the particular record desired and the law enforcement activity for which the record is sought; • For compelling circumstances affecting the health and safety of any person if notice of the disclosure is sent to the last known address of the individual; • To either House of Congress or to any congressional committee or subcommittee (see section I above for requests from members of Congress on behalf of constituents); • To the Comptroller General or an authorized representative to perform the duties of the General Accounting Office; • Pursuant to the order of a court of competent jurisdiction; • For a "routine use" - A "routine use" is a disclosure of information which may be made without the individual's written consent because the disclosure is compatible with the purpose for which the information was collected in the first place. An explanation of the purposes and uses of each "routine use" disclosure must be published in the Federal Register at least 30 days prior to the disclosure and at least annually thereafter. Current routine uses are: • Part B Payment Records • Payment Record Reference File • Tape containing amount, type, and cost of health care services. • Summary Records • Group Health Plan Membership Data • Identification Data • Group Health Membership Data • Group Health Membership List • Quality Assurance Program Releases and Corrections M. Accounting for Disclosure The Privacy Act requires that agencies account for disclosures of personal data to organizations outside DHHS or made in response to requests under the FOIA. The purposes of the accounting are: • To allow individuals to learn to whom records about themselves have been disclosed; and • To provide a basis for subsequently advising recipients of any amended or disputed records. The accounting must enable the contractor to tell the individual when and what information about the individual was released and to whom. It is not necessary to maintain a separate record of disclosures if such information can be retrieved from the contractor's operating records. An individual has the same access rights to an accounting of disclosures as to other information, with no exception. It is not mandatory to tell an individual about disclosures made to an agency for law enforcement purposes. (Refer requests for accountings that include disclosures to law enforcement agencies to the CMS regional office.) The contractor must maintain accounting records for 5 years, or the life of the basic record, whichever is longer. The lives of various basic records are furnished in Chapter 1 of the Claims Processing Manual. N. Reviewing and Correcting Records Individuals are permitted by the Privacy Act to request correction of any record pertaining to themselves. The contractor should have a method of reviewing records at the request of the individual and making corrections where appropriate. In reviewing an individual's request to amend a record, the contractor should, whenever practicable, complete the review and advise the individual of the results within 10 days of the receipt of the request. Prompt action should be taken wherever possible to reduce the administrative costs involved in issuing both a separate acknowledgment of the receipt of the request and a subsequent notice informing the individual of the action taken. If a contractor denies a request for correction, the individual can appeal to the system manager for the contractor's system of records. O. Penalties All employees must be aware of their responsibilities under the Privacy Act and guard against improper disclosure of personal information. Any officer or employee who willfully discloses individually identifiable information, the disclosure of which is prohibited by the Act, shall be guilty of a misdemeanor and fined not more than $5,000. P. Providers, Physicians, Suppliers, and the Privacy Act: 1. Confidentiality of Provider and Supplier Records Medicare information may not be accepted from providers, physicians, and other suppliers of services on a confidential basis, expressed or implied, since any medical information obtained by a contractor is subject to disclosure to the individual to whom it pertains. Contractors are to make sure their providers and other suppliers of services are aware that no medical information marked "confidential" will be accepted on that basis and that any medical information received by the contractor may be disclosed to the patient or his/her representative upon request, either directly or through designated professional medical personnel. If a provider, physician, or other supplier of services documents medical findings on medical forms preprinted "confidential" or the provider or other supplier of services routinely stamps all records "confidential," such records, when transmitted to the contractor are to be accompanied by a signed statement to the effect that the provider, physician or supplier understands that the information is subject to disclosure at the request of the patient or his/her representative under the Privacy Act. 2. Release of Eligibility Data to Providers and Suppliers When the Individual is Unable to Sign an Authorization In situations such as the admission to a hospital of an unconscious person, where the individual has not signed a statement authorizing the provider to pursue a Medicare claim, the disclosure of Medicare information to the provider should be treated as a routine use disclosure. If the individual has authorized the provider or supplier to pursue a Medicare claim, the release of information may be treated as a disclosure made with the beneficiary's consent.

(Rev. 1, 09-11-02) The following sections contain instructions concerning the confidentiality and disclosure of information acquired and maintained by CMS, contractors (i.e., Medicare Administrative Contractors), providers, and State agencies in the administration of the health insurance program. These instructions comply with the statutes and regulations governing disclosure of information, specifically section 1106 of the Social Security Act, the Freedom of Information Act (5 USC §552) and implementing HHS FOIA regulations at 45 CFR Part 5, and CMS Confidentiality and Disclosure regulations at 42 CFR 401.101, et seq.

(Rev. 1, 09-11-02) The Freedom of Information Act (FOIA) requires that within 20 working days of the receipt of a written request for records (or information known to be contained within an agency record), Federal agencies must decide whether the records/information will or will not be disclosed. By HHS regulation, only the CMS Freedom of Information Officer can make this decision, However, the CMS Freedom of Information Officer with the concurrence of the Office of the Assistant Secretary for Public Affairs, HHS, has delegated authority to Medicare contractors to directly release certain categories of frequently requested documents that the CMS Freedom of Information Officer has previously reviewed and decided to always release. These records are called "direct release" records. Some are identified within this manual; others are established by the CMS Freedom of Information Officer in administrative issuances. Accordingly, within 20 working days of receipt of an FOI request, if the contractor is authorized to release all or at least some of the requested records, it will advise the requester in writing whether the request will be wholly or partially fulfilled. The CMS does not permit the contractor to issue a written denial of any request for information, except in response to the contractor's direct receipt of a state or local court subpoena duces tecum that seeks records on a beneficiary or individual practitioner that are contained in a Privacy Act System of Records, when such subpoena is not accompanied by a valid authorization to release the records signed by the subject of records. (See §40.1B.) CMS requires the contractor to refer to the RO all requests for which the contractor does not have clear authority to release the records/information. Therefore, if the contractor receives a written request for records, the contractor must determine within 2 days of the receipt of the request whether it is clearly authorized to disclose the information. When able to furnish the requested materials, the contractor will furnish it whenever possible, within 20 working days. If it is not possible to furnish the materials within 20 working days, the contractor will immediately send the requester a substantive response that states that the records will be released, and explains the reason for the delay. If the contractor is not clearly authorized to release the information, it notifies the RO immediately and refers the request to the RO for handling. It sends the request, along with one set of the requested records, immediately to the RO by first class mail, and clearly identifies the request as a Freedom of Information Act request. The contractor acknowledges to the requester any request referred to the RO, using the following language: Dear: We have referred your (date) Freedom of Information Act request for (specify type of information requested) to: (name of the CMS Regional Office FOIA Coordinator, address of CMS RO, and telephone number of the CMS RO Coordinator). Any questions you may have relative to your request should be directed to that office. Sincerely yours, The contractor sends a copy of the acknowledgment letter with the request to the RO. The contractor is not required to create records to comply with requests for information. Contractors may answer requests that require creation of records by stating that the requested records do not exist and that the FOIA does not require agencies to recreate records in order to respond to a request. Include the appeal rights statement set forth below in the response. (Note that deletion of non-releasable information from an existing record is not considered creation of a records, no matter how extensive or time consuming the deletion process might be. Respond to requests that require creation of records using the following language: Dear: This is in response to your request dated ____, seeking access to (specify the subject(s) of requested record). Because you seek access to one or more agency records, or information contained in such records, we have considered your request under the Freedom of Information Act (FOIA) (5USC §552). We are unable to comply with your request because the agency does not maintain a records that is responsive to your request and because, under FOIA, we are not required to create records or to furnish information in a particular form or format is not readily reproducible employing reasonable efforts. If you have reason to disagree with this decision, you may appeal. Your appeal should be mailed, within 30 days of the date of this letter, to the Deputy Administrator Centers for Medicare & Medicaid Services, Room C5-16-03, 7500 Security Boulevard, Baltimore, Maryland 21244-1850. Please mark your envelope "Freedom of Information Act Appeal," and enclose a copy of this letter.

(Rev. 1, 09-11-02) Form CMS-632-FOI (Exhibit A) serves as a cover sheet for FOI requests. The form is designed to expedite the handling of requests and to provide the information necessary for reporting purposes. For each FOI request, the contractor will complete a Form CMS- 632-FOI. Completion instructions for the form are included on the reverse side. The contractor may furnish estimated costs if actual postage costs are not readily available. Order Form CMS-632-FOI routinely on an annual basis using the CMS 1961 Forms Order. Direct any interim requests for Form CMS-632-FOI to CMS Forms Distribution Officer, Forms Management and Distribution, Office of Internal Customer Support. Interim requests must be submitted in writing.

(Rev. 1, 09-11-02) The contractor's authority to directly release certain kinds of records includes the responsibility for complete and accurate reporting on the use of this authority. The following are reporting requirements for Medicare contractors: • Fill out completely and accurately a Form CMS-632-FOIA for each "direct release." • Maintain in either hardcopy or electronic form a Freedom of Information Daily Log on a daily basis. This log must include the case control number, date of incoming letter, requester's name, subject of the request, the date received in the FOIA unit, the date the response was mailed and the invoiced fee. • Prepare, on a monthly basis, the Summary Sheet for the CMS Monthly FOIA Report (Exhibit B). This Summary Sheet aggregates data from the individual Form CMS-632. • Submit the Daily Log and Summary Sheet for a given month to your RO FOIA Coordinator by the end of the fifth work day of the following month. • Retain copies of all completed Forms CMS-632-FOI in accordance with record retention requirements for FOIA Administrative Files.

Since many requesters make multiple FOIA requests, name identification is not adequate to assure proper tracking, or fiscal accounting. Therefore, CMS employs a Case Numbering System which includes unique identifiers for each releasing activity. • Use the Case Numbering System for all FOIA cases. • Use the case number in item one of the Form CMS-632-FOI and in the "case number" block at the top left of the Form CMS-633 Invoice of Fees for FOIA Services (Exhibit C). Requesters will be asked to put the case number on checks rendered for payment of FOIA services and on any correspondence relating to that case. 1. All case numbers in this system consist of ten characters. These characters maybe numeric or alphabetical and are determined as follows: a. Case numbers for requests responded to directly by contractors begin with an Arabic number for the Region. Region Case Number Region Case Number Boston 1 Dallas 6 New York 2 Kansas City 7 Philadelphia 3 Denver 8 Atlanta 4 San Francisco 9 Chicago 5 Seattle 0 NOTE: Only one space is designated to indicate the responding regional office or contractor within the region. Therefore, Seattle is represented by "0" rather than by "10". b. For example, a request responded to directly by any A/B MAC (B) within Region 1 would begin with the digit "1": 1--------- c. In all case numbers, the second character is the last digit of the calendar year in which the request is received by the responding activity. , continuing the example above, for a 2001 request in Region 1: 11-------- d. Characters three through six indicate the contractor within the region. A request answered by a contractor would use the last four digits of the contractor number in positions three through six. Thus, a request responded to directly by Blue Cross and Blue Shield of Rhode Island (A/B MAC (B) number 00870) would be: 110870---- e. The last four characters indicate the consecutively assigned case number, beginning with "0001". Thus, the first request responded to by that A/B MAC (B) in calendar year 2002 would be: 1108700002

(Rev. 1, 09-11-02) Under the provisions of the Freedom of Information Act, certain fees and charges have been established to recover some of the cost of disclosing information to the public. Providers, contractors, and State agencies are required to pay appropriate fees for copies of reports they request pertaining to other providers, contractors, or State agencies. Such fees are not reimbursable administrative costs under the Medicare program for contractors or State agencies. A provider may claim such fees as allowable costs only if it demonstrates that the information is necessary in developing and maintaining the operation of patient care facilities and activities. Members of Congress, when clearly requesting information on behalf of a constituent or other third party, are subject to the same fees and charges that would apply to the person represented. The contractor will not charge the public for inspection of disclosable documents, or for requests which result in charges under the minimum described in §21.3, below.

(Rev. 1, 09-11-02) 1. Fees are to be charged differentially, depending on the category of requester/use of the requested material, as follows: • Commercial Use Request - If the request is for a commercial use, charge the requester for search and review, plus duplication. • Education and Scientific Institutions and News Media - If the requester is (1) an educational institution or a non-commercial scientific institution operated primarily for scholarly or scientific research, or (2) a representative of the news media, charge only for duplication. However, do not charge for the first 100 pages of duplication. • Other Requesters - If the request fits into neither of the above categories, charge for search and duplication. However, do not charge for the first 2 hours of search time and the first 100 pages of duplication. In addition, do not charge the requester if the charge to be billed is less than the established billing threshold. NOTE: The CMS Freedom of Information Officer can rule on requests for waiver or reduction of fees, other than those listed above. 2. Regardless of the actual cost of responding to the requester, the law only permits charges to be levied for certain services and only in accord with a published FOIA fee schedule. The DHHS schedule at 45 CFR Part 5 is binding on CMS, and results in the following charges: a. Photocopying - Charge 10 cents per page for copying records. The contractor may charge lower fees for particular documents where: • The document has already been printed in large numbers, • The contractor determines that using existing stock to answer this request, and any other anticipated FOI requests will not interfere with program requirements, and • The contractor determines that the lower fee is adequate to recover the prorated share of the original printing costs. b. Search and Review - For manual searching and for review (when used, as applicable, in connection with processing records for a commercial use or other request), base the cost on the hourly rate of employees involved. Equate employee hourly wage scales to these three categories: Level Hourly Wage Range GS Grade Range CMS Bills Level 1 Up to $20.74 Federal Grades 1 through 8 $16.00 Level 2 $20.75 - $46.69 Federal Grades 9 through 14 $33.00 Level 3 $46.70 or more/hr Federal Grades 15 and up $59.00 NOTE: The CMS Freedom of Information Officer updates the above scale based upon changes to the HHS fee schedule, and provides such updates to all CMS/contractor FOIA Coordinators. The contractor will not charge the requester any fee at all if the costs of routine collection and processing of the fee are likely to equal or exceed the amount of the fee. As of November 2001, CMS's charge threshold is $15.00. If the contractor determines that the requester is breaking down a single request into a series of requests in order to avoid (or reduce) the fees charged, it may aggregate all these requests for purposes of calculating the fees charged. Certifying that records are true copies - Charge $10 per certification. Performing any other special service requested, that the contractor agrees to provide - actual costs of operating any machinery, plus actual cost of any materials used, plus charges for the time of its employees, at the rates given in paragraph 2b of this section. Special Forwarding Arrangements - Actual cost. This includes special delivery, airmail, registered mail, etc.

(Rev. 1, 09-11-02) The contractor is responsible for the billing of costs resulting from providing disclosable information. To invoice, use Form CMS-633 - Invoice of Fees for FOIA Services (Exhibit C). The requester sends payment derived from the release of information to the CMS Division of Accounting.

(Rev. 1, 09-11-02) Where estimated costs exceed $250.00, or if the requester has failed to pay previous bills in a timely fashion, collect fees and charges before the requested material is copied and furnished. Use the Division of Accounting, CMS's FOIA Bad Debtor Listing to determine delinquency. Notify the requester of the total estimated charges, using language similar to the following: The HHS regulations require that a charge be made to recover some of the costs incurred in the disclosure of information. The total (estimated) billable cost for the material you requested is $ ______. The cost consists of the following charges: (list here breakdown of charges; e.g., "Photocopying: $10; Searching: $450). Please send a check or money order for the total amount made out to CMS and mail it to (contractor address). The material will be mailed to you upon receipt of payment (subject to any adjustment to the estimate). If we do not hear from you within 30 days, we will assume your request has been withdrawn and no further action will be taken. Be sure to point out to the requester that even though the invoice says to mail the check to the CMS Division of Accounting in Baltimore, in this case the check must be mailed to the contractor so that payment can be verified before the material is mailed. Subsequent to the contractor's receipt of the advance payment, send both the check and the finance copy of the invoice to the Division of Accounting in Baltimore. Because some requesters will neither provide advance payment nor notify the contractor that they no longer desire the requested material, do not send the "Finance" copy of the invoice to Accounting until after the advance payment check is received. For the same reason, do not begin searching for and photocopying the requested material until the advance payment is received. If you do not hear from the requester in 30 days, close the request.

(Rev. 1, 09-11-02) The Freedom of Information Act deals with the right of the public to information about Government rules and methods of operating. It requires that every Federal agency make available for inspection and copying: "522(a)(2) (B) those statements of policy and interpretations which have been adopted by the agency and are not published in the Federal Register; and (C) administrative staff manual and instructions to staff that affect any member of the public, unless such materials are promptly published and copies offered for sale." Information contained in Medicare program manuals and Program Memoranda can be obtained via the Internet. Where requests are made to contractors, contractors will photocopy Program Memoranda and individual pages from CMS manuals to respond to minor requests. When inquirers ask to see Social Security Manuals and letters that are not maintained, the contractor will refer them to the SSO. If the request is for Medicare related information, the contractor may disclose the following: • Written policy used to evaluate and make payment decisions on claims subject to medical review. (Parameters are not components of medical payment policies and should not be disclosed.) • Fee schedules and profiles of customary and prevailing charges of physicians/suppliers, including backup data, as long as the provider identifiers and the frequencies of procedures per provider have been deleted. • Relative value units and conversion factors used to develop approved charges for procedures done too rarely to compile customary charges. • Lists of contractors, physicians/suppliers and provider numbers. • Documents listing and/or describing acceptable diagnostic or procedure codes, rate schedules or covered services. The contractor will not engage in interpretive analysis or discussion of the material when responding to requests. The contractor will not release information on the parameters and computer edits used to identify claims for medical review. These are tools for selection of claims for MR and are not determinants of whether a service is payable. EXAMPLE: The contractor has a screen which identifies for review all claims for CAT Scans of the head in excess of 3 in 30 days. Written MR policy contains diagnoses and other descriptions of medical conditions that would justify CAT Scans in excess of that amount. The contractor is required to release the policy guidelines but must withhold the "3 in 30 days" parameter used to identify claims for MR. The contractor must refer requests for information for which denial is recommended, including parameters and computer edits to the RO.

(Rev. 1, 09-11-02) The contractor should provide a facility for the public to view the program manuals and other information available to the public on the Internet. It will fulfill requests for printouts resulting in 50, or fewer, pages. Requests to examine manuals or letters usually arise where a beneficiary calls at an office to discuss his/her claim. In such situations, the contractor will abstain from engaging in interpretative analysis or discussion of the material.

(Rev. 1, 09-11-02) All interpretive materials, guidelines, and clarification of policies that relate to payment of Medicare benefits must be released. Upon request, the contractor will release written guidelines used to evaluate and make payment decisions on claims subject to MR. Precise information on the screens, parameters and computer edits used to identify claims for MR may be withheld. EXAMPLE: A screen identifies for review any SNF claim with more than 30 covered days. Written MR policy contains the documentation standards and guidelines which assist the reviewer in the decision to pay or deny the claim. Release of the policy guidelines is required, but the review screen can be withheld. Guidelines may be withheld that use specific criteria and tolerances intended to identify claims that raise a strong possibility of fraud or abuse because of a pattern of payment requests for excessive or duplicate services, or services not rendered. If disclosure of such guidelines could be judged to adversely affect the program by allowing violators to go undetected, the contractor should refer the request to the RO with its recommendations. The contractor will acknowledge any requests that should have gone to another contractor and refer them to the appropriate contractor.

(Rev. 1, 09-11-02) Sections 3764 - 3769 set the guidelines for disclosure of information about a named beneficiary, to whom it may be disclosed, and the purposes for which it may be disclosed. In general, no information may be released except to the beneficiary (or the beneficiary's legal guardian) without the beneficiary's (or legal guardian's) explicit written authorization. In cases requiring the beneficiary's consent, the authorization may be in any form, but it must: • Be signed and dated; • Specify the individual, organizational unit, class of individuals or organizational units to which the information may be disclosed; • Specify the record(s), information, or type(s) of information which may be disclosed; and • Indicate whether the consent is a one-time or on-going release of records. A contractor will not honor a blanket consent to disclose all beneficiary records to unspecified individuals or organizational units. The disclosure of information about beneficiaries is governed by the provisions of § 1106 if the Social Security Act as implemented by Regulation No. 1, the Privacy Act, the FOI Act, and the DHHS Public Information Regulation.

(Rev. 1, 09-11-02) Section 1106 of the Social Security Act prohibits disclosure of any file, record, report, or other paper, or any information obtained at any time by the Secretary or an officer or employee of DHHS in the course of discharging their duties under the Act, except as prescribed by regulations. Where manual instructions permit disclosure, assume that related regulations have been published. The same prohibition applies to information received by any person outside DHHS, from the Secretary, or an officer or employee of DHHS. The prohibition applies to any agency, organization (e.g., contractors), or institution, or any of its officers or employees, in the fulfillment of a contract or agreement with the Secretary. A. Disclosure of Provider or Physician Records The prohibition also relates to any information received from DHHS, a contractor, or any person or entity that furnishes services under arrangements with a provider or accepts an assignment under the program. However, patient records in the possession of a provider or physician are not subject to the prohibition against disclosure or to the Departmental rules and regulations concerning confidentiality merely because the patient is entitled to Medicare benefits. Disclosure of provider or physician records not in the possession of CMS or a contractor may, however, be subject to applicable State or local laws, or to hospital rules governing disclosure. B. Authority for Refusal to Disclose Information Denial of all or portions of requested records can only be made by the CMS Freedom of Information Officer. Therefore, when a request for information is received, disclosure of which is prohibited under these guidelines, the contractor will follow §10.2 above. The CMS FOIA Officer has authorized Medicare contractors to issue a denial on his/her behalf in the following situation: If any officer, employee, agent or subcontractor is served a subpoena or other compulsory process requiring the production of records or information on a beneficiary or individual practitioner that are contained in a Privacy Act System of records and such a request is not accompanied by a valid authorization to release the records signed by the subject of the records, he/she will decline to produce the records or information. He/she will base the refusal on §1106 of the Social Security Act and on 5 USC §552a, 5 USC §552, 45 CFR Part 2 and 45 CFR Part 5. The contractor will notify the RO immediately. If the contractor directly receives such a subpoena, it uses the following language to respond: Dear Sir or Madam: This is in response to the subpoena duces tecum, dated ______, initiated by your firm, for certain Medicare records in our possession. The Department of Health and Human Services regulation at 45 CFR Part 2 states, among other things, that the Department will treat subpoenas duces tecum for records in its possession as requests under the Freedom of Information Act (5 U.S.C. §552). Because the records the subpoena seeks are in a Privacy Act system of records, the Privacy Act (5 U.S.C. §552a) precludes release of those records except pursuant to a written authorization to release signed by the subject(s) of the records or unless the Freedom of Information Act requires release of the records or a court of competent jurisdiction orders release. Regarding the latter condition of disclosure, for purposes of the Privacy Act, a court of competent jurisdiction is a Federal court only. Review of this matter indicates that your firm has not presented a written authorization to release records signed by the subject(s) of the records. Moreover, your firm's subpoena is not an order of a court of competent jurisdiction, and 45 CFR Part 2 requires us to treat the subpoena duces tecum as a Freedom of Information Act request. Further the Freedom of Information Officer for the Centers for Medicare & Medicaid Services has determined that the requested records are exempt from mandatory disclosure under the Freedom of Information Act by exemption (b)(6) of that Act. Exemption (b)(6) permits the withholding of information about individuals in personnel and medical files and similar files, when the disclosure of such information would constitute a clearly unwarranted invasion of personal privacy. Based upon the foregoing, we respectfully decline to produce the Medicare records requested by your firm's subpoena duces tecum. If you have reason to disagree with this decision, you may appeal. Your appeal should be mailed, within 30 days of the date of this letter, to the Deputy Administrator, Centers for Medicare & Medicaid Services, Room C5-16-03, 7500 Security Boulevard, Baltimore, MD 21244-1850. Please mark your envelope "Freedom of Information Act Appeal," and enclose a copy of this letter. Sincerely yours, Signature of Authorized Official cc: FOI Officer, CMS Process the State or local court subpoena duces tecum that seeks other kinds of CMS records in accord with §10.2 above. C. Penalty for Failure to Comply With the Rules Relating to Disclosure of Information Obtained in the Administration of the Act Section 1106(a) of the Act provides that any person who violates the disclosure provisions shall be deemed guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine not exceeding $1,000, by imprisonment not exceeding 1 year, or both.

(Rev. 1, 09-11-02) Regulation No. 1 of the Act defines the basic authorization for disclosure of information obtained in the administration of the program. The general rule is that information about an individual obtained in the administration of the program may not be disclosed without the authorization of that individual. Medical information relating to an individual will generally be disclosed under more restrictive conditions than other information and, where permitted, usually may be furnished only upon the written authorization of the individual. Specific exceptions to this rule are detailed in the following sections. As far as program operations are concerned, information about an individual may be disclosed without the individual's authorization when the disclosure is necessary in connection with any claim, or other proceeding, under the Social Security Act. Information will be disclosed for other than program purposes only if the disclosure is authorized by Regulation No. 1 and is consistent with the proper and efficient administration of the program.

(Rev. 1, 09-11-02) A. Information About an Individual Disclosure of any record, report, or information about an individual may be made without the individual's authorization if it is in connection with any claim, or other proceeding, under the Act when it is necessary for the proper performance of duties of: • Any officer or employee of the Department; or • Any officer or employee of a State agency, contractor, provider of services, or other agency or organization participating in the administration of the program by contract or agreement in carrying out such contract or agreement. The SSOs have a responsibility for public information activities. In its development of a human interest story concerning health insurance, an SSO may, on occasion, request the contractor to provide claims reimbursement information about a specific beneficiary. The contractor will honor such a request when it comes from an SSO employee having authority for liaison with the contractor. Depending upon the agreements made with the parallel SSO, the employee authorized may be the manager, assistant manager, staff assistant, and/or HI coordinator. The contractor will not honor requests by other employees for beneficiary claims information. B. Disclosure to Third Parties In the administration of the program, the contractor may want to avail itself of the services of third parties such as auditors, court reporters, public stenographers, microfilm processors, or companies developing equipment for use in the program. The arrangement between the contractor and such third parties, even where it is of short duration, is in the nature of an agreement supplementing its contract with the Secretary. Under such an arrangement, disclosure to these parties of necessary information that relates to, and is used in, the administration of title XVIII of the Social Security Act is permitted as provided by §1106 of the Social Security Act and Regulation No. 1. However, when the contractor enters into an agreement with these parties, it will inform them that §401.1 of Regulation No. 1 precludes the disclosure of any information on identifiable individuals. It will call their attention to the penalty clause of §1106(a). It will call attention to these provisions by letter (see below), and obtain a written agreement to comply with the disclosure provisions before releasing any information. Sample Letter to Third Party Dear We are prepared to make available to your organization certain social security records so that (state reason). However, before making these records available, we must point out that by law, all information derived on identifiable individuals in the administration of the Social Security Act is confidential and may be disclosed to others only under very restrictive circumstances. Regulation No. 1 of the Social Security Administration which governs disclosure of official records and information precludes you from disclosing any information on identifiable individuals. You should also note that §1106(a) of the Social Security Act imposes criminal penalties for unauthorized disclosure. Any social security records which do not identify or make identifiable any individuals are not subject to these restrictions, but may be restricted under the provisions of the Freedom of Information Act. In order to comply with the requirements of the Social Security Act and Freedom of Information Act you must agree to the following conditions before we can make any social security records available to you: Any information which is turned over to you will be used only for the specific purpose intended. All employees having access to this material will be instructed as to its confidential nature. An official of your company will assume the responsibility for ensuring that the information is not revealed to another. The material must be returned to us as soon as you have finished the job. We must have a letter from a responsible official in your office agreeing to these conditions and assuming responsibility for carrying them out. Upon receipt of such letter, the social security records will be made available to you. Sincerely yours,

(Rev. 123, Issued: 05-10-19, Effective: 06-11-19, Implementation: 06-11-19) For more information related to disclosure of PII and PHI, please refer to Pub. 100-9, Medicare Contractor Beneficiary and Provider Communications Manual, Chapter 6, section 80.

(Rev. 1, 09-11-02) The contractor may disclose information concerning the fact, date, or circumstances of death when efficient administration permits. The request must be in writing and must state why the information is sought. Additional information may be disclosed to a surviving relative or an authorized representative of that relative, the legal representative of the estate, or to a probate court for the purpose of appointing a legal representative of the decedent's estate. The contractor must exercise care, however, to see that it discloses no information which would appear to be detrimental to the individual or the individual's estate, i.e., unusual place or manner of death or information which could create a liability to the individual's estate. The contractor may disclose medical information, in form and detail consistent with proper and efficient administration of the program, when such disclosure is reasonably necessary for a title XVIII purpose. (See §50 of this chapter for further information concerning the disclosure of non-medical and medical information when necessary for a program purpose.) The contractor may disclose medical information obtained in the administration of title XVIII to a surviving relative or legal representative of the estate of the individual or to others for other than a title XVIII purpose, when such information is necessary for a determination as to what supplementary benefits or services such deceased individual was eligible to receive under a private or public hospital or medical insurance program which is consistent with the purposes and objectives of title XVIII. The contractor may disclose such information only if the individual has consented to such disclosure or a surviving relative or the legal representative of the estate consents. (See §80.1 "Release of Title XVIII Claims Information for Complementary Insurance Purposes" in this chapter.)

(Rev. 1, 09-11-02) A. Non-medical Information Non-medical information about an individual may be disclosed for other than a program purpose, to persons or organizations designated by the individual, if the individual authorizes disclosure, and if disclosure is consistent with the proper and efficient administration of the Act. B. Disclosure of Medical Information to a Physician, Institution, or Other Supplier of Services The contractor may disclose medical information to a supplier of medical services solely for the purpose of the beneficiary's care or treatment. Such supplier will be informed that the information is being furnished in connection with the treatment of the beneficiary and that its use should be restricted to that purpose. C. Disclosure to the Source of Medical Evidence Occasionally in the course of reviewing medical evidence submitted to substantiate a claim, contractor medical personnel may discover a medical condition of which the source of the information is unaware. (For purposes of this section, the "source" of the information is the part submitting the evidence.) In cases where a serious or potentially serious condition is found, the contractor may wish to inform the source of the information. If the source of the information indicates that the beneficiary is not institutionalized and the identity of the beneficiary's current physician is not known, the source should recommend that the beneficiary consult a physician or institution of the beneficiary's choice for further treatment. D. Disclosure to a Source of Medical Services other Than the Source of the Information Medical information may also be disclosed, upon request, to the beneficiary's physician or to a medial institution at which the beneficiary is or was a patient when such physician or institution is not the source of the information. However, consent for the release must be obtained from the beneficiary.

(Rev. 1, 09-11-02) The contractor may not release or use information obtained in the administration of the Medicare program for non-program activities. However, when the beneficiary has given written authorization the contractor is permitted to release certain information to its complementary insurance program under specific conditions in its capacity as insurance writer or administrator, or to other insurers for complementary health benefits purposes. Under no circumstances may the contractor use the knowledge of an individual's entitlement or benefit utilization information for purposes of dropping an individual from a group health insurance plan. A. Information That May be Released Subject to necessary authorizations, copies, extracts, or summaries of only the following records may be released: • Provider billing forms (e.g., Form CMS-1450); • Explanation of benefits for Part B Provider Services, or denial letters; and • Information on date of entitlement to Part A, or date of enrollment under Part B, or the date Part B coverage began. Requests for other information desired for complementary insurance purposes should be referred to the RO. B. Form of Authorization The contractor must make certain that information is not released without the required authorization. This authorization may be either indicated on the billing and admission form or on a dated statement from the beneficiary. Where the authorization is on a dated statement it must: • Authorize release of information about his/her title XVIII Medicare claim; • Designate to whom the release is authorized; • Show that the release authorized is for complementary insurance purposes (this may be implied by the designation in the second bullet above); • Indicate whether the authorization is for a one-time or ongoing release of data (i.e., for the duration of the claims and appeals process, but not to exceed 2 years); and • Bear the signature of the beneficiary, the beneficiary's legal guardian, or the beneficiary's authorized representative. Where the bill contains a beneficiary signature or indicates that the beneficiary's signature authorizing release of information is contained in the provider's records, the bill must contain the name of the complementary insurer unless a dated statement as outlined above is already on file. Where the contractor has a dated statement on file, information may not be released for individual claims when the beneficiary indicated that they do not want disclosure on that claim. This may be indicated on certain claims forms by the beneficiary checking an appropriate block, or by attaching a separate statement. If someone other than the beneficiary, legal guardian, or authorized representative has authorized disclosure to a third party by filling out the appropriate item on the billing form, the contractor may not release the information unless an authorization from the beneficiary is on file. Instead, where feasible, the contractor will inform the beneficiary (or legal guardian or authorized representative) that the signature on the claims form does not constitute a proper authorization for disclosure and that, if the beneficiary desires information to be disclosed to a third party, the beneficiary should send to either the contractor or the third party, a statement authorizing release. (The contractor will indicate the necessary contents of a proper authorization or enclose an appropriate form or statement for use by the proper party in authorizing release.) If invalid authorizations are a frequent problem, the contractor advises third party payers to obtain appropriate ongoing consent statements from enrollees. C. Methods of Handling Requests Where the complementary insurers desire title XVIII information for certain claims only, either the complementary insurer or the beneficiary may request its release. The complementary insurer must furnish the required authorization(s) for release and must pay any charges. (The Medicare program will absorb charges for supplying duplicate MSN's or billing forms to beneficiaries, their authorized representatives, and to social security offices.) In the absence of a standing arrangement, the mere presence of an "authorization' to release and the identification of a complementary insurer on a title XVIII billing form does not constitute a request for the "release" of information. There must be a specific request for the information. The contractor may enter into a standing arrangement with a complementary insurer to provide and charge for title XVIII information, such as MSNs or deductible non-met letters, in every case in which the contractor receives a title XVIII claim which contains the necessary authorizations and identifies the complementary insurer. D. Release of Title XVIII Claims Information for Complementary Insurance Purposes by Providers Contractors should be aware that, subject to specific written beneficiary authorization, providers are permitted to furnish certain limited information about Medicare eligibility status and related claims information to third party payers for complementary insurance purposes. (See §170.)

(Rev. 1, 09-11-02) In using an integrated claims processing system, it is permissible to match a currently updated subscriber file against a run of currently processed Medicare claims to extract information required to pay the complementary claim provided: • When routinely securing beneficiary authorization for an ongoing release of information safeguards are maintained to ensure that, where a beneficiary revokes the authorization on the billing form or by a separate statement, there will be no release of information; • When a statement is not routinely secured for the ongoing release of information, controls ensure that there is an authorization per §80.1 of this chapter from each Medicare beneficiary with complementary insurance before information is released; and • Controls ensure that no information will be released in the matching process for any Medicare beneficiary who does not have complementary insurance. Contractors must update the subscriber file to incorporate all terminations before each match with the Medicare claims file so that information will not be passed to the private business sector for beneficiaries who are not entitled to the complementary insurance plan. The contractor may not permit the private business sector to have access to the Medicare claims history file. The private business sector may use only information concerning the current claim from the current run of processed claims.

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) The contractor may disclose information on such matters as entitlement, benefit payment, or benefit utilization relating to an individual who has applied for benefits administered by the State welfare departments. It may make such disclosure without the authorization of the individual or the individual's legal representative (i.e., legal guardian appointed by a court or a parent or a minor) to any duly authorized officer or employee of a State agency administration of grants-in-aid programs under titles IV, V, or XIX or in the case of Puerto Rico, Guam, or the Virgin Islands, titles I, X, or XVI of the Social Security Act with the authorization of the individual or their authorized representative. Medical information beyond that shown on billing forms relating to an individual (and obtained in the administration of the Medicare program) may be disclosed to a State agency administering the grants-in-aid program if the State agency shows a special need for the information, and the file contains a written authorization by the beneficiary specifically consenting to disclosure of medical information. Title XVIII, billing forms and completion instructions, provide for authorization by the beneficiary for the release of information to State agencies or their agents. Where the contractor, or a third party organization, is administering the medical payment program under a contract or underwriting arrangement with the State, it may release information to itself or to the third party organization on the same basis as it may release information to a State agency.

(Rev. 1, 09-11-02) Contractors may provide State Medicaid agencies with Medicare claims information. See Pub 100-04, Chapter 28 for more information.

(Rev. 1, 09-11-02) The release of information obtained in the administration of title XVIII indicating a course of unprofessional conduct or unethical practices by a physician or other practitioner will assist in the investigation of such conduct under titles V and XIX. The information to be released must have previously been released by a contractor in the administration of title XVIII to an official of a State licensing board (see §100.4 of this chapter), or to any officer, agency, establishment, or department of the Federal Government charged with the duty of conducting an investigation to determine whether there has been a violation of any provision of a Federal tax law (see §120 of this chapter).

(Rev. 1, 09-11-02) The CMS, which administers title XIX, requires a correlation between payments under that title and the fee schedule or the 75th percentile of the range of customary charges, if applicable, as determined for treatment rendered under Part B of title XVIII. This requirement assumes that title XVIII fee schedule and medical charge experience, where applicable, will be available to title XIX agencies. Therefore, it is necessary that agencies administering title XIX be furnished with physician, other practitioner, and supplier identification numbers; and fee schedules and/or charges of physicians or other practitioners, or suppliers for services furnished to beneficiaries, to enable them to determine the amount of benefits payable for medical services furnished under Title XVIII and XIX. As the individual title XIX programs of the several States may differ, some variation in the type of information required can be expected. Therefore, in order to obtain the information it needs, each State agency should consult with the title XVIII contractor(s) serving the various areas in each State concerning the availability and format of the necessary information. (CMS advises the appropriate State agencies of this arrangement.) Contractor Involvement - • The contractor will normally receive the request of the State title XIX agency through the RO. • The contractor will determine the amount of information it can furnish in accordance with the particular request. (See §10ff of this chapter.) • The contractor will determine the charge and discuss it with the State agency. (See Medicare Carrier Manual, Part 1, §4602.6.) • If consultation or clarification of the data requested is needed, the contractor should make contact with the State agency through the RO or directly, as advised by the RO. • When all details are completed, the contractor should submit the requested information in final form to the RO for furnishing to the State agency.

(Rev. 1, 09-11-02) Contractors may provide State Medicaid agencies with Medicare claims information. See Pub 100-04, Chapter 28 for more information.

(Rev. 1, 09-11-02) The CMS and/or A/B MACs (A) may furnish PROs information on claims specified by CMS for PRO review.

(Rev. 1, 09-11-02) The contractor may disclose information to the Internal Revenue Service when requested for investigation of a possible violation of the F.I.C.A., S.E.C.A., F.U.T.A., or any Federal income tax law. The contractor will bring to the attention of the RO any problem in complying with the IRS request (e.g., machine capability, cost, etc.).

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) The CMS may disclose certain information to TriCare for use in administering the TriCare program. The type of information to be made available parallels that made available to non-complementary title V and XIX State agencies and contractors. (See §100 of this chapter.)

(Rev. 1, 09-11-02) We expect that most requests from TriCare for information will involve primarily Part B Medicare operations in such areas as identification of physicians and other medical practitioners who may be engaging in providing excess services or fraud. Before we release this information to a requesting TriCare contractor that is not also a Medicare contractor, a Medicare contractor must have previously released the information in the administration of Title XVIII to: • An official of a medical or other applicable professional society or • An official of a State licensing board, or • Any other officer, agency, establishment or department of the Federal Government charged with the duty of conducting an investigation to determine whether there has been a violation of any provision of Federal law (see §120 of this chapter). We may also disclose to TriCare the types of data covered in §100.2 of this chapter, upon request when authorized by the beneficiary or the beneficiary's legal representative. In addition, we will, upon request, make available to TriCare Economic Index Data (as prescribed by §§405.502(a) and 405.504(a) of Regulations No. 5) that might affect the limits on prevailing charge levels.

(Rev. 1, 09-11-02) TriCare fiscal agents desiring Medicare information will usually request it either through the TriCare headquarters in Denver or through the parallel RO. The TriCare headquarters will refer the request to the parallel RO. Should a Medicare contractor receive a request directly from TriCare, it will refer the request to the RO. The RO will meet with the TriCare fiscal agent and the Medicare contractor to determine exactly what is needed, impress upon the TriCare contractor that TriCare may not further disclose the information, and indicate the cost involved, if any. (Also note that payment may be estimated or waived if collection would interfere with efficient administration.) At the RO's discretion, the Medicare contractor and the TriCare fiscal agent may meet to discuss data and cost requirements without regional involvement. Upon agreement about data and cost requirements, the RO will authorize release of the information from the Medicare contractor to the TriCare fiscal agent.

(Rev. 1, 09-11-02) In keeping with the spirit of the Freedom of Information Act and growing consumer interest in health care facilities and suppliers, CMS has made available to the public various final reports and other information regarding providers and suppliers. Disclosure to the public by a contractor is limited, but the following guidelines indicate what information is available, to whom it may be released, and the source to which a requestor should be directed for information that the contractor is not authorized to release.

(Rev. 1, 09-11-02) A. Disclosure of Survey Information of the Joint Commission on Accreditation for Hospitals (JCAH), American Osteopathic Association (AOA), or any other National Accreditation Organization The CMS may not disclose any accreditation survey made and released by the JCAH, AOA or other national accreditation organization except as prescribed by regulations. Accreditation letters and accompanying Recommendations and Comments prepared by the JCAH, AOA or other national accreditation organization for the provider's accreditation survey are confidential and exempted from public disclosure. A copy of the provider's most recent accreditation survey may be disclosed with the provider's authorization to any authorized representative, employee or agent of CMS for official use only in connection with the Medicare sample validation or substantial allegation survey program. B. Disclosure of Information About Hospitals, Skilled Nursing Facilities, Home Health Agencies, and Independent Laboratories Information about a hospital, skilled nursing facility, or home health agency, as well as information about independent laboratories, providers of outpatient physical therapy (rehabilitation and public health agencies and clinics) and portable X-ray suppliers, may be disclosed without the authorization of the institution or organization when such disclosure is required for the proper performance of the duties of: • An officer or employee of the Department; • An officer or employee of a contractor; or • An officer or employee of a State agency when necessary to carry out their duties under State law in the licensing or approving of hospitals, skilled nursing facilities, home health agencies, or independent laboratories, etc. Information obtained in the provider certification process is not to be disclosed to those not included in the above three categories, except as indicated in §140.3 below. However, information that a particular institution is participating in the program may be released; and information indicating the specialties for which title XVIII payment may be made for services of a particular independent laboratory may be released. This information is usually available from the Directory of Medical Providers and Suppliers of Services published by the Government Printing Office. C. Contractors' Disclosure to Third Parties Disclosure to third parties for program purposes of information about identifiable physicians and other suppliers who are natural persons is governed by the same restrictions and procedures as disclosure about named beneficiaries to third parties for program purposes. (See §50 of this chapter.) Information about unidentifiable individuals or about providers or corporate entities (e.g., clinics or independent laboratories), is not exempt from disclosure by section 1106 and regulations at 42 CFR, Part 401. However, it is not to be disclosed by third parties to which information is disclosed for program purposes. If the information the contractor discloses to third parties for program purposes is solely information that does not identify, or make identifiable, individuals (e.g., aggregate statistics or records on providers and other corporate entities) the following sample letter is to be used instead of the letter in §50B of this chapter. Sample Letter from Contractor to Third Party Dear We are prepared to make available to your organization certain CMS records so that (state reason). However, before making these records available to you, we must point out that by law all information derived in the administration of the Social Security Act is subject to the provisions of the Freedom of Information Act, which exempts from disclosure certain categories of records. In order to assure that no records held confidential under the Freedom of Information Act are disclosed, you must agree to meet the following conditions before we make any social security records available to you: • 1. Any information we supply you will be used only for the specific purpose intended and for no other purpose. • 2. All employees having access to this material will be instructed as to its confidential nature. • 3. An official of your company will assume responsibility for ensuring that the information is not revealed to any other party. • 4. You must return the material to us as soon as you have finished the job, and you may not retain copies. • 5. We must have a letter from a responsible official in your office agreeing to these conditions and assuming responsibility for carrying them out. Upon receipt of this letter from your organization, we will make available to you the CMS records you requested. Sincerely yours,

(Rev. 1, 09-11-02) A. Provider Survey Report and Related Information Information concerning survey reports of providers or facilities, as well as statements of deficiencies based on survey reports are available at the local social security office or the public health assistance office in the area where the facility is located. The following data may be released under this provision. • The official Medicare survey report; • Statement of deficiencies which have been conveyed to the provider following a survey; • Plans of correction, and pertinent comments submitted by the provider relating to Medicare deficiencies cited following a survey. B. Program Validation Review Reports and Other Formal Evaluation (CMS) Upon written request, CMS makes available to the public official reports and other formal evaluations of the performance of providers. After CMS prepares the survey reports and other formal evaluations, it must provide the evaluated provider an opportunity (not to exceed 30 days) to review the report and submit comments on the accuracy of the findings and conclusions. CMS must incorporate the provider's pertinent comments in the report. Generally, the RO serving the area in which the provider is located releases Program validation review reports. It will provide a copy of the report and the provider's comments to the contractors servicing the provider. CMS may also make available to the public, subject to certain possible exemptions, informal reports and other evaluations of the performance of providers prepared by the contractor. The contractor refers requests for these reports to the Medicare regional office with a copy of the information requested. C. Provider Cost Reports (A/B MAC (A) or (HHH)) 1. Requests for Disclosure Requests by the public either to inspect or to obtain a copy of a provider cost report must be in writing and must identify the provider or class of providers and specific cost reports requested. NOTE: Personal salary information cannot be disclosed. 2. Ten Day Notice Requirement A/B MACs (A) or (HHH) must respond in writing within 10 working days after receipt of the written request, advising the requestor of the date the reports will be available. This date should be no earlier than 10 working days from the date of the contractor's response. (For exceptions, see Exceptions To 10-Day Notice Requirement immediately below.) A copy of this response must be sent simultaneously to the provider, thus putting it on notice that its report has been requested and by whom. (For exception, see §140.3 below.) If the request is for a report submitted by a former owner of a participating facility, copies of the contractor's response should go to both the present and former owners. If the request is for a report submitted by a provider no longer participating in the program, a copy of the contractor's response should be sent to the former provider. (For both former owners and former providers the copy of the response should be sent to the last known address of the party.) If we cannot make the information available within a reasonable period of time, our response will include a brief explanation for the delay (e.g., because of the extent of searching, photocopying, or delay in securing reports from records retention centers). In addition to the provider's copy, the contractor sends a copy to the CMS regional office servicing the provider. If a contractor receives a request for information concerning providers that it does not service, it will immediately forward such request to the CMS regional office servicing the provider and will inform the requester of its action. The regional office forwards the request to the servicing contractor. 3. Exceptions to 10 Day Notice Requirement No 10-day delay in furnishing cost reports is necessary in the case of requests from: • Federal or State agencies that need cost report information to carry out requirements of the Social Security Act (e.g., a State health planning agency under title XI (§1122), or a Medicaid State agency under title XIX). The Congress - Requests from Congress are limited to those from the Congress as an official body (e.g., the Speaker of the House or the President of the Senate, or from the chairman of a committee or subcommittee of the House or Senate with jurisdiction related to the information requested). Requests from individual members of the House or Senate are considered requests from the public. 4. Information That Can Be Disclosed CMS's rules limit disclosure to cost report documents that providers are required by regulations and instructions to submit. In the case of a settled cost report, this includes the contractor's notice of program reimbursement. Cost report documents include the statistical page, the settlement pages, trial balance of expenses, cost finding schedules, balance sheet, statement of income and expenses, and other schedules or documents required as part of the regular cost report process. (Where a provider, after first obtaining program approval, submits equivalent documents in lieu of official program documents, such documents are subject to the same disclosure rules as apply to official forms.) Information That May Not Be Disclosed If a provider chooses to submit with its cost report additional information not specifically required by regulations or instructions, the contractor should not disclose such information unless it is contained within an official document or the equivalent thereof. For example, some providers may submit supplementary analyses of certain expenses, details of the professional component adjustment, financial statements (other than the statement of income and expenses and the balance sheet as required in accordance with cost reporting instructions), or income tax returns that are not required by the program. These would not be disclosable by the contractor. Except where a provider has not submitted an acceptable cost report and supplements are required to complete the report, any additional documents or schedules that the contractor requires the provider to submit in support of its cost representations are also not to be disclosed. In addition, do not disclose audits, schedules, letters, notes, and comments; comments on results of desk reviews (including copies of the actual desk review documents); contractor notes and comments (including transmittal letters); audit adjustment summaries that contractors and auditors are required to prepare; and information pertaining to an individual patient. Contractors acknowledge such requests and refer them to the regional office. NOTE: Cost report information that the contractor may not disclose may, nevertheless, be disclosed under the Freedom of Information Act by the CMS regional office, central office or, upon appeal of a denial, by the Administrator, CMS. Upon judicial review, a U. S. District Court may order Disclosure. When an A/B MAC (A) or (HHH) discloses a settled report, it may disclose schedules applicable to the settlement that have been reworked. The general rule is that if the contractor has reworked any of the schedules that the provider is required to submit with its original submission, these schedules become an integral part of the report for disclosure purposes. However, the A/B MAC (A) or (HHH) may not disclose any details containing contractor or auditor comments concerning the settlement, details of specific adjustments, or supporting schedules applicable to the settlement of the provider's operation. Prior to the release of cost report information to the requestor, the A/B MAC (A) or (HHH) servicing the provider must screen each cost report and remove non-disclosable documents and information. If the A/B MAC (A) or (HHH) is uncertain whether a particular document must be disclosed it should consult the regional office in the region in which the provider is located. Further, if the A/B MAC (A) or (HHH) discovers as a result of review that the cost report reflects information that might result in adverse program publicity, it alerts the RO immediately. However, it does not delay disclosure. The above instructions do not negate in any manner the requirement that the A/B MAC (A) or (HHH) submit cost reports to CMS that contain full and complete information, including the details of all contractor and auditor adjustments, comments, and any supporting schedules that may be needed to verify the settlement. 5. Responding to Requests for Inspection of Cost Reports The A/B MAC (A) or (HHH) will make cost reports available for inspection by the requestor at the A/B MAC (A) or (HHH)'s office during regular business hours. In addition, arrangements will be made to make copies available upon specific request at any RO, or at central office. The A/B MAC (A) or (HHH) must provide appropriate space for such inspections. It must establish procedures to ensure that all reports inspected are properly accounted for. Under no circumstances should it permit any requester to remove cost reports from the place of inspection. If the requester has questions with respect to the interpretation or analysis of cost report information, the A/B MAC (A) or (HHH) will advise the requester to submit such requests for more than routine explanations in writing to the regional office. 6. Disclosure of Cost Reports If a request is received to inspect or to obtain a copy of a report that has not been settled; i.e., the final settlement notice of program reimbursement has not been sent, the A/B MAC (A) or (HHH) will disclose a copy of the report as submitted by the provider. If settlement has been made, it will disclose the settled report. If a requester specifically asks for both the settled and unsettled cost reports of a provider, the A/B MAC (A) or (HHH) will comply. When a report is made available for inspection or copying, it should be clearly marked with one of the following captions, as applicable. Cost report as submitted: • Settlement subject to audit; and • Audited settlement. Requests for reproduction of all or part of a provider's cost report may be subject to photocopy fees. If it is determined that a fee must be charged, the A/B MAC (A) or (HHH) prepares the written response to the requester in accordance with §20 and §20.4 of this chapter. 7. Responding to Requests for Information A requester may desire only selected cost report information of a provider or several providers. However, the DHHS Freedom of Information Regulation specifies that agencies are not required to create a record by compiling selected items from the files; such requests will be met by furnishing copies of specific documents which contain the information requested. In addition, when the contractor receives a request that requires selecting documents from various cost reports, the request should be honored. It will follow the written response procedure above even though the entire report is not being disclosed. It will advise the requester that a searching fee will be charged and give an approximate date when the documents will be ready. D. Medicare Payment and Cost Data The A/B MAC (A) or (HHH) may release Medicare payment or Medicare cost data concerning a named provider without giving the provider the ten-day notice required in §10.2 or 30 above. However, it does not give the requester enough information to calculate provider non-Medicare data as well. For example, A/B MACs (A) or (HHH) do not tell a requester that Medicare payments to the provider represent 30 percent of its total revenues. The Medicare payment or Medicare cost data may be extracted from such documents as cost reports or Form CMS-3286, Monthly Actuarial Sample of Hospital Reimbursement. Any extraction of data is subject to the instructions above concerning creation of records. E. Waiver of Liability Status The waiver of liability status of a particular provider and the statistics used to determine that status may be disclosed.

(Rev. 1, 09-11-02) A. General Generally, the contractor will not honor requests for information about a specific physician or other supplier of services, or for information which would identify such a physician or other supplier of services, except in situations described in §140.1 above. Disclosure to third parties for program purposes of information about individual physicians and other suppliers who are natural persons is governed by the same restrictions and procedures as disclosure about named beneficiaries to third parties for program purposes. (See §50B of this chapter.) The contractor acknowledges such requests and refers them to the RO for response. If the information the contractor discloses is solely information that does not identify or make identifiable individuals (e.g., aggregate statistics or records on providers and other corporate entities), it uses the following language: Dear: We are prepared to make available to your organization certain social security records so that (state reason). However, before making these records available to you, we must point out that by law all information derived in the administration of the Social Security Act is subject to the provisions of the Freedom of Information Act, which exempts from disclosure certain categories of records. In order to assure that no records held confidential under the Freedom of Information Act are disclosed, you must agree to meet the following conditions before we make any social security records available to you: 1. Any information which is turned over to you will be used only for the specific purpose intended and for no other purpose. 2. All employees having access to this material will be instructed as to its confidential nature. 3. An official of your company will assume responsibility for ensuring that the information is not revealed to any other party. 4. The material must be returned to us as soon as you have finished the job. 5. We must have a letter from a responsible official in your office agreeing to these conditions and assuming responsibility for carrying them out. Upon receipt of this letter from your organization, the social security records will be made available to you. Sincerely yours, If the contractor receives a written request for a physician's or supplier's customary charges or for amounts of program payments made to physicians outside of its jurisdiction, it acknowledges the request and sends it to the appropriate contractor, when known. If not known, it sends the request to the RO. Disclosure of information about unidentifiable individuals, or about provider or corporate entities (e.g., clinics or independent laboratories) is not to be disclosed by third parties to which information is disclosed for program purposes. B. Physician Fee and Supplier Charge Information Customary charges may be disclosed to the public. However, requests from anyone (including a physician or supplier) for actual data used to determine the customary charge(s) should be referred to the RO. A/B MACs (B) or DME MACs may voluntarily specify a physician's or supplier's customary charges when explaining reimbursement or when furnishing denial or review notices. The A/B MAC (B) or DME MAC may furnish a physician or supplier with a copy of their own customary charges free of charge; requests for customary charges from other sources will be subject to FOIA fees. However, anyone may inspect the customary charges free at the office of the A/B MAC (B) or DME MAC serving the locality for which the screens are used. A/B MACs (B) or DME MACs produce a printout to be made available for inspection and/or photocopying in their office. If past experience with requests for customary charge screens from the public does not warrant the expense of producing a printout of all screens for inspection (i.e., there have been few request and no one has requested to inspect all the screens), printout copies of single screens or small numbers of screens may be furnished instead of photocopies; however, there will be no charge for the computer time for the printout nor shall the requesters be asked to pay more than they would if they were to request a photocopy of the screens. Requests specifically for printouts or tapes shall be furnished at cost to related Federal programs (for example, to TRICARE or Medicaid). A/B MACs (B) or DME MACs may release information to the public regarding the method used to determine Medicare allowances, e.g., that the median of the charges made by physician for a service is used as the customary charge, and that the 75th percentile of such customary charges in an area (weighted by frequency of service) is used to establish the prevailing charge. Written requests for lists A/B MACs (B) or DME MACs do not have should be referred to the RO immediately by telephone so that RO can indicate whether the A/B MAC (B) or DME MAC should create a list. Such request might be for all the customary charge screens of internists in a given county or for a list of all physicians who charge a given amount or less for a certain procedure. If requesters orally ask to see a list, which does not exist, the A/B MAC (B) or DME MAC will offer them the opportunity to inspect the screens and create their own list. C. Disclosure of Related Entrepreneurial Information Information such as the specialty and business address of a physician or supplier may be disclosed to the public. The A/B MAC (B) or DME MAC will refer to the RO written requests for special lists, such as a list of five orthopedists in a given city. However, if the A/B MAC (B) has processed a list of all orthopedists in that city, it may, upon request, disclose the entire list. It may fulfill oral requests by offering the requester the opportunity to look at whatever disclosable records (e.g., customary charge screens) there are that contain the data (or to purchase photocopies of the data) or by referring the requester to the medical society or licensing board in the requester's area, if appropriate.

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) Upon request, an A/B MAC (B) or DME MAC may disclose to the public the fact that a provider no longer participates in the program. It will refer to the RO inquiries as to why a provider no longer participates in the program.

(Rev. 1, 09-11-02) CMS publishes the names of providers, physicians, other suppliers of services, or any other persons who have been found guilty by a Federal court of submitting false claims in connection with title XVIII. A/B MACs (B) or DME MACs will refer requests for such names to the RO for response.

(Rev. 1, 09-11-02) The DHHS Second Opinion Campaign has led to requests under the Freedom of Information Act for the list of physicians who have volunteered to accept referrals for second opinions. If a contractor has a list, it should disclose it upon request.

(Rev. 1, 09-11-02) A. Referral of Suspended Practitioners Section 1862(e)(2)(B) of the Social Security Act requires the Secretary to notify the appropriate State or local licensing authority (e.g., State licensing board or medical review board) whenever a physician or other practitioner has been suspended from participation in the Medicare program. Thus, whenever CMS suspends a practitioner from participation in the Medicare program because the practitioner has been convicted of a criminal offense related to participation in the title XVIII or XIX program, CMS will promptly notify the appropriate State or local licensing authority(ies) to (1) make appropriate investigations, (2) invoke any sanctions available under State law which the authority(ies) deems appropriate, and (3) keep CMS and the Inspector General fully and currently informed of any action it takes. B. Referral by Medicare A/B MACs (B) or DME MACs In addition to the referrals made by CMS under section 1862, Medicare A/B MACs (B) or DME MACs are authorized to refer title XVIII-related cases of apparent unethical practices or unprofessional conduct to medical or other professional societies, and State or local licensing authorities (licensing boards or medical review boards). (See the routine uses for the Medicare Carrier Claims Records system as described in the system notice published in the Federal Register. The web address for this information is: http://www.cms.gov/Research-Statistics-Data-and-Systems/Computer-Data-and- Systems/Privacy/PrivacyActof1974.html When considering a case for referral, the A/B MAC (B) or DME MAC should assure itself that substantial basis for referral exists; that more than mere suspicion is involved. It need not compile evidence sufficient to prove misconduct before referral; it should ascertain the probability and severity of misconduct and leave further investigation, review, and disciplinary action to the appropriate society or board. Isolated instances of questionable practices or conduct should not normally be referred. Further, referral of apparent unethical practices or a course of unprofessional conduct by a practitioner should be made only after proper professional advice has been obtained from the A/B MAC (B)'s physician staff members, medical consultants, or other professional advisors. Since State licensing boards and medical review boards are responsible for the licensing and sanctioning of practitioners, cases should be referred to those boards only where the apparent unethical practices or unprofessional conduct is of a severity to possibly warrant such sanctions; cases involving less severe improprieties should typically be referred only to professional or medical societies for action. The following are examples of cases that should be referred: 1. Over-utilization - This refers to a pattern of medical care which consists of providing more services than are medically necessary or which is not in accordance with acceptable medical practice (e.g., an inordinate number of office visits over an extended period of time for a chronic illness, a conspicuously high number of injections, excessive hospitalizations). Cases involving suspected over utilization should be reviewed by the A/B MAC (B) or DME MAC's physician staff. In cases where additional peer review is necessary, A/B MACs (B) or DME MACs may refer the case to a PRO. If the PRO servicing the area in question is not available to perform this type of review, the case should be reviewed by the medical society, medical consultants, or other professional advisors. 2. Mis-utilization - This involves the rendering of services that are not medically acceptable according to the standards of the community concerned. 3. Overcharging - This refers to the charging of fees by a physician, or other practitioner, that are not commensurate with the services rendered. Billing for amounts in addition to the deductible and coinsurance when assignment has been accepted also falls into this category. 4. Harmful Services or Pattern of Treatment - This involves the furnishing of services or a pattern of treatment that is harmful to the patient, or of a quality which does not meet professionally-recognized standards of care. 5. Violation of Ethics - These violations involve conduct of a physician or other practitioner that is contrary to the principles of ethics of the professional society to which the physician or other practitioner may belong, or which would make their practice a danger to the health and welfare of their patients or to the public. 6. Violation of the State's Professional Practice Statutes - This involves the committing of acts that, under the applicable State law, would be grounds for suspension or revocation of the physician's or practitioner's license to practice. These guidelines are not all inclusive; any activities by a physician, or other practitioner, in their treatment of program beneficiaries, which would warrant concern by professional societies or State or local licensing boards or medical review boards may be brought to their attention. When a A/B MAC (B) or DME MAC refers a case to a professional society or State or local licensing board or medical review board because of apparent unethical practices or unprofessional conduct by practitioners furnishing services to beneficiaries, the PI staff in the regional office should be concurrently notified of the referral. Notification should include copies of all materials referred to the professional society or State or local board, and should be followed by reports of significant case developments. Since such cases may involve program abuse by the practitioner, the RO should be notified as quickly as possible to permit remedial or sanction action if deemed appropriate. When a case is pending prosecution, or when a decision is pending on whether to proceed with prosecution, the contractor will delay referral to the professional society until: (l) the prosecution action is completed, (2) the decision is made not to prosecute, or (3) CMS authorizes the referral. C. Requests for Assistance by State or Local Licensing Boards, or State or Local Medical Review Boards While cooperation on the part of CMS ROs and A/B MACs (B) or DME MACs with State or local licensing/medical review boards is generally encouraged, there seems to be three distinct situations in which these boards might request assistance: 1. When a case has been referred to a State or local licensing/medical review board for investigation and possible sanctions (either by CMS as a result of the conviction and suspension of the subject practitioner, or by an A/B MAC (B) or DME MAC), it would seem appropriate for CMS and A/B MACs (B) or DME MACs to provide assistance to the board in its investigative activity, provided the demands on staff time and resources do not become burdensome or unreasonable. All requests for A/B MAC (B) or DME MAC assistance should, however be channeled through the servicing CMS RO for a determination regarding the reasonableness of the request. Appearance by CMS personnel before board meetings involving a case which has been previously referred would also be permitted. 2. When a State or local licensing board or medical review board requests information or assistance on a case which was self-initiated (i.e., not previously referred to the board by CMS or a Medicare A/B MAC (B) or DME MAC) as a result of a complaint, allegation, inquiry, etc., relative to a specific physician or practitioner's practices, this request should be treated as a Freedom of Information Act request. Therefore, any requested material should be screened for sensitive information, with the decision to release or withhold such information made on a case-by-case basis. Further, the board would be responsible for the costs involved in providing such information (searching costs, duplicating costs, etc.). In such instances, the appearance of CMS personnel at a board hearing would be discouraged. 3. When the State or local licensing board or medical review board's request is for general information pursuant to a study or investigation of physician or practitioner impropriety or abuse, and is not related to a complaint, allegation, etc., against a specific physician or practitioner; or when the request would represent a clearly unwarranted invasion of personal privacy, cooperation by CMS or contractor personnel would be discouraged. In such instances it would be appropriate to release general or statistical information that did not identify specific individuals; however, the request for identifying information would constitute an improper search for information.

Numerous statistics on individual providers are available to the public. They include, but are not limited to, the following: 1. Waiver of liability statistics; 2. Interim rate payment data; 3. Amount of Medicare reimbursement; 4. Overpayment data; 5. Data from the Provider Monitor Listing; 6. Information from the Directory of Medical Facilities and the Directory of Medicare Providers and Suppliers of Services; 7. Medicare statistics (e.g., total visits, number of starts of care,) 8. Presumptive waiver of liability status; 9. Information as to whether a provider participates in the Medicare program; and 10. Medicare inpatient statistics for inpatient facilities (e.g., total inpatient days, number of admissions, average length of stay).

(Rev. 1, 09-11-02)

(Rev. 1, 09-11-02) RCPs are available to the public at the RO servicing the contractor. The contractor will refer requests for RCPs to the RO for response. It will refer requests for an RCP of a multi-State contractor to the RO servicing the home office of the contractor. The contractor will refer requests for supporting documentation for the RCP contained in Contractor Performance Evaluation (CPE) reports to the RO.

(Rev. 1, 09-11-02) DHHS Audit Agency reports issued to Medicare contractors are available if requested, to members of the press and the public. The contractor will refer requests for DHHS Audit Agency reports directly to the Audit Agency, which is responsible for decisions regarding the release of these reports.

CMS and its agents may disclose statistical data and similar information that does not relate to any identifiable person or persons. However, they are not required to create records for requestors by compiling selected items from the files, nor are they required to create records to provide such data as ratios, proportions, percentages, per capitas, frequency distributions, trends, correlations or comparisons. They may, however, create such records when efficient administration permits. Final authority to determine when "efficient administration permits" rests with CMS. The contractor will refer requests for information, which can be created by hand, to the RO unless the requestor is willing to accept copies of the pages containing the data needed to compile the requested information (i.e., the requester is willing to do the necessary compilation). The contractor will refer requests for information, which must be created by machine (e.g., computer programs to manipulate data and print results), to the RO. CMS and the contractors have a joint obligation to ensure that the program is clearly and accurately represented and that the public is given a complete picture of program performance. There are certain problems in accurately representing program performance by means of statistical data alone, since some groupings of statistics are subject to inadvertent inaccuracies or are susceptible to misinterpretation. Careful judgment is, therefore, essential in presenting information on operating and payment activities.

(Rev. 1, 09-11-02) When considered appropriate, the contractor may release operating, payment, and cost data listed below without prior approval of the RO. The contractor will promptly forward to the RO a copy of information provided under this guideline. In releasing any data under this guideline, the contractor must insure that the data are related specifically to the geographical area for which the contractor is responsible. For example, if a press inquiry is clearly for the purpose of presenting program operating data for a geographical area beyond the jurisdiction of the contractor, and CMS has not made such data available for public release, the contractor will tell the requestor that it does not have the authority to release information beyond its operational jurisdiction. It will refer the request to the RO. (See §160ff of this chapter.) In releasing payment data, the contractor must indicate that the information refers only to the area it services and does not include payments to direct dealing providers, group practice prepayment plans, or railroad beneficiaries. If it is not clear whether information can be released under this guide, the contractor will resolve doubt in favor of obtaining prior clearance from the RO. The data released under this guideline should be based on the figures furnished to CMS in the monthly financial report and the monthly workload report. The administrative cost information should be the same as in the quarterly Operations Schedule-Cumulative Interim Expenditure Report. The following data, relating only to the contractor's title XVIII workload, may be released: • Benefit amounts paid by the contractor, including: o Aggregate amounts, or o Amounts broken out by category; e.g., inpatient hospital, outpatient hospital, etc., or o Amounts broken out by provider, including interim rates, and cost reports. (See also §140.1 of this chapter.) • Total number of bills or claims paid by the contractor, either as an aggregate or broken out by category. • Total number of bills processed. • Admission notices, by category, i.e. inpatient hospital, skilled nursing facility, home health agency. (Extreme caution must be exercised to assure that this statistic is properly related to the items shown above.) • Claims volume as an aggregate amount, or broken out by category. • Median claims processing time, by category. Processing time is derived by subtracting date of receipt from date of approval for payment using the dates shown on bills. • Any data determined from the data in items 1-6 above and related data available to the public (e.g., average payment per paid claims). • Total administrative cost. • Average (arithmetic mean) cost per bill or claim processed. • Number or percentage of claims requiring contact with providers for further development. • Contractor-completed CMS forms and reports listed chronologically by form number. Refer requests for CMS generated reports to the RO. o Form SSA-1522 (Monthly Workload Report) o Form SSA-1523 (Estimate of Administrative Costs and Credits) o Form SSA-1566 (Intermediary Workload Report) o Form SSA-1566 Supplement (1972 Amendment Supplement to Intermediary Workload Report) o Form SSA-1615 (Operations Schedule - Final Administrative Cost Proposal) o Form SSA-1822 (Monthly Provider Audit Activity Report-Schedule I) o Form SSA-1822A (Final Summary of Audits Completed During Quarter- Schedule II) o Form SSA-1822B (Costs Accrued During Quarter, Cumulative Costs by Contract and FY, Schedule III) o Form SSAz-2580 (Cost Classification Report) o Form CMS-2582 (Plan of Expenditures) o Form CMS-2598 (Budget Distribution) o Form CMS-3208 (Provider Audit Cost Report) o Form CMS-1527 (Operations Schedule - Cumulative Interim Expenditure Report and Budget) Release of the last form should be accompanied by a qualifying statement such as the following: "This report is based on preliminary data and is subject to adjustment by subsequent cumulative reports and a final cost proposal." Absent prior RO clearance, the contractor may release only the data listed above. A request for data not included in the above list may, in the contractor's judgment, require an immediate response. If so, the contractor may furnish general comments but cannot provide statistics. No further action need be taken on these requests unless the requestor asks for additional information. When additional information is requested, the contractor refers the request to the RO.

(Rev. 1, 09-11-02) The CMS regional office may authorize contractors to release the following information: • Total man-years (or man-quarters, etc.) employed per report period. • Man-hours per claim or bill processed. • Number of weeks' work on hand. • Denial rates. • Percent of claims or total payments involving reduction in charges. Data which contrast one contractor's performance with the performance of any other contractor, or which compare a contractor's performance with any set of national, regional, or other combined contractor performance data, may not be released by the contractor without prior RO approval. The contractor refers requests for such information to the RO. Generally, data of this type will be made available in periodic CMS releases when sufficient to permit valid statistical inferences. When the release of this kind of information is considered valuable for contractor or program public relation, telephone request and approval for contractor release may be appropriate. This section applies only to data compiled in the administration of the health insurance program. The contractor does not need prior RO approval to release, for example, compilations created by the Blue Cross Administration (BCA) or The National Association of Blue Shield Plans (NABSP). Data pertaining to more than one contractor or which compare contractor performance may be released only in proper perspective. Essentially, cost information alone is not an accurate indication of a contractor's performance and, therefore, is not to be publicized without other relevant data accompanying it; e.g., information pertaining to workload volume and processing time. Moreover, release should always be accompanied by an interpretive statement indicating the limitations of the data and the known variables; e.g., wage differentials. Requests which include a provider population beyond the jurisdiction of the contractor may involve data which have not been made available by CMS for public release. Requests for such combined data will be handled by the RO, which, if it approves the release, will furnish the requestor with the appropriate combined data and alert the contractors involved regarding the release.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. Records and information, acquired in the administration of the Medicare program, may be disclosed only under prescribed rules and regulations or under the authority of the Administrator of CMS. Information furnished specifically for purposes of a claim under the health insurance program is subject to these rules and regulations. These regulations apply to Governmental or private agencies that participate in program administration. These entities include the following: • Institutions; • Agencies; • Person(s) providing services; and • Providers of services. The type of information includes, but is not limited to, the following: • The individual's Medicare beneficiary identifier; • Facts regarding the individual's entitlement to health insurance benefits; and • Medical and other information obtained from CMS, a MAC (contractor). Information not subject to these rules and regulations includes information in the provider's own records, such as the following: • Name; • Date of Birth; • Sex; • Marital status; and • Address. A provider's own records are, however, subject to requirements listed in the "Conditions of Participation", that "Patient's records be kept confidential (20 CFR Part 405.126). These records may also be subject to State or local laws governing disclosure. Providers are also responsible for following conditions for coverage. A provider or supplier that receives a request for disclosure of information about a Medicare beneficiary, Medicare claim, or related information that it may not disclose, should refer the requestor to the appropriate contractor for further consideration of the request.

(Rev. 1, 09-11-02) Information such as Medicare entitlement or eligibility data may be disclosed to a beneficiary or their authorized representative (this includes the beneficiary's representative payee).

(Rev. 1, 09-11-02) Providers and suppliers may not forward medical information to contractors on a confidential basis, expressed, or implied, since, under the Privacy Act, any medical information obtained by a contractor is subject to disclosure to the individual to whom the information pertains or to another person authorized by the individual to have access to it. Some providers and suppliers document findings on medical forms pre-printed "confidential" or routinely stamp all records "confidential" whether or not such records are ever intended for disclosure to a contractor. The contractor will accept such records only if the provider or supplier accompanies them with a signed statement indicating the following: • That the provider or supplier understands the information is subject to disclosure to the patient under the Privacy Act, and • That any words or statements that the transmitted records are confidential may be disregarded if the patient or the patient's representative requests them from the contractor or from CMS.

(Rev. 1, 09-11-02) Disclosure by the provider or supplier to persons other than the individual or the individual's authorized representative of any records, reports, or other information about the individual is authorized without the individual's or their representative's consent under the following circumstances: The disclosure is required in connection with any claim or other proceeding under the Social Security Act for the proper performance of the duties of: • Any officer or employee of the Department; or • Any officer or employee of a State agency, A/B MAC (A or HHH), provider of services, or other agency or organization participating in the administration of the program, by contract or agreement, in carrying out such contract or agreement. These limitations apply whether or not the individual to whom the information pertains authorizes further disclosure to third parties (e.g., to a private medical plan).

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. Information obtained from CMS or its contractor is confidential and may be disclosed only under conditions prescribed in rules and regulations or on the express authorization of the Administrator of CMS. However, certain limited information about a beneficiary's Medicare eligibility status and related claims information may be released to third party payers with the beneficiary's express authorization. The following information may be released subject to necessary authorization: • Medicare beneficiary identifier; • Coinsurance and deductible status; • Dates of entitlement to Medicare; • Copies of Medicare claims forms; • Medicare report of eligibility; and • Explanation of Medicare Benefits (EOMB) or Medicare Summary Notice (MSN). Providers should refer requests for other information to the contractor. Contractors refer requests to the CMS regional office. The provider or supplier will adhere to the following authorization guidelines to ensure that information is not released without the required authorization. Authorization must: • Be in writing; • Be signed and dated by the individual or someone authorized to act on the individual's behalf; • Specify the name of the provider authorized to disclose information; • Specify what information the individual is authorizing the provider to disclose; • Specify the names of the third party payers to whom the information is being released; • Specify the purpose for which the information is being released; • Specify an expiration date for the authorization that should not exceed 2 years from the date it was signed; and • Specify that it may be revoked at any time.

(Rev. 1, 09-11-02) The law requires providers to observe more stringent rules when disclosing medical information for claims processing purposes from the records of alcohol and drug abuse patients. Since the standard consent statement on the provider billing form is not sufficient authority, under the law, to permit the provider to release information from the records of alcohol or drug abuse patients, more explicit consent statements are required. Providers that participate in Medicare and alcohol and drug abuse prevention and treatment programs must obtain written consent in each alcohol or drug abuse case from beneficiaries to release medical information. This written consent, which allows the provider to disclose the records of the patient, must include all of the following: • The name of the organization (e.g., hospital name) that is to make the disclosure; • The name or title of the person or organization to which disclosure is to be made (e.g., CMS, including the appropriate MAC, specified by name); • The name of the patient; • The purpose or need for the information to be disclosed (e.g., for processing a claim for Medicare payment and for such evaluation of the treatment program as is legally and administratively required in the overall conduct of the Medicare program); • The specific extent or nature of information to be disclosed (e.g., all medical records regarding the beneficiary's treatment, hospitalization, and/or outpatient care including treatment for drug abuse or alcoholism); • A statement that the beneficiary may revoke their consent at any time to prohibit disclosures on or after date or revocation; • A statement specifying a date (not to exceed 2 years), event, or condition upon which consent expires without revocation; • The date on which the consent is signed; and • The signature of the patient or the signature of their authorized or legal representative. If the beneficiary wishes, the consent statement may be expanded to permit disclosure by the provider to any other person, organization, or program (e.g., PRO), as appropriate. Providers may also give authorization to CMS and its contractors to re-disclose specific information to third party payers for complementary insurance purposes. The provider keeps the consent statement with the patient's medical and other records. The duration of the consent statement is not to exceed 2 years after which it must be renewed by the beneficiary if further disclosures are necessary.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. A. General Section 4311 of the Balanced Budget Act of 1997 requires that if a Medicare beneficiary submits a written request to a health services provider for an itemized statement for any Medicare item or service provided to that beneficiary, the provider must furnish this statement within 30 days of the request. The law also states that a health services provider not furnishing this itemized statement may be subject to a civil monetary penalty of up to $100 for each unfulfilled request. Since most institutional health practices have established an itemized billing system for internal accounting procedures as well as for billing other payers, the furnishing of an itemized statement should not pose any significant additional burden. B. 30-Day Period to Furnish Statement The provider will furnish to the individual described above, or duly authorized representative, no later than 30 days after receipt of the request, an itemized statement describing each item or service provided to the individual requesting the itemized statement. C. Suggested Contents of Itemized Statement Although §4311 of the Balanced Budget Act of 1997 does not specify the contents of an itemized statement, suggestions for the types of information that might be helpful for a beneficiary to receive on any statement include: beneficiary name, date(s) of service, description of item or service furnished, number of units furnished, provider charges, and an internal reference or tracking number. If Medicare has adjudicated the claim, additional information the provider can include are: amounts paid by Medicare, beneficiary responsibility for co-insurance, and Medicare beneficiary identifier. The statement should also include a name and telephone number for the beneficiary to call if there are further questions. D. Penalty A knowing failure to furnish the itemized statement shall be subject to a civil monetary penalty of up to $100 for each such failure.

(Rev. 1, 09-11-02) Providers are required to pay appropriate fees for information they request pertaining to other providers, Medicare contractors, or State agencies. A provider may claim such fees as allowable costs only if it demonstrates to the contractor the information is necessary in developing and maintaining the operations of patient care facilities and activities.

(Rev. 7, 06-25-04) A. General Information To improve the efficiency and effectiveness of the health care system, HIPAA included provisions that required national standards for electronic health care transactions. At the same time, Congress recognized that advances in electronic technology could erode the privacy of health information. Consequently, Congress incorporated into HIPAA provisions that mandated the adoption of Federal privacy protections for individually identifiable health information. The Department of Health and Human Services issued the regulation “Standards for Privacy of Individually Identifiable Health Information”, 45 CFR Parts 160 and 164, (the HIPAA Privacy Rule) to implement section 264 of HIPAA. The HIPAA Privacy Rule establishes a set of basic national privacy standards and fair information practices. It sets a floor of ground rules for health care providers, health plans, and health care clearinghouses to follow to protect the privacy of an individual’s personal health information. The HIPAA Privacy Rule is based on the same fair information principles that are found in the Privacy Act of 1974 and are now generally extended to the public and private sectors of the health care delivery system. The HIPAA Privacy Rule applies to protected health information (PHI) held by covered entities, as defined by the Rule, while the Privacy Act protects records with individually identifiable information held by Federal agencies. The Privacy Act continues to apply to Medicare and Medicare fee-for-service (FFS) contractors in their day-to-day operations. The Department of Health and Human Services (HHS) Office for Civil Rights (OCR) is responsible for providing outreach and technical assistance to covered entities (health plans, health care clearinghouses, and health care providers who conduct certain financial and administrative transactions electronically) and for enforcing the HIPAA Privacy Rule. OCR maintains information on the HIPAA Privacy Rule at http://www.hhs.gov/ocr/hipaa/ B. How CMS Applies Laws Affecting the use and Disclosure of Personal Information 1. General rules Since Medicare operates under both the Privacy Act and the HIPAA Privacy Rule, CMS has determined how the provisions interact with each other as it uses personally identifiable information in its day-to-day operations. For example, a use or disclosure that is permitted under the HIPAA Privacy Rule (e.g., to facilitate cadaveric organ donation and transplants), but not published in a Federal Register notice as a routine use in a CMS system of records would not be permitted for Medicare. Similarly, if the disclosure is a “routine use” under the Privacy Act, but the HIPAA Privacy Rule prohibits the disclosure, CMS will not make the disclosure. Exemption 6 of the Freedom of Information Act (FOIA) permits Federal agencies to withhold personnel and medical files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy. When a FOIA request asks for documents that include personal information, CMS must apply Exemption 6 to preclude the release of, or must otherwise redact, identifying details before disclosing the remaining information. 2. Information About Deceased Individuals The application of Exemption 6 of the FOIA to information about deceased individuals requires a different analysis than that applicable to living individuals because under the Privacy Act of 1974, privacy rights are extinguished at death. However, under FOIA, it is entirely appropriate to consider the privacy interest of a decedent’s survivors under Exemption 6. Under the HIPAA Privacy Rule, the personal health information of deceased as well as living persons is protected. 3. Requests for Access to Records The FOIA and Privacy Act requests will continue to be handled according to current procedures and timeliness standards. A FOIA request for access to public records requires CMS, as a Federal agency, to provide the fullest possible disclosure of its records to the public, subject to certain exceptions (e.g., proprietary information, national defense risks). The Privacy Act requires CMS to provide individuals access to their personal information maintained in a System of Records. Note that an individual’s request under the Privacy Act to access his or her records must specify a Privacy Act System of Records and must be addressed to the system manager identified in the Federal Register notice. A HIPAA Privacy Rule request for access is separate from both FOIA and the Privacy Act and has its own timeliness standards associated with it. Requests for access under the HIPAA Privacy Rule will be handled by CMS’ Central Office (see section G below). 4. State Law Preemption Under HIPAA Medicare is a national program that is administered under Federal statute and regulation. CMS administers Medicare through Medicare FFS contractors that are required to operate in accordance with statutory and regulatory requirements and CMS administrative direction. When considering the provisions of HIPAA, Congress expressly intended to defer to more stringent state laws if those laws conflict with provisions in the HIPAA Privacy Rule. The HIPAA Privacy Rule therefore explicitly preempts conflicting state law provisions, unless they are more stringent or more protective of the individual’s rights. Since the Federal law expressly preserves more stringent state laws, and because of the complexity of this issue, contractors should ask CMS for guidance as issues arise. C. CMS Programs that are Covered Entities Under HIPAA The Federal health programs that CMS administers are health plans as defined in HIPAA and are covered entities subject to the HIPAA Privacy Rule. These health plans are: • Part A or Part B of the Medicare program under Title XVIII; • The Medicaid program under Title XIX; • The State Children’s Health Insurance Program (SCHIP); and • The Medicare Advantage (formerly Medicare+Choice (M+C)) program and other Medicare health plans. The CMS is directly responsible for ensuring that the Medicare Fee-For-Service (FFS) program, also known as the Original Medicare Plan, complies with the HIPAA Privacy Rule. For the Medicaid and SCHIP programs, the appropriate State Agency is responsible for ensuring compliance with privacy requirements. Medicare Advantage (formerly M+C) plans are covered entities subject to the HIPAA Privacy Rule in their own right and responsible for their own compliance. D. Business Associates Most health care providers and health plans do not carry out all of their health care activities and functions by themselves; they require assistance from a variety of contractors and other businesses. By definition, a business associate is a person or entity that performs or assists in the performance of a function or activity involving the use or disclosure of individually identifiable health information on behalf of a covered entity. Medicare FFS contractors that perform health care activities involving the use of PHI on behalf of the Medicare FFS health plan (i.e., claims processing functions) are business associates of the Medicare FFS health plan (the covered entity). The HIPAA Privacy Rule allows providers and plans to give PHI to their business associates as long as they have satisfactory assurances and document those assurances, typically by contract, that business associates will safeguard the information. Medicare contracts have been modified to include the business associate provisions. These provisions also address the contractor’s responsibility to ensure that subcontractors or agents to whom they disclose Medicare data agree, by contract, to safeguard any PHI as well. Contracts continue to include language that applies to contractors who maintain or operate a Privacy Act protected systems of records on Medicare’s behalf. Medicare contractors that perform health care activities involving the use of PHI on behalf of the Medicare FFS health plan are not business associates of providers, physicians, suppliers, clearinghouses, or other health plans. Likewise, providers, physicians, suppliers, clearinghouses, or other health plans are not business associates of the Medicare contractor unless the provider, physician, supplier, clearinghouse, or other health plan is doing work on behalf of the Medicare contractor. For these reasons, Medicare FFS contractors should not sign business associate agreements with any provider, physician, supplier, clearinghouse, or other plan unless the provider, physician, supplier, clearinghouse, or other health plan is doing work on the contractor’s behalf. E. Trading Partner Agreements Currently, Medicare contractors execute trading partner agreements (TPAs) with a number of payers, including Medigap insurers, Medicare supplemental/employee retiree health plans, multiple employer welfare trusts, TRICARE for Life, as well as State Medicaid Agencies, for the purpose of exchanging adjudicated Medicare claims for secondary liability determination by those partners. This exchange of data is commonly referred to as the “claims crossover process.” For coordination of benefits (COB) purposes, Medicare contractors and trading partners are not business associates of each other since neither entity is doing work on the other’s behalf; therefore, MACs should not sign business associate agreements with COB trading partners that receive claims crossover data from them. F. Notice of Privacy Practices The HIPAA Privacy Rule requires each covered entity to develop and provide a plain language notice that describes its legal duties, the uses and disclosures of protected health information that it may make, and individual privacy rights and how to exercise them. The individual rights include the right to inspect and copy protected health information, to amend protected health information, to request restrictions, confidential communications, an accounting of disclosures, a paper copy of the privacy notice, and how to file complaints. Medicare’s privacy notice was provided to beneficiaries for the first time in the 2003 Medicare & You handbook and is provided in the handbook every year. New enrollees receive the privacy notice in the handbook that is mailed to them within 30 days of Medicare entitlement. Medicare’s privacy notice is also posted on Medicare’s Web site at www.medicare.gov. Medicare’s Notice of Privacy Practices informs beneficiaries who are interested in exercising individual rights to go to www.medicare.gov or call 1-800-MEDICARE. Customer Service Representatives (CSR) at 1-800-MEDICARE use scripts to answer questions regarding exercising individual rights and filing complaints. Since Medicare’s privacy notice describes the uses and disclosures of PHI in the day-to- day operations of Medicare (including Medicare FFS contractors), FFS contractors are not required to develop a separate privacy notice for Medicare beneficiaries. G. Individual Rights and Complaints NOTE: For Individual Rights Under the Privacy Act of 1974, see §10 above. The HIPAA Privacy Rule gives individuals rights with respect to their PHI. These rights are listed in covered entities’ privacy notices. The Notice of Privacy Practices for the Original Medicare Plan includes the right to: 1. See and get a copy of personal health information held by Medicare. CMS Central Office is responsible for responding to beneficiary requests for access to records under the HIPAA Privacy Rule. Medicare FFS contractors should only respond to those requests for information related to payment of a claim, for which they are already responsible under the contract under existing customer service procedures. Simple telephone inquiries, such as asking about the status of a claim or requesting a duplicate Medicare Summary Notice, are not considered a HIPAA request for access and should be handled under existing customer service procedures. 2. Have personal health information amended if it is wrong or missing, and Medicare agrees. If Medicare disagrees, a statement of disagreement may be added to the personal health information. Central office is responsible for handling beneficiary requests to amend the record under the HIPAA Privacy Rule. Contractors will not be responding to requests to amend records. Requests for changes to claims or payment records, such as an appeal or change of address request, are not considered HIPAA Privacy Rule requests for amendments, and should be handled according to current procedures. Note, however, that if the request for amendment involves medical records, contractors should explain that, except in rare circumstances, only the source of the medical record (i.e., the provider) may make changes to the record. 3. Get a listing of those receiving personal medical information from Medicare. CMS Central Office is responsible for responding to beneficiary requests for an accounting of disclosures under the HIPAA Privacy Rule. Contractors will not be responding to requests for an accounting of disclosures. The listing does not cover personal health information that was given to the individual or his or her personal representative, that was given out to pay for health care or Medicare operations, or that was given out for law enforcement purposes. 4. Ask Medicare to communicate in a different manner or at a different place, for example, by sending materials to a P.O. box instead of the address on file. Current regulations and existing agreements with the Social Security Administration are extremely prescriptive, often governing precisely how CMS can respond to requests for confidential communications. Operationally, CMS can only maintain one address at a time. Because of this, routine change of address requests should be handled according to current change of address procedures. 5. Ask Medicare to limit how personal health information is used and given out to pay claims and run the Medicare program. CMS Central Office is responsible for responding to beneficiary requests to restrict disclosure of PHI. Contractors will not be responding to requests to restrict disclosure of PHI. 6. Get a separate paper copy of the privacy notice. Contractors who receive requests for a paper copy of the Notice of Privacy Practices for the Original Medicare Plan should refer requestors to their Medicare & You handbook. 7. File a complaint. Medicare’s Notice of Privacy Practices informs individuals of the right to file complaints about Medicare’s privacy practices with either Medicare or the Secretary of Health and Human Services. The privacy notice refers individuals to www.medicare.gov or 1-800-MEDICARE for further information on filing a complaint. CMS is required to document in written or electronic form the complaints received and their disposition. There is no requirement to respond in a particular manner or time frame. For the privacy rights listed above where CMS Central Office is responsible for responding to the request, contractors should advise beneficiaries to address their requests to: HIPAA Privacy P.O. Box 8050 U.S. Department of Health and Human Services Centers for Medicare & Medicaid Services 7500 Security Boulevard Baltimore, MD 21244-1850 H. Privacy Authorizations An authorization is a document that an individual uses to give a covered entity permission to disclose his or her PHI for a particular purpose (e.g., for marketing) or to a third party specified by the individual. A covered entity is generally not required to obtain an authorization for the use or disclosure of PHI for treatment, payment, or health care operations, as well as for certain public priority activities under specified conditions (e.g., health care oversight, law enforcement). Contractors should inform providers that contractors are unable to make payment for Medicare claims if the provider fails to provide the information needed to process them. The HIPAA Privacy Rule specifies certain core elements and required statements for a valid authorization. Contractors may add more elements to their authorizations as long as the core elements and required statements remain and no provisions are added that conflict with these core elements and statements. Contractors must also accept an authorization from another entity, provided it includes all of the core elements and required statements, and no provisions are added that conflict with these core elements and statements. I. Core Elements and Required Statements for an Authorization The core elements of a valid authorization are: 1. A description of the information to be used or disclosed that identifies the information in a specific and meaningful fashion; 2. The name or other specific identification of the person(s), or class of persons, authorized to make the requested use or disclosure; 3. The name or other specific identification of the person(s) or class of persons, to whom the covered entity may make the requested use or disclosure; 4. A description of each purpose of the requested use or disclosure. The statement, “at the request of the individual” is a sufficient description of the purpose when the beneficiary initiates the authorization and does not, or elects not to, provide a statement of the purpose; 5. An expiration date or an expiration event that relates to the individual or the purpose of the use or disclosure; and 6. The signature of the individual and date. If a personal representative of the individual signs the authorization, a description of such representative’s authority to act for the individual must also be provided. Although the HIPAA Privacy Rule requires only a description of the representative’s authority to act for the individual, CMS is requiring that documentation showing the representative’s authority be attached to the authorization (e.g., a Power of Attorney). In addition to the core elements, the authorization must contain statements adequate to place the individual on notice of all of the following: 1. The individual’s right to revoke the authorization in writing, how the individual may revoke the authorization, and the exceptions to the right to revoke, e.g., “You have the right to take back (“revoke”) your authorization at any time in writing, except to the extent that Medicare has already acted based on your permission. To revoke your authorization, send a written request to: [Each Medicare contractor or CMS: Please insert Name, Address, and Telephone number of your organization here]”; 2. The inability to condition treatment, payment, enrollment or eligibility for benefits on the authorization, e.g., “I understand refusal to authorize disclosure of my personal medical information will have no effect on my enrollment, eligibility for benefits, or the amount Medicare pays for the health services I receive”; 3. The potential for information disclosed pursuant to the authorization to be subject to redisclosure by the recipient and no longer protected, e.g.: “Your personal medical information that you authorize Medicare to disclose may be subject to redisclosure and no longer protected by law.” In addition, the authorization must be written in plain language and a signed copy must be provided to the individual (or the individual should be advised to retain a copy). The CMS is developing a standard authorization for beneficiaries or their personal representatives to request disclosure of PHI to third parties. The standard will contain the elements for compliance with both the HIPAA Privacy Rule and Privacy Act requirements. Contractors will be notified when the standard authorization is available. J. Personal Representatives and Third Party Authorizations The HIPAA Privacy Rule requires covered entities to treat an individual’s personal representative as the individual with respect to uses and disclosures of the individual’s PHI, as well as exercising the individual’s privacy rights listed in the covered entity’s Notice of Privacy Practices. A personal representative may also authorize disclosures of an individual’s PHI (see §190H above). In addition to these formal designations of a personal representative, the HIPAA Privacy Rule permits a covered entity to disclose to any person identified by the individual the protected health information directly relevant to such person’s involvement with the individual’s care or payment related to the individual’s care. Therefore, a verbal authorization is allowed under the HIPAA Privacy Rule for those individuals involved in the care of an individual. Contractors should continue to handle routine inquiries, such as telephone requests for the status of claims, under existing customer service procedures that include verification of the individual’s identity. Therefore, with the beneficiary’s verbal or written permission, contractors may continue to speak to third parties on behalf of the individual. See Exhibit D - Disclosure Desk Reference Guide for Call Centers for detailed instructions on disclosing PHI over the telephone. Contractors may also continue to handle Congressional inquiries under existing customer service procedures (see §10J above). K. Administrative Requirements As Medicare’s business associate, contractors are not subject to the administrative requirements of the HIPAA Privacy Rule. However, under the Privacy Act, contractors must comply with the privacy provisions specified in their contracts. Contractors are not required to designate a privacy official. However, contractors are required to have in place a senior official or other responsible party to address the privacy concerns of the organization and to establish an internal control system to monitor compliance with privacy requirements. Similarly, as Medicare’s business associate, contractors are not subject to the HIPAA Privacy Rule’s requirement to train staff specifically on the HIPAA Privacy Rule. However, under the Privacy Act, contractors are required to ensure that employees understand their responsibility to protect the privacy and confidentiality of CMS’s records. It is CMS policy that any data collected on behalf of CMS in the administration of a Medicare contract belongs to CMS. Any disclosure of individually identifiable information without prior consent from the individual to whom the information pertains, or without statutory or contract authorization, requires prior approval by CMS.

(Rev. 21, Issued: 04-29-05; Effective: 10-01-05; Implementation: 10-03-05) Contractors (A/B MACS (A and B), A/B MACs (HHH) and DME MACs) shall stop printing the Medicare Number on reimbursement checks to Medicare beneficiaries. Reimbursement checks going to Medicare beneficiaries are subject to others (e.g. banks) seeing the Medicare Number. CMS has determined that there is no business reason for the Medicare Number to be printed on the reimbursement check to the beneficiary. Therefore, CMS is directing Medicare contractors to stop printing the Medicare Number on reimbursement checks to Medicare beneficiaries. This change in policy does not affect the use of the Medicare Number by Medicare contractors. The Medicare program uses the Medicare Number to meet administrative responsibilities to pay for health care and to operate the Medicare program. In performance of these duties, Medicare is required to protect individual privacy and confidentiality in accordance with applicable laws, including the Privacy Act of 1974 and the Privacy Rule of the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Exhibit A - Freedom of Information Act Request Exhibit B - Summary Sheet for the CMS Monthly FOIA Report MAC/CENTRAL OFFICE COMPONENT SUMMARY SHEET FOR THE CMS MONTHLY FOIA REPORTS Data on this Summary Sheet is a summation of the data from all Forms CMS-632-FOI completed during the month. INSTRUCTIONS 1. Enter the month and year that this summary sheet covers. 2. Enter, in the applicable space, appropriate identifying information concerning your unit. 3. Enter the total number of 632s completed during the identified month. 4. Enter the number of times the 632s showed a request was closed by the cited action. 5. Enter the total of all staff hours used during the identified month. Use only whole numbers and fractions or decimals, e.g., 102 1/2 or 102.25, not 102 hours and fifteen minutes. 6. Enter the total of actual cost figures, based on the salaries of the staff involved. 7. Enter the total of copying charges. 8. Enter the mailing/postage costs. 9. Enter the total dollar amount of fees charged. This figure is not the same as actual costs. 10. Enter the total of all fees waived. (Unless the FOI Office, CMS has granted a waiver, this figure is a compilation of all fees which were waived because they were lower than CMS' $15.00 threshold). 11. Enter the name, office and address of the person who completed this summary sheet. 12. Enter the date the summary sheet was completed. PLEASE FILL OUT COMPLETELY 1. Month: ________________ Year: __________ MAC: __________________________________________________ CENTRAL OFFICE COMPONENT: _____________________________________________ Total 632s: _________________ Actions: ___________ Direct Reply (Records Sent) _____________ No Records Found ___________ Request Withdrawn _____________ Not FOIA ___________ Records Not Reasonably Described _____________ Subpoena Denial ___________ Fee Related Closure _____________ Other Staff Hours: ___________ Staff Charges: ____________ Copy Charges: ____________ Postage: ____________ Fees Charged: ____________ Fees Waived: ____________ Name/Phone: ____________________________________________ Office: _________________________________________________ Address: ________________________________________________ Date: __________ Exhibit C - Invoice of Fees for FOIA Services Exhibit E - “Medicare Authorization to Disclose Personal Health Information” form and “Information to Help You Fill Out the Medicare Authorization to Disclose Personal Health Information Form” Transmittals Issued for this Chapter Rev # Issue date Subject Impl date CR# R124GI 05/17/2019 Update to Publication (Pub.) 100-01 to Provide Language-Only Changes for the New Medicare Card Project 06/18/2019 11240 R123GI 05/10/2019 Updates to Publication (Pub.) 100-01, Medicare General Information, Eligibility, and Entitlement, Chapter 6, Disclosure of Information 06/11/2019 11218 R21GI 04/29/2005 Removal of Medicare Number from Reimbursement Checks 10/03/2005 3760 R07GI 06/25/2004 HIPAA Privacy Rules N/A 2484 R01MGI 09/11/2002 Initial Publication of Manual NA NA Back to top of Chapter

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06)

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Subject to the provisions of the Code of Federal Regulations, Title 41, Part 102 - Creation, Maintenance and Use of Records, http://www.access.gpo.gov/nara/cfr/waisidx_05/41cfr102- 193_05.html CMS has the responsibility for the development and implementation of standards and programs for the economical management of records under the health insurance program. Specifically, CMS is required to provide for effective controls over the creation of records, including the making of records containing adequate and proper documentation of the contractor's administration and operations. Each contractor is required to establish and maintain an active, continuing program for the economical and efficient management of the records outlined in §30.20. The contractor's programs must provide for: • Effective controls over the creation, the organization, maintenance and use, and disposition of all CMS health insurance claims and non-claims records; and • Development and application of standards, procedures, and techniques designed to assure the maintenance and security of records of continuing value and facilitate the disposal of all records of temporary value. The contractor provides for the continued analysis and improvement of record classification and indexing systems, the use of filing equipment and supplies, and the reproduction and transportation of records. The contractor assures that records are maintained economically and efficiently for maximum usefulness. The files established by the contractor, and all records and procedures documenting its programs for controlling the creation, maintenance, and use of current records, for the selective retention of records of continuing value, and for the disposal of noncurrent records, must be available for periodic review by CMS. Under no circumstances are any records identified by CMS as relating to a current investigation or litigation/negotiation by the Office of the Inspector General or the Department of Justice, ongoing Workers’ Compensation, set aside arrangements, or documents which prompt suspicions of fraud and abuse of overutilization of services to be destroyed. These records must be retained until you receive authorization from CMS.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) A. Claims Records These are Government records including Government-issued standard forms and other forms, documents, and statements needed to support claims. Such records are maintained by the contractor in accordance with instructions regarding retention, transfer, destruction, and other disposition of claims materials. (See §§30.30 and 30.40.) B. Non-Claims Records These include materials not needed as supporting documentation of a claim, such as used work sheets, extra copies of documents, retained CMS bill copies where records were submitted on tape, used punched cards, EDP listings, used paper tape, and general correspondence not related to specific pending or processed claims. See §30.30 for the records retention and disposal schedule and §30.70 for the disposition of such material. C. Fiscal and Administrative Records These include records that are not included as claims or non-claims records. See §30.70 for the records retention and disposal schedule. D. Microform Records This is a term used for any form containing micro-images (e.g., microfilm, microfiche). If records are microfilmed, the original records must still be retained. E. Scanned/Imaged Records This is a term used for any information that is recorded in a form that only a computer can process. This is the preferred format when paper records are not retained. The image becomes the “official record/recordkeeping copy” which must be retained in accordance with directives from CMS.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Records are basically files consisting of papers, folders, photographs, photographic copies, magnetic tapes, or other recorded information regardless of physical form or characteristics, accumulated or maintained in filing equipment, boxes, disks, CDs or shelves, and occupying office or storage space. Stocks of publications and blank forms are not included in this definition.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. Adequate records management controls over the creation of contractor files must insure that important policies and decision are adequately recorded, routine operational paper work is kept to a minimum, and the accumulation of unnecessary files is prevented. Effective techniques in this area include the application of systems for the control of correspondence and forms, the minimizing of duplicate files, and the disposal without filing of transitory material that has no value for record purposes. CMS expects each contractor to establish an appropriate program for the management of its files. The following actions are generally basic to such a files management program. A. Standardize classification and filing schemes to: 1. Achieve maximum uniformity and ease in maintaining and using program records; 2. Facilitate disposal of records in accordance with applicable records disposal schedules; and 3. Facilitate possible later consolidation of identical type files presently maintained at different locations. B. Formally authorize official file locations. Prohibit the maintenance of files at other than authorized locations. C. Standardize reference service procedures to facilitate the finding, charge-out, and refiling of records. D. File accumulations of papers received at file locations on a daily basis. E. Audit periodically a representative sample of the files for duplication, misclassification, or misfiles. In addition to the above, the contractor's program must: 1. Establish and implement standards and procedures issued by CMS. Such CMS standards and procedures relate to: a. Classifying, indexing, and filing records; b. Providing reference services to filed records; c. Locating active files to facilitate use of the records; and d. Reviewing the program periodically to determine the adequacy of the system and its effectiveness in meeting requests. 2. Ensure that the standards, guides, and instructions developed for the files management program are readily available to all employees concerned with the files operations. In addition, give pertinent information for users of files and references services the widest possible dissemination. 3. File accumulations of papers received at file locations on a daily basis. 4. Audit periodically a representative sample of the files for duplications, misclassification, or misfiles. The methods used in maintaining, using, and disposing of these files vary with the contractor. Variations depend on the filing and control methods established (e.g., provider number, Medicare beneficiary identifier, date, name, or other sequence) to record requests from providers; to furnish replies; to check on overdue cases; to control cases for completion of processing; to control cases requiring some type of investigation or additional documentation; to retain completed cases for history or other reference; to maintain for audits; and to schedule for transfer to other storage areas. Other variances may be due to computer or clerical practices; workload volume; review initiated at time of notice of admission, at time of start of care, at time of request for advance payment or at time of receipt of billing form; and other considerations.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) This schedule identifies those records accumulated by the contractor in administering the Medicare program and outlines the disposal schedule for each type of record. A freeze has been imposed on the destruction of Medicare records. No paper Medicare records can be destroyed unless they are electronically imaged. If Medicare records are not imaged, the original paper document must be retained. A contractor who images paper Medicare records: A. Must always be able to demonstrate the imaged version is an exact copy of the paper document, B. Document the steps taken to image the original document, C. Establish and implement a certification/quality assurance process to ensure the imaged information is an identical replication of the paper document in every way, D. Retain the scanned image as the “recordkeeping copy” for the required retention period, and E. Maintain accessibility and the ability to read the document in accordance with changes in technology. The methods used in imaging files may vary with the contractor. These variations depend on the type of equipment used and methods used to prepare documents for imaging. All imaged documents shall be tamper proof. Once an image is verified as an exact copy of the original paper document, only then can the original paper document be destroyed and the imaged copy is certified as the “recordkeeping copy”. Certifying images as an exact copy of the paper document means there is a "quality assurance" process in place that verifies that the images are good. Each contractor is responsible for establishing their own "quality assurance" procedures. Below is an example of a certification/quality assurance process. 1. The staff member performing the actual scan will: a. Observe that all pages successfully pass through scanner and that image displayed on the imaging software preview screen appear accurate. b. Affix a sticker marked “Scanned” to the top page, write the current date on the sticker and place on top of a pile of scanned material. 2. The staff member(s) responsible for these records will have immediate access to the images, from their desktops, using the imaging software. They will have 30 days to use and review the images. If any problem is detected, the paper will be retrieved and rescanned. After 30 days, the paper copies are subject to proper disposal. A contractor is authorized to cut off and transfer Medicare claims records and other records to inactive storage earlier than is prescribed in the disposal schedule shown below when the records are contained on microform. (See §§40.3 and .50ff. for guidelines on retention and disposition guidelines on microform copies of the following records.) The term "cut off" means the transfer of records to an inactive files area when there is no more than one reference to a file drawer per month. See §§30.70 for guidelines regarding the disposition of non-claims material not transferred to inactive storage.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) In accordance with Federal regulations, 36 CFR 1228.58(b)-Destruction of Temporary Records, http://www.access.gpo.gov/nara/cfr/waisidx_05/36cfr1228_05.html paper records to be disposed of normally must be sold as wastepaper. Because the records you maintain are considered restricted, you are required to pulp, macerate, shred, or otherwise definitely destroy the information contained in the records and their destruction must be witnessed by you who created the records or by a contractor employee (see Exhibit 11, Witness Disposal Certification-Sample). The contract for sale must prohibit the resale of all other paper records for use as records or documents. Regardless of medium, records other than paper records (e.g., audio, visual, data tapes, disks, diskettes, etc.) may be salvaged and sold in the same manner and under the same conditions as paper records. A Witness Disposal Certification must be completed and kept on file for 7 years.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) When operating under a freeze, you are prohibited from destroying records, and must follow the disposition instructions below in §30.30.1.2. Only after the freeze has been lifted, can you revert back to the normal disposition instructions in §30.30.2.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Paper Records All paper claims that are microfilmed must be retained until CMS notifies you the freeze is lifted. Microform Records The master microform must be retained until CMS notifies you the freeze is lifted.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) The contractor cuts off the file at the close of the calendar year in which the claim was paid, then transfers the paper records to inactive storage. The paper records must be retained until CMS notifies you the freeze is lifted.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Paper Since imaging can be used to replace paper documents, only when the image will be identical to the paper, you must image/scan both the front and the back of every document. There is an exception: Once the back of a claim form is imaged, you do not have to image the back of the rest of the documents imaged on that particular machine, as long as the backs are identical and a certified statement is kept on file stating “the remainder of the backs of the claim forms are identical”. However, if the back of a claim form differs in any respect, it must be imaged. The contractor must retain the paper records until their certification/quality assurance process (see below) has been completed and the imaged information (the recordkeeping copy) is verified as an identical replication of the paper document. Only then can the paper records be destroyed. If a scanned document is not identical to the paper document, that paper document must be retained until the freeze is lifted. Imaged/Scanned Records Due to the freeze prohibiting the destruction of Medicare records, do not destroy any images of claims records. They are the recordkeeping copy and must be retained until CMS notifies you the freeze is lifted. Once the freeze is lifted, revert back to the normal disposition instructions in §30.30.2. Sample Quality Assurance Procedure Certifying images as an exact replication of the paper document means there is a "quality assurance" process in place that verifies that the images are good. Each contractor is responsible for establishing their own "quality assurance" procedures. Below is an example of a quality assurance process. Standard Procedures for Document Imaging Quality Assurance 1. The staff member(s) performing the actual scan will: a. Observe that all pages successfully pass through scanner and that image displayed on the imaging software preview screen appear accurate. b. Affix a sticker marked “Scanned” to the top page, write the current date on the sticker and place on top of a pile of scanned material. 2. The staff member(s) responsible for these records will have immediate access to the images, from their desktops, using the imaging software. They will have 30 days to use and review the images. If any problem is detected, the paper will be retrieved and rescanned. After 30 days, the paper copies are subject to proper disposal.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) When potential fraud or overutilization has been identified, retain the recordkeeping copy onsite. If the recordkeeping copy has already been transferred to offsite storage, retrieve and retain onsite until the investigation and subsequent legal action, if any, has been completed (including the exhaustion of all appeals), then destroy 3 months thereafter. If at the close of this period, the disposition instructions shown in §30.30.1.1 through 30.30.2 remains applicable, retain, transfer, and destroy in accordance with the disposition instructions. If the disposition instructions in §30.30.1.1 through 30.30.2 are no longer applicable, then destroy after the 3 month period following completion of the investigation or subsequent legal action, if any. If any records are provided to a prosecutorial agency as evidentiary matter, consider such records as disposed of. If any such record is returned by the prosecutorial agency, retain for 3 months, then destroy in accordance with the foregoing disposition instructions unless otherwise directed by the prosecutorial agency.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. 1. Medicare Claims Records: A. A/B MAC (A) or (HHH) Billing Records (FROZEN - DO NOT DESTROY) These files consist of Inpatient and/or Outpatient Billing forms, and other documents used to bill for services processed by A/B MACs (A) or (HHH) i.e., inpatient hospital, outpatient hospital, SNF, hospice, home health, etc. DISPOSITION: Once the freeze is lifted, cutoff at the close of the CY in which paid. Destroy 6 years and 3 months after cutoff. B. A/B MAC (B) or DME MAC Billing Records (FROZEN - DO NOT DESTROY) These files consist of Requests for Payment and similar forms. Also included are itemized bills, correspondence (including correspondence with district offices), and comparable documents used to support payment to beneficiaries, physicians, and other suppliers of services under the Supplemental Medical Insurance (SMI) Program. DISPOSITION: Once the freeze is lifted, cutoff at the close of the CY in which paid. Destroy 6 years and 3 months after cutoff. 2. Medicare Benefit Check Records (FROZEN - DO NOT DESTROY) These files consist of paid checks that contractors receive from banks covering amounts paid to providers of service, beneficiaries, physicians, and other suppliers of service under the Hospital Insurance and Supplementary Medical Insurance (SMI) programs. Also included are check vouchers and cancelled or voided checks resulting from nonreceipt, loss, theft, or non-delivery. Disposition: The contractor cuts off the file at the close of the calendar year in which issued, holds the file for 1 additional year, and then transfers it to inactive storage. Once the freeze is lifted, the file is destroyed after a total of 6 years and 3 months retention. When fraud or overutilization of services is involved, the contractor retains the hard copy claim until 3 months after the resolution of the investigation OR reverts to normal disposition, whichever is longer. 3. Medicare Summary Notices (MSNs) (FROZEN - DO NOT DESTROY) These files consist of MSNs used to advise beneficiaries about remaining Part A benefits, Part A and Part B deductible status, and about applying for complementary health benefits. Disposition: The contractor cuts off the file at the close of the calendar year in which benefit was paid or denied, as applicable, holds for 1 additional year and then transfers to inactive storage. Once the freeze is lifted, remove them from inactive storage for destruction after a total of 6 years and 3 months retention from cut off. 4. Reconsideration and Hearing Case Files - Hospital Insurance Program (FROZEN - DO NOT DESTROY) Reconsideration records accumulate when a beneficiary or their representative is dissatisfied with the A/B MAC (A) or (HHH)'s determination denying payment, or with the amount of benefits payable on the beneficiary's behalf under the Hospital Insurance Program and files either an expressed or implied request for reconsideration. Hearing case records accumulate when a beneficiary or their representative is dissatisfied with the reconsideration determination and requests a hearing; and if still dissatisfied after the hearing, files for a subsequent court review. Included are Forms CMS-2649, Request for Hearing; CMS-561, Request for Reconsideration; or their equivalents. Also included are evidence furnished by beneficiaries or their representatives, correspondence, CMS determinations, Administrative Law Judge decisions, original bills, Appeals Council decisions and similar material. Disposition: Once the freeze is lifted, the contractor disposes of these records in accordance with instructions for Medicare claims records. 5. Review and Fair Hearing Case Files - Supplementary Medical Insurance Program (FROZEN - DO NOT DESTROY) This category includes files accumulated when a beneficiary, physician, provider, or other supplier of service is dissatisfied with the MAC’s determination denying a request for payment, or with the amount of the payment, or with the reasonable promptness of action on a request for payment. Included are copies of claimant's requests for review, relevant written statements or evidence, notices of adverse formal review decisions, requests for hearings to protest the adverse decisions, hearings proceedings, hearing officers' final decisions, and other comparable papers. Disposition: The contractor places these records in an inactive file upon final action on the case. It cuts off the inactive file at the close of the calendar year in which the final action was taken, and holds it for 2 additional years, then transfers it to off-site storage. Once the freeze is lifted, these records can be destroyed when 5 years old. 6. A/B MACs (A) and (HHH) and A/B MAC (B) or DME MAC Administrative Budget Estimate and Cost Report Form (FROZEN - DO NOT DESTROY) These files consist of all uses of the Administrative Cost and Budget Report, CMS-1523 for A/B MAC (B) or DME MAC and CMS-1524 for A/B MACs (A) or (HHH). This form is a multi-use document and issued for budget and cost reporting activities. Specific uses are: a. Budget request, supplemental budget request, notice of budget approval, interim expenditure report. Disposition: Once the freeze is lifted, destroy after a total retention of 3 years after HHS audit and final settlement. b. Supplemental Budget Request Disposition: Once the freeze is lifted, destroy after a total retention of 3 years after HHS audit and final settlement. c. Notice of Budget Approval. The MAC’s certified funding authority for the fiscal year. Include all supporting schedules, correspondence and justification. Disposition: Once the freeze is lifted, destroy after a total retention of 3 years after HHS audit and final settlement. d. Interim Expenditure Report. Cumulative fiscal year to date expenditures incurred by the MAC. Include all supporting schedules, correspondence and justifications. Disposition: Once the freeze is lifted, destroy after a total retention of 3 years after HHS audit and final settlement. e. Final Administrative Cost Proposal. The final statement of expenditures for the fiscal year. This form is used as the basis for final settlement of allowable costs. Include all supporting schedules, correspondence, HHS or GAO audit reports on administrative cost and benefits payments. Disposition: Once the freeze is lifted, destroy after a total retention of 6 years and 3 months after HHS audit and final settlement. 7. MAC Letter of Credit Files (FROZEN - DO NOT DESTROY) These records are authorizations to a Federal Reserve Bank to disburse funds to designated MACs’ banks on behalf of CMS upon presentation of request for funds for collection through the Federal Reserve System. Included are Standard Form 1193, Letter of Credit or its equivalent, and amending letters. Disposition: Once the freeze is lifted, destroy after a total retention of 6 years and 3 months after the year in which the letters of credit are cancelled. 8. A/B MAC (A) or (HHH) Payment Vouchers and Transmittal Files (FROZEN - DO NOT DESTROY) These consist of Form TFS-218, Request for Funds, and similar documents prepared by the A/B MAC (A) or (HHH)’s servicing bank to obtain Federal funds for benefits paid in administering medical insurance programs. Also included is Form CMS-1521, Payment Voucher on Letter of Credit, a transmittal that forwards information on request for funds to CMS and shows the purpose for which funds were drawn, i.e., hospital insurance benefits, supplementary medical insurance benefits, and total amount of payment vouchers. Disposition: Once the freeze is lifted, destroy after a total retention of 6 years and 3 months or after HHS audit and final settlement, whichever is later. 9. A/B MAC or DME MAC Payment Vouchers and Transmittal Files (FROZEN - DO NOT DESTROY) These files consist of form TSF-5805, Request for Funds, and similar documents prepared by the A/B MAC (B) or DME MAC’s servicing bank to obtain Federal funds for benefits paid in administering medical insurance benefit programs. Also included is Form CMS-1521, Payment Voucher on Letter of Credit Transmittal, a transmittal that forwards information on request for funds to CMS and shows the purpose for which funds were drawn, i.e., SMI benefits and total amount of payment vouchers. Disposition: Once the freeze is lifted, destroy after a total retention of 6 years and 3 months or HHS audit and final settlement, whichever is later. 10. A/BMAC (A) or (HHH) Monthly Financial Report Files These are reports submitted monthly to provide CMS with the basic data to reconcile CMS's accounts with those that contractors maintain. Included are Form CMS-1522, Monthly Intermediary Financial Report and attachments. Disposition: Destroy after HHS audit and final settlement. 11. A/B MAC (B) or DME MAC Performance Report Files These consist of Forms CMS-1565, Health Insurance for the Aged Program Carrier Performance Reports, and equivalent documents prepared monthly summarizing each A/B MAC (B) or DME MAC’s performance in processing claims. The information provides management information needed for budgeting, financing, work planning, performance evaluation, and identifying operating problems. Disposition: Destroy after 3 years. 12. Ambulance Supplier Certification Files These consist of certifications of suppliers of ambulance services. Disposition: Destroy 1 year from the end of the year when certification requirements are no longer met. 13. Requests for Assistance from District Offices (DOs) (FROZEN - DO NOT DESTROY) These consist of correspondence and forms submitted to the DO for development of additional information or documents relating to a Medicare claim, e.g., incorrect name or Medicare beneficiary identifier and similar errors that prevent the processing of a claim. Disposition: Once the freeze is lifted, dispose of in accordance with instructions for claims records. 14. A/B MAC (A) or (HHH) Workload Reports Files These consist of monthly statistical reports on the status of A/B MAC (A) or (HHH) workloads used by CMS to identify basic management data needed for budgeting, financing, work planning, and progress evaluation. Included is Form CMS-1566, Health Insurance for the Aged Program FI Workload Report, or equivalent documents. Disposition: Destroy after 3 years. 15. Overpayment and Duplicate Charge Detection Activity Report Files - A/B MAC (B) or DME MAC Report These consist of quarterly reports summarizing overpayment and duplicate charge detection activity. They are used to tabulate data on the number of cases in which overpayments are recovered, the total dollar amount of money overpaid, causes of overpayments, number of duplicated charges detected, and similar information. Disposition: Destroy after 3 years. 16. Medicare Beneficiary Correspondence Files (FROZEN - DO NOT DESTROY) These accumulate as a result of inquiries and complaints received by CO, RO, and contractors and do not include any correspondence that is related to a claim file. Disposition: Destroy 3 months after the date of the response to the correspondence. If a response is not required, the contractor destroys the material 3 months after the date of the correspondence. Where the material documents a specific claim, appeal, or similar case, the contractor follows the instructions for claims records. 17. MAC Contract Files These consist of agreements entered into with MACs by the Secretary under the provisions of §§1816 and 1842 of the Act by which MACs agree to perform certain functions in administering the Hospital Insurance and Supplementary Medical Insurance programs. As such, they provide basic documentation of the manner in which these programs are implemented. Included are modifications and amendments. Disposition: Destroy 3 years after supersession or termination, as applicable. 18. MAC Subcontract Files These consist of copies of MAC agreements with subcontractors regarding performance of an audit of providers' costs A/B MAC (A) or (HHH), leases for building space, equipment, and consulting and other services. Included are CMS approvals, amendments, and similar papers. Disposition: Destroy 3 years after termination of agreement. 19. Contract Performance Review Visit Files These consist of documents relating to scheduled or special visits to Medicare contractors to review your Medicare operations, to determine the degree of adherence to established policy and adequacy of service to the public, and to verify the accuracy of reporting. Included are reports of staff visits, follow-up reports, communications concerning improvements in operations, and any other related documents. Disposition: Destroy 4 years after the close of the calendar year in which action on the review is completed. 20. MAC Computer Printout Records (FROZEN - DO NOT DESTROY) These consist of computer printouts used in processing, paying, and controlling Medicare claims. a. Pending and process listing, payment listing, duplicate check control, master file update control, and profiles of physicians and other suppliers of services. Disposition: Once the freeze is lifted, destroy 4 years after the close of the calendar year in which payment was made. b. Check listing and bank reconciliation. Disposition: Once the freeze is lifted, destroy 6 years after the close of the calendar year in which paid or voided. c. CWF inquiry or response listings, transaction listing, activity listings, posting exceptions, analysis of posting errors, claims inventory control, edit input transactions, and aging of open claims. Disposition: Once the freeze is lifted, destroy 3 years after processing. (Contractors with the capability of electronically retaining the CWF data may destroy the paper copies after the tapes have been verified.) 21. A/B MAC (A) or (HHH) Cost Report Files (FROZEN - DO NOT DESTROY) These consist of cost reports submitted by providers to A/B MACs (A) or (HHH) for determining Medicare reimbursable costs in accordance with regulations and the principles of reimbursement. The cost report file includes: (a) a copy of the original cost report form as filed by the provider; (b) copies of all decisions made by field auditors, including those subsequently reversed by senior auditors; (c) a copy of the Audit Adjustment Report; (d) a copy of revised cost report schedules (or a revised cost report); (e) a copy of the notice of program reimbursement; (f) a copy of the audit report when prepared by the A/B MAC (A) or (HHH) staff accountants and the supporting audit working papers. Disposition: The A/B MAC (A) or (HHH) maintains the cost report on premises for 3 years after the Notice of Amount of Medicare Program Reimbursement has been issued to the provider, and then transfers cost report to inactive storage. Once the freeze is lifted, destroy the cost report files 5 years after receipt. (Exception: A cost report file that is the subject of an appeal, litigation, or any other administrative proceedings, e.g., collection of outstanding overpayments or bankruptcies is not sent to inactive storage until the case has been settled or closed and all the review and appeal procedures have been exhausted.) 22. MAC Closing Agreements These files contain the accepted final settlement for all MAC costs of administration and consist of the closing agreement, appendix, and schedules of balances due the MAC or Secretary. Disposition: The MAC cuts off files at the end of the fiscal year. It holds the file in office 1 year after HHS audit and final settlement then transfers to inactive storage. Destroy these 10 years after HHS audit and final settlement. 23. Medicare Data Match Files (FROZEN - DO NOT DESTROY) Questionnaires, case files, employer records and data match records. Disposition: Cutoff files at the end of the calendar month and transfer to an offsite storage facility. Once the freeze is lifted, destroy 6 years and 3 months after cutoff. 24. Initial Enrollment Questionnaire (FROZEN - DO NOT DESTROY) Questionnaires sent to newly enrolled Medicare beneficiaries to obtain information on whether the individual is covered under a primary insurance plan. Disposition: Once the freeze is lifted, destroy/delete when 5 years old. 25. Provider Statistical and Reimbursement Reports (PS&RR) - (FROZEN - DO NOT DESTROY) These files consist of EDP printouts or microforms showing summaries of payments to hospitals, skilled nursing facilities, home health agencies, and other providers of service. They are used to effect cost settlements between the A/B MACs (A) or (HHH) and the providers for program validation purposes and to determine accuracy of cost reports. These reports contain Part A and Part B inpatient and outpatient information, inpatient statistics, total bills, covered costs, and other related data. Disposition: Once the freeze is lifted, destroy 5 years after completion of audit and/or settlement process for provider cost report for corresponding fiscal year. 26. A/B MAC (B) or DME MAC Claims Processing File Consists of documents relating to Part B A/B MAC (B) or DME MAC performance. Submitted on a weekly basis electronically to CMS’s data center. Disposition: Destroy after 6 months.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) After the claims determination payment action and posting to CMS records is completed, the bills and related materials are accumulated in file segments and held before transfer to an approved offsite storage facility (see §30.40.2). Claims records having current value and continuing reference, or claims records otherwise flagged to indicate pending action, are retained as long as the A/B MAC (B) or DME MAC finds necessary.

(Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. In order to facilitate the transfer of material to an approved offsite storage facility, MACs maintain the permanent claims records files in accumulation period segments, based on the starting date of initial payment or denial. Each contractor may select an accumulation period segment of from 6 months to 2 years in length after such starting date. The contractor may also adopt one period of time on an ongoing basis, but a different period for the initial segment. Contractors who have been authorized to microfilm/image claims records may be authorized to shorten the segment file accumulation period. (See §30.50.) After a file segment is closed, the contractor retains the records contained in that segment until time to transfer them to an approved storage facility. (See §§30.40.2 and 30.40.3 for definition of retention periods.) EXCEPTION: Contractors who maintain total history files by individual Medicare beneficiary identifier, name, or other sequence, may wish to operate under some procedure other than by a file segment accumulation period. Such alternative procedures may be used provided purging techniques to withdraw inactive records are established which meet one of the following requirements: 1. They avoid costly and time consuming manual selection of material to be purged from each folder. 2. Separators are used for each year's (or other period's) material within the history folder to facilitate rapid selection. 3. The capability exists (e.g., computer prepared lists) to identify inactive cases in which no action has been taken for 12 months or more for selection as purged segments to be transferred to an approved storage facility when such a purge becomes necessary. 4. Periods for purging and transfer are carefully selected by studying rates of reference to claims materials in order to select a realistic inactive period to avoid unnecessary recall from the storage facility. Although contractors who follow a purging procedure need not establish a standard retention period, the establishment of one of these requirements provides them with the potential of transferring inactive files to a storage facility if such a transfer should become desirable. When such a purge is begun, the contractor should make no transfer to the storage facility until the entire purging operation for the period is completed.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Contractors keep each permanent claims records file segment for a period of not less than 6 months or more than 1 1/2 years after the segment has been closed. The contractor bases the selection of a retention period on its experience with the rate and frequency of reference and other criteria. It also should avoid too early transfer to the storage facility, which could result in volume recalls and delays. The contractor bases the exact length of the retention period on its needs and on the arrangements worked out with the storage facility. The following examples of segment accumulation and retention periods demonstrate some of the ways in which these periods can vary. EXAMPLES: Segment Files Accumulation Period Retention Period Transfer a. 6 months 7/1/05 - 12/31/05 6 months 7/1/06 1/1/06 - 6/30/06 6 months 1/1/07 1/1/06 - 6/30/06 12 months 7/1/06 1/1/06 - 6/30/06 18 months 1/1/07 b. 9 months 7/1/05 - 3/31/06 6 months 10/1/06 7/1/05 - 3/31/06 12 months 4/1/07 7/1/05 - 3/31/06 18 months 10/1/07 c. 12 months 1/1/05 - 12/31/05 6 months 7/1/06 1/1/05 - 12/31/05 12 months 1/1/07 1/1/05 - 12/31/05 18 months 7/1/07 d. 18 months 1/1/05 - 6/30/07 6 months 1/1/08 1/1/05 - 6/30/07 12 months 7/1/08 1/1/05 - 6/30/07 18 months 1/1/09 Accumulation Period Retention Period Transfer e. 2 years 7/1/05 - 6/30/07 6 months 1/1/08 7/1/05 - 6/30/07 12 months 7/1/07 7/1/05 - 6/30/07 18 months 1/1/09

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) MACs who have been authorized to microfilm claims records (see §§50ff) may be permitted to transfer an accumulation of the original source documents to an approved offsite storage facility, after retaining for a shorter period than is outlined in §§30.40 - 30.40.2. Accumulation Period Retention Period Transfer a. 1/1/06 - 1/31/06 1 month 3/1/06 b. 6/1/06 - 6/30/06 1 month 8/1/06

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Some MACs have been authorized to microfilm claims records and other files material; e.g., computer printouts, cancelled checks, financial records. Due to the document freeze, these contractors are not authorized to destroy original source documents but are permitted to transfer an accumulation of these documents to an offsite storage facility after microfilming and verification of the quality and completeness of the film. (See §30.30.2, item 3, concerning destruction the hard copy Medicare Summary Notices after microfilming.) The accumulation period may be daily, weekly, or monthly, depending on volume. Generally, contractors should not make shipments of less than three cartons. They coordinate transfer procedures with the storage facility. In §30.90, Exhibits 6-12 contain various sample forms to be used by contractors when microfilming files material. These forms are not supplied by CMS. Reproduction of the forms is the responsibility of the contractor.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) A - General The contractor must authenticate each roll of film containing reproductions of Medicare claims records by including certificates of authenticity at the start and at the end of the filmed documents. (Material other than claims records need not be authenticated.) The contractor produces these certificates and target cards as needed, using the language contained in the examples in §80, Exhibits 6-12. The camera operator completes a report for each roll that is microfilmed. See Exhibit 12, for an example of a roll report. The contractor films claims records without attachments (e.g., coding sheets) overlaying data on the record. If data on the attachment is needed for reference purpose, the contractor films it separately. To ensure that the camera is working efficiently when files material is being microfilmed, the contractor films a microcopy resolution test chart on the first roll in the morning and the first roll in the afternoon. It gives these rolls priority processing so that any camera malfunction is discovered as soon as possible. Exhibit 11 provides an example of a resolution test chart that cannot be used for actual tests. Usable charts are available from microfilm suppliers. B - Normal Filming The contractor films the start certificate (see Exhibit 5) after any target (or flash) cards that identify or index the documents on the film and before the records are filmed. It files the end certificate (Exhibit 6) after the last document and before any end target card. It retains documents in the order they were filmed for ease in reviewing the processed microfilm. The following is an example of normal filming sequence: OUT START OF FILM LEADER <ABOUT- 2 FEET ROLL NUMBER CARD TITLE CARD FILING SEQUENCE CARD START CERTIFICATION OF AUTHENTICITY CARD TEST* CHART \ / \ / \ DOCUMENT DOCUMENT DOCUMENT LAST DOCUMENT LAST CERTIFICATE OF AUTHENTICITY CARD \ / \ / \ / \ / \ END CARD ← TRAILER ABOUT 2 FEET *Filmed Twice Each Day END OF FILM / \ / \ / \ C - Corrections If the camera operator notices that a document has been incorrectly filmed due to being twisted, folded, or torn, photograph a correction card (see Exhibit 7) right after the incorrect document. The following is an example of correction filming sequence: \ / \ / \ DOCUMENT DOCUMENT (TORN) CORRECTION CARD DOCUMENT (REPAIRED) DOCUMENT / \ / \ D - Filming Retakes and Additions When the processed microfilm roll is reviewed, some documents may be illegible or incorrectly photographed. Other documents may have been out of file or omitted at the time of the original microfilming. The contractor will re-photograph these documents and splice onto the front of the completed microfilm roll. If splicing is not practical, it will maintain the retakes and additions as a separate microfilm roll. It will photograph a start of retake or addition card (Exhibit 8) immediately before the documents to be rephotographed or added. Photograph an end of retake or addition certificate (Exhibit 9) immediately after the last document to be rephotographed. The following is an example of retake or addition filming sequence: \ / \ / \ START RE- TAKE OR ADDITION CARD DOCUMENT DOCUMENT DOCUMENT END OF ADDITION OR RETAKE CERTIFICATE \ / \ / \

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Affix an index label to each contents of the roll microfilm and provide reference markers. It lists the normal filming and the retakes and additions. Below is an example of an index label: Title: Roll No. CMS-1453 CONTENTS INDEX Index Point 1 CMS-1453 Control Number 00400 Through 00450 Index Point 2 CMS-1453 Control Number 00451 Through 00499 Index Point 3 Retakes 00427, 00451, 00478 Index Point 4 Additions 00429, 00446, 00463 END OF ROLL End of Roll

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) A - Master Microfilm After producing the number of copies of the microfilm required for reference purposes, the contractor retains the master microfilm as a security file. It stores it at an offsite location so that copies may be made in the event the reference copies are destroyed. It disposes of the master microfilm at the time the storage facility disposes of the hardcopy contained on the film. (See §30.30 for records disposition instructions.) (The contractor need not maintain a master microfilm security file of records such as computer printouts when complete computerized backup data is retained. It disposes of the master microfilm when there is no longer a need to produce reference copies of the microfilm.) B - Copies of Microfilm The contractor retains one copy of the microfilm as a reference copy to be kept on site for use when needed. It disposes of this copy with the master microfilm. (See subsection A above.) The contractor may dispose of any other reference copies of the microfilm 2 years after the end of the calendar year in which the documents were filmed. These copies may be retained for a longer period if they are needed for reference purposes but not longer than the master microfilm. C - Destruction of Microfilm The contractor should destroy microfilm by shredding as this method provides the most complete destruction of the data on the film. Other methods of destroying film, e.g., exposure to extreme heat or boiling, do not eradicate the data as completely or efficiently. Shredders exist that can destroy both film and reels. The contractor should retain cartridges or magazines which contained the microfilm for reuse because of the high cost of replacement. If a contractor does not have a shredder and purchase of a shredder is not cost justified, it should check local sources such as microfilm equipment vendors, microfilm service bureaus, banks, and insurance companies for a shredder that it can use to destroy its film. If a shredder cannot be located, the contractor should contact its regional office for assistance.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) The Centers for Medicare & Medicaid Services (CMS) conducts a reporting of total records on hand in current file rooms, offices, and offsite storage facilities. Since Medicare claims records and related records created and maintained by you must be included, you must prepare an Annual Report of Medicare Records (See Exhibit 13). Each contractor shall prepare this report every year as of September 15, regardless of your fiscal year ending date, and mail one copy to reach the address shown below no later than September 30: Centers for Medicare & Medicaid Services Records Officer, OSORA/IRMG Mail Stop, SL-12-16 7500 Security Boulevard Baltimore, MD 21244-1850

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Non-claims materials, as defined in §30.10.1B, may be disposed of by the contractor. Retained CMS bill copies (where records were submitted on tape) may be destroyed. In disposing of this material, the contractor must: • Ensure the confidentiality of information regarding a particular beneficiary, provider, physician, or supplier by protective shredding, mutilation, or contractual provisions with the subcontractor regarding similar protective measures. • Provide for offsetting expenditures with salvage value received when contractual relationships have been established with a local contractor for the sale of non-claims materials for its salvage value. In such cases, the contractor records the salvage value received, and offsets the initial expense of purchasing such materials by such value received.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) A facility that is used to store Federal records, must meet the minimum structural, environmental, property and life safety standards as outlined in 36 CFR 1228.228-Facility Requirements http://www.access.gpo.gov/nara/cfr/waisidx_05/36cfr1228_05.html by October 1, 2009. You must submit a Facility Standards for Record Storage Facilities Inspection Checklist (see Exhibit 14) for all storage facilities used to house CMS records to the CMS Records Officer. The facility must be constructed with non-combustible materials and building elements, including walls, columns and floors. You may request a waiver of this requirement from the National Archives and Records Administration through CMS for an existing records facility with combustible building elements to continue to operate until October 1, 2009. Your request must provide documentation that the facility has a fire suppression system specifically designed to mitigate this hazard and that the system meets the requirements in 36 CFR 1228.230--Fire Safety Requirements http://www.access.gpo.gov/nara/cfr/waisidx_05/36cfr1228_05.html. Requests for waivers must be submitted to your CMS Regional Office contact who will forward to the CMS Records Officer for final approval by the National Archives and Records Administration.

(Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Exhibit 1. Preprinted Container Label Exhibit 2. Minimum Label Data Required for Unlabeled Boxes Exhibit 3. Records Transmittal and Receipt - Standard Form 135 Exhibit 4. Reference Request - Federal Records Center - Optional Form 11 Exhibit 5. Certificate of Authenticity - Start Exhibit 6. Certificate of Authenticity - End Exhibit 7. Correction Card Exhibit 8. Start of Retake or Addition Certificate Exhibit 9. Retake or Addition Certification Exhibit 10. Resolution Test Chart Exhibit 11. Witness Disposal Certification (Sample) Exhibit 12. Roll Report Exhibit 13 Report of Medicare Records Exhibit 14 Inspection Checklist -- Standards for Record Storage Facilities Exhibit 1 - Preprinted Container Label (Rev.124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 ACCESSION NO. CARTON NO. of AGENCY MAJOR SUBDIVISION DESCRIPTION OF RECORDS (BRIEF) Instructions for Completing Label Accession No. - Control number you assign to each shipment of records. Carton No. - Show the box number and also the total number of boxes in the same shipment, e.g., 5 of 60. Agency - Enter CMS Major Subdivision - Enter the name of the MAC in this block. Description of Records - Enter “Part A A/B MAC (A) or (HHH) or Part B A/B MAC (B) or DME MAC - Medicare bills and related claims records received, processed and paid (including dates),” or “Part A A/B MAC (A) or (HHH) - Medicare Fiscal Records, canceled checks and related records (including dates).” Also, for each box, show the inclusive claims numbers, dates, etc., depending on arrangement of records. Exhibit 2 - Minimum Label Data Required for Unlabeled Boxes (Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 For boxes not having a preprinted label (see Exhibit 1 above), enter the label as shown: CARTON _____ OF ______ CARTONS CMS MAC NAME CITY, STATE MAC - PAID MEDICARE BILLS DATE TO DATE (086-12-8462A--093-14-2362T) Instructions For Labeling Boxes Use broad-point felt tip marker to facilitate shelf reference. Minimum Label Data Accession Number - Control number assigned to each shipment of records. Carton No. - Show the box number and also total boxes in the shipment, e.g., 5 of 60. Agency - Show "CMS." Office - Show the name of MAC with city and State address. Description of Records - For Medicare bills and related records, show: "MAC name - Paid Medicare Bills (inclusive dates)." For fiscal records, canceled checks, and related records, show: " MAC - Medicare Fiscal Records (inclusive dates)." First and Last Entry in Box - Show the inclusive claim number, terminal digit numbers, check numbers, or other designated key numbers. Exhibit 3 - Records Transmittal and Receipt - Standard Form 135 (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Click on the link below then scroll down and click on “Records Transmittal and Receipt Form - SF135”. http://www.archives.gov/records_center_program/forms/sf_135_intro.html Exhibit 4 - Reference Request - Federal Records Center - Optional Form 11 (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Click on the link below to access Optional Form 11 http://www.gsa.gov/forms Exhibit 5 - Certificate of Authenticity - START (Rev. 124, Issued: 05-17-19, Effective: 06-18-19, Implementation: 06-18-19 The term Medicare beneficiary identifier (Mbi) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) during the new Medicare card transition period and after for certain business areas that will continue to use the HICN as part of their processes. CONTRACTOR NAME AND ADDRESS CERTIFICATE OF AUTHENTICITY START THIS IS TO CERTIFY THAT THE MICROPHOTOGRAPHIC IMAGES APPEARING ON THIS ROLL OF MICROFILM: STARTING WITH (e.g., control number, Medicare beneficiary identifier) ARE ACCURATE REPRODUCTIONS OF THE RECORDS OF: AND WERE MICROFILMED IN THE REGULAR COURSE OF BUSINESS PURSUANT TO ESTABLISHED ROUTINE COMPANY POLICY FOR SYSTEMS UTILIZATION AND OR FOR THE MAINTENANCE AND PRESERVATION OF SUCH RECORDS THROUGH THE STORAGE OF SUCH MICROFILMS IN PROTECTED LOCATIONS. IT IS FURTHER CERTIFIED THAT THE PHOTOGRAPHIC PROCESSES USED FOR MICROFILMING OF THE ABOVE RECORDS WERE ACCOMPLISHED IN A MANNER AND ON MICROFILM THAT MEETS THE RECOMMENDED REQUIREMENTS OF THE NATIONAL BUREAU OF STANDARDS FOR PERMANENT MICROPHOTOGRAPHIC REPRODUCTIONS. Date Microfilmed Camera Operator Location Authorized Signature Exhibit 6 - Certificate of Authenticity - END (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) CONTRACTOR NAME AND ADDRESS CERTIFICATE OF AUTHENTICITY END THIS IS TO CERTIFY THAT THE MICROPHOTOGRAPHIC IMAGES APPEARING ON THIS ROLL OF MICROFILM: ENDING WITH ARE ACCURATE REPRODUCTIONS OF THE RECORDS OF: AND WERE MICROFILMED IN THE REGULAR COURSE OF BUSINESS PURSUANT TO ESTABLISHED ROUTINE COMPANY POLICY FOR SYSTEMS UTILIZATION AND OR FOR THE MAINTENANCE AND PRESERVATION OF SUCH RECORDS THROUGH THE STORAGE OF SUCH MICROFILMS IN PROTECTED LOCATIONS. IT IS FURTHER CERTIFIED THAT THE PHOTOGRAPHIC PROCESSES USED FOR MICROFILMING OF THE ABOVE RECORDS WERE ACCOMPLISHED IN A MANNER AND ON MICROFILM THAT MEETS THE RECOMMENDED REQUIREMENTS OF THE NATIONAL BUREAU OF STANDARDS FOR PERMANENT MICROPHOTOGRAPHIC REPRODUCTIONS. Date Microfilmed Camera Operator Location Authorized Signature Exhibit 7 - Correction Card (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) CORRECTION CARD CORRECTION THIS DOCUMENT HAS BEEN REPHOTOGRAPHED TO ASSURE LEGIBILITY Exhibit 8 - Start of Retake or Addition Certificate (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) RETAKE OR ADDITION CARD START OF RETAKE OR ADDITION The images appearing between this point and the "End of Retake or Addition" are true copies of records, which were missing or provide unsatisfactory on inspection of the original microfilm reel. For a description of rephotographed material, see operator's "Retake or Addition Certificate" at the end of this section. Exhibit 9 - Retake or Addition Certificate (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) CONTRACTOR NAME AND ADDRESS CERTIFICATE OF AUTHENTICITY RETAKES OR ADDITIONS THIS IS TO CERTIFY THAT THE MICROPHOTOGRAPHIC IMAGES APPEARING ON THIS ROLL OF MICROFILM: ENDING WITH ARE ACCURATE REPRODUCTIONS OF THE RECORDS OF: AND WERE MICROFILMED IN THE REGULAR COURSE OF BUSINESS PURSUANT TO ESTABLISHED ROUTINE COMPANY POLICY FOR SYSTEMS UTILIZATION AND OR FOR THE MAINTENANCE AND PRESERVATION OF SUCH RECORDS THROUGH THE STORAGE OF SUCH MICROFILMS IN PROTECTED LOCATIONS. IT IS FURTHER CERTIFIED THAT THE PHOTOGRAPHIC PROCESSES USED FOR MICROFILMING OF THE ABOVE RECORDS WERE ACCOMPLISHED IN A MANNER AND ON MICROFILM THAT MEETS THE RECOMMENDED REQUIREMENTS OF THE NATIONAL BUREAU OF STANDARDS FOR PERMANENT MICROPHOTOGRAPHIC REPRODUCTIONS. Date Microfilmed Camera Operator Location Authorized Signature Exhibit 10 - Resolution Test Chart (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) The resolution test chart can also be viewed at the following link: http://www.efg2.com/Lab/ImageProcessing/TestTargets/#Microcopy Exhibit 11 - Witness Disposal Certification (Sample) (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) WITNESSED DISPOSAL CERTIFICATION Disposal Date: _____________________ Medicare Contractor: ________________________________________ Address: ________________________________________ ________________________________________ Disposal Location: ________________________________________ _____________________________________________________________ Volume by Cubic Feet (e.g., number of boxes): ____________________ Description & Year(s) of Records Destroyed: _____________________________________________________________ _____________________________________________________________ _____________________________________________________________ _____________________________________________________________ I certify that I witnessed the proper destruction of CMS Medicare records approved for disposal on the date and location named in this document. Print Name: __________________________________ Title: __________________________________ Signature: __________________________________ Date: ________________ Exhibit 12 - Roll Report (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) ROLL REPORT CAMERA NO. LIGHT LEVEL IRIS REDUCTION PROCESSING DEPARTMENT DATE PROC. DEV. TIME CHEM. TEMP REMARKS PROCESSOR INSPECTION DEPARTMENT APPROVED RESHOOTS FOOTAGE INSPEC. TIME INSPECTORS INTIALS DENSITY RESHOOTS WILL BE FOUND ON THIS ROLL FOR ROLL NUMBERS THEIR ROLL NO. AGENCY NAME OUR ORDER NUMBER FILMING TIME LUNCH TIME BREAK TIME PREP TIME WAITING TIME SET-UP TIME TRAVEL TIME REMARKS OPERATOR’S INITIALS Exhibit 13 – Report of Medicare Records (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) ANNUAL REPORT OF MEDICARE RECORDS Name & Address of Medicare Contractor Name, Title and Phone # of the Person Submitting the Report Type of Medicare Contractor (Carrier/Intermediary/DMERC, etc.) Current File Room Offsite Storage Storage Costs 1. Total Records on Hand at the End of the Reporting Period a. Magnetic Tape Included in Line 1 b. Microfilm Included in Line 1 c. CDs included in Line 1 d. Paper included in Line 1 2. Records Transferred to Storage During Reporting Period (provide the number of boxes) a. To Offsite Storage Included in Line 2 $ b. To Onsite Storage Included in Line 2 $ TOTAL STORAGE COSTS (Add 2a+b) $ 3. Total Records in Offsite Storage During the Contract Period For the purpose of this report, volume may be calculated according to the following table of cubic foot equivalents: 1 record storage box………………1 cubic foot Letter-size filing cabinet………….1½ cubic feet per drawer Legal-size filing cabinet…………..2 cubic feet per drawer Magnetic Tape…………………….1 cubic foot per 7 reels Microfilm………………………….1 cubic foot per 108 rolls CDs………………………………..¼ cubic foot per 12” case holder Exhibit 14 - Inspection Checklist - Facility Standards for Records Storage Facilities (Rev. 38, Issued: 05-26-06, Effective: 06-26-06, Implementation: 06-26-06) Facility Standards for Records Storage Facilities Inspection Checklist (Effective date of checklist September 2005) Agency: Facility: Common Name: Facility: Street Address Facility: City, State & Zip Facility Director or Representative: <<Typed name>> <<Typed Title>> □ Comments explaining or disagreeing with inspection findings are attached. Inspector: <<Typed name>> Date <<Typed Title>> Facility Description: Compliance with 36 CFR 1228.228 Facility Requirements §1228.228 paragraph: Requirement OK No Other (a) The facility must be constructed with non-combustible materials and building elements, including walls, columns, and floors. (a) exception 1 If the roof is constructed of combustible material it is protected by a properly installed and maintained wet-pipe automatic sprinkler system. (a) exception 2 Existing records storage facility with combustible building elements has an approved waiver from NAS that allows continued use until October 1, 2009 provided documentation has been submitted that indicates a fire- suppression system designed to mitigate the risk is present. (b) A facility with two or more stories must be designed or certified by a licensed fire protection engineer and civil/structural engineer to avoid catastrophic failure of the structure due to an uncontrolled fire on one of the intermediate levels. (c) The building must be sited a minimum of five feet above and 100 feet from any 100 year flood plain areas, or be protected by an appropriate flood wall (see FEMA flood maps) (d) The facility must be designed in accordance with national, regional, state or local building codes (whichever is most stringent) to provide protection from building collapse or failure of essential equipment from earthquake hazards, tornadoes, hurricanes, and other natural disasters. (e) Roads, fire lanes, and parking areas must permit unrestricted access for emergency vehicles. (f) A floor load limit must be established for the records storage area by a licensed structural engineer. … The allowable load limit must be posted in a conspicuous place and must not be exceeded. (g) The facility must ensure that the roof membrane does not permit water to penetrate the roof. (New buildings: effective 9/28/2005; existing buildings: effective 10/1/2009) §1228.228 paragraph: Requirement OK No Other (h) Piping (with the exception of sprinkler piping and storm water roof drainage piping) must not be run through the records storage area unless supplemental measures … are used to prevent water leaks …. (New buildings: effective 9/28/2005; existing buildings: effective 10/1/2009) (i)(1) All storage shelving must be designed and installed to provide seismic bracing that meets the requirements of the applicable state, regional, and local building code (whichever is most stringent). (i)(2) Racking systems, steel shelving, or other open-shelf records storage equipment must be braced to prevent collapse under full load. Each shelving unit must be industrial style shelving rated at least 50 lbs per cubic foot supported by the shelf. (i)(3) Compact shelving, if used, must be designed to permit proper air circulation and fire protection … (j) The records storage area must be equipped with an anti- intrusion alarm system … meeting the requirements of UL 1076, Proprietary Burglar Alarm Units and Systems (level AA) …. The alarm system must be monitored in accordance with UL 611, Central Station Burglar Alarm Systems. (k) The facility must comply with the requirements for a Level III facility. (Appendix A -- see separate checklist) (l) Records contaminated by hazardous materials … must be stored in separate areas having separate air handling systems from other records. (m) The facility must have an Integrated Pest Management program. (n) The following additional requirements apply only to new facilities: (n)(1) (1) No mechanical equipment containing motors in excess of 1 HP within records storage areas (excluding material handling and conveyance equipment that have operating thermal breakers on the motor). (n)(2) (2) No high-voltage electrical distribution equipment (i.e., 13.2kv or higher) in records storage areas. §1228.228 paragraph: Requirement OK No Other (n)(3) (3) A redundant source of primary electrical service … should be provided … . Manual switching between sources of service is acceptable. (See text in rule; applies to HVAC, fire and security alarms.) (n)(4) (4) For new facilities that store permanent records: (n)(4)a a. A facility storing permanent records must be kept under positive pressure. (n)(4)b b. No intake louvers in loading dock areas, parking or other areas subject to vehicle traffic. (n)(4)c c. Separate air supply and exhaust system for loading docks. Compliance with 36 CFR 1228.230 Fire Safety Requirements §1228.230 paragraph: Requirement OK No Other (a) The fire detection and protection system must be designed or reviewed by a licensed fire protection engineer. Review requires submission of a report under the seal of a licensed fire protection engineer; see rule text for minimum requirements. (b)(1) All walls separating records storage areas from each other and from storage areas within the building must be 3-hour fire resistant. (b)(2) The quantity of Federal records stored in a single fire compartment shall not exceed 250,000 cubic feet. (c)(1) For existing records storage facilities, at least 1-hour rated fire barrier walls must be provided between the records storage area(s) and other auxiliary spaces. (c)(2)(a) For new records storage facility, 2-hour-rated fire barrier walls must be provided between the records storage area(s) and other auxiliary spaces. §1228.230 paragraph: Requirement OK No Other (c)(2)(b) For new facilities, at least one exterior wall of each stack area must be designed with a maximum fire resistive rating of one-hour, or, if rated more than one-hour, there must be at least one knock-out panel in one exterior wall of each stack. (d) Penetrations in the walls must not reduce the specified fire resistance ratings. (e) The fire resistive rating of the roof must be a minimum of ½ hour. (e) alternate Unrated roof is protected in accordance with NFPA 13. (f) Openings in fire barrier walls must be protected by self- closing or automatic Class A fire doors, or equivalent doors that maintain the same rating as the wall. (g) Roof support structures that cross or penetrate fire barrier walls must be cut and independently supported on each side of the fire barrier wall. (h) If fire barrier walls are erected with expansion joints, the joints must be protected to their full height. (i) Building columns in records storage areas must be 1-hour fire resistant. (i) alternate Unrated columns are protected in accordance with NFPA 13. (j)(1) Automatic roof vents for routine ventilation purposes must not be designed into new records storage facilities. (j)(2) Automatic roof vents, designed solely to vent in the case of a fire, with a temperature rating of at least twice that of the sprinkler heads are acceptable. (k) Where lightweight steel roof or floor supporting members are present, they must be protected either by applying a 10-minute fire resistive coating to the top chords of the joists, or by retrofitting the sprinkler system with large drop sprinkler heads. (see rule text) §1228.230 paragraph: Requirement OK No Other (l) Open flame (oil or gas) unit heaters or equipment, if used, must be installed or used in any records storage area in accordance with NFPA 54 and the UMC. (m) For existing records storage facilities, boiler rooms or rooms containing equipment operating with a fuel supply … must be separated from records storage areas by a 2- hour rated fire barrier wall with no openings directly from those rooms to the records storage area(s). Such areas must be vented directly outside to a location where fumes will not be drawn back into the facility. (n) For new records storage facilities, boiler rooms or rooms containing equipment operating with a fuel supply … must be separated from records storage areas by a 4-hour rated fire barrier wall with no openings directly from those rooms to the records storage area(s). Such areas must be vented directly outside to a location where fumes will not be drawn back into the facility. (o) For new records storage facilities, fuel supply lines must not be installed in areas containing records, and must be separated from such areas with 4-hour-rated construction. (p) Equipment rows running perpendicular to the wall must comply with NFPA 101 Life Safety Code, with respect to egress requirements. (q)(1) No oil-type transformers, except thermally protected devices included in light ballasts, may be installed in records storage areas. (q)(2) All electrical wiring must be in metal conduit, except that armored cable may be used where flexible wiring connections to light fixtures are required (q)(3) Battery charging areas for electric forklifts must be separated from records storage areas with at least a 2-hour rated fire barrier wall. (r) Hazardous materials … must not be stored in records storage areas. §1228.230 paragraph: Requirement OK No Other (s) All records storage and adjoining areas must be protected by a professionally designed fire-safety detection and suppression system that is designed to limit the maximum anticipated loss from any single fire event to a maximum of 300 cubic feet of records destroyed. For systems in accordance with App. B, attach checklist. For other designs, see § 1228.242 for documentation requirements. Compliance with 36 CFR 1228.232, Environmental Control Requirements §1228.232 Paragraph: Requirement OK No Other (a) Paper-based temporary records must be stored under environmental conditions that prevent the active growth of mold. (See rule text) (b) Nontextual temporary records, including microforms and audiovisual and electronic records, must be stored in records storage space that will ensure their preservation for their full retention period. Effective 9/28/2005 for new records storage facility and 10/1/2009 for existing facilities. (See rule text) (c) Paper-based permanent, unscheduled, and sample/select records must be stored in records storage space that provides 24 hour/365 days per year air conditioning equivalent to that required for office space. (See rule text) Effective date: New facilities, 9/28/2005; existing facilities 10/1/2009 (d) Nontextual permanent, unscheduled and/or sample/select records: see parts 1230, 1232, and/or 1234 of 36 CFR Chapter XII. List of Attachments Description Yes N/A Minimum Security Requirements Check List (Appendix A) Description Yes N/A Fire-Safety Check List (Appendix B) Certification of fire-safety detection and suppression system (36 CFR 1228.242) Exceptions caused by Code Conflicts (36 CFR 1228.234) Waiver request(s) (36 CFR 1228.236) Other: (Describe) Notes Reference (§ and ¶) Comments Facility Standards for Records Storage Facilities Supplemental Check Lists: Appendix A and Appendix B Compliance with Federal Facility Security Standards, Level III (36 CFR Part 1228 Appendix A) (Complete for ALL facilities) Citation Requirement OK No Part S1 Control of facility parking S2 Receiving/shipping procedures S3 Intrusion detection system with central monitoring S4 Meets Life Safety Standards S5 Adequate exits from records storage areas Citation Requirement OK No Part S6 High security locks on entrances/exits S7 Visitor control/screening system S8 Prevent unauthorized access to utility areas S9 Provide emergency power to critical systems S10 Conduct background security checks and/or establish security control procedures for service contract personnel Compliance with 36 CFR Part 1228 Appendix B (Complete this section ONLY if the facility claims to be using the system described in Appendix B) Paragraph Requirement OK No Part 2a. The records storage height must not exceed the nominal 15 feet (+/-3 inches) records storage height. 2b. All records storage and adjoining areas must be protected by automatic wet pipe sprinklers. 2c.1 1. The sprinkler system must be rated at no higher than 285 degrees Fahrenheit utilizing quick response (QR) fire sprinkler heads. 2c.2 2. The sprinkler system must be designed by a licensed fire protection engineer to provide the specified density for the most remote 1,500 square feet of floor area at the most remote sprinkler head in accordance with NFPA 13 (1996), Standard for the Installation of Sprinkler Systems. 2c.3 3. Installation of the sprinkler system must be in accordance with NFPA 13 (1996), Standard for the Installation of Sprinkler Systems. 2c.4 4. Contractor’s Material and Test Certificates per NFPA 13 chapter 8. 2c.5 5. Hydraulic Calculations. 2d.1 1. Maximum spacing of the sprinkler heads must be on a 10-foot grid. Paragraph Requirement OK No Part 2d.2 2. The positioning of the heads must provide complete, unobstructed coverage, with a clearance of not less than 18 inches, but not more than 60 inches, from the top of the highest stored materials. 2e. The sprinkler system must be equipped with a water- flow alarm connected to a continuously staffed fire department or central station, with responsibility for immediate response. 2f.1 1. A manual fire alarm system must be provided with central station services or other automatic means of notifying the municipal fire department. 2f.2 2. A manual alarm pull station must be located adjacent to each exit. 2g. All water cutoff valves in the sprinkler system must be equipped with automatic closure alarm connected to a continuously staffed station, with responsibility for immediate response. 2h. A dependable water supply free of interruption must be provided. This normally requires a backup supply system having sufficient pressure and capacity to meet both fire hose and sprinkler requirements for 2 hours. 2i. Interior stand-pipe stations equipped with 1 ½ inch diameter hose may be provided in the records storage areas if required by the local fire department, enabling any point in the records storage area to be reached by a 50-foot hose stream from a 100-foot hose lay. If hose is provided, the cabinets must be marked “For Fire Department Use Only.” 2j. Where fire hose cabinets are not required, stand-pipes must be provided at each floor landing in the building core or stair shaft. Hose outlets must have easily removable adapter and cap. Threads and valves must be compatible with the local fire department’s equipment. Spacing must be so that any point in the records storage area can be reached with a 50-foot hose stream from a 100-foot hose lay. 2k. In addition to the designated sprinkler flow demand, 500 gpm must be provided for hose stream demand. The hose stream demand must be calculated into the system at the base of the main sprinkler riser. Paragraph Requirement OK No Part 2l.1 1. Fire hydrants must be located within 250 feet of each exterior entrance or other access to the records center that could be used by fire-fighters. 2l.2 2. All hydrants must be at least 50 feet away from the building walls and adjacent to a roadway usable by fire apparatus. Fire hydrants must have at least two 2-½ inch hose outlets and a pumper connection. All threads must be compatible with local standards. 2m. Portable water-type fire extinguishers (2½ gallon stored- pressure type) must be provided at each fire alarm striking station (see also NFPA 10). 2n.1 1. Where provided, the walking surface of the catwalks must be of expanded metal at least 0.09-inch thickness with a 2-inch mesh length. The surface opening ratio must be equal or greater than 0.75. 2n.2 2. The sprinkler water demand for protection over bays with catwalks where records are not oriented perpendicular to the aisles must be calculated to give 0.3 gpm per square foot for the most remote 2,000 square feet. Notes Reference Comments Reference Comments

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15)

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) (Rev. 105, Issued: 06-02-17, Effective: 07-03-17, Implementation: 07-03-17) The SSMs, MACs and the STC shall use standardized terminology to refer to common systems maintenance elements in all discussions, reporting, and documentation. Using common terminology will minimize confusion and misunderstanding for CMS, SSMs, MACs and the STC. The MACs and the STC shall examine their use of the system status information issued by the SSMs to determine if they have internal applications that need to be adjusted to adopt the standardized terminology. If they have internal systems or processes that must be modified to reflect the standardization required by this instruction, they shall make those changes to coincide with the shared system changes.

(Rev. 105, Issued: 06-02-17, Effective: 07-03-17, Implementation: 07-03-17) STANDARD TERMINOLOGY DESCRIPTION QUESTION (QCN) Request for assistance and/or reported potential system problem. For questions, the MACs and the STC shall contact the SSM’s helpdesk to log their question. PROBLEM Confirmed system and/or documentation problem Change Request (CR) Any software modification made to the system as a result of a CMS mandate or maintainer initiated action CMS STATUS CMS needs take action by answering a question, finalizing an instruction, etc. NSC (non-system change) STATUS CMS CR does not require shared system change. May require A/B MAC maintenance RESEARCH STATUS The SSM completes high level review of required changes by analyzing them and determining the intent of the change request REQUIREMENTS (REQS) STATUS The SSM finalizes the business requirements WALKTHROUGH STATUS The SSM presents the systems solution to the CR in a structured walkthrough discussion with CMS and Beta testers WORK STATUS The SSM completes technical design, coding and unit testing the system change STANDARD TERMINOLOGY DESCRIPTION ALPHA TESTING Functional testing performed by the SSM, after successful unit testing of the new or modified code; which starts approximately ninety (90) days prior to the implementation of the Change Request. The testing verifies all changed components function appropriately within the full environment at the SSM site in a controlled environment. BETA TESTING This is the second phase of testing after Alpha testing. The goal of Beta testing is to identify and resolve any remaining defects before a product/software is released to a production environment. Beta testing begins eight weeks prior to the production implementation date of a quarterly release. The Beta tester continues to test all iterations of the code through the UAT testing phase until the release moves to production. The Beta tester continues to test for two weeks post production or until they are 100% completed, whichever comes first. User Acceptance Testing (UAT) MACs and DME MACs perform UAT testing during the four weeks prior to the production implementation date of a quarterly release. USER STATUS The SSM returns question to user to provide more information or examples, assess solution

(Rev.: 128, Issued: 11-01-19, Effective: 12-03-19, Implementation: 12-03-19) (Rev. 13175; Issued: 04-17-25; Effective: 05-19-25; Implementation: 05-19-25) Shared System Maintainers (SSMs) shall obtain approval from their Government Task Leader (GTL) before quarterly release software can be scheduled and installed. Control of System Changes SSMs shall use the same quarterly release schedule, (i.e., on or about October 1, January 1, April 1, and July 1). CMS will schedule each quarterly release. All follow-up release changes (except emergencies) to the quarterly schedule shall be held and released on a predetermined schedule in coordination with CMS. Unscheduled emergency changes released as problems are identified without prior approval. The schedule for a follow-up release of changes shall be forwarded to your GTL for prior approval. When a system problem is identified, Medicare contractors (i.e. SSMs, the STC, MACs and CWF Hosts) shall submit documentation to their GTL outlining the problem and the reason correction is needed at this time. Section V of this instruction outlines the minimum information required by CMS for approval. Problem Priority Classifications for Follow-Up Releases Listed below are CMS’s problem priority classifications and examples. Priority 1 Classification Production: The problem prevents the accomplishment of a mission critical capability for which no acceptable workaround is known.* This priority also includes problems where code shall be fixed immediately in order for the normal production region functions or services to continue. For example, if the production region is down in a job resulting in an incomplete cycle or the system is pricing a significant volume of claims incorrectly causing over or under payment. EXAMPLES: • ABENDS on-line or batch (Inability to run a cycle) • Inaccurate payment or no payment of claims (significant impact/high volume) • Necessary file updates cannot be accomplished (payment files, history files) • Interface failures affecting claims processing Beta/User Acceptance Testing: The problem would prevent the accomplishment of a mission critical capability if the current test software is moved into the production environment. This priority also includes problems where code shall be fixed immediately in order for the normal test region functions or services to continue. For example, if the test region is down in a job causing the cycle to not complete or the system is pricing claims incorrectly with a potentially significant claim volume or payment impact, the issue would be classified as a priority 1. EXAMPLES: • ABENDS; inability to run a cycle or test • Inaccurate payment or no payment of claims (potentially significant impact) • Necessary file updates cannot be accomplished (payment files, history files) • Interface failures affecting test conditions Priority 2 Classification Production: The problem adversely affects the accomplishment of a mission critical capability so as to degrade performance and for which no acceptable work-around is known.* This means the problem adversely affects the payment of benefits with a small claim volume or payment impact, the completion of CMS required reporting, or inaccurate information is being sent providers, beneficiaries or CMS. For example, if the information on an outgoing document to the provider community or Medicare Summary Notice is incorrect, the issue would be classified as a priority 2. EXAMPLES: • Inaccurate payment or no payment of claims (small impact/low volume) • Inaccurate CMS required report • Inaccurate messages to the beneficiary, provider or CMS • ABENDs with limited impact (e.g. one contractor) Beta/User Acceptance Testing: The problem would adversely affect the accomplishment of a mission critical capability so as to degrade performance if current test software is moved into the production environment. This means the problem adversely affects the payment of benefits with a potentially small claim volume or payment impact, the completion of CMS required reporting, or inaccurate information is being sent to providers, beneficiaries or CMS. For example, if the information on an outgoing document to the provider community is incorrect, the issue would be classified as a priority 2. EXAMPLES: • Inaccurate payment or no payment of claims (potentially small impact) • Inaccurate CMS required report • Inaccurate messages to the beneficiary, provider or CMS Priority 3 Classification Production: The problem adversely affects the accomplishment of mission critical capability so as to degrade performance and for which an acceptable workaround is known.* This means the problem could have significant impact but the work-around alleviates the impact. This allows the system maintainer adequate time to code a fix and sufficiently test before the corrected software is delivered for production installation. EXAMPLES: • Impact of problem could be significant or minimal • Problem correctable by contractor workaround* • ABENDs with an acceptable workaround* Beta/User Acceptance Testing: The problem would adversely impact the accomplishment of a mission critical capability so as to degrade performance if current test software is moved into the production environment. If moved into the production environment before correcting an acceptable workaround could be instituted to prevent the adverse impact. ** EXAMPLES: • Potential impact of problem could be significant or minimal • Problem affects CMS required reporting Priority 4 Classification Production: The problem is an operator inconvenience or annoyance, which does not affect a required mission essential capability. EXAMPLES: • Problems affects non-mission critical functions • Operational procedure with workload impact that should be automated • Impact of problem is minimal • Correctable by contractor workaround* Beta/User Acceptance Testing: The problem is a test inconvenience or annoyance, which does not affect a required mission essential or test capability. If moved into the production environment before correcting, an acceptable workaround could be instituted to prevent the inconvenience. ** EXAMPLES: • Problem affects non-mission critical functions • Operational procedure with workload impact that should be automated • Impact of problem is minimal • Correctable by contractor workaround* Priority 5 Classification Production: All other documented system problems. These could include operator errors, an inability to reproduce the reported problem, a problem with insufficient information, or documentation errors. The system maintainer should request approval from the (GTL) before coding and implementing any system enhancements. EXAMPLES: • A/B and DME MACs requested enhancements • Documentation errors • Problem affects non-mission critical functions • Minimal impact Beta/User Acceptance Testing: All other documented system test problems. These could include operator errors, an inability to reproduce the reported problem, a problem with insufficient information, or test documentation errors. The system maintainer should work to correct these issues as soon as possible but any system enhancements should be discussed with the GTL. EXAMPLES: • Test region or processing enhancements • Test documentation • Problem affects non-mission critical test functions • Minimal impact * An acceptable workaround is a temporary alternative solution to a confirmed problem in the shared system that will ensure the contractor is able to accomplish a mission critical capability. What makes the workaround “acceptable” is it shall be agreeable to both the maintainer and contractor and does not cause an excessive burden to the contractor. If the maintainer and A/B and DME MACs cannot come to an agreement on what is “acceptable” the decision will be made by CMS. ** CMS does not recommend using workarounds in the test region in order to “pass” test cases. The institution of a workaround should be used in order to implement a CMS mandate where the system maintainer may not have time to adequately code a fix before the software is delivered for production installation.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) Medicare A/B, DME contractors shall implement workarounds within the shared systems for problems when formally defined as a Priority 3 or Priority 4 without obtaining written permission from a Project Officer or Regional Office. Shared system problems that are formally defined as a Priority 3 or a Priority 4 have acceptable workarounds which provide temporarily alternative solutions. In order for a A/B/DME MACs to implement a workaround, the shared system maintainer must first validate the problem, confirm that the workaround exists, is systematically viable and does not cause adverse effects. The implementation of such workarounds will eliminate delay in adjudication of Medicare claims and the payment to providers. Utilizing a Priority 3 or Priority 4 workaround shall not diminish the integrity of the shared systems and shall not include such actions as deactivating standard edits. The shared system’s priorities are formally defined at Section 40.2 of this chapter.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) Medicare requires implementation of a limited number of shared systems that must be used by all MACs for the administrative responsibilities of Traditional Medicare (Part A, B and DME claims). This eliminates the need for each A/B, DME MAC to repeat development of the base system as part of the complete system development life cycle (SDLC). CMS requires that the shared system quarterly release be subjected to the complete testing life cycle prior to production release. The goal is to ensure that all changes function as intended and that the implementation of changes does not degrade or otherwise unintentionally affect existing system capability and function prior to implementation. This requires that the shared system be subjected to all levels and types of testing including unit testing, integration testing, systems testing, functional testing, interface testing, performance testing, regression testing, and operational testing. Definitions are provided in subsection 40.3.9. The Shared System Maintainer and the Medicare A/B, DME MACs each have specific roles in testing the shared system quarterly release. Additionally, CMS contracts with a CMS Single Testing Contractor (STC) to act as a Beta tester for the FISS, MCS, VMS, and CWF shared systems respectively. The CMS Single Testing Contractor (STC) assumes primary responsibility for testing the Medicare Shared Systems. The STC will be fully responsible for meeting the requirements of the Beta tester as outlined in Chapter 7, Section 40.3, including all subsections. STC interface testing with HIGLAS will be initiated as a shadow test on Part A. The STC shall also initiate Railroad Retirement Board (RRB) testing. Three Medicare Contractor numbers have been established to accommodate STC testing. They are 00888 for MCS systems testing, 00388 for FISS systems testing, and 44410 for DMEMAC systems testing. This section identifies the testing responsibilities for each organization to ensure that each shared system quarterly release satisfies all CMS requirements. All organizations shall have processes in place to meet these requirements. Testing activities will generally begin 3 to 4 months in advance of the release date, particularly for shared system maintainers.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) Review subsection 40.3.9, Definitions, for a description of key testing terminology. 1. Maintainers of a Shared System shall plan and execute all the essential levels of testing. At a minimum this includes Unit testing, Integration testing, System testing, and Regression testing. Shared System Maintainers are also responsible for performing Interface Testing. 2. Beta testers may initiate testing at the integration level, but are primarily dedicated to testing at the system level, including regression testing. Beta testers are also responsible for performing Interface Testing, which includes full data exchanges between the shared system maintainers, and other systems. 3. Shared System Maintainers and Beta testers shall maintain a test environment that enables system-testing activities to replicate the production environment, as closely as required to effectively test. CMS provided all Beta testers with a date simulation tool to facilitate executing test cases with future dates (e.g., service dates, admission dates) without turning off edits or altering effective dates in the test environment.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) 1. The Shared System Maintainers (SSMs), and the Single Testing Contractor (STC) shall fully test the quarterly release to ensure it is ready to be elevated to production. For the quarterly release to be considered fully tested, all the requirements contained within the release must be tested. Shared System Maintainers (SSMs) and the Single Testing Contractor (STC) must be able to demonstrate the degree to which each discrete requirement within a CR has been tested and by which test cases. It is therefore mandatory that the testers maintain traceability between test cases and the discrete requirements being implemented in the release. Additionally, for each CR or transmittal under test, the Shared System Maintainers and the Single Testing Contractor (STC) must ensure that each discrete requirement specified in the Business Requirements section of any CR/transmittal has been fully tested. The Shared System Maintainers and the Single Testing Contractor (STC) shall specifically: • Maintain a repository of test requirements against which all test cases must be traced. • Prepare and execute a set of test cases that demonstrate the requirements were correctly implemented for all change requests within the quarterly release. • Maintain traceability between each test case and the requirement that the case was designed to test. 2. The Shared System Maintainers and Single Testing Contractor (STC) shall distinguish each test requirement with a unique Requirement Identifier. The Requirement Identifier must be a number or qualifier preceded by the CMS CR number and SSM CR number, separated by dashes. The format of the Requirement Identifier is: [SSM CR No.]-[CMS CR No.]- [Requirement No.], where: • SSM CR No. – is a number that identifies a CMS mandate or user change request under test. Free form text can also be used to identify changes not associated with maintainer CR numbers, e.g., “Regression” to indicate regression testing. Avoid spaces and use underscore symbol “_” instead. Dashes not allowed within this number; they are reserved for separation between the individual numbers in the Requirement Identifier. • CMS CR No. – is a minimum 4-digit number that identifies the CMS CR associated with the maintainer CR number. If no CMS CR is associated with a maintainer CR, use “0000”. Dashes are not allowed. Avoid spaces and use underscore symbol “_” instead. Dashes not allowed within this number; they are reserved for separation between the individual numbers in the Requirement Identifier. • Requirement No. – is a number that uniquely identifies the requirement with the CR. For any requirement taken from the Business Requirements section of a CMS CR, use the actual number from the Requirement # column. Do not repeat the CMS CR number. Dashes not allowed within this number; they are reserved for separation between the individual numbers in the Requirement Identifier. Example: Maintainer CR 22522 corresponds to CMS CR 2634. Business Requirement 2.8 was taken directly from CMS CR 2634. The Requirement Identifier would be 22522- 2634-2.8. 3. The Shared System Maintainer and the Single Testing Contractor (STC) shall complete Test Case specifications that include specific input situations and the expected results associated with a single test purpose. Each test case specification must include the following: • A unique Test Case Identifier (which includes a cross-reference to the requirement in which the case is designed to test); • The specific objective or purpose of the case; • Input specifications (i.e., a description of the input situation[s]); • Output specifications (i.e., a description of the expected results); and • Intercase dependencies - in instances where the test results of one test case may impact other test cases, the test case specification must identify the other test case(s) and describe the relationship(s). Refer to section 40.3.10, Test Case Specification Standard, for the specific format required to electronically maintain test cases. 4. All Test Cases must contain a unique Test Case Identifier. The CMS standard for the Test Case Identifier is the Requirement Identifier, followed by a number that uniquely qualifies the test case specification, separated by a dash. The format of the Test Case Identifier is: [Requirement Identifier]-[Test Case Number], where: • Requirement Identifier – is the actual identifier of the requirement being testing by the case. • Test Case Number – is a number that uniquely qualifies the test case. This is generally a sequential number. This is necessary since more than one test case is often needed to test a single requirement. Dashes not allowed within this number; they are reserved for separation between the individual numbers in the Test Case Identifier. Example: Two test cases were developed to test the implementation of Requirement 22522-2634-2.8 (see example above). The unique Test Case Identifier for the two test cases would be 22522-2634-2.8-01 and 22522-2634-2.8-02. 5. The Shared System Maintainers and the Single Testing Contractor (STC) shall document and execute both positive and negative test cases to ensure the requirements of the release are correctly implemented. • Positive test cases are required to ensure that the system is directly fulfilling the requirements as specified. One or more positive test cases are required for each requirement. As an example, if a program mandate effects a change for services beginning on July 1, a positive test case would include service dates in July or later and validate that the actual mandate was correctly implemented. • Negative test cases test cases are required to ensure that the system does not perform an incorrect action. As an example, if a program mandate effects a change for services beginning on July 1, a negative test case would ensure that implementing the mandate did not negatively impact claims with service dates prior to July 1. Unlike positive test cases, a negative test case may not be applicable to every requirement within a CR. Additionally, although due diligence might necessitate a negative test case, the need may be mitigated by an existing case in your regression test set. 6. The Shared System Maintainers and the Single Testing Contractor (STC) shall document all test cases and the actual results for each test case electronically. Each test case and the associated results must be stored in a test management repository (i.e., Application Lifecycle Management (ALM) tool) and must at a minimum contain the data elements outlined in the CMS Test Case specification standard. See subsection 40.3.10 for the Test Case specification standard. 7. The Shared System Maintainers and the Single Testing Contractor (STC) shall maintain a test log that provides a record of each test execution. Test Log requirements may be fulfilled by correctly using the ALM “run” feature (or an equivalent tool or approach) as outlined in the Quarterly Release Test Management User Guide. 8. The Shared System Maintainers and the Single Testing Contractor (STC) shall execute a full regression test set on their system for every quarterly release. Each testing entity shall perform regression testing within their designated testing window as outlined in subsection 40.3.7, Timeframe Requirements. 9. The Shared System Maintainers and the Single Testing Contractor (STC) shall perform interface testing. • The Shared System Maintainers and the Single Testing Contractor (STC) shall validate that all output files are correctly created by their system. The SSMs and STC shall validate that their system can accept and correctly process all input files. • The Shared System Maintainers and the Single Testing Contractor (STC) shall perform interface testing that includes full data exchanges (both ways) between the shared system and any principal claims processing adjudication or financial system (e.g., the CWF and HIGLAS respectively). The STC is required to perform data exchanges with HIGLAS after HIGLAS is implemented at the STC’s data center. • The Shared System Maintainers and the Single Testing Contractor (STC) shall complete an integrated system test coordinating the maintenance of test data baselines, such as beneficiary data, with the CWF Beta tester.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) 1. Each shared system maintainer and each beta tester shall complete integrated testing with the CWF Beta tester, using coordinated beneficiary data, in the execution of their test cases. All test cases involving CWF functionality (related to claims adjudication) must be executed in an integrated test with the CWF. This requires full data exchanges between testing entities including: • Satellite files being sent from the shared systems to the CWF Beta tester; and • Response files being sent from the CWF to the shared system Beta testers. 2. Each Beta tester shall: • Utilize the standard CMS Test Management tool and repository to documents all test cases and results. • Follow the procedures outlined in the Quarterly Release Test Management User Guide in order to complete the documentation of test runs and results. 3. Each STC/beta tester shall review all Shared System Maintainer release documentation for completeness, accuracy, and usability. Any questions, problems, or issues with the documentation shall be forwarded to both the Shared System Maintainer and CMS. 4. Each STC/beta tester shall conduct performance testing to reasonably assure that the system provides acceptable response times, throughput rates, and processing windows and can accommodate production workloads. 5. The CMS testing requirements outlined in section 40.3 may require the STC/beta tester to test a specific type of bill, specialty, or claim situation for which they do not possess the required level of expertise. In these instances, the STC/beta tester must partner with a Medicare A/B, DME MAC that possesses both the expertise and capabilities to test the specialty or claim type. As an example, should the STC/beta tester not have the operational capability or expertise to process Home Health claims, they are expected to partner with an A/B MAC (HHH) to complete the required HHA testing. Ultimately, the STC/beta tester is responsible for ensuring all test cases are exercised. Any partnerships that are established to complete the testing requirements shall be arranged and managed by the STC/beta tester.

(Rev. 43; Issued: 03-30-07; Effective: 07-01-07; Implementation: 07-02-07) The CWF Beta tester shall act as a test host and exchange data with entities testing the FISS, MCS, and VMS shared systems. The testing entities include all shared system maintainers and the shared system Beta testers.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) A/B, DME MACs are not mandated to prepare and execute test cases that cover Medicare business requirements implemented within the base system in standard system and CWF quarterly releases. Shared System Maintainers and the STC are fully responsible for testing the base functionality. The A/B, DME MAC (users) shall test their local/unique components and conduct a limited, end-to-end, operational test. 1. A/B, DME MACs shall fully test their local components and processing rules prior to production implementation of the quarterly release. This testing is applicable for all local components and processing rules modified since the previous quarterly release. A. A/B, DME MACs shall test any system components they maintain and implement to support claims processing in addition to the base system. This includes front-end and back-end components such as those for EDI entry and translation, EDI outbound processing, and printing (e.g., MSN generation). B. A/B, DME MACs shall test changes they make to user control files, facilities, and tables in order to implement new Medicare policy or business rules. Examples of these facilities include but are not limited to auto adjudication facilities (e.g., ECPS and MCS SCF) and the MCS SPITAB. C. A/B, DME MAC shall fully test any shared system functionality that was: - Developed by the shared system maintainer solely for them, or - Developed by the shared system maintainer under a special project in which they were the exclusive participant. An example would be a MAC working with CMS on a special demonstration project. In this example the MAC shall fully test the shared system functionality that was implemented for the demonstration project. 2. A/B, DME MACs shall complete a limited end-to-end operational test that incorporates the shared system release, integrated with their other claims processing components. These components include the front-end for claims receipt, translators, the CWF, the financials, and back-end EDI and report generation. The test must ensure that processing is contiguous from claims entry, to claims adjudication, and ultimately remittance and Medicare Summary Notice generation. Through contiguous processing, the interfaces between all key claims processing components must be exercised. The banking system interfaces such as National Clearing House (NCH) transfers need not be exercised. The test is limited in the number of test cases that are required, since shared system maintainers and the STC are testing the base functionality of the shared system. A. A/B, DME MACs shall ensure that the integrated systems software can complete cycles without system abends and produce the expected output. The A/B, DME Medicare Contractor shall ensure their operational test: • Exercises all claims entry points not fully incorporated in the base system such as paper and EMC front-end components; • Includes all allowable standard electronic formats and versions; • Includes a variety of claims types; and • Includes all components that support their claims workload and interfaces to the shared system. B. The operational test shall include the most recent shared system release received prior to the initiation of the test. A/B, DME MACs shall initiate the test as required to ensure its completion and the reporting of any problem prior to production implementation. 3. CMS strongly encourages the shared system user community to promote: • Standardizing their system nationally, • Centralizing any table maintenance that implements national Medicare policy at the system maintainer level, and • Minimizing local variations. 4. A/B, DME MACs may perform additional testing on the shared system or duplicate Beta testing tasks as time permits. At the discretion of their Regional Offices, the A/B, DME MACs may be required to separately document any testing they perform in addition to their mandated testing. 5. A/B, DME MACs shall test any business rule or event with future dates that they code or set- up in their Auto Adjudication Software (AAS), prior to implementing the rule or event into production. Examples of AAS include but are not limited to ECPS, SCF, the Shack, and the Mill. a. A/B MACS shall submit their date simulation recommendations to the FISS FWG in advance and participate in discussions at the FWG calls, as required to reach consensus on a date simulation schedule. b. A/B MACS shall submit their date simulation recommendations to the MCS FWG in advance and participate in discussions at the FWG calls, as required to reach consensus on a date simulation schedule. c. DME MACS shall submit their date simulation recommendations to the DMOP TAG or the CFMTAG in advance and participate in discussions at the TAG calls, as required to reach consensus on a date simulation schedule. d. The FISS FWG, MCS FWG, and DMOP/CFM TAG shall use the “system date request process” to provide the VDC(s) their latest “run-date simulation” schedule for their FISS, MCS, and VMS UAT environments. e. The FWG or DMOP TAG shall maintain their “run-date simulation” schedule for a minimum of 14 calendars days in advance. Here is an example of a “run-date simulation” schedule: Calendar Date System Run Date Calendar Date System Run Date Calendar Date System Run Date 10/8/2015 10/5/2015 10/17/2015 10/14/2015 10/26/2015 10/23/2015 10/9/2015 10/6/2015 10/18/2015 10/15/2015 10/27/2015 10/24/2015 10/10/2015 10/7/2015 10/19/2015 10/16/2015 10/28/2015 10/25/2015 10/11/2015 10/8/2015 10/20/2015 10/17/2015 10/29/2015 10/26/2015 10/12/2015 10/9/2015 10/21/2015 10/18/2015 10/30/2015 10/27/2015 10/13/2015 10/10/2015 10/22/2015 10/19/2015 10/31/2015 10/28/2015 10/14/2015 10/11/2015 10/23/2015 10/20/2015 10/1/2015 10/29/2015 10/15/2015 10/12/2015 10/24/2015 10/21/2015 10/2/2015 10/30/2015 10/16/2015 10/13/2015 10/25/2015 10/22/2015 10/3/2015 10/1/2015 f. The FISS FWG, MCS FWG, and DMOP/CFM TAG shall provide a copy of their “run-date simulation” schedule to their CWF test host. g. The FISS FWG and MCS FWG shall provide a copy of their “run-date simulation” schedule to the HIGLAS test site as required to accommodate their HIGLAS enabled contractors.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) Each CWF data center or CWF sector host shall: • Forward all satellite software and documentation to the satellites (contractors) to which they serve as the primary production host; • Install the CWF quarterly release software in a designated test region; • Make the designated test region available their satellites (users) for testing; • Coordinate test data, such as beneficiary data, with the user testers; • Process all satellite files submitted by the users and return all corresponding reply files generated for users; • Report release problems to the CWF Maintainer and CMS; • Verify with CMS that each of its satellites submitted at least one test file during user testing; and • The CWF Host shall support future date testing by the MACs. • The CWF Host shall review date simulation schedule submitted by the FISS FWG, MCS FWG, and DMOP TAG.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) The SSMs, STC, and MAC shall operate under the testing timeframes shown below for each quarterly release: Timeframe Requirements for Testing Entities 1. The Medicare A/B, DME MAC or User testing period shall begin four weeks prior to production implementation. 2. The Beta testing period shall begin eight weeks prior to production implementation. The CWF and standard system Beta testers shall have an exclusive four-week testing timeframe prior to the initiation of user testing. • The Beta tester shall complete a functional System Test and Regression Test before the shared system is released to the User community. • Beta testing must also continue through the User testing period. The Beta tester may initiate performance testing during the user testing period. 3. Exclusive CWFM and SSM testing shall continue until Beta testing is initiated eight weeks prior to production implementation. The SSM and CWFM shall complete a Unit Test (on all components), Integration Test, System Test, and Regression Test prior to distributing the shared system release to the designated Beta tester. For all integration, system, and regression testing, the SSM shall use the most recent version of any third party or CMS provided software components (e.g., Pricer, OCE, MCE, Grouper) they are provided. The SSM shall continue testing beyond the exclusive maintainer-testing window due to the late receipt of some third party or CMS provided software components such as the Pricers and OCE.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) 1. The SSM, STC, and MAC shall maintain documentation that fully demonstrates the requirements of this transmittal were met for each quarterly release. At a minimum the SSM, Beta tester, and MAC shall maintain the following test documentation to demonstrate full compliance: • Test Requirement and Test Case repository with traceability; • Test Log; • Test Status for the execution (run) of each test case (i.e., Pass, Fail, Not Run); • Actual Results for the run of each test case in which the actual results did not match the expected results; and • Documented proof of each test run, i.e., screen shots, scheduler job logs, etc. 2. The SSM, STC, and MAC shall: • Maintain all test documentation for the four quarterly releases prior to the current release under test. The documentation must be available for review by CMS (or its agent). • Document all software defects (problems) within the CMS specified repository such as INFOMAN. 3. The SSM shall communicate all confirmed software defects (problems) and fixes directly to CMS in writing through their CMS Maintenance Lead/(GTL) or other designee as specified by the CMS Project Officer. 4. A/B, DME MACs shall provide any testing documentation to their CMS regional office upon request. Additional requirements for selected shared system maintainers, STC, and CWF hosts may be contained in these organizations' individual contracts. Electronic screen shots may be incorporated/attached into the results of ALM has proof of online results. Test Log requirements may be fulfilled by correctly using the ALM “run” feature as outlined in the Quarterly Release Test Management User Guide.

(Rev. 105, Issued: 06-02-17, Effective: 07-03-17, Implementation: 07-03-17) These definitions are provided to ensure common understanding. Base Shared System - The FISS, MCS, VMS, or CWF system, which is routinely released by the Shared System Maintainers to their respective user community prior to any user customization. This includes all components released by the Shared System Maintainer, including but not limited to the claim adjudication subsystem, the financial subsystems, and other integrated components (i.e., Pricer, OCE, MCE, Grouper). Functional Testing – Testing to ensure that the functional requirements have been met. Functional testing is performed by the SSMs and the STC. Integration Testing – Testing combinations of interacting software components that make up parts of a system. Integration testing is performed by the SSMs, and the STC. Interface Testing – Testing conducted to evaluate whether subsystems or systems pass data. Interface testing is performed by the STC. Local Components – A Local Component as referenced in section 40.3 is any component or module that supports Medicare claims processing, but is not part of the Base System and is under the control and maintenance of the MAC. Maintainer – The Maintainer is an entity to which CMS directly contracts to maintain a Medicare claim processing shared system (FISS, MCS, VMS, or the Common Working File (CWF) system). The Maintainer, as referenced in section 40.3, does not refer to an entity to which a A/B or DME MAC subcontracts to operate their data center or perform other claim processing support activities. Operational Testing – Testing conducted to evaluate a system in its operational environment. Testing to ensure that the aggregate operational systems and their interfaces can be operated securely with the instructions provided. Operational Testing is performed by the SSMs and the A/B and DME MACs. Performance Testing – Testing that applies heavy transaction and processing loads to the system to ensure that response times, throughput rates, and processing windows remain acceptable and can accommodate production workloads. Performance Testing is performed by the STC. Regression Testing – Testing conducted on a system or components to verify that modifications have not caused unintended effects and that the system or components still complies with its requirements. Regression testing is performed by the SSMs and the STC. Regression Test Set – A set of selectable test cases designed to exercise a system over its functional capabilities and assure that it still works properly after changes have been applied. Requirement Identifier – A unique number assigned to each requirement comprised of the Shared System Maintainer CR Number, the CMS CR Number, and an alphanumeric element to uniquely qualify each requirement. For testing purposes CMS requires that each Test Case Identifier incorporate the Requirement Identifier to which it is traced. Stress Testing – Testing that applies a steadily increasing load to the system until it reaches the point where performance degrades to unacceptable levels. System Testing – Testing to discover any incorrect implementation of the requirements or incompatibilities in the software/hardware environment. System testing includes functional testing, performance testing, and operational testing. System testing is performed by the SSMs and the STC. Test Case Specification – A description of an input situation and of the required results associated with a specific test objective or purpose. Test Case Identifier – A unique identifier assigned to each test case. Test Log – A chronological record of relevant detail about the execution of tests. Relevant details include run date, run time, test status, and actual results. Test Requirement - A specific requirement that is under test and to which one or more test cases are traced. Test requirements may be derived from various types of requirements i.e., business functional requirements, performance requirements etc. Note: Any well-written requirement that is “testable” may be considered a Test Requirement. Any requirement contained in the Business Requirements section of a CR or transmittal, also constitutes a test requirement. Test Set – A collection of test cases that have a common usage. Unit Testing – The testing of individual units (i.e., software components, modules) or groups of related units. It is the lowest level of testing and is usually performed by programmers. Unit testing may be both functional (requirements oriented) and structural (i.e. logic oriented, code coverage oriented). Unit testing is performed by the SSMs.

(Rev. 97, Issued: 01-15-16, Effective: 09-21-15, Implementation: 09-21-15) Purpose: This standard establishes a controlled outline for the contents and presentation of a Test Case Specification used by the shared system maintainers and the STC. Applicability: This standard is applicable to all Test Case Specifications developed by the shared system maintainers and the STC. Data Element Description Allowable Values or Format Comments Test Case Specification Identifier Multi-part indicator that uniquely identifies the test case specification. See Test Case Specification Identifier Standard. Test Purpose A free form field that captures the intent of the test and identifies any key components of the test, e.g., specific codes. See attached example. Input Specification A free form field that captures critical information used to exercise the system functionality. Information could be grouped into the following topics: Claim Data Requirements Claims History Beneficiary Information Provider Information See attached example. Intercase Dependencies (Predecessor Transaction Identifier) The test case specification identifier of the transaction that must be entered into and processed by the system prior to processing the transaction described by the test case specification. See Test Case Specification Identifier Standard. Output Specification A free form declarative statement that identifies the expected results from performing all the steps, as a collection, within the test. Test Type A one-character indicator to identify whether the test is positive or negative. P = Positive Test N = Negative Test ALM Plan Tab (Required User Defined Fields) Originator A one-character indicator to identify the originating entity (designer) of the test case. B = Beta C = CMS/QRTM M = Maintainer Test Status Summary indicator for a test case. PS = Passed FA= Failed NR = Not Run IN = Incomplete ID = Invalid Data IC = Invalid Case Required Test Execution (Run) Elements Test Results Free form declarative statement of actual results for a test case when the actual results do not match the expected results. Optional Information: Industry best practices demonstrate that additional granularity may be necessary to document discrete key test actions that should be executed and documented. These items are referred to as test steps. A test case specification may have one or more test steps. When documenting test steps, the following standard applies: Step Number Unique identifier for each test step. “Step n” Where “n” is a sequential counter for each step starting at 1. There is at least one test step in each test case specification, but usually contains multiple test steps. Optional Test Case Step Description A free form declarative statement that identifies the action taken to perform the test. The step description statement usually begins with a verb. Elements Expected Step Results A free form declarative statement that identifies the expected results from performing the associated step description. Example #1 Test Case Identifier 4419-2825-5.2-001 Test Purpose To confirm that the A/B MAC (A) claims processing systems accept, process, and assign reason code 30 (Payment adjusted because the patient has not met the required eligibility, spend down, waiting or residency requirements) to Inpatient Hospital claims submitted on Type of bill (TOB) 111 (Hospital Inpatient Part A; admit through discharge) with Dates of Service (DOS) on 01/01/2004 when a beneficiary is not lawfully present in the United States. Input Specification Claims History None Beneficiary Information Beneficiary must be unlawfully present in United States. Beneficiary elected English as primary language Provider Information Provider Number Range = XX0001-XX0999 Claim Data Requirements TOB = 111 DOS = 01/01/2004 Intercase Dependencies None Output Specification Claim will be assigned reason code 30 indicating beneficiary is not lawfully present in the United States, generating MSN message 5.7 (Medicare payment may not be made for the item or service because on the date of service, you were not lawfully present in the United States). Test Type P Originator C Test Status PS Test Results Claim was assigned appropriate reason code

(Rev. 125; Issued: 07-05-19, Effective: 08-05-19, Implementation: 08-05-19) ID LOB STC Not Testable Conditions and Potential Testing Impacts 1 FISS, MCS, VMS Electronic Correspondence Referral System functionality (ECRS) - The STC does not interface with ECRS. 2 FISS, MCS, VMS Recovery Audit Contractor (RAC) and/or Recovery Audit Contractor Data Warehouse (RACDW) - The STC does not interface with the RAC or the RACDW. The STC does have the ability to test RAC related changes in the shared system applications. 3 FISS, MCS, VMS Non-Base Job System Processing. The STC does not test non-base jobs. 4 FISS ECPS events – The STC does not test MAC controlled ECPS events. 5 VMS Super Op events - The STC does not test MAC controlled Super Op events. 6 MCS SCF Logic - The STC does not test MAC controlled SCF Logic. 7 FISS, MCS, VMS Local Coverage Determinations (LCDs) - The STC does not test MAC LCD or medical policy. MACs conduct LCD and medical policy testing. 8 MCS Interactive Voice Response (IVR) - STC would not do end-to-end testing of MCS base system changes for the IVR. The STC does have the ability to test IVR related changes in the shared system. 9 MCS Automated Response Unit (ARU) - STC would not do end-to-end testing of MCS base system changes for the ARU. The STC does have the ability to test ARU related changes in the shared system. 10 FISS, MCS, VMS Optical Character Recognition (OCR) - The STC does not test changes to OCR functionality. 11 FISS, MCS, VMS, CWF Contractor ID specific logic – The STC is unable to conduct state or jurisdiction specific testing that requires a specific contractor number for processing. 12 FISS, MCS, VMS Printing – The STC does not have a print vendor and does not test backend print/mail functions. 13 FISS, MCS, VMS, CWF Testing that requires large volumes of data – The STC environment contains a limited number of claims. Thus, the STC may not be able to identify volume- related issues in its test environment. 14 FISS, MCS, VMS, CWF Runbooks are documentation artifacts maintained by the SSMs that provide instructions regarding how jobs are to be scheduled (daily, weekly, monthly, on request etc.) and predecessor/successor relationships for jobs that must precede or succeed, as well as containing comments on known abend return codes the job is programmed to return sometimes including instructions on how to rerun/restart each abend return code. As Runbooks are documentation in nature the STC does not test Runbooks. 15 CWF Enrollment Database (EDB) - The STC does not interface with the EDB system. 16 FISS, MCS, VMS, CWF Processes that are designed to only work in a test environment - Processes that are designed to only work in a test environment and will never be promoted or utilized in the production environments. This includes the internal testing facility (ITF), the CWF response generator, the HIGLAS response generator, and the MBI generator. 17 FISS, MCS, VMS Healthcare Integrated General Ledger Accounting System (HIGLAS) - The STC is not responsible for testing HIGLAS changes. The shared systems will continue to test HIGLAS. 18 FISS INFOMAN - The STC does not test CRs implemented by the FISS SSM that update the release identifier on the main CICS screen in the FISS application. 19 FISS, MCS, VMS, Electronic Funds Transfer (EFT) - The STC does not conduct testing with financial institutions, and is therefore unable to test the EFT transactions. The STC inspects the EFT files created from the shared systems and processes them. 20 FISS, MCS Payment File Development Contractor (PFDC) - The STC does not interface with the PFDC system. Changes to the file are tested by the STC by manually sending and receiving a file. The STC inspects the files created from the shared systems and processes them. 21 FISS, MCS, VMS, CWF Integrated Data Repository (IDR) - The STC can test IDR file changes as part of the shared system, but the files are not automatically sent to the IDR contractor. STC manually sends files to the IDR contractor twice during the release. The STC inspects the files for accuracy created from the shared systems and processes them. 22 FISS Quality Improvement Evaluation System (QIES) - The STC does not interface with QIES. The STC inspects the files for accuracy created from the shared systems and processes them. 23 FISS, MCS, VMS, CWF Provider Statistical and Reimbursement System (PS&R) - The STC does not interface with the PS&R system. The STC inspects the files for accuracy created from the shared systems and processes them. 24 FISS, MCS, VMS, CWF Production Performance Monitoring System (PULSE) - The STC does not interface with PULSE. The STC inspects the files for accuracy created from the shared systems and processes them. 25 MCS Provider Enrollment System (PES) - The STC does not have the PES application that is used exclusively by the Railroad Retirement Board Specialty MAC. The STC is unable to test the PES application. 26 FISS, MCS, VMS Provider Enrollment Chain and Ownership (PECOS) - The STC does not utilize the PECOS system to generate enrollments. STC manually creates a file when needed for testing. 27 FISS, MCS, VMS Electronic Submission of Medical Documentation (esMD) - The STC does not have connectivity with esMD. The STC does have the ability to test esMD related changes in the shared system. 28 CWF Affordable Care Organization (ACO) – The STC does not have connectivity with the ACO. The STC does have the ability to test ACO related changes in the shared system. 29 CWF CWF MBI (Medicare Beneficiary ID) XWALK - There are some connectivity tests that STC cannot execute since the XWALK in STC is set up differently compared to production. The XWALK in the STC environment is embedded in the CWF CICS region that houses all other STC CWF data whereas the XWALK in production is in a separate CICS region called Host K. The STC does not connect to Host K.

(Rev. 105, Issued: 06-02-17, Effective: 07-03-17, Implementation: 07-03-17) CMS has fully deployed the Next Generation Desktop (NGD) to the contractors’ beneficiary customer service contact centers. The NGD is a multiple call center application that is used by Medicare Customer Service Representatives (CSRs) to answer inquiries and perform operations on behalf of CMS beneficiaries and the American public. The NGD is designed to pull customer service-needed information into a common desktop application. As such, the NGD requires data exchange with CMS shared systems (VMS, CWF, FISS, MCS) and standard systems (Enrollment Database (EDB)/Master Beneficiary Database (MBD), Master Beneficiary Record (MBR), Group Health Plan (GHP)/Maricopa Managed Care System (MMCS). Note: NGD may integrate with additional systems as future releases are developed. Because NGD integrates with the shared systems, periodic changes will be made to the NGD Integration Layer as a result of the shared systems quarterly release process. The NGD maintainer will be required to update NGD in shares systems quarterly releases (Jan, Apr, July, Oct.) The NGD maintainer will be required to perform the various activities associated with changes to the NGD (i.e., unit and system testing). In addition to the shared systems quarterly release schedule, the NGD will adhere to a separate quarterly functional release process for NGD-specific updates and defect correction. The NGD maintainer shall follow all of the requirements identified in Section 40.3 for the shared system maintainers except as indicated below: 1. Section 40.3.1 Maintainers and Beta Testers –Required Levels of Testing, #3 is not applicable to NGD Beta testers. 2. Section 40.3.2 (#2) Minimum Testing Standards for Maintainers and Beta Testers, for NGD naming conventions, the NGD Maintainer should refer to the NGD test Plan. 3. Section 40.3.2 (#4) Minimum Testing Standards for Maintainers and Beta Testers, for NGD test case identifiers, the NGD maintainer should refer to the NGD System Test Plan. 4. Section 40.3.7 Timeframe Requirements for Testing Entities – NGD testing timeframes are as follows: • The official NGD User Acceptance testing period conducted by the VCS Support Contractor shall begin 2 weeks prior to production implementation. • The overall NGD testing period shall begin 3 weeks prior to production implementation. The NGD VCS Support testers shall have an exclusive 1 week testing timeframe prior to the initiation of user testing (Validation testing) -The User Acceptance tester shall complete a functional System Test and Regression Test before the system is released to the User community. • Exclusive NGD System Maintainer testing shall continue until User Acceptance testing is initiated 3 weeks prior to production implementation. The NGD Maintainer shall complete a Unit Test (on all components), Integration Test, System Test, and Regression Test prior to distributing the shared system release to the designated Beta Tester. 5. Section 40.3.8 Testing Documentation Requirements (#2) For NGD, documentation of all software defects (problems) should be through ClearQuest.

(Rev. 11395, Issued:05-04-2022, Effective:05-31-22, Implementation:05-31-22) POLICY Contractors shall implement all issued Change Requests (CRs) and comply with all issued Technical Direction Letters (TDLs). Medicare Administrative Contractors (MACs) shall prepare and transmit the quarterly Contractor Implementation of Change Request (CRIR) and Technical Direction Letter Compliance Reports (TCR) reports as directed below. The CRIR shall contain all CRs to be implemented within that fiscal quarter. If CMS omitted a CR that should have been included in the report, the contractor shall add the CR to the bottom of the report in red font. MACs are not required to report on or add Shared System Only CRs (i.e., no MAC Responsibility checked). The TCR shall contain all TDLs issued that fiscal quarter, with the exception of contractor- specific TDLs. TDLs issued to specific contractor(s) shall be added by that contractor at the bottom of the report in red font. If CMS omitted a TDL that should have been included in the report, the contractor shall add the TDL to the bottom of the report in red font. A CMS Central Office (CO) representative will notify the MACs via a TDL (within two weeks of the end of each fiscal quarter) that the CRIR and TCR reports are available to download on Electronic Change Information Management Portal (ECHIMP). MACs shall enter all applicable information into the reports. MACs shall upload the completed reports into the CMS ART system. MACs shall also then send the completed reports to the CMS CO mailbox at CR_IMPL_REPORTS@cms.hhs.gov. NOTE: There are no spaces in this email address. Underscore “_” separates the words CR_IMPL_REPORTS. The CRIR and TCR reports are due no later than the 28th of the month in which the reports are due, as indicated below. If the report due date of the 28th falls on a weekend or a holiday; each MAC shall submit the report on the next business day following the due date. • Quarter 1 includes October, November, and December. The report for Quarter 1 is due no later than February 28th. • Quarter 2 includes January, February, and March. The report for Quarter 2 is due no later than May 28th. • Quarter 3 includes April, May, and June. The report for Quarter 3 is due no later than August 28th. • Quarter 4 includes July, August, and September. The report for Quarter 4 is due no later than November 28th. Each MAC shall complete and submit one CRIR by jurisdiction, one TCR by jurisdiction, cover Letter/Attestation Statements, and if necessary, a separate explanation document. MACs with multiple jurisdictions may complete a separate sheet within a single Excel workbook for each jurisdiction. In addition, each contractor shall write and maintain written procedures on its change management process (i.e., Standard Operating Procedures – SOP). Elements should include, but are not limited to, written procedures for the timely processing of CMS instructions (issued CRs and TDLs) from the CMS DRI MAILBOX and CMS TDL MAILBOX, written procedures of the contractor’s CR and TDL distribution process (including, but not limited to, the dissemination of provider education information), written procedures for CR implementation and TDL compliance (including written documentation to verify implementation/compliance). Contractors shall retain the written documentation to verify CR and TDL implementation/compliance using CMS’s records retention guidelines. Upon request from CMS, contractors shall supply the written procedures of their change management process, as well as written documentation to verify CR and TDL implementation/compliance to CMS. Implementation Date I. Definition Refer to section 50.4.2 of this chapter for the definition of the implementation date. II. Supporting Information For any instruction affecting providers, regardless if there are Systems or Non-systems changes, CMS gives at least 90 days’ advance notice to the providers. That is, CMS must issue the instruction at least 90 days prior to the implementation date to give providers enough time to implement the instruction. The vehicle used to alert providers 90 days prior to an instruction’s implementation date is the CMS Quarterly Provider Update, which can be accessed at: http://www.cms.hhs.gov/QuarterlyProviderUpdates/01_Overview.asp There are four exceptions to the 90 days’ advance notice policy: (1) the instruction is contractor specific and therefore does not affect providers; (2) the instruction is a correction/clarification where the previously issued instruction contained typos or errors of fact or omissions; (3) the instruction is a routine or recurring item (which qualifies it to be included on the Mid-Quarter List in the Provider Update); and (4) the instruction is approved by the CMS Administrator to be published immediately or by a certain date. If a previously issued instruction is re-issued with revised MAC requirements and a revised implementation date is not specified, MACs shall comply with the revised instruction as soon as possible but no later than 10 business days from the CR’s date of issuance. For a system change, the Initiator of the CR will specify an implementation date that corresponds to one of the quarterly release dates. Usually, the quarterly release date will be the first Monday of the quarter. Non-recurring system changes are usually issued five months in advance of the implementation date. On occasion, an off-cycle release date can be approved by OSORA and/or the Administrator. This exception tends to occur most frequently with the implementation of National Coverage Determinations (NCDs) and corrections to finals. For a Non-system change that has no impact on providers, the Initiator of the CR may specify the implementation date as 30 days from issuance. For a Non-system change that has provider impact, the Initiator of the CR may specify the implementation date as 90 days from issuance. After the comment period ends and the Initiator of the CR has addressed all comments, he/she prepares a final CR package for CMS clearance. The last part of the CMS clearance process involves obtaining approval from the Medicare Change Control Board (MCCB). The MCCB, in consultation with the Initiator of the CR, will determine the time period needed for implementing each change request. After the clearance process is completed, the Office of Strategic Operations and Regulatory Affairs/Issuances & Records Management Group (OSORA/IRMG) will insert the actual implementation date before issuing the CR as a final instruction. COMPLETING AND SUBMITTING THE QUARTERLY CR IMPLEMENTATION REPORT (CRIR) Medicare Administrative Contractors (MACs) shall complete the CR Implementation Report, as follows, for each jurisdiction. MACs with multiple jurisdictions may complete a separate sheet within a single Excel workbook for each jurisdiction. If CMS omitted a CR that should have been included in the report, the contractor shall add the CR to the bottom of the report in red font. MACs shall update the report in the same manner as a CMS CO entered CR, unless specifically instructed below to exclude specific items. Header Rows The report contains three header rows. 1. Header Row 1, Contains the title, “CR Implementation Report (CRIR) – Quarter X (MMM-MMM) YYYY,” where X is the number of the quarter, MMM-MMM are the months included in that quarter, and YYYY is the Calendar Year. This data will be completed by CMS CO. 2. Item 1: Header Row 2, MACs shall enter their Contractor Name and Jurisdiction identifier in Item 1 of the report. 3. Item 2: Header Row 2, MACs shall enter the “Date Report Submitted” to CMS in Item 2 of the report in MM/DD/YYYY. [This is the date the report is e-mailed to CMS CO.] 4. Item 3: Header Row 2, Report Due. This is the date the report is due to CMS CO. This date will be completed by CMS CO. 5. Item 4: Header Row 3, CRIR Contractor Contact (First Name, Last Name, Phone). MACs shall enter the first name, last name, and phone number of the individual CMS CO should contact to ask questions regarding information in this report. Contact must be knowledgeable on the contents of the report. Details Rows Below the header Rows, Detail Rows shall be completed as follows: 1. Item 5 (No.) - This field contains a consecutive number to track the number of CRs on the report. CMS CO will complete this field for all CRs included on the report. If the contractor adds additional CRs, they should continue numbering from the previous CMS entered row in red font. For example, if CMS included 15 CRs on the report, the contractor shall begin numbering in this field with 16 in red font. 2. Item 6 (CMS CR #) - CMS CO will complete this field with the CMS CR numbers implemented during the quarter. 3. Item 7 (CMS Transmittal #) - CMS CO will not complete this field. 4. Item 8 (Subject) - CMS CO will complete this field with the subject for all CMS CRs implemented during the quarter. 5. Item 9 (CMS Published Implementation Date MM/DD/YYYY) - CMS CO will complete this field with the CMS Published Implementation date in MM/DD/YYYY format for all CRs implemented during the quarter. 6. Item 10 (Applicable Workload? (“X” or blank)) - MACs shall complete this field with an “X” for all CRs applicable to their workload or leave the field blank if the CR is not applicable to their workload. The CR is considered applicable to the contractor if any of the business requirements in the CR were required to be implemented by the contractor in the reporting period. Note: Shared System Only CRs (with no MAC responsibility checked) are considered not applicable. 7. Item 11 (Completed by Implementation Date? (“Y”, “N”, or blank)) - MACs shall complete this field with a ‘Y” for all CRs implemented on or before the CMS Published Implementation Date indicated in Item 9. MACs shall complete this field with an “N” for all CRs that have not been implemented by the implementation date and MACs must select a Reason for Delay from Item 12. This field shall remain blank if the CR is not applicable to the contractor (i.e. Item 10 is blank). 8. Item 12 (Reasons for Delay (leave blank if implemented by due date)) - This field shall remain blank if the CR has been implemented on or before the CMS Published Implementation date (Item 11 is “Y”) or is not applicable to the contractor workload (i.e. Item 10 is blank). MACs shall select one of the following Reasons for Delay from the drop-down list for all applicable CRs not completed by the CMS Published Implementation date indicated in Item 9 (i.e. Item 10 has an ‘x’ and Item 11 has a “N”): 01. Due date changed due to TDL 02. Due date changed due to CR 03. Retired: MLN delay is retired as a reason for delay 04. CMS delay of file transmission 05. System related delay 06. CR extension approved or pending 07. Deadline past quarter end date 08. Other Reason 01 (Due date changed due to TDL) - Applies only in situations where CMS has issued a TDL which directs contractors to hold claims and/or otherwise delay the work related to that specific CR. Reason 02 (Due date changed due to CR) – Applies only in the following situations: a. Correction final changed the CMS Published Implementation date to be different than the date indicated in Item 9; b. CR was rescinded/replaced with a different CR number that changed the CMS Published Implementation date to be different than the date indicated in Item 9; c. Correction or Rescinded/Replaced CR changed the due date of specific Business Requirements. Reason 03 (CMS MLN Matters® Article Delay) – Retired Reason 04 (CMS delay of file transmission) - Applies only in situations when the file needed to complete work indicated in the CR was not available timely (i.e., payment files related to annual recurring CRs such as the HCPCS, Pricer, and OPPS). Reason 05 (System related delay) – Applies only in the following situations: a. Shared System Maintainer (SSM) production problem prevents a MAC from completing a specific task in the CR; b. Non-MAC maintained system (e.g., PECOS, HIGLAS, CWF, etc.) production problem prevents a MAC from completing a specific task in the CR. Reason 06 (CR extension approved or pending) - Applies only in situations where CMS Contracting Officer Representative (COR) has approved an extension of the implementation date specifically referencing this CR. Reason 07 (Deadline past quarter end date) - Applies only in the following situations: a. CRs with multiple implementation dates; b. CRs that contain instruction for work to be done after the implementation date listed in the CR. Reason 08 (Other) - Applies in all other situations where the implementation of the CR was delayed, and Reasons for Delay 01 through 07 do not apply. 9. Item 13 (Additional Explanation) - MACs shall enter additional comments regarding the implementation of this CR in this field if a Reason for Delay is selected. Do not update this field for CRs implemented timely. For the following Reasons for Delay, MACs shall include the following data: Reason 01 (Due date changed due to TDL) - TDL reference number (TDL-######) of the specific TDL which grants an extension and the date to which the extension was granted. Note the actual implementation date of the CR requirements. Reason 02 (Due date changed due to CR) - Issued date of the Correction final, CR number and issued date of replacement CR (if applicable), and the revised implementation date. Note the actual implementation date of the CR requirements. Reason 03 (MLN delay) – Retired Reason 04 (CMS delay of file transmission) - Name of the delayed file, date that the file was expected, and the date the file was actually received. Note the actual implementation date of the CR requirements. Reason 05 (System related delay) – Name of the system, specific production problem identification number, description of the issue, and resolution date (if applicable). Note the actual implementation date of the CR requirements. Reason 06 (CR extension approved or pending) - Name of COR, date approval received, and the revised due date. Note the actual implementation date of the CR requirements. Reason 07 (Deadline past quarter end date) - Note impacted business requirement numbers and the delayed implementation date(s). MACs shall add this CR to the bottom of the CRIR report in red font for the CRIR report of the quarter where MACs completed their work. Reason 08 (Other) – Explanation of the delay for situations not applicable to Reasons for Delay 01 through 07. Use the space allowed in Item 13. If additional space is needed, MACs may submit with the completed CR Implementation report on a separate explanation document. Provide the following information in a clear and concise manner: a. Cause of the delay; b. If not the entire CR, reference the specific delayed Business Requirements; c. Description of specific tasks that were delayed; d. Indicate what is the impact to the government and resolution of the issue that delayed the CR implementation; e. Note the actual implementation date of the CR requirements. 10. CRIR Totals. This section summarizes the totals for the detail rows. a. Item 14 (Total number of CRs in this report) - This field is calculated. The contractor shall not update this field. NOTE: This formula sums both CRs added by CMS and any additional rows of CRs added by the contractor on the spreadsheet. b. Item 15 (Number of CRs applicable to the contractor) – This field is calculated. The contractor shall not update this field. NOTE: This formula counts CRs that the contractor has indicated are applicable by marking an “X” in Column F. c. Item 16 (Number of applicable CRs completed by the Implementation Date) - This field is calculated. The contractor shall not update this field. NOTE: This formula counts CRs that the contractor has indicated were implemented timely by marking a “Y” in Column G. d. Item 17 (% of applicable CRs completed by Implementation Date) - This field is calculated. The contractor shall not update this field. This field reflects the percentage of applicable CRs completed by the Implementation date, regardless of CMS or contractor-controlled reasons for delay. NOTE: This formula calculates a percentage from Item 15 and Item 16. e. Item 18 (% of applicable CRs completed timely) - This field is calculated. The contractor shall not update this field. This field reflects the percentage of applicable CRs implemented timely, regardless of contractor-controlled reasons for delay, as indicated by a selection of Reason for Delay 8 (Other). NOTE: This formula calculates a percentage from the total number of Reason for Delay 08 indicated in Item 19 and the total number of CRs applicable to the contractor in Item 15. 11. Each MAC shall complete and submit one CRIR report by jurisdiction, a cover Letter/Attestation Statement (located on tab 1 of the CRIR Report Template or the Sample in Section 50.3), and if necessary, a separate explanation document. MACs with multiple jurisdictions may complete a separate sheet within a single Excel workbook for each jurisdiction. By the quarterly due date, each MAC shall submit the CRIR report, via e-mail to the CMS CO mailbox. [The CMS CO mailbox is: CR_IMPL_REPORTS@cms.hhs.gov. NOTE: There are no spaces in this Web address. Underscore “_” separates the words CR_IMPL_REPORTS.] If the report due date of the 28th falls on a weekend or a holiday, each contractor, including MACs, shall submit the report on the next business day following the due date. 12. Each MAC shall upload the report to the CMS ART system. COMPLETING AND SUBMITTING THE QUARTERLY TDL COMPLIANCE REPORT Medicare Administrative Contractors (MACs) shall complete the TDL Compliance Report (TCR) for each jurisdiction as follows. MACs with multiple jurisdictions may complete a separate sheet within a single Excel workbook for each jurisdiction (name each tab accordingly). There are some TDLs not issued to all Contractors. If a MAC received a TDL in the reporting period, the TDL should be included on the report. If CMS omitted a TDL that should have been included in the report, the contractor shall add the TDL to the bottom of the report in red font. MACs shall update the report in the same manner as a CMS CO entered TDL, with the exception of Item 7 (CMS Component). For Contractor added rows, Item 7 may remain blank. Header Rows The report contains four header rows. 1. Header Row 1, Contains the title, “TDL Compliance Report (TCR) – Quarter X (MMM- MMM) YYYY,” where X is the number of the quarter, MMM-MMM are the months included in that quarter, and YYYY is the Calendar Year. This data will be completed by CMS CO. 2. Item 1: Header Row 2, MACs shall enter their Contractor Name and Jurisdiction identifier in Item 1 of the report. 3. Item 2: Header Row 2, MACs shall enter the “Date Report Submitted” to CMS in Item 2 of the report in MM/DD/YYYY format. [This is the date the report is e-mailed to CMS CO.] 4. Item 3: Header Row 2, Report Due. This is the date the report is due to CMS CO. This date will be completed by CMS CO. 5. Item 4: Header Row 3, TCR Contractor Contact (First Name, Last Name, Phone). MACs shall enter the first and last name of the individual CMS CO should contact to ask questions regarding information in this report. The contact must be knowledgeable on the contents of the report. Detail Rows Below the Header Rows, Detail Rows shall be completed as follows: 1.Item 5: No. This field contains a consecutive number to track the number of TDLs on the report. CMS CO will complete this field for all TDLs included on the report by CO. If the contractor adds additional TDLs, they should continue numbering from the previous CMS entered row in red font. For example, if CMS included 15 TDLs on the report, the contractor shall begin numbering in this field with 16 in red font. 2.Item 6: TDL #. CMS CO will complete this field with the TDL number for each public TDL issued during the quarter. 3.Item 7: CMS Component. CMS CO will complete this field with the CMS Component responsible for issuing the TDL. [If MACs added the TDL to the report, they do not need to complete item 7 for those TDLs.] 4.Item 8: Subject. CMS CO will complete this field with the subject for all TDLs issued during the quarter. 5.Item 9: CMS Issued Date MM/DD/YYYY. CMS CO will complete this field with the Issued date in MM/DD/YYYY format for all TDLs issued during the quarter. 6.Item 10: Applicable Workload? (“X” or blank). MACs shall complete this field with an “X” for all TDLs applicable to their workload or leave blank if the TDL is not applicable to their workload. The TDL is considered applicable to the contractor if any action in the TDL were required to be completed by the contractor in the reporting period. 7.Item 11: Contractor Compliance? (“Y”, “N” or blank). MACs shall complete this field with a “y” for all applicable TDLs that the contractor has received, reviewed and complied with the instructions in the TDL. MACs shall complete this field with a “n” for all applicable TDLs that the contractor has received and reviewed, but has not complied with the instructions in the TDL. This field shall remain blank if the TDL is not applicable to the contractor (i.e. Item 10 is blank). 8.Item 12: Reason for Delay (Leave blank if in compliance). This field shall remain blank if the TDL has been complied with on or before the due date (i.e. Item 11 is a “y”) or is not applicable to contractor workload (i.e. Item 11 is blank). If the contractor did not comply with the instructions in the TDL (i.e. Item 11 is a “n”), the contractor shall select one of the following reasons from the drop-down list in this field: 01. Due date changed due to TDL 02. Due date changed due to CR 03. System Changes Required to Comply 04. TDL extension approved or pending 05. Deadline past quarter end date 06. Other 01 (Due date changed due to TDL) – Applies only in situations where CMS has issued a subsequent TDL which corrects and/or replaces previous direction provided under the original TDL. 02 (Due date changed due to CR) - Applies only in situations where CMS has issued a CR that supersedes direction provided previously in this specific TDL. 03 (System Changes Required to Comply) – Applies only in the following situations: a. Shared System Maintainer (SSM) production problem prevents a MAC from completing a specific task in the TDL; b. Non-MAC maintained system (e.g., PECOS, HIGLAS, CWF, etc.) production problem prevents a MAC from completing a specific task in the TDL; c. MAC is unable to accomplish a specific task in the TDL without SSM system changes. 04 (TDL extension approved or pending) – Applies only in situations where the CMS Contracting Officer Representative (COR) has approved an extension of the due date specified in the TDL. 05 (Deadline past quarter end date) – Applies only in the situations where some or all of the tasks in the TDL are due to be completed beyond the reporting period of the TCR report. 06 (Other) – Applies in all other situations where compliance with the TDL was delayed, but Reasons for Delay 01 through 05 does not apply. 9.Item 13: Additional Explanation. MACs shall enter additional comments regarding the compliance of the TDL in this field if a Reason for Delay is selected in Item 12. Do not update this field for TDLs complied with timely. For the following Reasons for Delay (Item 12), MACs shall include the following data in Item 13: 01 (Due date changed due to TDL) – TDL reference number (TDL-######) of the specific TDL which corrects and replaces the previous TDL. Note the actual date of compliance with the TDL. 02 (Due date changed due to CR) – CR number and issued date of the CR which supersedes the TDL. Note the implementation date of the CR. 03 (System Changes Required to Comply) – If a production problem prevents compliance, provide: name of the system, specific production problem identification number, and resolution date (if applicable). Note the actual date of compliance with the TDL. If shared system changes are needed to comply, describe necessary change and any steps taken to notify CMS of the discrepancy. 04 (TDL extension approved or pending) – Name of the COR, date approval received, and the revised due date. Note the actual date of compliance with the TDL. 05 (Deadline past quarter end date) – Note specific tasks and the due dates beyond the TCR reporting period. MACs shall add this TDL to the bottom of the TCR report in red font for the TCR report of the quarter where MACs completed their work. 06 (Other) – Explanation of the delay for situations not applicable to Reasons for Delay 01 through 05. Use the space allowed in Item 13. If additional space is needed, MACs may submit with the completed TCR report a separate explanation document. Provide the following information in a clear and precise manner: a. Cause of the delay; b. If not the entire TDL, reference the specific delayed task; c. Description of specific tasks that were delayed; d. Indicate what is the impact to the government and resolution of the issue with the TDL implementation; e. Note the actual date of compliance with the TDL. 10. TCR Totals. This section summarizes the totals for the detail rows. a. Item 14 (Total number of TDLs in this report) – This field is calculated. The contractor shall not update this field. NOTE: this formula sums both TDLs added by CMS and any additional rows of TDLs added by the contractor on the spreadsheet. b. Item 15 (Number of TDLs applicable to the contractor) – This field is calculated. The contractor shall not update this field. NOTE: this formula counts TDLs that the contractor has indicated are applicable by marking an “x” in Column F. c. Item 16 (Number of applicable TDLs by compliance date) – This field is calculated. The contractor shall not update this field. NOTE: This formula counts TDLs that the contractor has indicated were completed timely by marking a “y” in Column G. d. Item 17 (% of applicable TDLs by compliance date) – This field is calculated. The contractor shall not update this field. This field reflects the percentage of applicable TDLs complied with by the due date, regardless of CMS or contractor- controlled reasons for delay. NOTE: This formula calculates a percentage from Item 15 and Item 16. e. Item 18 (% of applicable TDLs completed timely) – This field is calculated. The contractor shall not update this field. This field reflects the percentage of applicable TDLs complied with timely, regardless of contractor-controlled reasons for delay, as indicated by a selection of Reason for Delay 6 (Other). NOTE: This formula calculates a percentage from the total number of Reason for Delay 06 indicated in Item 19 and the total number of TDLs applicable to the contractor in Item 15. 11. Each MAC shall complete and submit one TCR report by jurisdiction, a cover Letter/Attestation Statement (located on tab 1 of the TCR Report Template or in Section 50.3), and if necessary, a separate explanation document. MACs with multiple jurisdictions may complete a separate sheet within a single Excel workbook for each jurisdiction. By the quarterly due date, each MAC shall submit the TCR report, via e-mail to the CMS CO mailbox. [The CMS CO mailbox is: CR_IMPL_REPORTS@cms.hhs.gov. NOTE: There are no spaces in this Web address. Underscore “_” separates the words CR_IMPL_REPORTS.] If the report due date of the 28th falls on a weekend or a holiday, each contractor, including MACs, shall submit the report on the next business day following the due date. 12. Each MAC shall upload the report to the CMS ART system.

(Rev. 90, Issued: 02-12-15, Effective: 08-28-14- Begin with Quarter 3 in 2014.Implementation: 08-28-14- Begin with Quarter 3 in 2014) Upon direction from CMS via a Technical Direction Letter, MACs shall download the updated CR Implementation Report Template from Electronic Change Information Management Portal (ECHIMP), Help page. From there, MACs shall click the link from the List of Documents for the CRIR Template.

(Rev. 90, Issued: 02-12-15, Effective: 08-28-14- Begin with Quarter 3 in 2014.Implementation: 08-28-14- Begin with Quarter 3 in 2014) Upon direction from CMS via a Technical Direction Letter, MACs shall download the updated TCR Template from ECHIMP, Help page. From there, MACs shall click the link from the List of Documents for the TCR Template.

(Rev. 90, Issued: 02-12-15, Effective: 08-28-14- Begin with Quarter 3 in 2014.Implementation: 08-28-14- Begin with Quarter 3 in 2014) CR Implementation Report Contractor Name: Contractor/Jurisdiction Number: Date Report Submitted to CMS: [MM/DD/CCYY] Subject: Attestation Statement: Implementation of Change Requests, Qtr.__, FY__ [Include the appropriate quarter and fiscal year in the Subject line.] Attention: CMS Central Office (CO) Medicare Contractor Management Group (MCMG) In accordance with the Centers for Medicare & Medicaid Services (CMS) Change Requests 2884, 6102, and 8598, I attest that all instructions required to be implemented within Quarter __ [1, 2, 3 or 4 – select appropriate quarter] of FY __ [Enter appropriate fiscal year.] have been implemented. Exceptions are explained in Item 13 of the CR Implementation Report or attached in a separate document. Sincerely, [Name of Contractor Certifying Official.] [Title of Contractor Certifying Official.] Technical Direction Letter Compliance Report Contractor Name: Contractor/Jurisdiction Number: Date Report Submitted to CMS: [MM/DD/CCYY] Subject: Attestation Statement: Compliance with Technical Direction Letters, Qtr.__, FY__ [Include the appropriate quarter and fiscal year in the Subject line.] Attention: CMS Central Office (CO) Medicare Contractor Management Group (MCMG) In accordance with the Centers for Medicare & Medicaid Services (CMS) Change Request 8598, I attest that all instructions required to be complied with within Quarter __ [1, 2, 3 or 4 – select appropriate quarter] of FY __ [Enter appropriate fiscal year.] have been complied with. Exceptions are explained in Item 13 of the TDL Compliance Report or attached in a separate document. Sincerely, [Name of Contractor Certifying Official.] [Title of Contractor Certifying Official.]

(Rev. 66, Issued: 01-07-11, Effective: 02-08-11, Implementation: 02-08-11)

(Rev. 66, Issued: 01-07-11, Effective: 02-08-11, Implementation: 02-08-11) The date the Centers for Medicare and Medicaid Services (CMS) publishes a change request (CR). When a CR has passed through all phases of the change management process, it is then ready for publication; that is, the CMS is ready to make the instructions contained in the CR available to contractors, maintainers, providers, beneficiaries and/or any group or organization that may be affected, as appropriate. The CMS publishes CRs by posting them as Transmittals, on the CMS Web site. Note: The issue date is named “Date” on the Transmittal form, One-Time Notification, Recurring Update Notification, and the Standard CR forms. It is sometimes referred to as the “transmittal date.”

(Rev. 66, Issued: 01-07-11, Effective: 02-08-11, Implementation: 02-08-11) The implementation date identified in a change request (CR) is the date by which Medicare fee- for-service contractors and shared system maintainers shall apply all changes detailed in the business requirements, unless otherwise specified. It is the date when all necessary updates to infrastructure, business processes and/or supporting technology changes shall be completed and operational in order to execute new/modified policy and procedure. For CRs that do not require changes to the shared systems (non-system changes), contractors are usually given 30 to 90 days from issuance to implement the CR. For CRs that do require changes to the shared systems (system changes), a date is specified that usually corresponds with one of the quarterly shared system release dates. The date is usually the first Monday of the quarter (for example, January 3, April 4, July 5, or October 3 for 2011). Unless otherwise stated, the implementation date is the same for all business requirements listed within a specific CR. In some instances, a separate implementation date(s) may be given for a particular business requirement(s) within a CR. Implementation and effective dates are frequently not the same. The list below contains the scenarios for the differences: • The effective date and implementation date are different because the first day of the quarter is not a Monday; • The effective date and the implementation date are different because the effective date occurs after the implementation date; • The effective date and the implementation date are different because the effective date occurs before the implementation date, but both dates are in the future; or • The effective date and the implementation date are different because the effective date occurs before the implementation date, and the effective date is in the past, while the implementation date is in the future.

(Rev. 66, Issued: 01-07-11, Effective: 02-08-11, Implementation: 02-08-11) The effective date identified in a change request (CR) is the date on which any new rules, laws, processes and/or policies become active. Beginning on this date, Medicare contractors shall apply the new rules to process Medicare claims according to their updated business processes and supporting technology. The effective date is normally a mandated date resulting from legislation or a regulation. In the case of National Coverage Determinations (NCDs), the effective date is the first day the item or service that is the subject of the NCD is covered nationally under the Medicare Program. Effective dates are not always future dates; sometimes, they are in the past. When this happens, the Centers for Medicare and Medicaid Services (CMS) instructs contractors, using business requirements, how to process claims for the period between the effective date and the implementation date. Typically, the effective date is the first day of any given fiscal year quarter or the first day of the month.

(Rev. 66, Issued: 01-07-11, Effective: 02-08-11, Implementation: 02-08-11) The date of service (DOS) is the date a provider renders service to a beneficiary. Unless otherwise specified, the effective date of a change request is the date of service. For the purpose of processing claims, the effective date for applying processing rules, laws, processes, and/or policies is the date the beneficiary received a service from a provider. For Durable Medical Equipment (DME) claims with spanned dates of service, the ViPS Medicare System (VMS) will use only the “From” DOS as the date the supplier rendered a service to a beneficiary. For example, if a new rule or law became effective on January 1, 2011, and a beneficiary received service on December 27, 2010, then that service would not be covered under the new rule. If the beneficiary received the service on or after January 1, 2011, then that service would be covered by the new rule. More service-specific information on the Date of Service can be found in. Pub.100-02, Medicare Benefit Policy Manual and Pub. 100-04, Medicare Claims Processing Manual.

(Rev. 23, Issued: 05-06-05; Effective: 10-01-05; Implementation: 10-03-05) POLICY Contractors must implement processes and procedures for adding, deleting, inactivating, bypassing or otherwise modifying all shared system edits. Contractors must also have the capability to document and track those modifications. Modifications to maintainer coded edits must additionally include documentation that provides the rationale for the modification, the expected duration of the change, the impact of the change with respect to potential over or underpayments, claims volumes, effect on providers and / or beneficiaries, etc. In addition, the claims operations manager or equivalent area manager must document approval of the edit modification followed by CMS approval before any maintainer coded edit change has been made. MACs shall examine their current processes for modifying shared system edits and adjust them to incorporate the appropriate levels of internal controls. These controls must be documented and available upon request for review by CMS or an auditor. In addition, contractors must limit the number of personnel with the security clearance to modify maintainer coded shared system edits to ten (10). Should the reason for an edit modification be because of a shared system deficiency, that associated problem must be documented and reported to the maintainer by the contractor. The shared system maintainer and contractor must prioritize the appropriate systems changes to correct edit deficiencies and schedule them for correction as soon as possible via existing change management processes. Should there not be consensus with the contractors regarding schedule, CMS maintenance staff should be consulted. Shared system maintainers must have the capability to track edit changes made by a contractor to the maintainer coded shared system edits. The shared systems must be able to identify who modified the edit, what was modified and when the alteration was made.

(Rev. 59, Issued: 10-30-09, Effective: 04-01-10, Implementation: 04-05-10) The A/B MAC (A) or (HHH) Edits Evaluation Workgroup is tasked with identifying the inventory of contractor inactivated edits, documenting the reasons why the edits are turned off, and making a decision as to whether they should remain inactive or not. Transmittal 338, (Change Request (CR) 5927) issued on May 2, 2008, created the ‘CMS Standard’ field within the existing FISS Reason Code File which contains the status that was determined by the A/B MAC (A) or (HHH) Edits Evaluation Workgroup for each individual code that was reviewed. The ‘CMS Standard’ field indicators are as follows: • ‘A’ = Active • ‘I’ = Inactive • ‘ ‘ = Blank NOTE: The terms ‘Active’ & ‘Inactive‘ are defined as: • Active = Reason code status is equal to ‘S’, ‘P’, ‘ ‘ (blank), ‘D’, ‘R’, ‘T’, or is not equal to ‘S MDLTD’; and • Inactive = Reason code status is equal to ‘A’ or is equal to ‘S MDLTD.’ Each quarter, as necessary, CMS will issue an updated CMS Standard File for Reason Codes which is loaded into the system by the FISS maintainer via a Recurring Update Notification.

(Rev. 100, Issued: 06-23-16; Effective: 07-05-16; Implementation: 07-05-2016) The Centers for Medicare & Medicaid Services’ (CMS’s) Division of Change Management (DCM) is responsible for the coordination and distribution of the draft Medicare Fee-for-Service (FFS) Change Requests (CRs) for Point-of-Contact (POC) Review. To that end, the DCM has developed the Electronic Change Information Management Portal (ECHIMP), a user-friendly, Web-based application to streamline and automate the change management process. In September 2004, the initiators of the CRs began creating and submitting CRs to the DCM via ECHIMP. In the past, the DCM distributed the draft Medicare FFS CRs to only 15 contractor POCs and shared system maintainers (SSMs) for POC review. The SSMs forwarded the CRs to their users for review which increased the time to market the CR and sometimes resulted in the submission of late comments. Therefore, beginning January 3, 2006, the DCM will continue to notify the CMS and SSM POCs of the draft Medicare FFS CRs that are in POC review and also notify all the Medicare FFS contractor POCs as well via ECHIMP 2.0. The DCM will implement ECHIMP 2.0 on a voluntary basis for its internal CMS staff. Initiators of CRs may create and submit a CR for POC review using ECHIMP 2.0 beginning January 3, 2006. However, effective February 6, 2006, ECHIMP 2.0 will be implemented on a mandatory basis (i.e., all CRs will be initiated, submitted and reviewed in ECHIMP 2.0). The POCs will continue to receive the POC Review e-mail for CRs initiated and submitted in ECHIMP 1.0 which will contain the CR and the attachments until February 6, 2006. In addition to receiving the POC review e-mail with the CR and the attachments, POCs will also receive the POC review e-mail alert for CRs that are initiated and submitted in ECHIMP 2.0 which will not contain the CR file and the attachments. However, these e-mail alerts will contain a link for the POCs to click to review and submit comments on the CR via ECHIMP 2.0. NOTE: Beginning February 6, 2006, contractors and maintainers should not reply to any e- mails from ECHIMP @cms.hhs.gov nor should they send any e-mail to eChimp@cms.hhs.gov. Effective February 6, 2006, we will not accept any e-mails sent to that address. The notification of the draft Medicare FFS CRs will be distributed via an E-mail from ECHIMP to the CMS, contractor and SSM POCs, which will no longer contain the files and documents associated with the draft CR. Once the POCs receive the e-mail notification from ECHIMP that notifies them that a CR is currently in POC review, they shall log in to ECHIMP via a link that will be provided in the E-mail notification. Once logged in, they shall review the draft CR and provide comments to CMS via ECHIMP by the POC Review Comment due date. To maintain as much efficiency as possible with such a large number of prospective reviewers, each POC may submit only one set of comments on behalf of their contractor or maintainer organization and that submission must be identified as such. If the CR impacts A/B MAC (A), A/B MAC (B), DME MAC and/or A/B MAC (HHH) and it makes more sense to submit the comments separately (to keep the content clear), then two sets of comments from the contractor site or maintainer organization will be acceptable. No response received will be considered a concurrence. NOTE: It is the responsibility of the POCs to notify appropriate staff that a CR has entered POC review and to share the information with them. Each individual who has access to ECHIMP will also have the ability to review, download and print the CR files and share the files, either electronically or hardcopy, with other staff members who do not have ECHIMP access. We believe that expanding the POC review process to all of the Medicare FFS contractors and SSMs will not only decrease the time to market the CRs, but will also increase the quality of the review of the CRs by allowing a wider audience of those potentially impacted by the change the opportunity to comment. We also believe that this expansion to the POC review process will reduce the number of late comments submitted as well as reduce the number of corrected CRs now necessary as a result of uncoordinated and/or untimely POC comments. CMS realizes that expanding the POC review process to all of the Medicare FFS contractors and SSMs could potentially cause a lack of efficiency and an administrative burden if the above- outlined POC review process is not adhered to. Therefore, we will pilot this expanded POC review process for approximately 3 months effective February 6, 2006. At the conclusion of the 3 months, we will evaluate the pilot and adjust the POC review process, if necessary. Change Request Correction and Rescind Process Currently, the CR corrections and rescind process is a manual process, which is completed via email. CMS is automating the CR correction and rescind process utilizing the ECHIMP system. This CR implements the following processes: • CMS will begin distributing Medicare FFS CRs that are being corrected or rescinded for review via a notification from ECHIMP to the current POC Review recipients. These notifications will specify the type of review to be performed in the subject line of the email (i.e., POC, Correction or Rescind Review). All current POC Review recipients will receive the notifications whether they are impacted on the CR or not. The notifications will specify which Medicare Administrative Contractors (MACs) and Shared System Maintainers (SSMs) are impacted. • Impacted SSMs will review and comment on CRs during the CR's Correction or Rescind Review Period. • Impacted SSMs will update their estimates as a result of the correction or rescind. • Non-impacted SSMs and non-impacted MACs will be able to review and comment on the draft corrected or draft rescinded CRs in ECHIMP, if they so choose. CRs that have been corrected and rescinded prior to this automation will not be updated in ECHIMP. This process will apply to CR corrections and Rescinds initiated on or after July 5, 2016.

(Rev.108, Issue: 11-03-17, Effective: 12-04-17, Implementation: 12-04-17) Fee-for-Service contractor workload transitions occurred when a Medicare Administrative Contractor’s (MAC’s) period of performance ends or its contract is terminated. When either of these two circumstances occurs, the outgoing contractor is required to work with the new incoming contractor to transfer the Medicare workload without any disruption to providers and beneficiaries. During a transition, the outgoing contractor has responsibilities and processes for closing out its Medicare contract and shutting down its operation. It must also assist the new incoming contractor in its efforts to assume the Medicare claims administration functions. Concurrently, the incoming contractor is required to establish an operational infrastructure and ensure that all data, records, and functions are properly transferred from the outgoing contractor. Both parties have a responsibility to ensure that the transition is conducted seamlessly and that all contractual obligations are met during the transition.

(Rev.108, Issue: 11-03-17, Effective: 12-04-17, Implementation: 12-04-17) The Medicare Contractor Management Group (MCMG) in the Center for Medicare has developed a handbook in order to assist fee-for-service contractors with the transfer of Medicare workload from one contractor to another. This is found at: https://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative- Contractors/Resources-for-MACs.html Every Medicare workload transition will vary depending on the unique circumstances and environment of the Medicare contractors involved. There may be activities and processes described in the handbooks that, for various reasons, will not be applicable to a specific transition. There may also be activities that will need to be performed that the handbooks do not cover. The handbook cannot identify and address all of the variations that may occur during a workload transition. However, the overall activities described in the handbooks for managing a workload implementation or closeout project and the requirements contained therein for meetings, reporting, and providing information, data, and records are part of the IOM and incorporated by reference into the MAC contracts.

(Rev. 54, Issued: 10-01-08; Effective: 10-01-08; Implementation: 01-05-09) The CMS’ fraud investigation landscape is significantly different today than in the past as a result of program changes, such as the implementation of the Medicare Prescription Drug benefit, competitive selection of contractors responsible for claims administration and program integrity, such as Medicare Administrative Contractors (MACs) and PSCs, expansion of Medi- Medi and Recovery Audit Contractor (RAC) programs, and advent of the Medicaid Integrity Program (MIP). CMS recognizes the need to significantly enhance the use of technology to improve its collaborative fraud fighting efforts as well as to establish a modernized data analysis capability for all of Program Integrity. Today, most Program Integrity contractors have built their own data warehouses and/or avenues for collecting, processing, analyzing data which serves their own individual needs. These distributed, regional approaches to data analysis do not lend themselves to national analyses, do not represent best practices, and do not take advantage of the cost savings that a centralized data repository would provide. All of these functions can be better served through a comprehensive set of common data structures and modern tools that encourage collaboration and innovation. The IDR goal - through incremental releases - is to be the centralized data repository for all Medicare data. The Program Safeguard Contractors (PSCs) cannot currently use the IDR exclusively because the source of claims data is the National Claims History (NCH). The limited NCH data record is inadequate to support the extensive fraud, waste and abuse investigations that need to be performed by PSCs. The Shared Systems data are the required data source for Program Integrity. The CR initiates the acquisition of the Shared Systems data for the IDR. Once the IDR has the required Shared Systems data, Program Integrity and their contractors will increase their ability to detect potential fraud, waste and abuse. FISS shall provide, in electronic format, all claims output for all A/B MACs (A) or (HHH) and claim types on a daily basis at the claims header and detail level for each of the three identified lifecycle phases required. MCS shall provide, in electronic format, all claims output for all A/B MACs (B) and claim types on a daily basis at the claims header and detail level for each of the three identified lifecycle phases required. VMS shall provide, in electronic format, all claims output for all DME MACs and Certificates of Medical Necessity, as required with certain claims for payment, on a daily basis at the claims header and detail level for each of the three lifecycle phases required. The IDR Lifecycle Phase I is defined as the claim upon enumeration. The IDR Lifecycle Phase II is defined as the claim immediately after CWF adjudication. The IDR Lifecycle Phase III is defined as the claim once financial information has been posted to it. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R13175GI 04/17/2025 Internet Only Manual (IOM) Update, Publication (Pub.) 100-01, Chapter 7, 40.2 - General Information, Eligibility, and Entitlement Manual Chapter 7 - Contract Administrative Requirements 05/19/2025 14038 R11395GI 05/04/2022 Updated Instructions for the Change Request Implementation Report (CRIR) and Technical Direction Letter (TDL) Compliance Report (TCR) 05/31/2022 12714 R128GI 11/01/2019 Update to General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40.2 – Shared System Maintainer Responsibilities for Systems Releases 12/03/2019 11518 R125GI 07/05/2019 Internet Only Manual (IOM) - Update to General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40.2 – Shared System Maintainer Responsibilities for Systems Releases, Section 40.3.11 Single Testing Contractor (STC) Non-Testable Conditions and Potential Testing Impacts 08/05/2019 11245 R124GI 05/17/2019 Update to Publication (Pub.) 100-01 to Provide Language-Only Changes for the New Medicare Card Project 06/18/2019 11240 R122GI 12/21/2018 Updated Instructions for the Change Request Implementation Report (CRIR) and Technical Direction Letter (TDL) Compliance Report (TCR) 05/28/2019 11067 R108GI 11/03/2017 MAC Transition Workload Handbook 12/04/2017 10329 R105GI 06/02/2017 Update to General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40 – Shared System Maintainer Responsibilities for Systems Releases 07/03/2017 10062 R102GI 11/02/2016 Internet Only Manual (IOM) Publication 100-01 - General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40 – Shared System Maintainer Responsibilities for Systems Releases 11/02/2016 9785 R100GI 06/23/2016 Medicare Fee-for-Service Change Request Correction and Rescind Process 07/05/2016 9455 R99GI 06/10/2016 Medicare Fee-for-Service Change Request Correction and Rescind Process – Rescinded and replaced by Transmittal 100 06/10/2016 9455 R97GI 01/15/2016 Internet Only Manual (IOM) Publication 100-01 - General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40 – Shared System Maintainer Responsibilities for Systems Releases 09/21/2015 9219 R95GI 10/16/2015 Internet Only Manual (IOM) Publication 100-01 - General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40 – Shared System Maintainer Responsibilities for Systems Releases – Rescinded and replaced by Transmittal 97 09/21/2015 9219 R93GI 08/21/2015 Internet Only Manual (IOM) Publication 100-01 - General Information, Eligibility, and Entitlement, Chapter 7 - Contract Administrative Requirements, Section 40 – Shared System Maintainer Responsibilities for Systems Releases – Rescinded and replaced by Transmittal 95 09/21/2015 9219 R90GI 02/12/2015 Rescinds/Replaces CR 7468 - Updated Instructions for the Change Request Implementation Report (CRIR) and Technical Direction Letter (TDL) Compliance Report (TCR) 05/28/2015 8598 R88GI 08/25/2014 Rescinds/Replaces CR 7468 - Updated Instructions for the Change Request Implementation Report (CRIR) and Technical Direction Letter (TDL) 09/11/2014 8598 Compliance Report (TCR) – Rescinded and replaced by Transmittal 90 R87GI 08/08/2014 Update to Pub. 100-01, Chapter 7 for Language-Only Changes for ICD-10 Upon Implementati on of ICD-10 8639 R86GI 05/16/2014 Rescinds/Replaces CR 7468 - Updated Instructions for the Change Request Implementation Report (CRIR) and Technical Direction Letter (TDL) Compliance Report (TCR) – Rescinded and replaced by Transmittal 88 08/28/2014 8598 R83GI 03/07/2014 Update to Pub. 100-01, Chapter 7 for Language-Only Changes for ICD-10 – Rescinded and replaced by Transmittal 87 10/01/2014 8639 R75GI 12/30/2011 Contractor Implementation of Change Requests and Compliance With Technical Direction Letters – Rescinded and replaced by CR 8598 05/28/2012 7468 R66GI 01/07/2011 Change Request (CR) Definitions 02/08/2011 6592 R59GI 10/30/2009 The CMS Standard File for Reason Codes for the Fiscal Intermediary Shared System (FISS) 04/05/2010 6529 R57GI 02/20/2009 Implementing Validated Workarounds for Share System Claims Processing by Medicare Administrative Contractors (A/B MACs), Durable Medical Equipment Medicare Administrative Contractors (DMEMACs). Carriers, Regional Home Health Intermediaries (RHHIs) and Fiscal Intermediaries 03/20/2009 6379 R54GI 10/01/2008 IDR Claims Sourcing From Shared Systems-Implementation 01/05/2009 5949 R53GI 09/26/2008 Medicare Contractor Testing with Future Dates in the EDC 10/27/2008 6110 R52GI 07/11/2008 Change to CR Implementation Report Due Dates 08/11/2008 6102 R51GI 05/16/2008 IDR Claims Sourcing From Shared Systems-Implementation - Rescinded and Replaced by Transmittal 54 10/06/2008 5949 R46GI 07/20/2007 Implement New Contractor ID for Single Testing Contractor (STC) 01/07/2008 5648 R44GI 05/25/2007 Fee-for-Service Contractor Transition Handbooks 07/02/2007 5446 R43GI 03/30/2007 Clarification in Testing Instructions for Definition of “Local Components” 07/02/2007 5395 R38GI 05/26/2006 Files Maintenance Program Update to the Internet-Only Manual (IOM) 06/26/2006 5055 R34GI 01/06/2006 Change Management Process -- Electronic Change Information Management Portal (eChimp) 01/03/2006 4092 R33GI 12/30/2005 Change Management Process -- Electronic Change Information Management Portal (eChimp) 01/03/2006 4092 R30GI 10/28/2005 Initiate STC testing of the MCS for RRB and HIGLAS 04/03/2006 4150 R26GI 07/22/2005 Implement New Medicare Plan ID and Carrier Number for the Single Testing Contractor (STC) 10/03/2005 3978 R25GI 07/15/2005 Next Generation Desktop (NGD) Testing Requirements 08/15/2005 3493 R24GI 05/27/2005 2005 Scheduled Release for July Updates to Software Programs and Pricing/Coding Files 06/27/2005 3865 R23GI 05/06/2005 Procedures for Modifying Shared Systems Edits and Capturing Audit Trail Data 10/03/2005 3862 R17GI 02/25/2005 Review of Contractor Implementation of Change Requests (Replacement for expired CR 944) 03/01/2005 2884 R16GI 01/28/2005 Standard Terminology for Claims Processing Systems 04/04/2005 3596 R15GI 01/21/2005 Review of Contractor Implementation of Change Requests (Replacement for expired CR 944) 03/01/2005 2884 R08GI 07/30/2004 Establish Standard Terminology for Medicare Shared Systems 01/03/2005 3086 R06GI 05/2//2004 CMS Policy for Testing Quarterly Release of the Medicare Shared Systems and the CWF 08/01/2004 3011 R05GI 05/07/2004 Initial Publication of Chapter N/A 2765 Back to top of Chapter

(Rev. 1, 10-01-03) Inpatient hospital services are defined in Title XVIII of the Social Security Act (the Act) and in the regulations (42 CFR 409.10): A. Subject to the conditions, limitations, and exceptions set forth in this subpart, the term "inpatient hospital or inpatient CAH services" means the following services furnished to an inpatient of a participating hospital or of a participating CAH or, in the case of emergency services or services in foreign hospitals, to an inpatient of a qualified hospital: 1. Bed and board. 2. Nursing services and other related services. 3. Use of hospital or CAH facilities. 4. Medical social services. 5. Drugs, biologicals, supplies, appliances, and equipment. 6. Certain other diagnostic or therapeutic services. 7. Medical or surgical services provided by certain interns or residents-in- training. 8. Transportation services, including transport by ambulance. B. Inpatient hospital services does not include the following types of services: 1. Posthospital SNF care, as described in 42 CFR 409.20, furnished by a hospital or a critical access hospital that has a swing-bed approval. 2. Nursing facility services, described in 42 CFR 440.155 that may be furnished as a Medicaid service under title XIX of the Act in a swing- bed hospital that has an approval to furnish nursing facility services. 3. Physician services that meet the requirements of 42 CFR 415.102(a) for payment on a fee schedule basis. 4. Physician assistant services, as defined in §1861(s)(2)(K)(i) of the Act. 5. Nurse practitioner and clinical nurse specialist services, as defined in §1861(s)(2)(K)(ii) of the Act. 6. Certified nurse mid-wife services, as defined in §1861(gg) of the Act. 7. Qualified psychologist services, as defined in §1861(ii) of the Act. 8. Services of an anesthetist, as defined in 42 CFR 410.69.

(Rev. 234, Issued: 03-10-17, Effective: 01-01-16, Implementation: 06-12-17) Patients covered under hospital insurance are entitled to have payment made on their behalf for inpatient hospital services. (Inpatient hospital services do not include extended care services provided by hospitals pursuant to swing bed approvals. See Pub. 100-02, Chapter 8, §10.3, "Hospital Providers of Extended Care Services."). However, both inpatient hospital and inpatient SNF benefits are provided under Part A - Hospital Insurance Benefits for the Aged and Disabled, of Title XVIII). Additional information concerning the following topics can be found in the following chapters of this manual: • Benefit Period is found in Chapter 3 • Counting Inpatient Days is found in Chapter 3 • Lifetime reserve days is found in Chapter 5 • Related payment information is housed in the Provider Reimbursement Manual Blood must be furnished on a day which counts as a day of inpatient hospital services to be covered as a Part A service and to count toward the blood deductible. Thus, blood is not covered under Part A and does not count toward the Part A blood deductible when furnished to an inpatient after the inpatient has exhausted all benefit days in a benefit period, or where the individual has elected not to use lifetime reserve days. However, where the patient is discharged on their first day of entitlement or on the hospital's first day of participation, the hospital is permitted to submit a billing form with no accommodation charge, but with ancillary charges including blood. The records for all Medicare hospital inpatient discharges are maintained in CMS for statistical analysis and use in determining future Prospective Payment System (PPS) Diagnosis Related Group (DRG) classifications and rates. Non-PPS hospitals do not pay for noncovered services generally excluded from coverage in the Medicare Program. This may result in denial of a part of the billed charges or in denial of the entire admission, depending upon circumstance. In PPS hospitals, the following are also possible: 1. In appropriately admitted cases where a noncovered procedure was performed, denied services may result in payment of a different DRG (i.e., one which excludes payment for the noncovered procedure); or 2. In appropriately admitted cases that become cost outlier cases, denied services may lead to denial of some or all of an outlier payment. The following examples illustrate this principle. If care is noncovered because a patient does not need to be hospitalized, the A/B MAC Part A denies the admission and makes no Part A (i.e., PPS) payment unless paid under limitation on liability. Under limitation on liability, Medicare payment may be made when the provider and the beneficiary were not aware the services were not necessary and could not reasonably be expected to know that the services were not necessary. For detailed instructions, see Pub. 100-04, Medicare Claims Processing Manual, Chapter 30,"Limitation on Liability" section 20. If a patient is appropriately hospitalized but receives (beyond routine services) only noncovered care, the admission is denied. NOTE: The A/B MAC Part A does not deny an admission that includes covered care, even if noncovered care was also rendered. Under PPS, Medicare assumes that it is paying for only the covered care rendered whenever covered services needed to treat and/or diagnose the illness were in fact provided. If a noncovered procedure is provided along with covered nonroutine care, a DRG change rather than an admission denial might occur. If noncovered procedures are elevating costs into the cost outlier category, outlier payment is denied in whole or in part. When the hospital is included in PPS, most of the subsequent discussion regarding coverage of inpatient hospital services is relevant only in the context of determining the appropriateness of admissions, which DRG, if any, to pay, and the appropriateness of payment for any outlier cases. If a patient receives items or services in excess of, or more expensive than, those for which payment can be made, payment is made only for the covered items or services or for only the appropriate prospective payment amount. This provision applies not only to inpatient services, but also to all hospital services under Parts A and B of the program. If the items or services were requested by the patient, the hospital may charge him or her the difference between the amount customarily charged for the services requested and the amount customarily charged for covered services. An inpatient is a person who has been admitted to a hospital for bed occupancy for purposes of receiving inpatient hospital services (see §10.2 below). Generally, a patient is considered an inpatient if formally admitted as inpatient with the expectation that he or she will require hospital care that is expected to span at least two midnights and occupy a bed even though it later develops that the patient can be discharged or transferred to another hospital and not actually use a hospital bed overnight. The physician or other practitioner responsible for a patient's care at the hospital is also responsible for deciding whether the patient should be admitted as an inpatient. Physicians should use the expectation of the patient to require hospital care that spans at least two midnights period as a benchmark, i.e., they should order admission for patients who are expected to require a hospital stay that crosses two midnights and the medical record supports that reasonable expectation. However, the decision to admit a patient is a complex medical judgment which can be made only after the physician has considered a number of factors, including the patient's medical history and current medical needs, the types of facilities available to inpatients and to outpatients, the hospital's by-laws and admissions policies, and the relative appropriateness of treatment in each setting. Factors to be considered when making the decision to admit include such things as: • The severity of the signs and symptoms exhibited by the patient; • The medical predictability of something adverse happening to the patient; • The need for diagnostic studies that appropriately are outpatient services (i.e., their performance does not ordinarily require the patient to remain at the hospital for 24 hours or more) to assist in assessing whether the patient should be admitted; and • The availability of diagnostic procedures at the time when and at the location where the patient presents. Admissions of particular patients are not covered or noncovered solely on the basis of the length of time the patient actually spends in the hospital. In certain specific situations coverage of services on an inpatient or outpatient basis is determined by the following rules: Minor Surgery or Other Treatment - When patients with known diagnoses enter a hospital for a specific minor surgical procedure or other treatment that is expected to keep them in the hospital for only a few hours (less than 24), they are considered outpatients for coverage purposes regardless of: the hour they came to the hospital, whether they used a bed, and whether they remained in the hospital past midnight. Renal Dialysis - Renal dialysis treatments are usually covered only as outpatient services but may under certain circumstances be covered as inpatient services depending on the patient's condition. Patients staying at home, who are ambulatory, whose conditions are stable and who come to the hospital for routine chronic dialysis treatments, and not for a diagnostic workup or a change in therapy, are considered outpatients. On the other hand, patients undergoing short-term dialysis until their kidneys recover from an acute illness (acute dialysis), or persons with borderline renal failure who develop acute renal failure every time they have an illness and require dialysis (episodic dialysis) are usually inpatients. A patient may begin dialysis as an inpatient and then progress to an outpatient status. Under original Medicare, the Quality Improvement Organization (QIO), for each hospital is responsible for deciding, during review of inpatient admissions on a case-by-case basis, whether the admission was medically necessary. Medicare law authorizes the QIO to make these judgments, and the judgments are binding for purposes of Medicare coverage. In making these judgments, however, QIOs consider only the medical evidence which was available to the physician at the time an admission decision had to be made. They do not take into account other information (e.g., test results) which became available only after admission, except in cases where considering the post-admission information would support a finding that an admission was medically necessary. Refer to chapters 4 and 7 of Pub. 100-10, Quality Improvement Organization Manual with regard to initial determinations for these services. The QIO will review the swing bed services in these PPS hospitals as well. NOTE: When patients requiring extended care services are admitted to beds in a hospital, they are considered inpatients of the hospital. In such cases, the services furnished in the hospital will not be considered extended care services, and payment may not be made under the program for such services unless the services are extended care services furnished pursuant to a swing bed agreement granted to the hospital by the Secretary of Health and Human Services.

(Rev. 1, 10-01-03) A3-3101.1, HO-210.1

(Rev. 1, 10-01-03) A3-3101.1.A, HO-210.1.A The program will pay the same amount for routine accommodations services whether the patient has a private room not medically necessary, a private room medically necessary (Medicare does not pay for deluxe accommodations in any case), a semiprivate room (2-, 3-, or 4-bed accommodations), or ward accommodations, if its ward accommodations are consistent with program purposes (see §10.1.6 below). A provider having both private and semiprivate accommodations may nevertheless charge the patient a differential for a private room if: • The private room is not medically necessary; and • The patient (or relative or other person acting on their behalf) has requested the private room, and the provider informs them of the amount of charge at the time of the request. The private room differential may not exceed the difference between the customary charge for the accommodations furnished and the most prevalent semiprivate accommodation rate at the time of the patient's admission. Where the provider bills for a private room as a covered service, i.e., shows the charge for the room as a covered charge on the Form CMS-1450, the A/B MAC (A) will deem the private room to be medically necessary. Where the provider, on the other hand, shows a private differential as a noncovered charge, the A/B MAC (A) will assume that the private room is not medically necessary. If the beneficiary (or their representative) protests a charge for the private room on the grounds that the privacy was medically necessary, such protest will, if not in written form, be reduced to writing and forwarded to the A/B MAC (A). The A/B MAC (A) will then develop the facts and make a specific determination regarding the medical necessity of the private room. (If an A/B MAC (A) receives many protests of this kind, the provider may need guidance on what constitutes medical necessity for privacy). If the protest is received after the claim is processed, it will be treated as a request for reconsideration. If at any time in the course of development (or thereafter within the period when the determination is not administratively final), the provider acknowledges that the private room was medically necessary; the A/B MAC (A) will make an immediate finding to this effect. Where it is necessary to develop the medical necessity of a private room, the guidelines in subsections §§10.1.2 and 10.1.3 below will apply.

(Rev. 1, 10-01-03) A3-3101.1.B, HO-210.1.B A private room is medically necessary where isolation of a beneficiary is required to avoid jeopardizing their health or recovery, or that of other patients who are likely to be alarmed or disturbed by the beneficiary's symptoms or treatment or subjected to infection by the beneficiary's communicable disease. For example, communicable diseases, heart attacks, cerebra-vascular accidents, and psychotic episodes may require isolation of the patient for certain periods. (See §10.1.3 below concerning medical necessity not based on need for isolation). In establishing the medical necessity for isolation, the date of the physician's written statement is not controlling, nor is the presence of a written statement. The crucial question is whether a private room was ordered by the physician because it is necessary for the health of the patient himself or herself or of other patients. In the absence of such an order, a patient who requested the room with knowledge of the amount of the charge may be charged appropriately, even though a physician subsequently submits a statement that the room was medically necessary. There may be cases in which the physician's written statement of medical necessity, though dated after admission or even after discharge, merely confirms an order made informally at or before the time the beneficiary was admitted to the private room (e.g., the physician made arrangements by phone for the patient's admission, gave the diagnosis, and stated the beneficiary would need a private room). In such cases, assuming that the private room was medically necessary, the lack of a written statement by the physician, or the fact that the written statement was prepared after discharge, would not be controlling. The patient may not be charged.

(Rev. 1, 10-01-03) A3-3101.1.C, HO-210.1.C A private room is considered to be medically necessary even though the beneficiary's condition does not require isolation if he/she needs immediate hospitalization (i.e., the beneficiary's medical condition is such that hospitalization cannot be deferred) and the hospital has no semiprivate or ward accommodations available at the time of admission. It need not be considered whether semiprivate or ward accommodations were available in some other accessible hospital. Where medical necessity exists, the provider may not charge the beneficiary a private room differential until semiprivate or ward accommodations become available. Thereafter the provider may transfer the patient to the nonprivate accommodations, or allow them to continue occupancy of the private room, subject to an appropriate differential charge (described in §10.1.1 above) if they request the private room with knowledge of the amount of the charge. If the admission could be deferred until semiprivate or ward accommodations become available, the beneficiary should be informed of the amount of the differential he/she must pay for a private room if he/she wishes to be admitted immediately. The beneficiary may be charged the specified differential if he/she has been admitted to the private room at their request (or at the request of their representative) with knowledge of the amount of the charge.

(Rev. 1, 10-01-03) A3-3101.1.D, HO-210.1.D Beneficiaries found to need a private room (either because they need isolation for medical reasons or because they need immediate admission when no other accommodations are available) may be assigned to any of the provider's private rooms. They do not have the right to insist on the private room of their choice, but their preferences should be given the same consideration as if they were paying all provider charges themselves. The program does not, under any circumstances, pay for personal comfort items. Thus, the program does not pay for deluxe accommodations and/or services. These would include a suite, or a room substantially more spacious than is required for treatment, or specially equipped or decorated, or serviced for the comfort and convenience of persons willing to pay a differential for such amenities. If the beneficiary (or representative) requests such deluxe accommodations, the provider should advise that there will be a charge, not covered by Medicare, of a specified amount per day (not exceeding the differential defined in the next sentence); and may charge the beneficiary that amount for each day he/she occupies the deluxe accommodations. The maximum amount the provider may charge the beneficiary for such accommodations is the differential between the most prevalent private room rate at the time of admission and the customary charge for the room occupied. Beneficiaries may not be charged this differential if they (or their representative) do not request the deluxe accommodations. The beneficiary may not be charged such a differential in private room rates if that differential is based on factors other than personal comfort items. Such factors might include differences between older and newer wings, proximity to lounge, elevators or nursing stations, desirable view, etc. Such rooms are standard 1-bed units and not deluxe rooms for purposes of these instructions, even though the provider may call them deluxe and have a higher customary charge for them. No additional charge may be imposed upon the beneficiary who is assigned to a room that may be somewhat more desirable because of these factors.

(Rev. 1, 10-01-03) A3-3101.E, HO-210.1.E If the patient is admitted to a provider which has only private accommodations, and no semiprivate or ward accommodations, medical necessity will be deemed to exist for the accommodations furnished. Beneficiaries may not be subjected to an extra charge for a private room in an all-private room provider.

(Rev. 1, 10-01-03) A3-3101.1.F, HO-210.1.F The law contemplates that Medicare patients should not be assigned to ward accommodations except at the patient's request or for a reason consistent with the purposes of the health insurance program. When ward accommodations are furnished at the patient's request or for a reason determined to be consistent with the program's purposes, payment will be based on the average per diem cost of routine services (see §10.1.1 above). Where ward accommodations are assigned for other reasons, the law provides what may be a substantial penalty. (See §10.1.6.2 below). Any request by the patient (or relative or other person responsible for his or her affairs) for ward accommodations must be obtained by the provider in writing and kept in its files.

(Rev. 1, 10-01-03) A3-3101.1.F.1, HO-210.1.F.1 It is considered to be consistent with the program's purposes to assign the patient to ward accommodations if all semiprivate accommodations are occupied, or the facility has no semiprivate accommodations. However, the patient must be moved to semiprivate accommodations if they become available during the stay. Some hospitals have a policy of placing in wards all patients who do not have private physicians. Such a practice may be consistent with the purposes of the program if the A/B MAC (A) determines that the ward assignment inures to the benefit of the patient. In making this determination, the principal consideration is whether the assignment is likely to result in better medical treatment of the patient (e.g., it facilitates necessary medical and nursing supervision and treatment). The A/B MAC (A) should ask a provider having this policy to submit a statement describing how the assignments are made, their purpose, and the effect on the care of patients so assigned. If the A/B MAC (A) makes a favorable determination on a practice affecting all ward assignments of Medicare patients in the institution, a reference should be made on the appropriate billing form for patients to whom the hospital assigned a ward pursuant to such practice.

(Rev. 1, 10-01-03) A3-3101.1.F.2, HO-210.1.F.2 It is not consistent with the purposes of the law to assign a patient ward accommodation based on their social or economic status, their national origin, race, or religion, or their entitlement to benefits as a Medicare patient, or any other such discriminatory reason. It is also inconsistent with the purposes of the law to assign patients to ward accommodations merely for the convenience or financial advantage of the institution. Additionally, under DRGs, there no longer is a reduction to payment or an adjustment to the end of year settlement.

(Rev. 1, 10-01-03) A3-3101.1.G, HO-210.1.G Customary charges means amounts which the hospital or skilled nursing facility is uniformly charging patients currently for specific services and accommodations. The most prevalent rate or charge is the rate that applies to the greatest number of semiprivate or private beds in the institution.

(Rev. 234, Issued: 03-10-17, Effective: 01-01-16, Implementation: 06-12-17) The order to admit as an inpatient (“practitioner order”) is a critical element in clarifying when an individual is considered an inpatient of a hospital, including a critical access hospital (CAH), and is therefore required for all hospital inpatient cases for hospital inpatient coverage and payment under Part A. As a condition of payment for hospital inpatient services under Medicare Part A, according to section 1814(a) of the Social Security Act, CMS is requiring, only for long-stay cases and outlier cases, separate physician certification of the medical necessity that such services be provided on an inpatient basis. The signed physician certification is considered, along with other documentation in the medical record, as evidence that hospital inpatient service(s) were reasonable and necessary. The following guidance applies to all inpatient hospital and CAH services unless otherwise specified. For the remainder of this guidance, references to hospitals includes CAHs. The complete requirements for the physician certification are found in 42 CFR Part 424 subpart B, and requirements for admission orders are found at 42 CFR 412.3. A. Physician Certification. Physician certification of inpatient services is required for cases that are 20 inpatient days or more (long-stay cases), for outlier cases of hospitals other than inpatient psychiatric facilities and for cases of CAHs. (See CY 2015 Outpatient Prospective Payment System Final Rule, 79 FR 66997 and 42 CFR 412 Subpart F, 42 CFR 424.13 and 42 CFR 424.15): 1. Content: The physician certification includes the following information: a. Reason for inpatient services: The physician certifies the reasons for either— (i) Continued hospitalization of the patient for inpatient medical treatment or medically required inpatient diagnostic study; or (ii) Special or unusual services for outlier cases under the applicable prospective payment system for inpatient services. For example, documentation of an admitting diagnosis could fulfill this part of the certification requirement. b. The estimated (or actual) time the beneficiary requires or required in the hospital: The physician certifies the estimated time in the hospital the beneficiary requires (if the certification is completed prior to discharge) or the actual time in the hospital (if the certification is completed at discharge). Estimated or actual length of stay is most commonly reflected in the progress notes where the practitioner discusses the assessment and plan. For the purposes of meeting the requirement for certification, expected or actual length of stay may be documented in the order or a separate certification or recertification form, but it is also acceptable if discussed in the progress notes assessment and plan or as part of routine discharge planning. If the reason an inpatient is still in the hospital is that they are waiting for availability of a skilled nursing facility (SNF) bed, the regulations at 42 CFR 424.13(c) and 424.14(e) provide that a beneficiary who is already appropriately an inpatient can be kept in the hospital as an inpatient if the only reason they remain in the hospital is they are waiting for a post-acute SNF bed. The physician may certify the need for continued inpatient admission on this basis. c. The plans for posthospital care, if appropriate, and as provided in 42 CFR 424.13. d. For inpatient CAH services only, the physician must certify that the beneficiary may reasonably be expected to be discharged or transferred to a hospital within 96 hours after admission to the CAH. Time as an outpatient at the CAH does not count towards the 96 hour certification requirement. The clock for the 96 hour certification requirement only begins once the individual is admitted to the CAH as an inpatient. Time in a CAH swing-bed also does not count towards the 96 hour certification requirement. The 96-hour certification requirement is based on an expectation at the time of admission. If a physician certifies in good faith that an individual may reasonably be expected to be discharged or transferred to a hospital within 96 hours after admission to the CAH, and something unforeseen occurs that causes the individual to stay longer at the CAH, the CAH would be paid for that unforeseen extended inpatient stay as long as that individual’s stay does not cause the CAH to exceed its 96-hour annual average condition of participation requirement. However, if a physician cannot in good faith certify that an individual may reasonably be expected to be discharged or transferred within 96 hours after admission to the CAH, the CAH will not receive Medicare reimbursement for any portion of that individual’s inpatient stay. This would be determined based on a medical review of the case. All certification requirements must be completed, signed, and documented in the medical record no later than 1 day before the date on which the claim for payment for the inpatient CAH service is submitted, as provided in the FY15 IPPS Final Rule and 42 CFR 424.11 and 42 CFR 424.15. e. Inpatient Rehabilitation Facilities (IRFs): The documentation that IRFs are already required to complete to meet the IRF coverage requirements (such as the preadmission screening (including the physician review and concurrence), the post-admission physician evaluation, and the required admission orders) may be used to satisfy the certification and recertification statement requirements. 2. Timing: Outlier cases must be certified and recertified as provided in 42 CFR 424.13. Under extenuating circumstances, delayed initial certification or recertification of an outlier case may be acceptable as long as it does not extend past discharge. For all other long stay cases, the certification must be signed and documented no later than 20 days into the inpatient portion of the hospital stay. 3. Authorization to sign the certification: The certification or recertification may be signed only by one of the following: (1) A physician who is a doctor of medicine or osteopathy. (2) A dentist in the circumstances specified in 42 CFR 424.13(d). (3) A doctor of podiatric medicine if his or her certification is consistent with the functions he or she is authorized to perform under state law. Certifications and recertifications must be signed by the physician responsible for the case, or by another physician who has knowledge of the case and who is authorized to do so by the responsible physician or by the hospital’s medical staff (or by the dentist as provided in 42 CFR 424.11 and 42 CFR 424.13). CMS considers only the following physicians, podiatrists or dentists to have sufficient knowledge of the case to serve as the certifying physician: the admitting physician of record (“attending”) or a physician on call for him or her; a surgeon responsible for a major surgical procedure on the beneficiary or a surgeon on call for him or her; a dentist functioning as the admitting physician of record or as the surgeon responsible for a major dental procedure; and, in the specific case of a non‐physician non‐dentist admitting practitioner who is licensed by the state and has been granted privileges by the facility, a physician member of the hospital staff (such as a physician member of the utilization review committee) who has reviewed the case and who also enters into the record a complete certification statement that specifically contains all of the content elements discussed above. The admitting physician of record may be an emergency department physician or hospitalist. CMS does not require the certifying physician to have inpatient admission privileges at the hospital. 4. Format: As specified in 42 CFR 424.11, no specific procedures or forms are required for certification and recertification statements. The provider may adopt any method that permits verification. The certification and recertification statements may be entered on forms, notes, or records that the appropriate individual signs, or on a special separate form. Except as provided for delayed certifications, there must be a separate signed statement for each certification or recertification. If all the required information is included in progress notes, the physician's statement could indicate that the individual's medical record contains the information required and that hospital inpatient services are or continue to be medically necessary. B. Inpatient Order: A Medicare beneficiary is considered an inpatient of a hospital if formally admitted as an inpatient pursuant to an order for inpatient admission by an ordering practitioner. As stated in the FY 2014 IPPS Final Rule, 78 FR 50908 and 50941, and as conveyed in 42 CFR 482.24, if the order is not properly documented in the medical record prior to discharge, the hospital should not submit a claim for Part A payment. Meeting the two midnight benchmark does not, in itself, render a beneficiary an inpatient or serve to qualify them for payment under Part A. Rather, as provided in Medicare regulations, a beneficiary is considered an inpatient (and Part A payment may only be made) if they are formally admitted as such pursuant to an order for inpatient admission by an ordering practitioner. With regard to the time of discharge, a Medicare beneficiary is considered a patient of the hospital until the effectuation of activities typically specified by the ordering practitioner as having to occur prior to discharge (e.g., “discharge after supper” or “discharge after voids”). Thus, discharge itself can but does not always coincide exactly with the time that the discharge order is written, rather it occurs when the ordering practitioner’s order for discharge is effectuated. 1. Content: The ordering practitioner’s order contains the instruction that the beneficiary should be formally admitted for hospital inpatient care. The order must specify admission for inpatient services. Inpatient rehabilitation facilities (IRFs) must adhere to the admission requirements specified in 42 CFR 412.622. The two midnight benchmark does not apply in IRFs. 2. Qualifications of the ordering/admitting practitioner: The order must be furnished by a physician or other practitioner (“ordering practitioner”) who is: (a) licensed by the state to admit inpatients to hospitals, (b) granted privileges by the hospital to admit inpatients to that specific facility, and (c) knowledgeable about the patient’s hospital course, medical plan of care, and current condition at the time of admission. See section (B)(3) for a discussion of the requirements to be knowledgeable about the patient’s hospital course. The ordering practitioner makes the determination of medical necessity for inpatient care and renders the admission decision. The ordering practitioner is not required to write the order but must authenticate (sign, or in the case of an initial order (under (B)(2)(a)) or a verbal order (under (B)(2)(b)), countersign) the order reflecting that he or she has made the decision to admit the patient for inpatient services. The admission decision (order) may not be delegated to another individual who is not authorized by the state to admit patients, or has not been granted admitting privileges by the hospital's medical staff. However, a medical resident, physician assistant, nurse practitioner, or other non-physician practitioner may act as a proxy for the ordering practitioner provided they are authorized under state law to admit patients and the requirements outlined below are met (FY 14 IPPS Final Rule and 42 CFR 412.3(b)). a. Residents and non-physician practitioners authorized to make initial admission decisions - Certain non-physician practitioners and residents working within their residency program are authorized by the state in which the hospital is located to admit inpatients, and are allowed by hospital by-laws or policies to do the same. The ordering practitioner may allow these individuals to write inpatient admission orders on his or her behalf, if the ordering practitioner approves and accepts responsibility for the admission decision by authenticating (countersigning) the order prior to discharge. (See (A)(2) for guidance regarding the definition of discharge time and (B)(3) for more guidance regarding knowledge of a patient’s hospital course). In authenticating (countersigning) the order, the ordering practitioner approves and accepts responsibility for the admission decision. This process may also be used for practitioners (such as emergency department physicians) who do not have admitting privileges but are authorized by the hospital to issue temporary or “bridge” inpatient admission orders. b. Verbal orders- At some hospitals, individuals who lack the authority to admit inpatients under state laws and hospital by‐laws (such as a registered nurse) may nonetheless enter the inpatient admission order as a verbal order. In these cases, the ordering practitioner directly communicates the inpatient admission order to staff as a verbal (not standing) order, and the ordering practitioner need not separately record the order to admit. Following discussion with and at the direction of the ordering practitioner, a verbal order for inpatient admission may be documented by an individual who is not qualified to admit patients in his or her own right, as long as that documentation (transcription) of the order for inpatient admission is in accordance with state law including; scope‐ of‐practice laws, hospital policies, and medical staff bylaws, rules, and regulations. In this case, the staff receiving the verbal order must document the verbal order in the medical record at the time it is received. The order must identify the ordering practitioner and must be authenticated (countersigned) by the ordering practitioner promptly and prior to discharge. Example: “Admit to inpatient per Dr. Smith” would be considered an acceptable method of identifying the ordering practitioner and would meet the verbal order requirement if the verbal order (1) is appropriately documented in the medical record by the individual receiving the verbal order when the order is received; and (2) is authenticated (countersigned) by Dr. Smith promptly, prior to discharge. c. Standing orders and protocols - The inpatient admission order cannot be a standing order. While Medicare’s rules do not prohibit use of a protocol or algorithm that is part of a protocol, only the ordering practitioner, or a resident or other practitioner acting on his or her behalf under section (B)(2)(a) can make and take responsibility for the inpatient admission decision. d. Commencement of inpatient status - Inpatient status begins at the time of formal admission by the hospital pursuant to the order, including an initial order (under (B)(2)(a)) or a verbal order (under (B)(2)(b)) that is authenticated (countersigned) timely, by authorized individuals, as required in this section. If the practitioner responsible for authenticating (countersigning) an initial order or verbal order does not agree that inpatient admission was appropriate or valid (including an unauthorized verbal order), he or she should not authenticate (countersign) the order and the beneficiary is not considered to be an inpatient. The hospital stay may be billed to Part B as a hospital outpatient encounter. 3. Knowledge of the patient’s hospital course: CMS considers only the following practitioners to have sufficient knowledge about the beneficiary’s hospital course, medical plan of care, and current condition to serve as the ordering practitioner: the admitting physician of record (“attending”) or a physician on call for him or her, primary or covering hospitalists caring for the patient in the hospital, the beneficiary’s primary care practitioner or a physician on call for the primary care practitioner, a surgeon responsible for a major surgical procedure on the beneficiary or a surgeon on call for him or her, emergency or clinic practitioners caring for the beneficiary at the point of inpatient admission, and other practitioners qualified to admit inpatients and actively treating the beneficiary at the point of the inpatient admission decision. A utilization review committee physician functioning in that role does not have direct responsibility for the care of the patient and is therefore not considered to be sufficiently knowledgeable to order the inpatient admission. The order must be written by one of the above practitioners directly involved with the care of the beneficiary, and a utilization committee physician may only write the order to admit if he or she is not acting in a utilization review capacity and fulfills one of the direct patient care roles, such as the attending physician. Utilization review may not be conducted by any individual who was professionally involved in the care of the patient whose case is being reviewed (42 CFR 482.30(d)(3)). 4. Timing: The order must be furnished at or before the time of the inpatient admission. The order can be written in advance of the formal admission (e.g., for a pre‐scheduled surgery), but the inpatient admission does not occur until hospital care services are provided to the beneficiary. Conversely, in the unusual case in which a patient is admitted as an inpatient prior to an order to admit and there is no documented verbal order, the inpatient stay should not be considered to commence until the inpatient admission order is documented. CMS does not permit retroactive orders. Authentication by the ordering practitioner of the order (either by signature or, in the case of an initial order under (B)(2)(a) or a verbal order under (B)(2)(b), countersignature) is required prior to discharge for all inpatient cases. 5. Specificity of the Order: The regulations at 42 CFR 412.3 require that, as a condition of payment, an order for inpatient admission must be present in the medical record. The preamble of the FY 2014 IPPS Final Rule at 78 FR 50942 states, “the order must specify the admitting practitioner’s recommendation to admit ‘to inpatient,’ ‘as an inpatient,’ ‘for inpatient services,’ or similar language specifying his or her recommendation for inpatient care. While CMS does not require specific language to be used on the inpatient admission order, it is in the interest of the hospital that the ordering practitioner use language that clearly expresses intent to admit the patient as inpatient that will be commonly understood by any individual who could potentially review documentation of the inpatient stay. CMS does not recommend using language that may have specific meaning only to individuals that work in a particular hospital (e.g., “admit to 7W”) that will not be commonly understood by others outside of the hospital. If admission order language used to specify inpatient or outpatient status is ambiguous, the best course of action would be to obtain and document clarification from the ordering practitioner before initial Medicare billing (ideally before the beneficiary is discharged). Under this policy, CMS will continue to treat orders that specify a typically outpatient or other limited service (e.g., admit “to ER,” “to Observation,” “to Recovery,” “to Outpatient Surgery,” “to Day Surgery,” or “to Short Stay Surgery”) as defining a non‐ inpatient service, and such orders will not be treated as meeting the inpatient admission requirements. The admission order is evidence of the decision by the ordering practitioner to admit the beneficiary to inpatient status. In extremely rare circumstances, the order to admit may be missing or defective (that is, illegible, or incomplete, for example “inpatient” is not specified), yet the intent, decision, and recommendation of the ordering practitioner to admit the beneficiary as an inpatient can clearly be derived from the medical record. In these extremely rare situations, contractors have been provided with discretion to determine that this information constructively satisfies the requirement that the hospital inpatient admission order be present in the medical record. However, in order for the documentation to provide acceptable evidence to support the hospital inpatient admission, thus satisfying the requirement for the order, there can be no uncertainty regarding the intent, decision, and recommendation by the ordering practitioner to admit the beneficiary as an inpatient, and no reasonable possibility that the care could have been adequately provided in an outpatient setting. This narrow and limited alternative method of satisfying the requirement for documentation of the inpatient admission order in the medical record should be extremely rare, and may only be applied at the discretion of the contractor.

(Rev. 1, 10-01-03) A3-3101.2, HO-210.2 Nursing and other related services, use of hospital facilities, and medical social services ordinarily furnished by the hospital for the care and treatment of inpatients are covered under hospital insurance and included in the Prospective Payment system payment. NOTE: The services of a private-duty nurse or other private-duty attendant are not covered. Private-duty nurses or private-duty attendants are registered nurses, licensed practical nurses, or any other trained attendant whose services ordinarily are rendered to, and restricted to, a particular patient by arrangement between the patient and the private- duty nurse or attendant. Such persons are engaged or paid by an individual patient or by someone acting on their behalf, including a hospital that initially incurs the costs and looks to the patient for reimbursement for such noncovered services. Where the hospital acts on behalf of a patient, the services of the private-duty nurse or other attendant under such an arrangement are not inpatient hospital services regardless of the control which the hospital may exercise with respect to the services rendered by such private-duty nurse or attendant.

(Rev. 1, 10-01-03) A3-3101.2.A, HO-210.2.A If the hospital engages the services of a nurse anesthetist or other nonphysician anesthetist (either on a salary or fee-for-service basis) under arrangements which provide for billing to be made by the hospital, the cost of the service when provided to an inpatient could be covered under Part A. (See the Medicare Claims Processing Manual for more information.)

(Rev. 1, 10-01-03) A3-3101.2.B, HO-210.2.B Medical social services are services which contribute meaningfully to the treatment of a patient's condition. Such services include, but are not limited to: • Assessment of the social and emotional factors related to the patient's illness, need for care, response to treatment, and adjustment to care in the facility; • Appropriate action to obtain case work services to assist in resolving problems in these areas; and • Assessment of the relationship of the patient's medical and nursing requirements to their home situation, financial resources, and the community resources available to them in making the decision regarding their discharge.

(Rev. 1, 10-01-03) A3-3101.3, HO-210.3 Drugs and biologicals for use in the hospital, which are ordinarily furnished by the hospital for the care and treatment of inpatients, are covered. Three basic requirements must be met for a drug or biological furnished by a hospital to be a covered hospital service: 1. The drug or biological must represent a cost to the institution in rendering services to the beneficiary; 2. The drug or biological must meet the statutory definition. Under the statute, payment may be made for a drug or biological only where it is included, or approved for inclusion, in the latest official edition of the United States Pharmacopoeia-National Formulary (USP-NF), the United States Pharmacopoeia Drug Information (USP DI), or the American Dental Association (ADA) Guide to Dental Therapeutics, except for those drugs and biologicals unfavorably evaluated in the ADA Guide to Dental Therapeutics. Combination drugs are also included in the definition of drugs if the combination itself or all of the therapeutic ingredients of the combination are included, or approved for inclusion, in any of the above drug compendia. Drugs and biologicals are considered approved for inclusion in a compendium if approved under the established procedure by the professional organization responsible for revision of the compendium; or be approved by the pharmacy and drug therapeutics or equivalent committee of the medical staff of the hospital for use in the hospital; and 3. Use of the drug or biological must be safe and effective and otherwise reasonable and necessary as specified in the Medicare Benefit Policy Manual, Chapter 15, “Covered Medical and Other Health Services,” §50. Drugs or biologicals approved for marketing by the Food and Drug Administration (FDA) are considered safe and effective for purposes of this last requirement when used for indications specified in the labeling. Therefore, use of an FDA-approved drug or biological is covered if: • It was administered on or after the date of the FDA's approval; • It is reasonable and necessary for the individual patient; and • All other applicable coverage requirements are met. Drugs and biologicals, which have not received final marketing approval by the FDA, are not covered unless CMS instructs the A/B MAC (A) to the contrary. However, FDA- approved drugs are used for indications other than those specified on the labeling. As long as the FDA has not specified such use as nonapproved, coverage is determined taking into consideration the generally accepted medical practice in the community. For example, the labeling of certain chemotherapeutic drugs indicates their use in the therapy of specified types of cancer. However, based on experience and empirical evidence, physicians may prescribe these drugs for a wider range of cancer treatments than what is indicated in the labeling. Local medical review policy may or may not grant coverage, depending on the circumstances. Determinations as to whether use of a drug or biological is reasonable and necessary for an individual patient are the responsibility of the Quality Improvement Organization (QIO), if this is part of the review for a PPS acute care admission. However, if this is an excluded service claim being reviewed by the A/B MAC (A), the A/B MAC (A) reviews and makes a determination, unless it cannot and needs to refer it to the QIO for an initial determination. A hospital stay solely for the purpose of use of a drug or biological that is determined not reasonable and necessary is not covered.

(Rev. 1, 10-01-03) A3-3101.2.A, HO-210.3.A Medicare covers only those drugs and biologicals included, or approved for inclusion, in the latest official edition or revision of the compendia as previously listed. Where a drug is excluded from coverage because it is unfavorably evaluated in either the AMA Drug Evaluations or Accepted Dental Therapeutics, the exclusion applies to all uses for which the drug or biological was so unfavorably evaluated. Drugs and biologicals are considered "approved for inclusion" in a compendium if approved under the procedure established by the professional organization responsible for revision of the compendium.

(Rev. 1, 10-01-03) A3-3101.3.B, HO-210.3.B A pharmacy and drug therapeutics or equivalent committee is a medical staff committee that confers with the hospital pharmacist in the formulation of policies pertaining to drugs. Drugs and biologicals approved for use in the hospital by such a committee are covered only if the committee develops and maintains a formulary or list of drugs accepted for use in the hospital. The committee need not function exclusively as a pharmacy and drug therapeutics committee but may also carry on other medical staff functions. Drugs and biologicals are considered approved for use in the hospital if selected for inclusion in the hospital drug list of formulary under the procedure of the committee established for that purpose. Express approval is required; the fact that a drug or biological has not been specifically determined to be unacceptable for use in the hospital does not constitute approval. Drugs and biologicals are covered if approved for general use in the hospital, or if approved for use by a particular patient or group of patients. Approval by a pharmacy and drug therapeutics committee is an alternative to approval for inclusion of the drug or biological in an approved drug compendium (see §30.1 above); such approval does not preclude the need for a determination of medical necessity. An investigational drug is not considered to meet the reasonable and necessary test since its efficacy has not yet been established. The decision of individual hospitals should not transcend the determinations of the Food and Drug Administration and Public Health Service in respect to the safety and effectiveness of drugs. Therefore, even if approved by an appropriate hospital committee, the reasonable cost of an investigational or other nonapproved drug or biological (e.g., Laetrile) cannot be reimbursed. This exclusion from payment applies whether or not the drug or biological is administered during the course of an otherwise covered hospital stay, since payment may not be made for items and services that are not reasonable and necessary. A hospital stay solely for the purpose of administering a drug or biological that is not reasonable and necessary, including an investigational drug or biological, is not covered and the drug or biological itself is not covered.

(Rev. 1, 10-01-03) A3-3101.3.C, HO-210-3.C Combination drugs are covered if the combination itself or all of the therapeutic ingredients of the combination are included, or approved for inclusion, in any of the designated drug compendia. Any combination drug approved for use in the hospital by the pharmacy and drug therapeutics or equivalent committee is covered.

(Rev. 1, 10-01-03) A3-3101.3.D, HO-210.3.D Coverage is not limited to drugs and biologicals routinely stocked by the hospital; a drug or biological not stocked by the hospital, which the hospital obtains for the patient from an outside source, such as a community pharmacy, can also be covered. Drugs and biologicals not included in the drug list or formulary maintained by the hospital's pharmacy and drug therapeutics committee may be covered if the hospital has a policy which permits such drugs to be furnished to a patient at the special request of a physician. However, in order to be covered, such drugs and biologicals must be included, or approved for inclusion, in one of the designated drug compendia. (In addition, a combination drug, or all of its therapeutic ingredients, would have to be included or approved for inclusion in one of the compendia.)

(Rev. 1, 10-01-03) A3-3101.3.E, HO-210.3.E Drugs and biologicals furnished by a hospital to an inpatient for use outside the hospital are, in general, not covered as inpatient hospital services. However, if the drug or biological is deemed medically necessary to permit or facilitate the patient's departure from the hospital, and a limited supply is required until the patient can obtain a continuing supply, the limited supply of the drug or biological is covered as an inpatient hospital service.

(Rev. 1, 10-01-03) A3-3101.4, HO-210.4 Supplies, appliances, and equipment, which are ordinarily furnished by the hospital for the care and treatment of the beneficiary solely during the inpatient hospital stay, are covered inpatient hospital services. Under certain circumstances, supplies, appliances, and equipment used during the beneficiary's inpatient stay are covered under Part A even though the supplies, appliances and equipment leave the hospital with the patient upon discharge. These are circumstances in which it would be unreasonable or impossible from a medical standpoint to limit the patient's use of the item to the periods during which the individual is an inpatient. Examples of items covered under this rule are: • Items permanently installed in or attached to the patient's body while an inpatient, such as cardiac valves, cardiac pacemakers, and artificial limbs; and • Items which are temporarily installed in or attached to the patient's body while an inpatient, and which are also necessary to permit or facilitate the patient's release from the hospital, such as tracheotomy or drainage tubes. Hospital “admission packs” containing primarily toilet articles, such as soap, toothbrushes, toothpaste, and combs, are covered under Part A if routinely furnished by the hospital to all its inpatients. If not routinely furnished to all patients, the packs are not covered. In that situation, the hospital may charge beneficiaries for the pack, but only if they request it with knowledge of what they are requesting and what the charge to them will be. Supplies, appliances, and equipment furnished to an inpatient for use only outside the hospital are not, in general, covered as inpatient hospital services. However, a temporary or disposable item, which is medically necessary to permit or facilitate the patient's departure from the hospital and is required until the patient can obtain a continuing supply, is covered as an inpatient hospital service. Oxygen furnished to hospital inpatients is covered under Part A as an inpatient supply.

(Rev. 1, 10-01-03) A3-3101.5, HO-210.5 Other diagnostic or therapeutic items or services ordinarily furnished inpatients by the hospital or by others under arrangements made by the hospital are covered. This category of covered services encompasses items and services not otherwise specifically listed as covered inpatient hospital services. (See the Medicare Benefit Policy Manual, Chapter 15, “Covered Medical and Other Health Services.”) Such services to hospital inpatients may be covered under Part A even when furnished off the hospital premises. For example, diagnostic or therapeutic services of an audiologist off the hospital premises are covered if billed for by the hospital under arrangements (see Pub 100-01, the Medicare General Information, Eligibility, and Entitlement Manual, Chapter 5, §10.3, for further information concerning “under arrangements”), if the services are furnished at a speech and hearing center, and if the audiologist meets the qualifications for an audiologist: • Is licensed if applicable by the State in which practicing; and • Is eligible for a certification of clinical competence in audiology granted by the American Speech and Hearing Association; or • Meets the education requirements for certification and is in the process of accumulating the supervised experience required for certification.

(Rev. 1, 10-01-03) A3-3101.5.A, HO-210.5 Therapeutic items, which are covered when ordinarily furnished by the hospital to its inpatients, or when ordinarily furnished to hospital inpatients by others under arrangements with them made by the hospital, include but are not limited to the following: • Surgical dressings, and splints, casts, and other devices used for the reduction of fractures and dislocations; • Prosthetic devices (other than dental) which replace all or part of an internal body organ (including contiguous tissue) or replace all or part of the function of a permanently inoperative or malfunctioning internal body organ; and • Leg, arm, back, and neck braces, trusses, and artificial legs, arms, and eyes. With respect to items that leave the hospital with the patient upon discharge, such as splints or casts, the rules for determining whether the item is covered are the same as the rules set forth above for supplies, appliances, and equipment.

(Rev. 1, 10-01-03) A3-3101.5.B, HO-210.5 When a psychologist or physical therapist is a salaried member of the staff of a hospital, their diagnostic or therapeutic services to inpatients of that hospital are covered. See the Medicare Claims Processing Manual for information on distinguishing between professional and technical services, and for information about billing and payment for nonphysician practitioners.

(Rev. 1, 10-01-03) A3-3101.5.C, HO-210.5 Diagnostic services furnished to an inpatient by an independent clinical laboratory under arrangements with the hospital are reimbursable under hospital insurance provided the lab is certified by CLIA to perform the services. An independent laboratory is one which is independent both of an attending or consulting physician's office and also independent of any hospital which meets at least the requirements to qualify as an emergency hospital (e.g., maintains clinical records, has a utilization review plan, meets the health and safety requirements found necessary by the Secretary of Health and Human Services). A consulting physician is one whose services include history taking, examination of the patient and, in each case, furnishing to the attending physician an opinion regarding diagnosis or treatment. A physician providing clinical laboratory services for patients of other physicians is not considered to be a consulting physician. A laboratory operated by or under the supervision of a hospital (or the organized medical staff of the hospital) that does not meet at least the definition of an emergency hospital is considered to be an independent laboratory. However, a laboratory serving hospital patients and operated on the premises of a hospital that meets the definition of an emergency hospital is presumed to be subject to the supervision of the hospital or its organized medical staff and is not an independent laboratory. A laboratory that a physician or group of physicians maintains for performing diagnostic tests in connection with their own or the group practice is also not considered to be an independent laboratory. An out-of-hospital laboratory is ordinarily presumed to be independent unless there is written evidence establishing that it is operated by or under the supervision of a hospital that meets at least the definition of an emergency hospital or of the organized medical staff of such a hospital. Refer to “The Conditions of Participation for Hospitals” found at 42 CFR 482 and below for a description of independent lab approval requirements when the hospital is participating. Where a laboratory operated on hospital premises is claimed to be independent or where an out-of-hospital facility is designated as a hospital laboratory, the CMS regional office makes the determination concerning the laboratory's status. A clinical laboratory is a laboratory where microbiological, serological, chemical, hematological, radiobioassay, cytological, immunohematological, or pathological examinations are performed on materials derived from the human body, to provide information for the diagnosis, prevention, or treatment of a disease or assessment of a medical condition. The "Conditions of Participation for Hospitals (HIRM-1)" call for independent clinical laboratory services furnished under arrangements made by a hospital to be furnished only by a laboratory meeting the specified conditions for coverage under the program. These require that: • Where State or applicable local law provides for licensing of independent clinical laboratories, the laboratory is either licensed under law or is approved as meeting the requirements for licensing by the State or local agency responsible for licensing laboratories; and • Such laboratories also meet the health and safety requirements prescribed by the Secretary of Health and Human Services. (See “The Conditions of Participation for Hospitals” at 42 CFR 482). Where independent laboratory services are provided to patients of a participating hospital under arrangements with the hospital, the law does not require as a condition of payment in an individual case that the independent laboratory be approved under the program. In processing individual claims, the A/B MAC (A), therefore, need not verify that the services were obtained from an approved laboratory. The A/B MAC (A) should make payment for laboratory services although it may know that the laboratory from which the hospital has obtained the service is not approved under the program. However, it should promptly refer this information to the appropriate regional office for review of the determination of the hospital's compliance with the conditions of participation and for whatever action the regional office deems appropriate. The above policy applies to PPS exempt hospitals. Note that under PPS, there is no separate payment for lab services furnished to inpatients.

(Rev. 1, 10-01-03) A3-3101.5.D, HO-210.5 Diagnostic services furnished a hospital inpatient under arrangements with the laboratory of another participating hospital are reimbursable on a cost basis under Part A to the hospital obtaining the services if the hospital is PPS exempt. If the hospital is not exempt, there is not separate payment for lab services furnished to inpatients. NOTE: Where a PPS exempt hospital obtains diagnostic laboratory services for inpatients under arrangements described in §§50.3 and 50.4 the cost to the hospital obtaining the services would be the reasonable charge for the laboratory's service.

(Rev. 1, 10-01-03) A3-3101.6, HO-210.6 Hospital insurance covers the reasonable cost of the services of medical or osteopathic interns or residents-in-training under a teaching program approved by the appropriate approving body. In the case of services of interns or residents-in-training in the field of dentistry in a hospital or osteopathic hospital, the teaching program must have the approval of the Council on Dental Education of the American Dental Association. The services of interns and residents-in-training in the field of podiatry who are in a residency program approved by the Council on Podiatric Medical Education of the American Podiatric Medical Association are covered on the same basis as the services of other interns and residents in other approved residency programs.

(Rev. 1, 10-01-03) A3-3101.7, HO-210.7 When a patient is hospitalized for a dental procedure and the dentist's service is covered under Part B, the inpatient hospital services furnished are covered under Part A. For example, both the professional services of the dentist and the inpatient hospital expenses are covered when the dentist reduces a jaw fracture of an inpatient at a participating hospital. In addition, hospital inpatient services, which are necessary because of the patient's underlying medical condition and clinical status or the severity of a noncovered dental procedure, are covered. When the hospital services are covered, all ancillary services such as x-rays, administration of anesthesia, use of the operating room, etc., are covered. Regardless of whether the inpatient hospital services are covered, the medical services of physicians furnished in connection with noncovered dental services are not covered. The services of an anesthesiologist, radiologist, or pathologist whose services are performed in connection with the care, treatment, filling, removal, or replacement of teeth or structures directly supporting teeth are not covered.

(Rev. 1, 10-01-03) A3-3101.12, HO-210.13 Reasonable and necessary services associated with pregnancy are covered and reimbursable under the Medicare program. Because pregnancy is a condition sufficiently at variance with the usual state of health, it is appropriate for a pregnant woman to seek medical care. The increased possibility of illness or injury accompanying this condition is well recognized, and medical supervision is required throughout pregnancy and for a brief period beyond. Skilled medical management is appropriate throughout the events of pregnancy, beginning with diagnosis of the condition, continuing through delivery, and ending after the necessary postnatal care. Similarly, if the pregnancy terminates, whether spontaneously or for therapeutic reasons (i.e., where the life of the mother would be endangered if the fetus were brought to term), the need for skilled medical management and/or medical services is equally as important as in those cases carried to full term. After the infant is delivered, items and services furnished to the infant cannot be covered and reimbursed under the program on the basis of the mother's eligibility.

(Rev. 1, 10-01-03) B3-4276.1,.2 Effective for services furnished on or after October 1, 1998, Medicare will cover abortions procedures in the following situations: 1. If the pregnancy is the result of an act or rape or incest; or 2. In the case where a woman suffers from a physical disorder, physical injury, or physical illness, including a life-endangering physical condition caused by the pregnancy itself that would, as certified by a physician, place the woman in danger of death unless an abortion is performed. NOTE: The "G7" modifier must be used with the following CPT codes in order for these services to be covered when the pregnancy resulted from rape or incest, or the pregnancy is certified by a physician as life threatening to the mother: 59840 59841 59850 59851 59852 59855 59856 59857 59866

(Rev. 1, 10-01-03) A3-3101.13 Effective for services rendered on or after January 15, 1980, reasonable and necessary services associated with treatment for infertility are covered under Medicare. Like pregnancy (see §80 above), infertility is a condition sufficiently at variance with the usual state of health to make it appropriate for a person who normally would be expected to be fertile to seek medical consultation and treatment. A/B MACs (A) should coordinate with QIOs to see that utilization guidelines are established for this treatment if inappropriate utilization or abuse is suspected.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) The inpatient rehabilitation facility (IRF) benefit is designed to provide intensive rehabilitation therapy in a resource intensive inpatient hospital environment for patients who, due to the complexity of their nursing, medical management, and rehabilitation needs, require and can reasonably be expected to benefit from an inpatient stay and an interdisciplinary team approach to the delivery of rehabilitation care. The IRF benefit is not to be used as an alternative to completion of the full course of treatment in the referring hospital. A patient who has not yet completed the full course of treatment in the referring hospital is expected to remain in the referring hospital, with appropriate rehabilitative treatment provided, until such time as the patient has completed the full course of treatment. Though medical management can be performed in an IRF, patients must be able to actively participate in and benefit from the intensive rehabilitation therapy program provided in IRFs in order for an IRF claim to be considered reasonable and necessary, in accordance with 42 CFR § 412.622(a)(3)(ii). Therefore, patients who are not able to actively participate in and benefit from the intensive rehabilitation therapy services because they are still completing their course of treatment in the referring hospital should remain in the referring hospital until they are able to do so. Conversely, the IRF benefit is not appropriate for patients who have completed their full course of treatment in the referring hospital, but do not require intensive rehabilitation. Medicare benefits are available for such patients in a less-intensive setting. IRF care is only considered by Medicare to be reasonable and necessary under 1862(a)(1)(A) of the Social Security Act if the patient meets all of the requirements outlined in 42 CFR § 412.622(a)(3), (4), and (5). This is true regardless of whether the patient is treated in the IRF for 1 or more of the 13 medical conditions listed in 42 CFR § 412.29(b)(2) or not. Medicare requires determinations of whether IRF stays are reasonable and necessary to be based on an assessment of each beneficiary's individual care needs. For detailed guidance on the required qualifications of a therapist, required skills of a therapist, and medically necessary and appropriately documented therapy services, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, sections 220 and 230. The policies in those sections describe a standard of care that should be consistent throughout the therapy disciplines, regardless of the setting of care.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) Part A/B Medicare Administrative Contractors (MACs) (A) must consider completion of the requirements at 42 CFR § 412.622(a)(3), (4), and (5) in a patient’s IRF medical record when determining whether an IRF admission was reasonable and necessary.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) In accordance with 42 CFR § 412.622(a)(4)(i) a preadmission screening is an evaluation of the patient’s condition and need for rehabilitation therapy and medical treatment that must be conducted by licensed or certified clinician(s) within the 48 hours immediately preceding the IRF admission. A preadmission screening that includes all of the required elements, but that is conducted more than 48 hours immediately preceding the IRF admission, will be accepted as long as an update is conducted in person or by telephone to document the patient’s medical and functional status within the 48 hours immediately preceding the IRF admission in the patient’s medical record at the IRF. The preadmission screening in the patient’s IRF medical record serves as the primary documentation by the IRF clinical staff of the patient’s status prior to admission and of the specific reasons that led the IRF clinical staff to conclude that the IRF admission would be reasonable and necessary. As such, IRFs must make this documentation detailed and comprehensive. In accordance with 42 CFR § 412.622(a)(4)(i)(B) the preadmission screening documentation must indicate the patient’s prior level of function (prior to the event or condition that led to the patient’s need for intensive rehabilitation therapy), expected level of improvement, and the expected length of time necessary to achieve that level of improvement. It must also include an evaluation of the patient’s risk for clinical complications, the conditions that caused the need for rehabilitation, the treatments needed (i.e., physical therapy, occupational therapy, speech-language pathology, or prosthetics/orthotics), and anticipated discharge destination. If the patient is being transferred from a referring hospital, the preadmission screening could either be done in person or through a review of the patient’s medical records from the referring hospital (either paper or electronic format), as long as those medical records contain the necessary assessments to make a reasonable determination. However, a preadmission screening conducted entirely by telephone should generally include transmission of the patient’s medical records from the referring hospital to the IRF and a review of those records by licensed or certified clinical staff member in the IRF to ensure it includes a detailed and comprehensive review of the patient’s condition and medical history in accordance with 42 CFR § 412.622(a)(4)(i)(B). The IRF should develop a thorough preadmission screening process for patients admitted to the IRF from the home or community-based environment, which should ensure that patient preadmission screenings include all of the required elements described in 42 CFR § 412.622(a)(3), (4), and (5). However, such admissions may not necessarily involve the use of medical records from a prior hospital stay in another inpatient hospital setting unless such records are pertinent to the individual patient’s situation. Individual elements of the preadmission screening may be evaluated by any clinician or group of clinicians designated by a rehabilitation physician, as long as the clinicians are licensed or certified to perform the evaluation. Although clinical personnel are required to evaluate the preadmission screening information in accordance with 42 CFR § 412.622(a)(4)(i), each IRF may determine its own processes for collecting and compiling the preadmission screening information. The focus of the review of the preadmission screening information will be on its completeness, accuracy, and the extent to which it supports the appropriateness of the IRF admission decision, not on how the process is organized. The “rehabilitation physician” need not be a salaried employee of the IRF, but must be a licensed physician who is determined by the IRF to have specialized training and experience in inpatient rehabilitation, in accordance with 42 CFR § 412.622(c). For ease of exposition throughout this document, this physician will be referred to as a “rehabilitation physician”. All findings of the preadmission screening should be conveyed to a rehabilitation physician prior to the IRF admission. Additionally, in accordance with 42 CFR § 412.622(a)(4)(i), the rehabilitation physician must document that he or she has reviewed and concurs with the findings and results of the preadmission screening prior to the IRF admission. All preadmission screening documentation (including documents transmitted from the referring hospital or other prior inpatient hospital stay, if applicable) must be retained in the patient’s medical record at the IRF per the regulation at 42 CFR § 412.622(a)(4)(i).

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) The post-admission physician evaluation documentation requirement, previously required pursuant to 42 CFR § 412.622(a)(4)(ii), was removed in the FY 2021 IRF PPS Final Rule (85 FR 48424). However, the history and physical is still required under the Conditions of Participation at 42 CFR § 482.24(c)(4)(i)(A).

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) In accordance with 42 CFR § 412.622(a)(4)(ii), information from the preadmission screening and other information garnered from the assessments of all therapy disciplines involved in treating the patient and other pertinent clinicians, must be synthesized by a rehabilitation physician to support a documented overall plan of care. The overall plan of care should generally detail the patient’s medical prognosis and the anticipated interventions, functional outcomes, and discharge destination from the IRF stay, thereby supporting the medical necessity of the admission. The anticipated interventions detailed in the overall plan of care should generally include the expected intensity (meaning number of hours per day), frequency (meaning number of days per week), and duration (meaning the total number of days during the IRF stay) of physical, occupational, speech- language pathology, and prosthetic/orthotic therapies required by the patient during the IRF stay. These expectations for the patient’s course of treatment should generally be based on consideration of the patient’s impairments, functional status, complicating conditions, and any other contributing factors. Whereas the individual assessments of appropriate clinical staff will contribute to the information contained in the overall plan of care, the rehabilitation physician is responsible (in accordance with 42 CFR § 412.622(a)(4)(ii)) for developing the overall plan of care with input from the interdisciplinary team. In accordance with 42 CFR § 412.622(a)(4)(ii), in order for the IRF admission to be considered reasonable and necessary, the overall plan of care must be completed within the first 4 days of the IRF admission; it must support the determination that the IRF admission is reasonable and necessary; and it must be retained in the patient’s medical record at the IRF. While CMS believes that it may be good practice to conduct the first interdisciplinary team meeting within the first 4 days of admission to develop the overall individualized plan of care, CMS believes that there may be other ways of developing the overall individualized plan of care. Thus, IRFs may develop this required documentation using whatever internal processes they believe are most appropriate, provided that the documentation fulfills all relevant regulatory requirements.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) At the time that each Medicare Part A fee-for-service patient is admitted to an IRF, a physician must generate admission orders for the patient's care as per the requirements at 42 CFR § 482.12(c)(2), § 482.24(c), and § 412.3. These admission orders should generally be retained in the patient’s medical record at the IRF.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) As per the requirements at 42 CFR § 412.606(b), the IRF patient assessment instrument (IRF-PAI) forms should generally be included in the patient’s medical record at the IRF (either in electronic or paper format).

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) In order for IRF care to be considered reasonable and necessary, the documentation in the patient’s IRF medical record (which must include the preadmission screening described in section 110.1.1, the overall plan of care described in section 110.1.3, and the admission orders described in section 110.1.4) must demonstrate a reasonable expectation that the following criteria were met at the time of admission to the IRF. Certain exceptions to these requirements may apply due to conditions arising during the Public Health Emergency defined in 42 CFR § 400.200. These exceptions are described further in Section 110.2.6 of this manual. 1. The patient must require the active and ongoing therapeutic intervention of multiple therapy disciplines (physical therapy, occupational therapy, speech- language pathology, or prosthetics/orthotics), one of which must be physical or occupational therapy. 2. The patient must generally require an intensive rehabilitation therapy program, as defined in section 110.2.2. Under current industry standards, this intensive rehabilitation therapy program generally consists of at least 3 hours of therapy per day at least 5 days per week. In certain well-documented cases, this intensive rehabilitation therapy program might instead consist of at least 15 hours of intensive rehabilitation therapy within a 7 consecutive calendar day period, beginning with the date of admission to the IRF. 3. The patient must reasonably be expected to actively participate in, and benefit significantly from, the intensive rehabilitation therapy program that is defined in section 110.2.2 at the time of admission to the IRF. The patient can only be expected to benefit significantly from the intensive rehabilitation therapy program if the patient’s condition and functional status are such that the patient can reasonably be expected to make measurable improvement (that will be of practical value to improve the patient’s functional capacity or adaptation to impairments) as a result of the rehabilitation treatment, as defined in section 110.3, and if such improvement can be expected to be made within a prescribed period of time. The patient need not be expected to achieve complete independence in the domain of self-care nor be expected to return to his or her prior level of functioning in order to meet this standard. 4. The patient must require physician supervision by a rehabilitation physician, defined as a licensed physician who is determined by the IRF to have specialized training and experience in inpatient rehabilitation. The requirement for medical supervision means that the rehabilitation physician must conduct face-to-face visits with the patient at least 3 days per week throughout the patient’s stay in the IRF to assess the patient both medically and functionally, as well as to modify the course of treatment as needed to maximize the patient’s capacity to benefit from the rehabilitation process. Beginning with the second week of admission to the IRF, a non-physician practitioner who is determined by the IRF to have specialized training and experience in inpatient rehabilitation may conduct 1of the 3 required face-to-face visits with the patient per week, provided that such duties are within the non-physician practitioner’s scope of practice under applicable state law. In the first week of the patient’s IRF stay, the rehabilitation physician is required to visit the patients a minimum of three times to ensure that the patient’s plan of care is fully established and optimized to the patient’s care needs in the IRF. For the second, third, fourth weeks of the stay, and beyond, CMS will continue to require Medicare fee-for-services beneficiaries in the IRFs to receive a minimum of three rehabilitation physician visits per week, but will allow non-physician practitioners to independently conduct one of these three minimum require visits per week. 5. The patient must require an intensive and coordinated interdisciplinary approach to providing rehabilitation, as defined in section 110.2.5.

(Rev. 112, Issued: 10-23-09, Effective: 01-01-10, Implementation: 01-04-10) A primary distinction between the IRF environment and other rehabilitation settings is the interdisciplinary approach to providing rehabilitation therapy services in an IRF. Patients requiring only one discipline of therapy would not need this interdisciplinary approach to care. For this reason, the information in the patient’s IRF medical record (especially the required documentation described in section 110.1) must document a reasonable expectation that, at the time of admission to the IRF, the patient required the active and ongoing therapeutic intervention of multiple therapy disciplines (physical therapy, occupational therapy, speech-language pathology, or prosthetics/orthotics), one of which must be physical or occupational therapy.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) A primary distinction between the IRF environment and other rehabilitation settings is the intensity of rehabilitation therapy services provided in an IRF. For this reason, the information in the patient’s IRF medical record (especially the required documentation described in section 110.1) must document a reasonable expectation that at the time of admission to the IRF the patient generally required the intensive rehabilitation therapy services that are uniquely provided in IRFs. Although the intensity of rehabilitation services can be reflected in various ways, the generally-accepted standard by which the intensity of these services is typically demonstrated in IRFs is by the provision of intensive therapies at least 3 hours per day at least 5 days per week. However, this is not the only way that such intensity of services can be demonstrated (that is, CMS does not intend for this measure to be used as a “rule of thumb” for determining whether a particular IRF claim is reasonable and necessary). The intensity of therapy services provided in IRFs could also be demonstrated by the provision of 15 hours of therapy per week (that is, in a 7-consecutive calendar day period starting from the date of admission). For example, if a hypothetical IRF patient was admitted to an IRF for a hip fracture, but was also undergoing chemotherapy for an unrelated issue, the patient might not be able to tolerate therapy on a predictable basis due to the chemotherapy. Thus, this hypothetical patient might be more effectively served by the provision of 4 hours of therapy 3 days per week and 1 ½ hours of therapy on 2 (or more) other days per week in order to accommodate his or her chemotherapy schedule. Thus, IRFs may also demonstrate a patient’s need for intensive rehabilitation therapy services by showing that the patient required and could reasonably be expected to benefit from at least 15 hours of therapy per week (defined as a 7-consecutve calendar day period starting from the date of admission), as long as the reasons for the patient’s need for this program of intensive rehabilitation are well-documented in the patient’s IRF medical record and the overall amount of therapy can reasonably be expected to benefit the patient. Many IRF patients will medically benefit from more than 3 hours of therapy per day or more than 15 hours of therapy per week, when all types of therapy are considered. However, the intensity of therapy provided must be reasonable and necessary under section 1862(a)(1)(A) of the Act and must never exceed the patient’s level of need or tolerance, or compromise the patient’s safety. See below for a brief exceptions policy for temporary and unexpected events. In accordance with 42 CFR § 412.622(a)(3)(ii), the required therapy treatments must begin within 36 hours from midnight of the day of admission to the IRF. Therapy evaluations are generally considered to constitute the beginning of the required therapy services. As such, they should generally be included in the total daily/weekly provision of therapies used to demonstrate the intensity of therapy services provided in an IRF. The standard of care for IRF patients is individualized (i.e., one-on-one) therapy. Group therapies serve as an adjunct to individual therapies. In those instances in which group therapy better meets the patient’s needs on a limited basis, the situation/rationale that justifies group therapy should be specified in the patient’s medical record at the IRF. Brief Exceptions Policy - While patients requiring an IRF stay are expected to need and receive an intensive rehabilitation therapy program, as described above, this may not be true for a limited number of days during a patient’s IRF stay because patients’ needs vary over time. For example, if an unexpected clinical event occurs during the course of a patient’s IRF stay that limits the patient’s ability to participate in the intensive therapy program for a brief period not to exceed 3 consecutive days (e.g., extensive diagnostic tests off premises, prolonged intravenous infusion of chemotherapy or blood products, bed rest due to signs of deep vein thrombosis, exhaustion due to recent ambulance transportation, surgical procedure, etc.), the specific reasons for the break in the provision of therapy services should generally be documented in the patient’s IRF medical record. If these reasons are appropriately documented in the patient’s IRF medical record, such a break in service (of limited duration) should generally not affect the determination of the medical necessity of the IRF admission. Thus, A/B MACs (A) may consider approving brief exceptions to the intensity of therapy requirement in these particular cases if they determine that the initial expectation of the patient’s active participation in intensive therapy during the IRF stay was based on a diligent preadmission screening, post- admission physician evaluation, and overall plan of care that were based on reasonable conclusions.

(Rev. 112, Issued: 10-23-09, Effective: 01-01-10, Implementation: 01-04-10) The information in the patient’s IRF medical record (especially the required documentation described in section 110.1) must document a reasonable expectation that at the time of admission to the IRF the patient’s condition is such that the patient can reasonably be expected to actively participate in, and significantly benefit from, the intensive rehabilitation therapy program that is defined in section 110.2.2.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) A primary distinction between the IRF environment and other rehabilitation settings is the high level of physician supervision that accompanies the provision of intensive rehabilitation therapy services. For this reason, the information in the patient’s IRF medical record (especially the required documentation described in section 110.1) must document a reasonable expectation that at the time of admission to the IRF the patient’s medical management and rehabilitation needs require an inpatient stay and close physician involvement. Close physician involvement in the patient’s care is demonstrated by documented face-to-face visits from a rehabilitation physician at least 3 days per week throughout the patient’s IRF stay. Beginning with the second week of admission to the IRF, a non-physician practitioner who is determined by the IRF to have specialized training and experience in inpatient rehabilitation may conduct 1 of the 3 required face-to-face visits with the patient per week, provided that such duties are within the non-physician practitioner’s scope of practice under applicable state law. In the first week of the patient’s IRF stay, the rehabilitation physician is required to visit patients a minimum of three times to ensure that the patient’s plan of care is fully established and optimized to the patient’s care needs in the IRF. In the second, third, fourth weeks of the stay, and beyond, CMS will continue to require Medicare fee-for-service beneficiaries in IRFs to receive a minimum of three rehabilitation physician visits per week, but will allow non-physician practitioners to independently conduct one of these three minimum required visits per week. The purpose of the face-to-face visits is to assess the patient both medically and functionally (with an emphasis on the important interactions between the patient’s medical and functional goals and progress), as well as to modify the course of treatment as needed to maximize the patient’s capacity to benefit from the rehabilitation process. Other physician specialties may treat and visit the patient, as needed, more often than 3 days per week. However, the requirement for IRF physician supervision is intended to ensure that IRF patients receive more comprehensive assessments of their functional goals and progress, in light of their medical conditions, by a rehabilitation physician who is determined by the IRF to have specialized training and experience in inpatient rehabilitation at least 3 times per week. The required rehabilitation physician and non- physician practitioner visits should generally be documented in the patient’s medical record at the IRF per the requirements at 42 CFR § 482.24(4)(c)(vi).

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) An IRF stay will only be considered reasonable and necessary if at the time of admission to the IRF the documentation in the patient’s IRF medical record indicates a reasonable expectation that the complexity of the patient’s nursing, medical management, and rehabilitation needs requires an inpatient stay and an interdisciplinary team approach to the delivery of rehabilitation care. That is, the complexity of the patient’s condition must be such that the rehabilitation goals indicated in the preadmission screening, and the overall plan of care can only be achieved through periodic team conferences—at least once a week—of an interdisciplinary team of medical professionals (as defined below). Interdisciplinary services are those provided by a treatment team in which all of its members participate in a coordinated effort to benefit the patient and the patient’s significant others and caregivers. Interdisciplinary services, by definition, cannot be provided by only one discipline. Though individual members of the interdisciplinary team work within their own scopes of practice, each professional is also expected to coordinate his or her efforts with team members of other specialties, as well as with the patient and the patient’s significant others and caregivers. The purpose of the interdisciplinary team is to foster frequent, structured, and documented communication among disciplines to establish, prioritize, and achieve treatment goals. In accordance with the requirements at 42 CFR 412.622(a)(5), at a minimum, the interdisciplinary team must document participation by professionals from each of the following disciplines (each of whom must have current knowledge of the patient as documented in the medical record at the IRF): • A rehabilitation physician who is determined by the IRF to have specialized training and experience in inpatient rehabilitation; • A registered nurse with specialized training or experience in rehabilitation; • A social worker or a case manager (or both); and • A licensed or certified therapist from each therapy discipline involved in treating the patient. The interdisciplinary team must be led by a rehabilitation physician either in person or remotely via a mode of communication such as video or telephone conferencing, who is responsible for making the final decisions regarding the patient’s treatment in the IRF. This physician must document concurrence with all decisions made by the interdisciplinary team at each meeting. The periodic team conferences—held a minimum of once per week—must focus on: Assessing the individual's progress towards the rehabilitation goals; • Considering possible resolutions to any problems that could impede progress towards the goals; • Reassessing the validity of the rehabilitation goals previously established; and • Monitoring and revising the treatment plan, as needed. A team conference may be formal or informal; however, a review by the various team members of each other's notes does not constitute a team conference. It is expected that all treating professionals from the required disciplines will be at every meeting or, in the infrequent case of an absence, be represented by another person of the same discipline who has current knowledge of the patient. Documentation of each team conference should generally include the names and professional designations of the participants in the team conference. Signatures from participants of the interdisciplinary team meeting are not required other than the rehabilitation physician’s concurrence as noted above. The occurrence of the team conferences and the decisions made during such conferences, such as those concerning discharge planning and the need for any adjustment in goals or in the prescribed treatment program, must be recorded in the patient’s medical record in the IRF. The focus of the review of this requirement will be on the accuracy and quality of the information and decision-making, not on the internal processes used by the IRF in conducting the team conferences.

(Rev. 10892; Issued: 08-06-21; Effective: 11-08-21; Implementation: 11-08-21) Inpatient Rehabilitation Facility (IRF) Flexibilities Issued on March 30, 2020 On March 30, 2020, CMS issued the interim final rule “Medicare and Medicaid Programs; Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency” (CMS-1744-IFC). This interim final rule removed the IRF post-admission physician evaluation requirement in 42 CFR § 412.622(a)(4)(ii) for all Medicare Part A fee-for-service beneficiaries during the public health emergency (PHE) specified in 42 CFR 400.200. Thus, contractors shall not require documentation of post-admission physician evaluations in the IRF medical records for Medicare Part A fee-for-service beneficiaries during the PHE. As discussed in Section 110.1.2, CMS subsequently removed the post-admission physician evaluation documentation requirement entirely beginning with FY 2021 (e.g., for all IRF discharges beginning on or after October 1, 2020). This interim final rule also revises the physician supervision requirement in 42 CFR § 412.622(a)(3)(iv) and § 412.29(e) to permit physician visits in the IRF required under these provisions to be conducted via telehealth to safeguard the health and safety of Medicare beneficiaries and the rehabilitation physicians treating them during the PHE. Contractors shall allow rehabilitation physicians to use telehealth services as defined in section 1834(m)(4)(F) of the Act to conduct the required 3 physician visits per week during the PHE for the COVID-19 pandemic. IRF Flexibilities Issued on April 30, 2020 On April 30, 2020, CMS issued the interim final rule “Medicare and Medicaid Programs, Basic Health Program, and Exchanges; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency and Delay of Certain Reporting Requirements for the Skilled Nursing Facility Quality Reporting Program” (CMS-5531- IFC). This interim final rule, codified at 42 CFR § 412.622(a)(3)(ii), waives the IRF “3- hour rule” in accordance with section 3711(a) of the CARES Act. As a result of the “3-hour rule” waiver, contractors shall not review Medicare Part A fee-for-service beneficiaries admitted to IRFs during the PHE specified in section 1135(g)(1)(B) of the Social Security Act for compliance with 42 CFR § 412.622(a)(3)(ii). That is, Medicare Part A fee-for-service beneficiaries admitted to IRFs during the PHE do not need to receive at least 15 hours of intensive rehabilitation therapy per week. This waiver applies to all patients admitted to IRFs during the PHE. This interim final rule also modifies the IRF coverage and classification requirements in 42 CFR § 412.29(d), (e), (h), and (i) and § 412.622(a)(3)(i), (iii) – (iv), (4), and (5) for the public health emergency (PHE) during the COVID-19 pandemic, when all of the following criteria are satisfied at the time of admission to the IRF: • Patient is admitted to a freestanding IRF solely to alleviate acute care hospital bed capacity issues, and • IRF is located in a state (or region, as applicable) that is experiencing a surge during the Public Health Emergency, as defined in 42 CFR § 400.200. The regulation at 42 CFR § 412.622(c), as amended by the April 30, 2020 interim final rule, specifies that a “state (or region, as applicable) that is experiencing a surge” refers to a state region that is in Phase 1 of the presidential “Guidelines for Opening Up America Again” ((https://www.whitehouse.gov/openingamerica/), specifically, a state (or region, as applicable) that satisfies all of the following, as determined by applicable state and local officials: 1. All vulnerable individuals continue to shelter in place. 2. Individuals continue social distancing. 3. Individuals avoid socializing in groups of more than 10. 4. Non-essential travel is minimized. 5. Visits to senior living facilities and hospitals are prohibited. 6. Schools and organized youth activities remain closed. The evolution of the Phase 1 criteria listed above are most likely to be clearly articulated by a state’s governor. Further, contractors will need to be aware that there may not be a clearly posted phase for a state or community that aligns with the presidential “Guidelines for Opening Up America Again” cited at 42 CFR § 412.622(c). Some of the criteria are likely to be in place across a number of phases, particularly the criteria in (i), (ii), and (iii). An example of a more complicated criteria to apply is (iv). Non-essential travel can still be minimized, even after stay at home orders are lifted in an area to allow for additional access to health care services or to allow for additional commerce (such as manufacturing) to improve the overall economic circumstances of a region or state. There may also be circumstances where beach regions, which can provide more ability for social distancing, of a state are reopening whereas more concentrated population centers remain with higher restrictions. Thus, contractors should apply the standard regionally, as applicable. Furthermore, schools and organized youth activities may be closed simply because of the time of year (for instance, during the summer months). Additionally, contractors should recognize that, in some cases, states or regions can move to Phase 2 or Phase 3 of the plan and then return to Phase 1 if they experience another surge in cases. In the April 30, 2020 interim final rule, CMS instructed freestanding IRFs to add the letters “DS” to the end of their unique hospital patient identification numbers (the numbers that identify the patients’ medical records in the IRF) to identify patients who are being treated in a freestanding IRF hospital solely to alleviate inpatient bed capacity in a state that is experiencing a surge during the PHE for the COVID-19 pandemic. The modifier will be used to identify those patients for whom the requirements in 42 CFR § 412.622(a)(3)(i), (iii), (iv), (4) and (5) do not apply. Thus, contractors shall not review freestanding IRF patient medical records that have “DS” at the end of their unique hospital patient identifier numbers for meeting any of the following requirements: • Needing at least 2 forms of therapy (one of which must be physical or occupational therapy, • Being sufficiently stable to tolerate the IRF intensive rehabilitation therapy program, • Requiring close medical supervision by a rehabilitation physician, as demonstrated by at least 3 rehabilitation physician visits per week, • Having a preadmission screening, • Having an individualized overall plan of care, or • Having an interdisciplinary approach to care, including weekly interdisciplinary team meetings. In addition, as noted at 85 FR 27573 contractors shall not include freestanding IRF patient medical records that have “DS” at the end of their unique hospital patient identifier numbers when reviewing whether the IRF meets the following coverage requirements: • Has in effect a preadmission screening procedure, • Has in effect a procedure for ensuring that patients receive close medical supervision by a physician, • Has a plan of treatment for each patient, or • Uses an interdisciplinary approach to care. Contractors shall allow freestanding IRFs to be paid at the usual IRF prospective payment amounts for these patients.

(Rev. 179, Issued: 01-14-14, Effective: 01-07-14, Implementation: 01-07-14) A patient can only be expected to benefit significantly from an intensive rehabilitation therapy program provided in an IRF, as required in section 110.2.3, if the patient’s IRF medical record indicates a reasonable expectation that a measurable, practical improvement in the patient’s functional condition can be accomplished within a predetermined and reasonable period of time. In general, the goal of IRF treatment is to enable the patient’s safe return to the home or community-based environment upon discharge from the IRF. The patient’s IRF medical record is expected to indicate both the nature and degree of expected improvement and the expected length of time to achieve the improvement. Since discharge planning is an integral part of any rehabilitation program and must begin upon the patient’s admission to the IRF, an extended period of time for discharge from the IRF would not be reasonable and necessary after established goals have been reached or the determination has been made that further progress is unlikely. For an IRF stay to be considered reasonable and necessary, the patient does not have to be expected to achieve complete independence in the domain of self-care or return to his or her prior level of functioning. However, to justify the need for a continued IRF stay, the documentation in the IRF medical record must demonstrate the patient’s ongoing requirement for an intensive level of rehabilitation services (as defined in section 110.2.1) and an inter-disciplinary team approach to care (as defined in section 110.2.2). Further, the IRF medical record must also demonstrate that the patient is making functional improvements that are ongoing and sustainable, as well as of practical value, measured against his/her condition at the start of treatment. Since in most instances the goal of an IRF stay is to enable a patient’s safe return to the home or community-based environment upon discharge, the patient’s treatment goals and achievements during an IRF admission are expected to reflect significant and timely progress toward this end result. During most IRF stays, therefore, the emphasis of therapies would generally shift from traditional, patient-centered therapeutic services to patient/caregiver education, durable medical equipment training, and other similar therapies that prepare the patient for a safe discharge to the home or community-based environment. CMS notes that as evidenced by the criteria established above, an IRF claim could never be denied for the following reasons: (1) because a patient could not be expected to achieve complete independence in the domain of self-care or (2) because a patient could not be expected to return to his or her prior level of functioning.

(Rev. 189, Issued: 06-27-14, Effective: 05-30-14, Implementation: 06-29-14) Medical and hospital services are sometimes required to treat a condition that arises as a result of services that are not covered because they are determined to be not reasonable and necessary or because they are excluded from coverage for other reasons. Services "related to" non-covered services (e.g., cosmetic surgery, non-covered organ transplants, non-covered artificial organ implants, etc.), including services related to follow-up care and complications of non-covered services which require treatment during a hospital stay in which the non-covered service was performed, are not covered services under Medicare. Services "not related to" non-covered services are covered under Medicare. Following are examples of services "related to" and "not related to" non-covered services while the beneficiary is an inpatient: • A beneficiary was hospitalized for a non-covered service and broke a leg while in the hospital. Services related to care of the broken leg during this stay is a clear example of "not related to" services and are covered under Medicare. • A beneficiary was admitted to the hospital for covered services, but during the course of hospitalization became a candidate for a non-covered transplant or implant and actually received the transplant or implant during that hospital stay. When the original admission was entirely unrelated to the diagnosis that led to a recommendation for a non-covered transplant or implant, the services related to the admitting condition would be covered. • A beneficiary was admitted to the hospital for covered services related to a condition which ultimately led to identification of a need for transplant and receipt of a transplant during the same hospital stay. If, on the basis of the nature of the services and a comparison of the date they are received with the date on which the beneficiary is identified as a transplant candidate, the services could reasonably be attributed to preparation for the non-covered transplant, the services would be "related to" non-covered services and would also be non-covered. Following is an example of services received subsequent to a non-covered inpatient stay: After a beneficiary has been discharged from the hospital stay in which the beneficiary received non-covered services, medical and hospital services required to treat a condition or complication that arises as a result of the prior non-covered services may be covered when they are reasonable and necessary in all other respects. Thus, coverage could be provided for subsequent inpatient stays or outpatient treatment ordinarily covered by Medicare, even if the need for treatment arose because of a previous non-covered procedure. Some examples of services that may be found to be covered under this policy are the reversal of intestinal bypass surgery for obesity, complications from cosmetic surgery, removal of a non-covered bladder stimulator, or treatment of any infection at the surgical site of a non-covered transplant that occurred following discharge from the hospital. However, any subsequent services that could be expected to have been incorporated into a global fee are not covered. Thus, where a patient undergoes cosmetic surgery and the treatment regimen calls for a series of postoperative visits to the surgeon for evaluating the patient's progress, these visits are not covered.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Section 1821 of the Social Security Act provides for coverage of services furnished in a Medicare qualified religious nonmedical health care institution (RNHCI), when the beneficiary meets specific coverage conditions. The beneficiary must have a valid election for RNHCI services and would otherwise qualify for care in a conventional hospital or post hospital extended care facility that was not a religious nonmedical health care institution. The RNHCI benefit provides only for Part A inpatient services. The Medicare program will only pay for nonmedical health care services furnished in RNHCIs, as defined in Section 1861(ss)(1) of the Act and 42 CFR 403 Subpart G. The program does not pay for supporting religious services or payment for the religious practitioner. The cost of religious items/services and the cost of using a religious practitioner is a personal financial responsibility and not covered by Medicare.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) A beneficiary may elect to receive care in an RNHCI based on his or her own religious convictions or to revoke that election at any time if for any reason he or she decides to pursue medical care. Section 1821(a) of the Act requires that as a condition for Part A Medicare coverage, the beneficiary must have a condition that would qualify under Medicare Part A for inpatient hospital services or extended care services furnished in a hospital or skilled nursing facility that is not an RNHCI if it were not for their religious convictions. When a beneficiary has an effective election on file with CMS but does not have a condition that would qualify for Medicare Part A inpatient hospital or posthospital extended care services if the beneficiary were an inpatient of a hospital or a resident of a SNF that is not an RNHCI, then services furnished in an RNHCI are not covered by Medicare. A Medicare claim for services that were furnished to that beneficiary would be treated as a claim for noncovered services. If the beneficiary only needs assistance with activities of daily living, then the beneficiary's condition could not be considered as meeting the Medicare Part A requirements. Prior to submitting a claim to Medicare it is the responsibility of the RNHCI’s utilization review committee to determine that the beneficiary meets the Medicare Part A requirements. If no valid election is filed or the election has been revoked and no new election is in effect, the beneficiary does not have Medicare coverage for services furnished in an RNHCI. Consequently, a Medicare claim for services furnished to such a beneficiary would also be treated as a claim for noncovered services. In those cases where a beneficiary is admitted to an RNHCI with a valid election, the submission of prior claim for medical services to the Common Working File will revoke the election during the course of the RNHCI stay. If this is the first revocation, the beneficiary may make a new election without any disruption to the benefit. If this, however, is the second or subsequent revocation, the applicable waiting period applies and the remainder of the stay is not covered by Medicare (see 130.2.2).

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) For an RNHCI to receive payment under the Medicare program, the beneficiary must make a written election to receive benefits under §1821 of the Act. To elect religious nonmedical health care services, the beneficiary or the beneficiary’s legal representative must attest that the individual is conscientiously opposed to acceptance of nonexcepted medical treatment, and the individual’s acceptance of such treatment would be inconsistent with the individual’s sincere religious beliefs. Religious non-medical care or religious method of healing means health care furnished under established religious tenets that prohibit conventional or unconventional medical care for the treatment of a beneficiary, and the sole reliance on these religious tenets to fulfill a beneficiary's total health care needs. Medical care or treatment means health care furnished by or under the direction of a licensed physician that can involve diagnosing, treating, or preventing disease and other damage to the mind and body. It may involve the use of pharmaceuticals, diet, exercise, surgical intervention, and technical procedures. The signed and notarized election must include a statement that the receipt of nonexcepted medical services would constitute a revocation of the election and may limit further receipt of payment of religious nonmedical health care services. The election is effective on the date it is signed, and it remains in effect until revoked in writing or by the receipt and filing of a claim for nonexcepted medical treatment. The completed election form must be filed with the specialty contractor, a copy retained by the RNHCI provider and a copy provided to the beneficiary. See Pub. 100-04, Medicare Claims Processing Manual, Chapter 3, Section 170 for instructions on submission of elections to the specialty contractor. Section 1821 defines “excepted” medical treatment as medical care or treatment that is received involuntarily or is required under Federal, State or local law. The term is intended to identify the kinds of medical services that can be provided to a beneficiary with an election for RNHCI services without revoking the election. Examples of excepted medical care include, but are not limited to the following: • A beneficiary that receives vaccinations required by a State or local jurisdiction. This is compliant behavior to meet government requirements and not considered as voluntarily seeking medical care or services; or • A beneficiary who is involved in an accident and receives medical attention at the accident scene, or in transport to the hospital, or at the hospital before being able to make their beliefs and wishes known; or • A beneficiary who is unconscious and receives emergency care and is hospitalized before regaining consciousness or being able to locate his or her legal representative. “Nonexcepted” medical treatment is defined as medical care or treatment other than excepted medical treatment. The term is intended to define the kinds of medical services that, if received by a beneficiary who has previously elected RNHCI services, would revoke the individual's election of services. Examples of nonexcepted medical care could include but are not limited to the following: • A beneficiary receiving medical diagnosis and/or treatment for persistent headaches and/or chest pains. • A beneficiary in an RNHCI who is transferring to a community hospital to have radiological studies and the reduction of a fracture. • A beneficiary with intractable back pain receiving medical, surgical, or chiropractic services. • A beneficiary who has requested a physician to prescribe a wheelchair or other durable medical equipment item. Note that the terms ‘excepted’ and ‘nonexcepted’ care represent mutually exclusive conditions under §1821 of the Social Security Act. Medicare contractors may use the examples above in making determinations of excepted and nonexcepted care.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Revocation is the cancellation of the RNHCI election and can be achieved in two ways: either by submitting a written statement to the intermediary indicating the desire to cancel the election or by seeking nonexcepted medical care for which Medicare payment is sought. See Pub. 100-04, Medicare Claims Processing Manual, Chapter 3, Section 170 for instructions on submission of revocations to the specialty contractor. See section 180 of that manual for a description of how Medicare non-specialty contractors revoke elections upon billing for nonexcepted services.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) After an initial revocation, the individual may again file a written election to receive the religious nonmedical health care benefit. This second election takes effect immediately upon its execution. If an individual revokes a second election, the next (third) election cannot become effective until 1 year after the date of the most recent revocation. Subsequent elections are not effective until 5 years after the most recent revocation. Once an election is revoked, Medicare payment cannot be made to an RNHCI unless a valid election is filed. The RNHCI revocation does not interfere with the beneficiary’s ability to seek other Medicare services within the limits of his/her Medicare coverage.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Medicare pays for RNHCI services under TEFRA payment rules (see Pub. 15-2, Provider Reimbursement Manual, chapter 30). RNHCI services are subject to the inpatient hospital cash deductible, when applicable. If services are for the 61st through 90th day of a benefit period or are for lifetime reserve days, RNHCI services are subject to coinsurance (see Pub. 100-01, Medicare General Information, Eligibility and Entitlement Manual, Chapter 3, Sections 10.1 and 10.2). Under normal Medicare rules, a provider of services may only bill a beneficiary deductible and coinsurance amounts. However, total Medicare payments to RNHCIs are subject to limits established in sections 1821(c)(2) (A) or (B) of the Act. In the event that the Medicare program reduces payments to RNHCIs based on these limits, RNHCIs may also bill beneficiaries an amount equal to any such reduction.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Prior to the passage of the Medicare Prescription Drug, Improvement and Modernization Act (MMA) of 2003, the Medicare program’s RNHCI benefit was limited to inpatient services provided in an RNHCI facility. The MMA revised sections 1821(a) and 1861 of the Social Security Act to extend coverage to RNHCI items and services that are provided in a beneficiary’s home and that are comparable to items and services provided by a home health agency that is not an RNHCI. Beneficiaries elect the RNHCI benefit if they are conscientiously opposed to accepting most medical treatment, since accepting such services would be inconsistent with their sincere religious beliefs. The Medicare home health benefit provides skilled nursing, physical therapy, occupational therapy, speech language pathology and home health aide services to eligible beneficiaries under a physician’s plan of care. The home health benefit also provides medical supplies, a covered osteoporosis drug and durable medical equipment (DME) while under a plan of care (see chapter 7). Medicare covers specified durable medical equipment and intermittent RNHCI nursing visits provided in the home to RNHCI beneficiaries. These services comprise the RNHCI home benefit. The remainder of the services covered under the Medicare home health benefit are medical in nature and must be provided under the order of a physician. As such, these services conflict with RNHCI beneficiaries’ conscientious opposition to medical care. The RNHCI home benefit must exclude the same services that are excluded from the home health benefit, which include: drugs and biologicals; transportation; services that would not be covered as inpatient services; housekeeping services; services covered under the End Stage Renal Disease program; prosthetic devices; and medical social services provided to family members. These exclusions are defined at 42 CFR 409.49. Additionally, the RNHCI home benefit excludes the items or services provided by any HHA that is not an RNHCI; or any supplier, independent RNHCI nurse or aide that is working directly for a beneficiary rather than under arrangements with the RNHCI. Medicare requires a brief letter of intent from the provider in order to determine the number of RNHCIs that will be implementing the home service benefit. In the case where an RNHCI chooses to provide home services then only care on an intermittent basis, which is provided to an eligible beneficiary who is confined to their home for health reasons, will be covered under the home benefit. The home benefit is not to be confused with hospice care, which may involve more frequent visits and can involve institutional services. If for some reason the home serviced patient requires more than intermittent service, then institutional services may be required. However, the patient would need to meet the criteria for admission to a RNHCI, or the patient would require another institutional setting not necessarily covered by Medicare. Similar to the inpatient RNHCI benefit, the physician role in certifying and ordering the home benefit is replaced with the use of the RNHCI utilization review committee to review the need for care and plan for initial and continued care in the home setting. The home benefit will also require a prompt review of admission to the home service, since the patient must be fully eligible (have a health condition that keeps them confined to the home (42CFR409.42(a), have health needs that can be met with intermittent care, and have a valid election) before billable services can be rendered and Medicare payment requested. Additionally the utilization review committee is responsible for review and approval of care plans and orders for DME items, and review of the need for the continuation of services. As in the original RNHCI benefit, Medicare will only pay for nonmedical services in the home, but not for those religious items or services provided by the RNHCI. Medicare covers these items and services for dates of service from January 1, 2005 through December 30, 2006. Total Medicare payments under this benefit for each calendar year during this period are limited to $700,000.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Medicare covers a defined list of nonmedical DME items for RNHCI home services that are comparable to items used in the inpatient RNHCI setting and could be provided by an HHA. The DME items include canes, crutches, walkers, commodes, a standard wheelchair, hospital beds, bedpans, and urinals. Those RNHCIs offering home services may order these items without a physician order and without compromising the beneficiary election for RNHCI care. The need for each item of DME ordered must be supported by the RNHCI patient’s plan of care for the home setting and the RNHCI nurses’ notes for home services. It must be noted that the benefit is applicable only to what we shall refer to as “nonmedical DME items” and does not include any of the related services provided by RNHCI staff members. The RNHCI shall establish a payment arrangement with one or more DME suppliers to obtain any of the items on the DME list (below) they may require for a beneficiary. The supplier will provide the items and related instructions on use to the beneficiary/family/care giver. The RNHCI will submit claims for these DME items to the RNHCI specialty FI. The RNHCI must stress to suppliers that DME claims are not to be submitted to the DMERC because this will cause the beneficiary’s election for RNHCI care to be revoked. DME Items and HCPCS Codes for use by RNHCI Home Service Units Canes E0100 Cane, includes canes of all materials, adjustable or fixed, with tip E0105 Cane, quad or three prong, includes canes of all materials, adjustable or fixed with tip Crutches E0112 Crutches, underarm, wood, adjustable or fixed, pair, with pads, tips and handgrips E0113 Crutch underarm, wood, adjustable or fixed, pair, with pad, tip and handgrip E0114 Crutches, underarm, other than wood, adjustable or fixed, pair, with pads, tips and handgrips E0116 Crutch underarm, other than wood, adjustable or fixed, with pad, tip and handgrip Walkers E0130 Walker, rigid (pickup), adjustable or fixed height E0135 Walker, folding (pickup), adjustable or fixed height E0141 Walker, rigid, wheeled, adjustable or fixed height E0143 Walker, folding, wheeled, adjustable or fixed height Commodes E0163 Commode chair, stationary, with fixed arms E0167 Pail or pan for use with commode chair Wheelchairs K0001 Standard wheelchair Hospital Beds & Accessories E0250 Hospital bed, fixed height, with any type side rails, with mattress E0255 Hospital bed, variable height, hi-lo, with any type side rails, with mattress E0260 Hospital bed, semi-electric (head and foot adjustment), with any type side rails, with mattress E0275 Bed pan, standard, metal or plastic E0276 Bed pan, fracture, metal or plastic E0290 Hospital bed, fixed height, without side rails, with mattress E0292 Hospital bed, variable height, hi-lo, without side rails, with mattress E0325 Urinal; male, jug-type, any material E0326 Urinal; female, jug-type, any material Payment to RNHCIs for these specified DME items will be made based on the DME fee schedule. Coinsurance applies to these items. Deductible does not apply to these items.

(Rev. 45, Issued: 02-10-06; Effective: 05-11-06;Implementation: 05-11-06) Medicare covers intermittent RNHCI nursing visits provided in the home to RNHCI beneficiaries. The RNHCI nursing personnel may be skilled in ministering to a beneficiary’s religious needs (not covered by Medicare), but do not have the training or nursing skill sets required of credentialed/licensed health care professionals (e.g., registered nurse). While RNHCI nurses may provide tender loving care, they are focused primarily on religious healing and meeting basic beneficiary needs for assistance with activities of daily living (e.g., bathing, toileting, dressing, ambulation), as part of creating a milieu for religious healing. The care provided by an RNHCI nurse is not at the level of either a registered nurse or a licensed practical nurse. The physical care provided by an RNHCI nurse is at a level that could be considered as supportive, but decidedly not “skilled” as defined by the Medicare program. For purposes of payment for RNHCI nursing services in the home, the following services are comparable to the services of HHAs that are not RNHCIs (e.g., the RNHCI nurse and the home health aide share the following basic tasks): • Assist with activities of daily living which include: ambulation, bed to chair transfer, and assist with range of motion exercises; bathing, shampoo, nail care and dressing; feeding and nutrition; and toileting; • Light housekeeping, incident to visit • Documenting visit By comparison the home health aide will routinely perform additional medically oriented services (e.g., observation and reporting of existing medical conditions, taking and reporting vital signs, and using basic infection control procedures). Due to the uniqueness of RNHCI nursing in the Medicare program, Medicare pays for RNHCI nursing visits at a percentage of the HHAs “low utilization payment adjustment” (LUPA) rate for home health aides. Only a visit by an RNHCI nurse to a home will be considered as billable to Medicare. A visit is defined as an episode in which an RNHCI nurse will render physical care to an RHNCI beneficiary in the home setting. The visit is a single billable unit that is not influenced by the number of involved caregivers or the duration of the episode. The difference in skill levels and the incorporation of RNHCI religious activity (noncovered by Medicare) into a visit, resulted in a payment rate that is 80% of the home health aide rate adjusted by metropolitan service area (MSA) wage index rate for the involved RNHCI. RNHCI nursing visits are paid using the LUPA system even in situations where the involved patient would not be classified as low utilization. The HHAs have moved to PPS, which is constructed on the medical model and therefore inappropriate for RNHCI use. The same “labor”/”non-labor” portions applied in the HHA PPS will be used for calculating the RNHCI nursing visit payments. Example of LUPA Payment: An RNHCI in Baltimore, MD, provides twelve RNHCI nursing visits over the course of a 30 day period. 1. Home Health Aide Visit (National standardized rate for 2005) $44.76 2. RNHCI Nurse Visit ……………………………(.80 * $ 44.76) 35.81 3. Calculate the labor portion of the Standardized Budget Neutral Per-Visit Payment Amount for 1 RNHCI nurse visit……………………...…….(.76775 * $.35.81) 27.49 4. Apply wage index factor for Baltimore, MD..…(.9907 * $ 27.49) 27.23 5. Calculate the non-labor portion of the Standardized Budget Neutral Per-Visit Payment Amount for 1 RNHCI nurse visit……………….(.23225 * $ 35.81) 8.32 6. Subtotal—Low Utilization Payment Adjustment (LUPA) wage for 1 RNHCI nurse visit…………..($ 27.49 + $ 8.32) $35.55 7. Total - Calculate total Low Utilization Payment Adjustment (LUPA) for 12 RNHCI nurse visits provided during the 30-day episode … …………(12 * $ 35.55) $426.60 Step 1. Take the HHA aide visit base rate ($ 44. 76) for the involved year (2005), from the HHA update published annually each November in the Federal Register. Step 2. To calculate the RNHCI nurse visit base rate, multiply the HHA base rate ($ 44.76) by the allowed percentage for an RNHCI nurse visit (.80%) to allow for religious activity and reduced physical care skill level = ($ 35.81) Step 3. To calculate the labor portion of the Standardized Budget Neutral Per-Visit Payment Amount for 1 RNHCI nurse visit, multiply the fixed allowance .76775 by the RNHCI nurse visit rate ($ 35.81) = ($ 27.49) Step 4. Apply the wage index for the involved MSA from the HHA update published annually each November in the Federal Register (Baltimore, MD = .9907) multiplied by the labor portion of the RNHCI nurse visit ($ 27.49) = ($27.23). Step 5. To calculate the non-labor portion of the Standardized Budget Neutral Per-Visit Payment Amount for 1 RNHCI nurse visit, multiply the fixed allowance .23225 by the RNHCI nurse visit rate ($ 35.81) = ($ 8.32) Step 6. To calculate the LUPA rate for 1 RNHCI nurse visit add the products from Step 4 ($27.49) and Step 5 ($ 8.32) = ($ 35.55) Step 7. To calculate the LUPA payment for RNHCI nurse visits to one beneficiary in a 30 day period, multiply the product of Step 6 ($ 35.55) by the number of visits (12) = ($ 426.60) Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R10892BP 08/06/2021 Internet Only Manual Updates to Publication (Pub.) 100-02 to Implement Updates to Policy and Correct Errors and Omissions (Inpatient Rehabilitation Facility (IRF) 11/08/2021 12353 R234BP 03/10/2017 Clarification of Admission Order and Medical Review Requirements 06/12/2017 9979 R232BP 12/22/2016 January 2017 Update of the Hospital Outpatient Prospective Payment System (OPPS) 01/03/2017 9930 R179BP 01/14/2014 Manual Updates to Clarify Skilled Nursing Facility (SNF), Inpatient Rehabilitation Facility (IRF), Home Health (HH), and Outpatient (OPT) Coverage Pursuant to Jimmo vs. Sebelius 01/07/2014 8458 R176BP 12/13/2013 Manual Updates to Clarify Skilled Nursing Facility (SNF), Inpatient Rehabilitation Facility (IRF), Home Health (HH), and Outpatient (OPT) Coverage Pursuant to Jimmo vs. Sebelius – Rescinded and replaced by Transmittal 179 01/07/2014 8458 R119BP 01/05/2010 Coverage of Inpatient Rehabilitation Services 01/04/2010 6699 R112BP 10/23/2009 Coverage of Inpatient Rehabilitation Services – Rescinded and replaced by Transmittal 119 01/04/2010 6699 R45BP 02/10/2006 Revisions to Instructions for Contractors Other Than the Religious Nonmedical Health Care Institution (RNHCI) Specialty Contractor Regarding Claims for Beneficiaries with RNHCI Elections 05/11/2006 4218 R25BP 11/05/2004 Implementation of Coverage of Religious Nonmedical Health Care Institution (RNHCI) Items and Services Furnished in the Home, MMA section 706. 04/04/2005 3529 R1BP 10/01/2003 Introduction to the Benefit Policy Manual N/A N/A Back to top of Chapter

(Rev. 1, 10-01-03) B3-2120, A3-3114, HO-236 Ambulance services are separately payable only under Part B. There are certain circumstances in which the service is covered and payable as a beneficiary transportation service under Part A; however in this case the service cannot be classified and paid for as an ambulance service under Part B. (See §10.3.3 for a description of this exception. Also see §10.2.4 for the required documentation for ambulance services.) Payment may be made for expenses incurred for ambulance service provided the conditions specified in the following subsections are met. (See the Medicare Claims Processing Manual, Chapter 15, “Ambulance,” for instructions for processing ambulance service claims.) The Medicare ambulance benefit is a transportation benefit and without a transport there is no payable service. When multiple ground and/or air ambulance providers/suppliers respond, payment may be made only to the ambulance provider/supplier that actually furnishes the transport.

(Rev. 1, 10-01-03) B3-2120.1, A3-3114, HO-236.1

(Rev. 1, 10-01-03) B3-2120.1.A, A3-3114.A, HO-236.1.A Any vehicle used as an ambulance must be designed and equipped to respond to medical emergencies and, in nonemergency situations, be capable of transporting beneficiaries with acute medical conditions. The vehicle must comply with State or local laws governing the licensing and certification of an emergency medical transportation vehicle. At a minimum, the ambulance must contain a stretcher, linens, emergency medical supplies, oxygen equipment, and other lifesaving emergency medical equipment and be equipped with emergency warning lights, sirens, and telecommunications equipment as required by State or local law. This should include, at a minimum, one 2-way voice radio or wireless telephone.

(Rev. 226, Issued: 09-12-16, Effective: 01-01-16, Implementation: 12-12-16) Basic Life Support (BLS) ambulances must be staffed by at least two people, who meet the requirements of state and local laws where the services are being furnished and where, at least one of whom must (1) be certified at a minimum as an emergency medical technician-basic (EMT-basic) by the state or local authority where the services are being furnished and (2) be legally authorized to operate all lifesaving and life-sustaining equipment on board the vehicle. Advanced Life Support (ALS) vehicles must be staffed by at least two people, who meet the requirements of state and local laws where the services are being furnished and where at least one of whom must (1) meet the vehicle staff requirements above for BLS vehicles and (2) be certified as an EMT-Intermediate or an EMT-Paramedic by the state or local authority where the services are being furnished to perform one or more ALS services.

(Rev. 1, 10-01-03) B3-2120.1.C, B3-2120.1.C, HO-236.1 In determining whether the vehicles and personnel of each supplier meet all of the above requirements, A/B MACs (B) may accept the supplier’s statement (absent information to the contrary) that its vehicles and personnel meet all of the requirements if: 1. The statement describes the first aid, safety, and other patient care items with which the vehicles are equipped; 2. The statement shows the extent of first aid training acquired by the personnel assigned to those vehicles; 3. The statement contains the supplier’s agreement to notify the A/B MAC (B) of any change in operation which could affect the coverage of ambulance services; and 4. The information provided indicates that the requirements are met. The statement must be accompanied by documentary evidence that the ambulance has the equipment required by State and local authorities. Documentary evidence could include a letter from such authorities, a copy of a license, permit, certificate, etc., issued by the authorities. The A/B MAC (B) will keep the statement and supporting documentation on file. When a supplier does not submit such a statement or whenever there is a question about a supplier’s compliance with any of the above requirements for vehicle and crew (including suppliers who have completed the statement), A/B MACs (B) will take appropriate action including, where necessary, on-site inspection of the vehicles and verification of the qualifications of personnel to determine whether the ambulance service qualifies for reimbursement under Medicare. Since the requirements described above for coverage of ambulance services are applicable to the overall operation of the ambulance supplier’s service, information regarding personnel and vehicles need not be obtained on an individual trip basis.

(Rev. 1, 10-01-03) A3-3114, B3-2120.1, HO-236.1 The A/B MAC (A) is responsible for the processing of claims for ambulance service furnished under arrangements by participating hospitals, skilled nursing facilities, and home health agencies. Since provider ambulance services furnished “under arrangements” with suppliers can be covered only if the supplier meets the above requirements, the A/B MAC (A) may ask the A/B MAC (B) to identify those suppliers who meet the requirements. Where the "under arrangement" supplier also supplies ambulance services directly to Medicare beneficiaries, i.e., services that are not pursuant to an arrangement with a provider, the A/B MAC (A) contacts the A/B MAC (B) to ascertain whether it has already determined whether the crew and ambulance requirements are met. In such a situation, the A/B MAC (A) should accept the A/B MAC (B)’s determination without pursuing its own investigation.

(Rev. 1, 10-01-03) A3-3114.A, B3-2120.2.E As mentioned above, the ambulance must have customary patient care equipment and first aid supplies, including reusable devices and equipment such as backboards, neckboards, and inflatable leg and arm splints. These are all considered part of the general ambulance service and payment for them is included in the payment rate for the transport.

(Rev. 1, 10-01-03) B3-2120.2, A3-3114.B, HO-236.2 To be covered, ambulance services must be medically necessary and reasonable.

(Rev. 1, 10-01-03) B3-2120.2.A, A3-3114.B, HO-236.2 Medical necessity is established when the patient's condition is such that use of any other method of transportation is contraindicated. In any case in which some means of transportation other than an ambulance could be used without endangering the individual's health, whether or not such other transportation is actually available, no payment may be made for ambulance services. In all cases, the appropriate documentation must be kept on file and, upon request, presented to the A/B MAC (A) or (B). It is important to note that the presence (or absence) of a physician’s order for a transport by ambulance does not necessarily prove (or disprove) whether the transport was medically necessary. The ambulance service must meet all program coverage criteria in order for payment to be made. In addition, the reason for the ambulance transport must be medically necessary. That is, the transport must be to obtain a Medicare covered service, or to return from such a service.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Under the FS payment is made according to the level of medically necessary services actually furnished. That is, payment is based on the level of service furnished (provided they were medically necessary), not simply on the vehicle used. Even if a local government requires an ALS response for all calls, payment under the FS is made only for the level of service furnished, and then only when the service is medically necessary.

(Rev. 1, 10-01-03) As stated above, medical necessity is established when the patient’s condition is such that the use of any other method of transportation is contraindicated. A/B MACs (A) and (B) may presume this requirement is met under certain circumstances, including when the beneficiary was bed-confined before and after the ambulance trip (see §20 for the complete list of circumstances). A beneficiary is bed-confined if he/she is: • Unable to get up from bed without assistance; • Unable to ambulate; and • Unable to sit in a chair or wheelchair. The term "bed confined" is not synonymous with "bed rest" or "nonambulatory". Bed- confinement, by itself, is neither sufficient nor is it necessary to determine the coverage for Medicare ambulance benefits. It is simply one element of the beneficiary's condition that may be taken into account in the A/B MAC (A)’s or (B)’s determination of whether means of transport other than an ambulance were contraindicated.

In all cases, the appropriate documentation must be kept on file and, upon request, presented to the A/B MAC (B). It is important to note that neither the presence nor absence of a signed physician’s order for an ambulance transport necessarily proves (or disproves) whether the transport was medically necessary. The ambulance service must meet all program coverage criteria in order for payment to be made.

(Rev. 1, 10-01-03) No payment may be made for the transport of ambulance staff or other personnel when the beneficiary is not onboard the ambulance (e.g., an ambulance transport to pick up a specialty care unit from one hospital to provide services to a beneficiary at another hospital). This policy applies to both ground and air ambulance transports.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Because the Medicare ambulance benefit is a transport benefit, if no transport of a Medicare beneficiary occurs, then there is no Medicare-covered service. In general, if the beneficiary dies before being transported, then no Medicare payment may be made. Thus, in a situation where the beneficiary dies, whether any payment under the Medicare ambulance benefit may be made depends on the time at which the beneficiary is pronounced dead by an individual authorized by the State to make such pronouncements. The chart below shows the Medicare payment determination for various ground ambulance scenarios in which the beneficiary dies. In each case, the assumption is that the ambulance transport would have otherwise been medically necessary. Ground Ambulance Scenarios: Beneficiary Death Time of Death Pronouncement Medicare Payment Determination Before dispatch. None. After dispatch, before beneficiary is loaded onboard ambulance (before or after arrival at the point-of- pickup). The provider’s/supplier’s BLS base rate, no mileage or rural adjustment; use the QL modifier when submitting the claim. After pickup, prior to or upon arrival at the receiving facility. Medically necessary level of service furnished.

(Rev. 243; Issued: 04-13-18; Effective: 07-16-18; Implementation: 07-16-18) An ambulance transport is covered to the nearest appropriate facility to obtain necessary diagnostic and/or therapeutic services (such as a CT scan or cobalt therapy) as well as the return transport. In addition to all other coverage requirements, this transport situation is covered only to the extent of the payment that would be made for bringing the service to the patient. Medicare covers ambulance transports (that meet all other program requirements for coverage) only to the following destinations: • Hospital; • Critical Access Hospital (CAH); • Skilled Nursing Facility (SNF); • From a SNF to the nearest supplier of medically necessary services not available at the SNF where the beneficiary is a resident and not in a covered Part A stay, including the return trip; • Beneficiary’s home; • Dialysis facility for ESRD patient who requires dialysis; or • A physician’s office is not a covered destination. However, under special circumstances an ambulance transport may temporarily stop at a physician’s office without affecting the coverage status of the transport. As a general rule, only local transportation by ambulance is covered, and therefore, only mileage to the nearest appropriate facility equipped to treat the patient is covered. However, if two or more facilities that meet the destination requirements can treat the patient appropriately and the locality (see §10.3.5 below) of each facility encompasses the place where the ambulance transportation of the patient began, then the full mileage to any one of the facilities to which the beneficiary is taken is covered. Because all duly licensed hospitals and SNFs are presumed to be appropriate sources of health care, only in exceptional situations where the ambulance transportation originates beyond the locality of the institution to which the beneficiary was transported, may full payment for mileage be considered. And then, only if the evidence clearly establishes that the destination institution was the nearest one with appropriate facilities under the particular circumstances. (See §10.3.6 below.) The institution to which a patient is transported need not be a participating institution but must meet at least the requirements of §1861(e)(1) or §1861(j)(1) of the Social Security Act (the Act.) (See Pub. 100-01 Medicare General Information, Eligibility, and Entitlement Manual, Chapter 5, "Definitions," for an explanation of these requirements.)

(Rev. 1, 10-01-03) A3-3114.C.1, HO-236.3.A Ambulance service from an institution to the beneficiary’s home is covered when the home is within the locality of such institution or where the beneficiary’s home is outside of the locality of such institution but the institution, in relation to the home, is the nearest one with appropriate facilities.

(Rev. 14, 05-28-04) A3-3114.C.2, HO-236.3.B Occasionally, the institution to which the patient is initially taken is found to have inadequate or unavailable facilities to provide the required care, and the patient is then transported to a second institution having appropriate facilities. In such cases, transportation by ambulance to both institutions would be covered to the extent of the mileage to be the nearest institution with appropriate facilities. Responsibility for payment would follow the rules in § 10.3.3. In these cases, transportation from such second institution to the patient's home could be covered if the home is within the locality served by that institution, or the locality served by the first institution to which the patient was taken.

(Rev.243; Issued: 04-13-18; Effective: 07-16-18; Implementation: 07-16-18) Transportation of a beneficiary from his or her home, an accident scene, or any other point of origin is covered under Part B as an ambulance service only to the nearest hospital, critical access hospital (CAH), or skilled nursing facility (SNF) that is capable of furnishing the required level and type of care for the beneficiary's illness or injury and only if medical necessity and other program coverage criteria are met. An ambulance transport from a SNF to the nearest supplier of medically necessary services not available at the SNF where the beneficiary is a resident and not in a covered Part A stay, including the return trip, is covered under Part B provided that the ambulance transportation was medically reasonable and necessary and all other coverage requirements are met. Medicare-covered ambulance services are paid either as separately billed services, in which case the entity furnishing the ambulance service bills Part B of the program, or as a packaged service, in which case the entity furnishing the ambulance service must seek payment from the provider who is responsible for the beneficiary’s care. If either the origin or the destination of the ambulance transport is the beneficiary’s home, then the ambulance transport is paid separately by Medicare Part B, and the entity that furnishes the ambulance transport may bill its A/B MAC (A) or (B) directly. If both the origin and destination of the ambulance transport are providers, e.g., a hospital, critical access hospital (CAH), skilled nursing facility (SNF), then responsibility for payment for the ambulance transport is determined in accordance with the following sequential criteria. NOTE: These criteria must be applied in sequence as a flow chart and not independently of one another. 1. Provider Numbers: If the Medicare-assigned provider numbers of the two providers are different, then the ambulance service is separately billable to the program. If the provider number of both providers is the same, then consider criterion 2, “campus”. 2. Campus: Following criterion 1, if the campuses of the two providers (sharing the same provider numbers) are the same, then the transport is not separately billable to the program. In this case the provider is responsible for payment. If the campuses of the two providers are different, then consider criterion 3, “patient status.” “Campus” means the physical area immediately adjacent to the provider’s main buildings, other areas and structures that are not strictly contiguous to the main buildings, but are located within 250 yards of the main buildings, and any of the other areas determined on an individual case basis by the CMS regional office to be part of the provider’s campus. 3. Patient Status: Inpatient vs. Outpatient Following criteria 1 and 2, if the patient is an inpatient at both providers (i.e., inpatient status both at the origin and at the destination, providers sharing the same provider number but located on different campuses), then the transport is not separately billable. In this case the provider is responsible for payment. All other combinations (i.e., outpatient-to-inpatient, inpatient-to-outpatient, outpatient-to-outpatient) are separately billable to the program. In the case where the point of origin is not a provider, Part A coverage is not available because, at the time the beneficiary is being transported, the beneficiary is not an inpatient of any provider paid under Part A of the program and ambulance services are excluded from the 3-day preadmission payment window. The transfer, i.e., the discharge of a beneficiary from one provider with a subsequent admission to another provider, is also payable as a Part B ambulance transport, provided all program coverage criteria are met, because, at the time that the beneficiary is in transit, the beneficiary is not a patient of either provider and not subject to either the inpatient preadmission payment window or outpatient payment packaging requirements. This includes an outpatient transfer from a remote, off-campus emergency department (ER) to becoming an inpatient or outpatient at the main campus hospital, even if the ER is owned and operated by the hospital. Once a beneficiary is admitted to a hospital, CAH, or SNF, it may be necessary to transport the beneficiary to another hospital or other site temporarily for specialized care while the beneficiary maintains inpatient status with the original provider. This movement of the patient is considered "patient transportation" and is covered as an inpatient hospital or CAH service and as a SNF service when the SNF is furnishing it as a covered SNF service and payment is made under Part A for that service. (If the beneficiary is a resident of a SNF and must be transported by ambulance to receive dialysis or certain other high-end outpatient hospital services, the ambulance transport may be separately payable under Part B. Also, if the beneficiary is a SNF resident and not in a Part A covered stay and must be transported by ambulance to the nearest supplier of medically necessary services not available at the SNF, the ambulance transport, including the return trip, may be covered under Part B.) Because the service is covered and payable as a beneficiary transportation service under Part A, the service cannot be classified and paid for as an ambulance service under Part B. This includes intra-campus transfers between different departments of the same hospital, even where the departments are located in separate buildings. Such intra-campus transfers are not separately payable under the Part B ambulance benefit. Such costs are accounted for in the same manner as the costs of such a transfer within a single building.

(Rev. 14, 05-28-04) A3-3114.C.3, HO-236.3.C, AB-00-127, B3-2120.3C Ambulance transports to and from a covered destination (i.e., two 1-way trips) furnished to a beneficiary who is not an inpatient of a provider for the purpose of obtaining covered medical services are covered, if all program requirements for coverage are met. In addition, coverage of ambulance transports to and from a destination under these circumstances is limited to those cases where the transportation of the patient is less costly than bringing the service to the patient. For frequent transports of this kind subject to the A/B MAC (A)’s or (B)’s discretion, additional information may be required supporting the need for ambulance services relative to the option of admission to a treatment facility. Specialized services are covered services that are not available at the facility in which the beneficiary is a patient.

(Rev. 236, Issued: 06-16-17, Effective: 09-18-17, Implementation: 09-18-17) The term “locality” with respect to ambulance service means the service area surrounding the institution to which individuals normally travel or are expected to travel to receive hospital or skilled nursing services. The MACs have the discretion to define locality in their service areas. EXAMPLE: Mr. A becomes ill at home and requires ambulance service to the hospital. The small community in which he lives has a 35-bed hospital. Two large metropolitan hospitals are located some distance from Mr. A's community and both regularly provide hospital services to the community's residents. The community is within the "locality" of both metropolitan hospitals and direct ambulance service to either of these (as well as to the local community hospital) is covered.

(Rev. 1, 10-01-03) A3-3114.C.6, HO-236.3.F The term “appropriate facilities” means that the institution is generally equipped to provide the needed hospital or skilled nursing care for the illness or injury involved. In the case of a hospital, it also means that a physician or a physician specialist is available to provide the necessary care required to treat the patient’s condition. However, the fact that a particular physician does or does not have staff privileges in a hospital is not a consideration in determining whether the hospital has appropriate facilities. Thus, ambulance service to a more distant hospital solely to avail a patient of the service of a specific physician or physician specialist does not make the hospital in which the physician has staff privileges the nearest hospital with appropriate facilities. The fact that a more distant institution is better equipped, either qualitatively or quantitatively, to care for the patient does not warrant a finding that a closer institution does not have “appropriate facilities.” Such a finding is warranted, however, if the beneficiary’s condition requires a higher level of trauma care or other specialized service available only at the more distant hospital. In addition, a legal impediment barring a patient’s admission would permit a finding that the institution did not have “appropriate facilities.” For example, the nearest tuberculosis hospital may be in another State and that State’s law precludes admission of nonresidents. An institution is also not considered an appropriate facility if there is no bed available. The A/B MAC (A) or (B), however, will presume that there are beds available at the local institutions unless the claimant furnished evidence that none of these institutions had a bed available at the time the ambulance service was provided. EXAMPLE: Mr. A becomes ill at home and requires ambulance service to the hospital. The hospitals servicing the community in which he lives are capable of providing general hospital care. However, Mr. A requires immediate kidney dialysis, and the needed equipment is not available in any of these hospitals. The service area of the nearest hospital having dialysis equipment does not encompass the patient’s home. Nevertheless, in this case, ambulance service beyond the locality to the hospital with the equipment is covered since it is the nearest one with appropriate facilities.

(Rev. 1, 10-01-03) A3-3114.C.4, HO-236.3.D Where ambulance service exceeds the limits defined in §§10.3 through 10.3.7, above, refer to §20, item #5 for instructions on partial payment.

(Rev. 1, 10-01-03) A3-3114.C.7, HO-236.3.G, B3-2130.3.G These trips are covered only under the following circumstances: • The ambulance transport is enroute to a Medicare covered destination as described in §10.3 ; and • During the transport, the ambulance stops at a physician's office because of the patient's dire need for professional attention, and immediately thereafter, the ambulance continues to the covered destination. In such cases, the patient will be deemed to have been transported directly to a covered destination and payment may be made for a single transport and the entire mileage of the transport, including any additional mileage traveled because of the stop at the physician’s office.

(Rev. 1, 10-01-03) A3-3114.C.8, HO-236.3.H, B3-2130.3.H Where a home health agency has a beneficiary transported by ambulance to a hospital or skilled nursing facility to obtain needed medical services not otherwise available to the individual, the trip is covered as a Part B service only if the requirements are met for ambulance transportation from wherever the patient is located (place of origin). Such transportation is not covered as a home health service.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Effective April 1, 2002, if two patients are transported to the same destination simultaneously, for each Medicare beneficiary, Medicare will allow 75 percent of the payment allowance for the base rate applicable to the level of care furnished to that beneficiary plus 50 percent of the total mileage payment allowance for the entire trip. If three or more patients are transported to the same destination simultaneously, then the payment allowance for the Medicare beneficiary (or each of them) is equal to 60 percent of the base rate applicable to the level of care furnished to the beneficiary. However, a single payment allowance for mileage will be prorated by the number of patients onboard. This policy applies to both ground and air transports.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Medically appropriate air ambulance transportation is a covered service regardless of the State or region in which it is rendered. However, A/B MACs (A) and (B) approve claims only if the beneficiary’s medical condition is such that transportation by either basic or advanced life support ground ambulance is not appropriate. There are two categories of air ambulance services: fixed wing (airplane) and rotary wing (helicopter) aircraft. The higher operational costs of the two types of aircraft are recognized with two distinct payment amounts for air ambulance mileage. The air ambulance mileage rate is calculated per actual loaded (patient onboard) miles flown and is expressed in statute miles (not nautical miles). 1. Fixed Wing Air Ambulance (FW) Fixed wing air ambulance is furnished when the beneficiary’s medical condition is such that transport by ground ambulance, in whole or in part, is not appropriate. Generally, transport by fixed wing air ambulance may be necessary because the beneficiary’s condition requires rapid transport to a treatment facility, and either great distances or other obstacles, e.g., heavy traffic, preclude such rapid delivery to the nearest appropriate facility. Transport by fixed wing air ambulance may also be necessary because the beneficiary is inaccessible by a ground or water ambulance vehicle. 2. Rotary Wing Air Ambulance (RW) Rotary wing air ambulance is furnished when the beneficiary’s medical condition is such that transport by ground ambulance, in whole or in part, is not appropriate. Generally, transport by rotary wing air ambulance may be necessary because the beneficiary’s condition requires rapid transport to a treatment facility, and either great distances or other obstacles, e.g., heavy traffic, preclude such rapid delivery to the nearest appropriate facility. Transport by rotary wing air ambulance may also be necessary because the beneficiary is inaccessible by a ground or water ambulance vehicle.

(Rev. 1, 10-01-03) A3-3114.C.11.A, B3-2120.4A Air ambulance transportation services, either by means of a helicopter or fixed wing aircraft, may be determined to be covered only if: • The vehicle and crew requirements described in §10.1 are met; • The beneficiary’s medical condition required immediate and rapid ambulance transportation that could not have been provided by ground ambulance; and either 1. The point of pickup is inaccessible by ground vehicle (this condition could be met in Hawaii, Alaska, and in other remote or sparsely populated areas of the continental United States), or 2. Great distances or other obstacles are involved in getting the patient to the nearest hospital with appropriate facilities as described in §10.4.4. Additionally, Medicare allows payment for an air ambulance service when the air ambulance takes off to pick up a Medicare beneficiary, but the beneficiary is pronounced dead before being loaded onto the ambulance for transport (either before or after the ambulance arrives on the scene). This is provided the air ambulance service would otherwise have been medically necessary. In such a circumstance, the allowed amount is the appropriate air base rate, i.e., fixed wing or rotary wing. However, no amount shall be allowed for mileage or for a rural adjustment that would have been allowed had the transport of a living beneficiary or of a beneficiary not yet pronounced dead been completed. For the purpose of this policy, a pronouncement of death is effective only when made by an individual authorized under State law to make such pronouncements. This policy also states no amount shall be allowed if the dispatcher received pronouncement of death and had a reasonable opportunity to notify the pilot to abort the flight. Further, no amount shall be allowed if the aircraft has merely taxied but not taken off or, at a controlled airport, has been cleared to take off but not actually taken off.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Medical reasonableness is only established when the beneficiary’s condition is such that the time needed to transport a beneficiary by ground, or the instability of transportation by ground, poses a threat to the beneficiary’s survival or seriously endangers the beneficiary’s health. Following is an advisory list of examples of cases for which air ambulance could be justified. The list is not inclusive of all situations that justify air transportation, nor is it intended to justify air transportation in all locales in the circumstances listed. • Intracranial bleeding - requiring neurosurgical intervention; • Cardiogenic shock; • Burns requiring treatment in a burn center; • Conditions requiring treatment in a Hyperbaric Oxygen Unit; • Multiple severe injuries; or • Life-threatening trauma.

(Rev. 1, 10-01-03) A3-3114.C.11.C, B3-2120.4.C Differing Statewide Emergency Medical Services (EMS) systems determine the amount and level of basic and advanced life support ground transportation available. However, there are very limited emergency cases where ground transportation is available but the time required to transport the patient by ground as opposed to air endangers the beneficiary’s life or health. As a general guideline, when it would take a ground ambulance 30-60 minutes or more to transport a beneficiary whose medical condition at the time of pick-up required immediate and rapid transport due to the nature and/or severity of the beneficiary’s illness/injury, A/B MACs (A) and (B) should consider air transportation to be appropriate.

(Rev. 1, 10-01-03) A3-3114.C.11.E, B3-2120.4.E Air ambulance transport is covered for transfer of a patient from one hospital to another if the medical appropriateness criteria are met, that is, transportation by ground ambulance would endanger the beneficiary’s health and the transferring hospital does not have adequate facilities to provide the medical services needed by the patient. Examples of such specialized medical services that are generally not available at all type of facilities may include but are not limited to: burn care, cardiac care, trauma care, and critical care. A patient transported from one hospital to another hospital is covered only if the hospital to which the patient is transferred is the nearest one with appropriate facilities. Coverage is not available for transport from a hospital capable of treating the patient because the patient and/or the patient’s family prefer a specific hospital or physician.

(Rev. 1, 10-01-03) A3-3114.C.11.F, B3-2120.4.F Air ambulance services are not covered for transport to a facility that is not an acute care hospital, such as a nursing facility, physician’s office, or a beneficiary’s home.

(Rev. 133, Issued: 10-22-10, Effective: 01-01-11, Implementation: 01-03-11) If a determination is made to order transport by air ambulance, but ground ambulance transport would have sufficed, payment for the air ambulance transport is based on the amount payable for ground ambulance transport. If the air transport was medically appropriate (that is, ground transportation was contraindicated, and the beneficiary required air transport to a hospital), but the beneficiary could have been treated at a hospital nearer than the one to which they were transported, the air transport payment is limited to the rate for the distance from the point of pickup to that nearer hospital.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) In order to determine the medical appropriateness of air ambulance services the A/B MAC (A) or (B) may request that documentation be submitted that indicates the air ambulance services are reasonable and necessary to treat the beneficiary’s life- threatening condition. The contractor’s medical staff may consider reviewing all claims for air ambulance services.

(Rev. 1, 10-01-03) The chart below shows the Medicare payment determination for various air ambulance scenarios in which the flight is aborted due to bad weather, or other circumstance beyond the pilot’s control. Air Ambulance Scenarios: Aborted Flights Aborted Flight Scenario Medicare Payment Determination Any time before the beneficiary is loaded onboard (i.e., prior to or after take-off to point-of-pickup.) None. Transport after the beneficiary is loaded onboard. Appropriate air base rate, mileage, and rural adjustment.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Because the Medicare ambulance benefit is a transport benefit, if no transport of a Medicare beneficiary occurs, then there is no Medicare-covered service. In general, if the beneficiary dies before being transported, then no Medicare payment may be made. Thus, in a situation where the beneficiary dies, whether any payment under the Medicare ambulance benefit may be made depends on the time at which the beneficiary is pronounced dead by an individual authorized by the State to make such pronouncements. The chart below shows the Medicare payment determination for various air ambulance scenarios in which the beneficiary dies. In each case, the assumption is that the ambulance transport would have otherwise been medically necessary. If the flight is aborted for other reasons, such as bad weather, the Medicare payment determination is based on whether the beneficiary was onboard the air ambulance. Air Ambulance Scenarios: Beneficiary Death Time of Death Pronouncement Medicare Payment Determination Prior to takeoff to point-of-pickup with notice to dispatcher and time to abort the flight. None. NOTE: This scenario includes situations in which the air ambulance has taxied to the runway, and/or has been cleared for takeoff, but has not actually taken off.) After takeoff to point-of-pickup, but before the beneficiary is loaded. Appropriate air base rate with no mileage or rural adjustment; use the QL modifier when submitting the claim. After the beneficiary is loaded onboard, but prior to or upon arrival at the receiving facility. As if the beneficiary had not died.

(Rev. 125, Issued 05-14-10, Effective: 01-04-10, Implementation: 06-15-10) A. BLS/ALS Joint Responses In situations where a BLS entity provides the transport of the beneficiary and an ALS entity provides a service that meets the fee schedule definition of an ALS intervention (e.g., ALS assessment, Paramedic Intercept services, etc.), the BLS supplier may bill Medicare the ALS rate provided that a written agreement between the BLS and ALS entities exists prior to submitting the Medicare claim. Providers/suppliers must provide a copy of the agreement or other such evidence (e.g., signed attestation) as determined by their A/B MAC (A) or (B) upon request. A/B MACs (A) and (B) must refer any issues that cannot be resolved to the regional office. Medicare does not regulate the compensation between the BLS entity and the ALS entity. If there is no agreement between the BLS ambulance supplier and the ALS entity furnishing the service, then only the BLS level of payment may be made. In this situation, the ALS entity’s services are not covered, and the beneficiary is liable for the expense of the ALS services to the extent that these services are beyond the scope of the BLS level of payment. B. Ground to Air Ambulance Transports When a beneficiary is transported by ground ambulance and transferred to an air ambulance, the ground ambulance may bill Medicare for the level of service provided and mileage from the point of pickup to the point of transfer to the air ambulance.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Payment may be made for expenses incurred by a patient for ambulance service provided conditions l, 2, and 3 in the left-hand column have been met. The right-hand column indicates the documentation needed to establish that the condition has been met. Conditions Review Action 1. Patient was transported by an approved supplier of ambulance services. 1. Ambulance suppliers are explained in greater detail in §10.1.3 2. The patient was suffering from an illness or injury, which contraindicated transportation by other means. (§10.2) 2. (a) The A/B MAC (A) or (B) presumes the requirement was met if the submitted documentation indicates that the patient: • Was transported in an emergency situation, e.g., as a result of an accident, injury or acute illness, or • Needed to be restrained to prevent injury to the beneficiary or others; or • Was unconscious or in shock; or • Required oxygen or other emergency treatment during transport to the nearest appropriate facility; or • Exhibits signs and symptoms of acute respiratory distress or cardiac distress such as shortness of breath or chest pain; or • Exhibits signs and symptoms that indicate the possibility of acute stroke; or • Had to remain immobile because of a fracture that had not been set or the possibility of a fracture; or • Was experiencing severe hemorrhage; or • Could be moved only by stretcher; or • Was bed-confined before and after the ambulance trip. (b) Conditions Review Action In the absence of any of the conditions listed in (a) above additional documentation should be obtained to establish medical need where the evidence indicates the existence of the circumstances listed below: (i) Patient’s condition would not ordinarily require movement by stretcher, or (ii) The individual was not admitted as a hospital inpatient (except in accident cases), or (iii) The ambulance was used solely because other means of transportation were unavailable, or (iv) The individual merely needed assistance in getting from his room or home to a vehicle. (c) Where the information indicates a situation not listed in 2(a) or 2(b) above, refer the case to your supervisor. 3. The patient was transported from and to points listed below. (a) From patient’s residence (or other place where need arose) to hospital or skilled nursing facility. 3. Claims should show the ZIP Code of the point of pickup. (a) i. Condition met if trip began within the institution’s service area as shown in the A/B MAC (B)’s locality guide. ii. Condition met where the trip began outside the institution’s service area if the institution was the nearest one with appropriate facilities. NOTE: A patient’s residence is the place where he or she makes his/her home and dwells permanently, or for an extended period of time. A skilled nursing facility is one, which is listed in the Directory of Medical Facilities as a participating SNF or as an institution which meets §1861(j)(1) of the Act. NOTE: A claim for ambulance service to a participating hospital or skilled nursing facility should not be denied on the grounds that there is a nearer nonparticipating institution having appropriate facilities. (b) Skilled nursing facility to a hospital or hospital to a skilled nursing facility. (b) (i) Condition met if the ZIP Code of the pickup point is within the service area of the destination as shown in the A/B MAC (B)’s locality guide. (ii) Condition met where the ZIP Code of the pickup point is outside the service area of the destination if the destination institution was the nearest appropriate facility. Conditions Review Action (c) Hospital to hospital or skilled nursing facility to skilled nursing facility. (c) Condition met if the discharging institution was not an appropriate facility and the admitting institution was the nearest appropriate facility. (d) From a hospital or skilled nursing facility to patient’s residence. (d) (i) Condition met if patient’s residence is within the institution’s service area as shown in the A/B MAC (B)’s locality guide. (ii) Condition met where the patient’s residence is outside the institution’s service area if the institution was the nearest appropriate facility. (e) Round trip for hospital or participating skilled nursing facility inpatients to the nearest hospital or nonhospital treatment facility. (e) Condition met if the reasonable and necessary diagnostic or therapeutic service required by patient’s condition is not available at the institution where the beneficiary is an inpatient. NOTE: Ambulance service to a physician’s office or a physician-directed clinic is not covered. See §10.3.8 above, where a stop is made at a physician’s office en route to a hospital and §10.3.3 for additional exceptions.) 4. Ambulance services involving hospital admissions in Canada or Mexico are covered (Medicare Claims Processing Manual, Chapter 1, “General Billing Requirements, “§10.1.3.) if the following conditions are met: 4. (a) The foreign hospitalization has been determined to be covered; and (b) The ambulance service meets the coverage requirements set forth in §§10-10.3. If the foreign hospitalization has been determined to be covered on the basis of emergency services (See the Medicare Claims Processing Manual, Chapter 1, “General Billing Requirements,” §10.1.3), the necessity requirement (§10.2) and the destination requirement (§10.3) are considered met. 5. The A/B MAC (B) will make partial payment for otherwise covered ambulance service, which exceeded limits defined in item 6. The A/B MAC (B) will base the payment on the amount payable had the patient been transported: 5 & 6 (a) From the pickup point to the nearest appropriate facility, or 5 & 6 (b) From the nearest appropriate facility to the beneficiary’s residence where he or she is being returned home from a distant institution.

(Rev. 1, 10-01-03) When an ambulance provider/supplier, or a third party under contract with the provider/supplier, furnishes a Medicare-covered ambulance service to a Medicare beneficiary and the service is not statutorily excluded under the particular circumstances, the provider/supplier must submit a claim to Medicare and accept assignment of the beneficiary's right to payment from Medicare.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) Mandatory assignment for ambulance services, in effect with the implementation of the ambulance fee schedule, applies to ambulance providers/suppliers under managed care as well as under fee-for-service. The ambulance fee schedule is effective for claims with a date of service on or after April 1, 2002. Any provider or supplier without a contract establishing payment amounts for services provided to a beneficiary enrolled in a Medicare Advantage (MA) coordinated care plan or MA private fee-for-service plan must accept, as payment in full, the amounts that they could collect if the beneficiary were enrolled in original Medicare. The provider or supplier can collect from the MA plan enrollee the cost-sharing amount required under the MA plan, and collect the remainder from the MA organization.

(Rev. 190, Issued: 07-11-14, Effective: 08-12-14, Implementation: 08-12-14) Medicare requires the signature of the beneficiary, or that of his or her representative, for both the purpose of accepting assignment and submitting a claim to Medicare. If the beneficiary is unable to sign because of a mental or physical condition, the following individuals may sign the claim form on behalf of the beneficiary: (1) The beneficiary’s legal guardian. (2) A relative or other person who receives social security or other governmental benefits on behalf of the beneficiary. (3) A relative or other person who arranges for the beneficiary’s treatment or exercises other responsibility for his or her affairs. (4) A representative of an agency or institution that did not furnish the services for which payment is claimed, but furnished other care, services, or assistance to the beneficiary. (5) A representative of the provider or of the nonparticipating hospital claiming payment for services it has furnished, if the provider or nonparticipating hospital is unable to have the claim signed in accordance with 42 CFR 424.36(b) (1 – 4). (6) A representative of the ambulance provider or supplier who is present during an emergency and/or nonemergency transport, provided that the ambulance provider or supplier maintains certain documentation in its records for at least 4 years from the date of service. A provider/supplier (or his/her employee) cannot request payment for services furnished except under circumstances fully documented to show that the beneficiary is unable to sign and that there is no other person who could sign. Medicare does not require that the signature to authorize claim submission be obtained at the time of transport for the purpose of accepting assignment of Medicare payment for ambulance benefits. When a provider/supplier is unable to obtain the signature of the beneficiary, or that of his or her representative, at the time of transport, it may obtain this signature any time prior to submitting the claim to Medicare for payment. (Note: there is a 12 month period for filing a Medicare claim, depending upon the date of service.) If the beneficiary/representative refuses to authorize the submission of a claim, including a refusal to furnish an authorizing signature, then the ambulance provider/supplier may not bill Medicare, but may bill the beneficiary (or his or her estate) for the full charge of the ambulance items and services furnished. If, after seeing this bill, the beneficiary/representative decides to have Medicare pay for these items and services, then a beneficiary/representative signature is required and the ambulance provider/supplier must afford the beneficiary/representative this option within the claims filing period.

(Rev. 103; Issued: 02-20-09; Effective Date: 01-05-09; Implementation Date: 03- 20-09) The Medicare program ambulance fee schedule (FS) is effective for ambulance items and services furnished on or after April 1, 2002. Under the FS, payment for ambulance services covered under the program is based on the lower of the actual billed amount or the ambulance fee schedule amount. The fee schedule was phased in over a 5-year period. The fee schedule replaced the retrospective reasonable cost reimbursement system for providers and the reasonable charge system for ambulance suppliers. During the transition period, payment was based on a blend of the FS amount and the amount under its current billing methodology. The fee schedule applies to all ambulance services, including volunteer, municipal, private, independent, and institutional providers, i.e., hospitals, skilled nursing facilities and home health agencies covered under Medicare Part B, except for services furnished by certain critical access hospitals (CAH). Payment for ambulance items and services furnished by a CAH, or by an entity that is owned and operated by a CAH, is based on reasonable cost if the CAH or entity is the only provider or supplier of ambulance services that is located within a 35- mile drive of such CAH. The provision is effective for ambulance services furnished on or after December 21, 2000.

(Rev. 226, Issued: 09-12-16, Effective: 01-01-16, Implementation: 12-12-16) There are several categories of ground ambulance services and two categories of air ambulance services under the fee schedule. (Note that “ground” refers to both land and water transportation.) All ground and air ambulance transportation services must meet all requirements regarding medical reasonableness and necessity as outlined in the applicable statute, regulations and manual provisions.

(Rev. 13459; Issued: 11-26-25; Implementation: 01-01-25; Effective: 07-17-25) Basic Life Support (BLS) Definition: BLS is transportation by ground ambulance vehicle (as defined in section 10.1, above) and the provision of medically necessary supplies and services (as defined in section 10.2, above), including BLS ambulance services as defined by the state. The ambulance vehicle must be staffed by at least two people who meet the requirements of the state and local laws where the services are being furnished, and at least one of the staff members must be certified at a minimum as an emergency medical technician-basic (EMT-Basic) by the state or local authority where the services are being furnished and be legally authorized to operate all lifesaving and life-sustaining equipment on board the vehicle. These laws may vary from state to state or within a state. Basic Life Support (BLS) – Emergency Definition: When medically necessary, the provision of BLS services, as specified above, in the context of an emergency response (as defined below). Advanced Life Support, Level 1 (ALS1) Definition: Advanced life support, level 1 (ALS1) is the transportation by ground ambulance vehicle (as defined in section 10.1, above) and the provision of medically necessary supplies and services (as defined in section 10.2, above) including the provision of an ALS assessment by ALS personnel or at least one ALS intervention. Advanced Life Support Assessment Definition: An ALS assessment is an assessment performed by an ALS crew as part of an emergency response (as defined below) that was necessary because the patient's reported condition at the time of dispatch was such that only an ALS crew was qualified to perform the assessment. An ALS assessment does not necessarily result in a determination that the patient requires an ALS level of service. In the case of an appropriately dispatched ALS Emergency service, as defined below, if the ALS crew completes an ALS Assessment, the services provided by the ambulance transportation service provider or supplier shall be covered at the ALS emergency level, regardless of whether the patient required ALS intervention services during the transport, provided that ambulance transportation itself was medically reasonable and necessary, as defined in section 10.2, above and all other coverage requirements are met. Advanced Life Support Intervention Definition: An ALS intervention is a procedure that is in accordance with state and local laws, required to be done by an emergency medical technician-intermediate (EMT- Intermediate) or EMT-Paramedic. Application: An ALS intervention must be medically necessary to qualify as an intervention for payment for an ALS level of service. An ALS intervention applies only to ground transports. Advanced Life Support, Level 1 (ALS1) - Emergency Definition: When medically necessary, the provision of ALS1 services, as specified above, in the context of an emergency response, as defined below. Advanced Life Support, Level 2 (ALS2) Definition: Advanced life support, level 2 (ALS2) is the transportation by ground ambulance vehicle and the provision of medically necessary supplies and services including (1) at least three separate administrations of one or more medications by intravenous (IV) push/bolus or by continuous infusion (excluding crystalloid fluids) or (2) ground ambulance transport, medically necessary supplies and services, and the provision of at least one of the ALS2 procedures listed below: a. Manual defibrillation/cardioversion; b. Endotracheal intubation; c. Central venous line; d. Cardiac pacing; e. Chest decompression; f. Surgical airway; or g. Intraosseous line; or h. Prehospital blood transfusion which includes: (i) Administration of low titer O+ and O- whole blood (WBT); (ii) Administration of packed red blood cells (PRBCs); (iii) Administration of plasma; or (iv) Administration of a combination of PRBCs and plasma. Application: Crystalloid fluids include but are not necessarily limited to 5 percent Dextrose in water (often referred to as D5W), Saline and Lactated Ringer’s. To qualify for the ALS2 level of payment, medications must be administered intravenously. Medications that are administered by other means, for example: intramuscularly, subcutaneously, orally, sublingually, or nebulized do not support payment at the ALS2 level rate. The IV medications are administered in standard doses as directed by local protocol or online medical direction. It is not appropriate to administer a medication in divided doses in order to meet the ALS2 level of payment. For example, if the local protocol for the treatment of supraventricular tachycardia (SVT) calls for a 6 mg dose of adenosine, the administration of three 2 mg doses in order to qualify for the ALS 2 level is not acceptable. The administration of an intravenous drug by infusion qualifies as one intravenous dose. For example, if a patient is being treated for atrial fibrillation in order to slow the ventricular rate with diltiazem and the patient requires two boluses of the drug followed by an infusion of diltiazem, then the infusion would be counted as the third intravenous administration and the transport would be billed as an ALS 2 level of service. The fractional administration of a single dose (for this purpose, meaning a “standard” or “protocol” dose) of a medication on three separate occasions does not qualify for ALS2 payment. In other words, the administering 1/3 of a qualifying dose 3 times does not equate to three qualifying doses to support claiming ALS2-level care. For example, administering one-third of a dose of X medication 3 times might = Y (where Y is a standard/protocol drug amount), but the same sequence does not equal 3 times Y. Thus, if 3 administrations of the same drug are required to claim ALS2 level care, each administration must be in accordance with local protocols; the run will not qualify at the ALS2 level on the basis of drug administration if that administration was not according to local protocol. The criterion of multiple administrations of the same drug requires that a suitable quantity of the drug be administered and that there be a suitable amount of time between administrations, and that both are in accordance with standard medical practice guidelines. An example of a single dose of medication administered fractionally on three separate occasions that would not qualify for the ALS2 payment rate is the administration of a single 1 mg dose of IV Epinephrine in partial increments to treat an adult pulseless Ventricular Tachycardia/Ventricular Fibrillation (VF/VT) patient. The American Heart Association (AHA), Advanced Cardiac Life Support (ACLS) protocol calls for Epinephrine to be administered in 1 mg increments every 3 to 5 minutes. Therefore, administering IV Epinephrine in separate increments of 0.25 mg, 0.25 mg, and 0.50 mg (for a total of 1 mg) over the course of a single 3 to 5 minute episode would not qualify for the ALS2 level of payment. Conversely, administering three separate 1 mg doses of IV Epinephrine over the requisite protocol-based time period to a patient with unresolved VF/VT would qualify for an ALS2 level of service. NOTE: refer to and abide by your authorized protocols; AHA’s ACLS protocols are referenced here only by way of widely recognized example. Another example that would not qualify for the ALS2 payment level is administering Adenosine in three 2 mg increments (for a total of 6 mg) in treating an adult patient with Paroxysmal Supraventricular Tachycardia (PSVT). ACLS guidelines dictate treating PSVT with 6 mg of Adenosine by rapid intravenous push (IVP) over 1 to 2 seconds. Should the initial 6 mg dose not eliminate the PSVT within 1 to 2 minutes, guidelines dictate that another 12 mg of Adenosine IVP should be administered where the PSVT persists, followed by another 12 mg dose 1 to 2 minutes later; for a total of 30 mg of Adenosine. Administering a total of 30 mg of Adenosine, involving three episodes of administration in a complete cycle of treatment as outlined above, would qualify for ALS2 payment. Endotracheal (ET) intubation (which includes intubating and/or monitoring/maintaining an ET tube inserted prior to transport) is a service that qualifies for the ALS2 level of payment. Therefore, it is not necessary to consider medications administered by ET tube to determine whether the ALS2 rate is payable. The administration of PHBTs requires an individual trained to the level of the emergency medical technician -intermediate [EMT-Intermediate] or paramedic. Medical monitoring of WBT by an EMT-Intermediate or paramedic with additional training to administer WBT during a ground ambulance transport would qualify for ALS2 payment. Advanced Life Support (ALS) Personnel Definition: ALS personnel are individuals trained to the level of the emergency medical technician-intermediate (EMT-Intermediate) or paramedic. Specialty Care Transport (SCT) Definition: SCT is the interfacility transportation (as defined below) of a critically injured or ill beneficiary by a ground ambulance vehicle, including the provision of medically necessary supplies and services, at a level of service beyond the scope of the EMT-Paramedic. SCT is necessary when a beneficiary’s condition requires ongoing care that must be furnished by one or more health professionals in an appropriate specialty area, for example, emergency or critical care nursing, emergency medicine, respiratory care, cardiovascular care, or an EMT-Paramedic with additional training. Application: SCT is necessary when a beneficiary’s condition requires ongoing care that must be furnished by one or more health professionals in an appropriate specialty area. The EMT-Paramedic level of care is set by each state. Medically necessary care that is furnished at a level above the EMT-Paramedic level of care may qualify as SCT. To be clear, if EMT-Paramedics - without specialty care certification or qualification - are permitted to furnish a given service in a state, then that service does not qualify for SCT. The phrase “EMT-Paramedic with additional training” recognizes that a state may permit a person who is not only certified as an EMT-Paramedic, but who also has successfully completed additional education as determined by the state in furnishing higher level medical services required by critically ill or injured patients, to furnish a level of service that otherwise would require a health professional in an appropriate specialty care area (for example, a nurse) to provide. “Additional training” means the specific additional training that a state requires a paramedic to complete in order to qualify to furnish specialty care to a critically ill or injured patient during an SCT. Paramedic Intercept (PI) Definition: Paramedic Intercept services are ALS services provided by an entity that does not provide the ambulance transport. This type of service is most often provided for an emergency ambulance transport in which a local volunteer ambulance that can provide only BLS level of service is dispatched to transport a patient. If the patient needs ALS services such as EKG monitoring, chest decompression, or IV therapy, another entity dispatches a paramedic to meet the BLS ambulance at the scene or once the ambulance is on the way to the hospital. The ALS paramedics then provide services to the patient. This tiered approach to life saving is cost effective in many areas because most volunteer ambulances do not charge for their services and one paramedic service can cover many communities. Prior to March 1, 1999, Medicare payment could be made for these services, but could not be made directly to the intercept service provider; rather, Medicare payment could be made only when the claim was submitted by the entity that actually furnished the ambulance transport. In those areas where state laws prohibited volunteer ambulances from billing Medicare and other health insurance, the intercept service could not receive payment for treating a Medicare beneficiary and was forced to bill the beneficiary for the entire service. Paramedic intercept services furnished on or after March 1, 1999, are payable separate from the ambulance transport when all of the requirements in the following three conditions are met: I. The intercept service(s) is: • Furnished in a rural area (as defined below); • Furnished under a contract with one or more volunteer ambulance services; and, • Medically necessary based on the condition of the beneficiary receiving the ambulance service. II. The volunteer ambulance service involved must: • Meet Medicare’s certification requirements for furnishing ambulance services; • Furnish services only at the BLS level at the time of the intercept; and, • Be prohibited by state law from billing anyone for any service. III. The entity furnishing the ALS paramedic intercept service must: • Meet Medicare’s certification requirements for furnishing ALS services, and, • Bill all recipients who receive ALS paramedic intercept services from the entity, regardless of whether or not those recipients are Medicare beneficiaries. For purposes of the paramedic intercept benefit, a rural area is an area that is designated as rural by a state law or regulation or that is located in a rural census tract of a metropolitan statistical area (as determined under the most recent version of the Goldsmith Modification). (The Goldsmith Modification is a methodology to identify small towns and rural areas within large metropolitan counties that are isolated from central areas by distance or other features). The current list of these areas is periodically published in the Federal Register. See Pub. 100-04, Medicare Claims Processing Manual, Chapter 15, "Ambulance," §20.1.4 for payment of paramedic intercept services. Services in a Rural Area Definition: For purposes other than the paramedic intercept benefit (as defined above), services in a rural area are services that are furnished (1) in an area outside a Metropolitan Statistical Area (MSA); or, (2) an area identified as rural using the most recent version of the Goldsmith Modification even though the area is within an MSA. Emergency Response Definition: Emergency response is a BLS or ALS1 level of service that has been provided in immediate response to a 911 call or the equivalent. An immediate response is one in which the ambulance provider/supplier begins as quickly as possible to take the steps necessary to respond to the call. The nature of an ambulance’s response (whether emergency or not) does not independently establish or support medical necessity for an ambulance transport. Rather, Medicare coverage always depends on, among other things, whether the service(s) furnished is actually medically reasonable and necessary based on the patient’s condition at the time of transport. Application: The phrase “911 call or the equivalent” is intended to establish the standard that the nature of the call at the time of dispatch is the determining factor. Regardless of the medium by which the call is made (e.g., a radio call could be appropriate) the call is of an emergent nature when, based on the information available to the dispatcher at the time of the call, it is reasonable for the dispatcher to issue an emergency dispatch in light of accepted, standard dispatch protocol. An emergency call need not come through 911 even in areas where a 911 call system exists. However, the determination to respond emergently with a BLS or ALS ambulance must be in accord with the local 911 or equivalent service dispatch protocol. If the call came in directly to the ambulance provider/supplier, then the provider’s/supplier’s dispatch protocol and the dispatcher’s actions must meet, at a minimum, the standards of the dispatch protocol of the local 911 or equivalent service. In areas that do not have a local 911 or equivalent service, the protocol and the dispatcher’s actions must meet, at a minimum, the standards of the dispatch protocol in another similar jurisdiction within the state, or if there is no similar jurisdiction, then the standards of any other dispatch protocol within the state. Where the dispatch was inconsistent with this standard of protocol, including where no protocol was used, the beneficiary’s condition (for example, symptoms) at the scene determines the appropriate level of payment. EMT-Intermediate Definition: EMT-Intermediate is an individual who is qualified, in accordance with state and local laws, as an EMT-Basic and who is also certified in accordance with state and local laws to perform essential advanced techniques and to administer a limited number of medications. EMT-Paramedic Definition: EMT-Paramedic possesses the qualifications of the EMT-Intermediate and, in accordance with state and local laws, has enhanced skills that include being able to administer additional interventions and medications. Interfacility Transportation Definition: For purposes of SCT payment, an interfacility transportation is one in which the origin and destination are one of the following: a hospital or skilled nursing facility that participates in the Medicare program or a hospital-based facility that meets Medicare’s requirements for provider-based status.

(Rev. 187, Issued: 05-01-14; Effective: 08-04-14; Implementation: 08-04-14) There are two categories of air ambulance services: fixed wing (airplane) and rotary wing (helicopter) aircraft. The higher operational costs of the two types of aircraft are recognized with two distinct payment amounts for air ambulance mileage. The air ambulance mileage rate is calculated per actual loaded (patient onboard) miles flown and is expressed in statute miles (not nautical miles). 1. Fixed Wing Air Ambulance (FW) Fixed wing air ambulance is furnished when the beneficiary’s medical condition is such that transport by ground ambulance, in whole or in part, is not appropriate. Generally, transport by fixed wing air ambulance may be necessary because the beneficiary’s condition requires rapid transport to a treatment facility, and either great distances or other obstacles, e.g., heavy traffic, preclude such rapid delivery to the nearest appropriate facility. Transport by fixed wing air ambulance may also be necessary because the beneficiary is inaccessible by a ground or water ambulance vehicle. 2. Rotary Wing Air Ambulance (RW) Rotary wing air ambulance is furnished when the beneficiary’s medical condition is such that transport by ground ambulance, in whole or in part, is not appropriate. Generally, transport by rotary wing air ambulance may be necessary because the beneficiary’s condition requires rapid transport to a treatment facility, and either great distances or other obstacles, e.g., heavy traffic, preclude such rapid delivery to the nearest appropriate facility. Transport by rotary wing air ambulance may also be necessary because the beneficiary is inaccessible by a ground or water ambulance vehicle. 07/17/2025 Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R13459BP 11/26/2025 Update to the List of Advanced Life Support, Level 2 (ALS2) Procedures in Chapter 10, Ambulance Services, Section 30.1.1, Definition of Ground Ambulance Services 07/17/2025 14036 R13169BP 04/17/2025 Update to the List of Advanced Life Support, Level 2 (ALS2) Procedures in Chapter 10, Ambulance Services, Section 30.1.1, Definition of Ground Ambulance Services- Rescinded and replaced by Transmittal 13495 07/17/2025 14036 R243BP 04/13/2018 Ambulance Transportation for a Skilled Nursing Facility (SNF) Resident in a Stay Not Covered by Part A - Medicare Benefit Policy Manual, Chapter 10 and Medicare Claims Processing Manual, Chapter 15 07/18/2018 10550 R236BP 06/17/2017 Medicare Benefit Policy Manual - Chapter 10, Ambulance Locality and Advanced Life Support (ALS) Assessment 09/18/2017 10110 R225BP 09/09/2016 Ambulance Staffing Requirements 12/12/2016 9761 R190BP 07/11/2014 Beneficiary Signature Requirements for Ambulance Services 08/12/2014 8760 R187BP 05/01/2014 Update to the Medicare Benefit Policy Manual to Restore Missing Air Ambulance Definitions 08/04/2014 8706 R133BP 10/22/2010 Air Ambulance Services 01/03/2011 7161 R130BP 07/29/2010 Definition of Ambulance Services 01/03/2011 7058 R125BP 05/14/2010 Ambulance Services-Joint Responses 06/15/2010 6949 R115BP 11/13/2009 Ambulance Services 01/04/2010 6707 R103BP 02/20/2009 Ambulance Services and Expiration of the Ambulance Fee Schedule Transition Period 03/20/2009 6318 R68BP 03/30/2007 Ambulance Fee Schedule – Ground Ambulance Services – Revision to the Specialty Care Transport (SCT) Definition 04/30/2007 5533 R14BP 05/28/2004 Ambulance Benefit Policy-Payment for Ambulance Services 07/01/2004 3225 R1BP 10/01/2003 Introduction to the Benefit Policy Manual N/A N/A Back to top of Chapter

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) End-Stage Renal Disease (ESRD) occurs from the destruction of normal kidney tissues over a long period of time. Often there are no symptoms until the kidney has lost more than half its function. At this advanced stage of kidney disease, the kidneys do not perform effectively and dialysis or a kidney transplant is needed to live. The loss of kidney function in ESRD is usually irreversible and permanent. The term “individual with acute kidney injury” means an individual who has acute loss of renal function and does not receive renal dialysis services for which payment is made under section 1881(b)(14) of the Social Security Act (the Act). Renal dialysis services furnished to hospital in-patients are covered under Medicare Part A and paid in accordance with applicable payment rules. Renal dialysis services furnished by ESRD facilities to individuals with ESRD who need outpatient dialysis are covered under Medicare Part B and paid under the ESRD Prospective Payment System (PPS). Medicare Part B also covers and pays for AKI dialysis, as discussed in §10.E.3 of this chapter. ESRD facilities must be certified by Medicare and are required to comply with the Conditions for Coverage set forth in 42 CFR Part 494. Survey and certification information for ESRD facilities can be found at the following Centers for Medicare & Medicaid Services (CMS) website: <http://www.cms.gov/Medicare/Provider-Enrollment-and- Certification/GuidanceforLawsAndRegulations/Dialysis.html>. A. Dialysis Dialysis is the process of removing waste products from the body by diffusion from one fluid compartment to another across a semi-permeable membrane (dialyzer). This process involves using a bath solution known as dialysate to remove waste products from the blood. Dialysis procedures can include: 1) hemodialysis; 2) peritoneal dialysis; 3) hemofiltration; and 4) ultrafiltration. Of these types of dialysis procedures, the two most commonly used for the treatment of ESRD are hemodialysis and peritoneal dialysis. 1. Hemodialysis – In Hemodialysis, blood passes from the access site through an artificial kidney machine and the waste products diffuse across a man-made membrane (dialyzer) into a bath solution (dialysate), after which the cleansed blood is returned to the patient’s body. Hemodialysis is usually accomplished in 3 to 5- hour sessions with an average of 4 hours per session, 3 times a week. Hemodialysis paid for under the ESRD PPS can be performed in an ESRD facility or at home. See §50.A.1 of this chapter for payment information related to hemodialysis. 2. Peritoneal – In Peritoneal dialysis, waste products are passed from the patient’s body through the peritoneal membrane into the peritoneal (abdominal) cavity. A bath solution (dialysate) is introduced into the body and removed periodically to extract the waste products. See §50.A.4 of this chapter for payment information related to peritoneal dialysis. The three types of peritoneal dialysis are listed below: a. Continuous Ambulatory Peritoneal Dialysis (CAPD) - In CAPD, the dialyzer is the patient’s peritoneal membrane. The patient connects a 2-liter plastic bag of dialysate to a surgically implanted indwelling catheter (a synthetic tube is placed into the abdominal cavity) that allows the dialysate to pour into the patient’s peritoneal cavity. Every 4 to 6 hours the patient drains the fluid out into the same bag and replaces the empty bag with a new bag of fresh dialysate. This is done several times a day. b. Continuous Cycling Peritoneal Dialysis (CCPD) - CCPD combines the advantages of the long dwell, continuous steady-state dialysis of CAPD, with the advantages of automation inherent in intermittent peritoneal dialysis. The major difference between CCPD and CAPD is that the solution exchanges are performed manually during the day by the patient on CAPD, but for the patient on CCPD the solution exchanges occur instead at night and are performed automatically with a peritoneal dialysis cycler. Generally, there are three nocturnal exchanges occurring at intervals of 2 1/2 to 3 hours. Upon awakening, the patient disconnects from the cycler and leaves the last 2-liter fill inside the peritoneum to continue the daytime long dwell dialysis. c. Intermittent Peritoneal Dialysis (IPD) - Waste products pass from the patient’s body through the peritoneal membrane into the peritoneal cavity where the dialysate is introduced and removed periodically by machine. IPD is generally required for approximately 30 hours a week, either as three 10-hour sessions or less frequent, but longer, sessions. See §50.A.5 of this chapter for payment information. 3. Hemofiltration - Hemofiltration is an alternative to peritoneal dialysis and hemodialysis. Hemofiltration removes fluid, electrolytes, and other low molecular weight toxic substances from the blood by filtration through hollow artificial membranes and may be routinely performed in three weekly sessions. In contrast to both hemodialysis and peritoneal dialysis treatments, which eliminate dissolved substances via diffusion across semi-permeable membranes, hemofiltration mimics the filtration process of the normal kidney. The technique requires an arteriovenous (AV) access. Hemofiltration may be performed either in an ESRD facility or at home. For payment information see §50.A.2 of this chapter. 4. Ultrafiltration – Ultrafiltration is the process of removing excess fluid from the blood by exerting pressure through a dialysis membrane. This is not a substitute for dialysis. Ultrafiltration is used in cases where excess fluid cannot be removed easily during the regular course of hemodialysis. It is commonly done during the first hour or two of hemodialysis on patients who have refractory edema (collection of fluid that is unresponsive to maintenance dialysis). Occasionally, medical complications may occur which require that ultrafiltration be performed separately from the dialysis treatment. See §50.A.3 of this chapter for payment information. B. ESRD Facility An ESRD facility is an entity that provides outpatient maintenance dialysis services, or home dialysis training and support services, or both. Per section 1881 of the Act, ESRD facilities are designated in 42 CFR § 413.174 as being either hospital-based or independent facilities. There is no distinction between the two facility types for payment purposes under the ESRD PPS. 1. Hospital-Based ESRD Facilities In accordance with 42 CFR §§ 413.65(a) and 413.174(c), hospital-based ESRD facilities may be located on a hospital campus and may share certain overhead costs and administrative functions with the hospital but do not qualify as provider-based departments of a hospital. However, hospital-based ESRD facilities have separate provider numbers under which they bill Medicare and are subject to unique Conditions for Coverage that differ from hospital Conditions of Participation. Information regarding the survey and certification of ESRD facilities may be found at the following link: <http://www.cms.gov/Medicare/Provider-Enrollment-and- Certification/GuidanceforLawsAndRegulations/Dialysis.html>. CMS determines that an ESRD facility is hospital-based if all of the following criteria are met: • The ESRD facility and hospital are subject to the bylaws and operating decisions of a common governing board. This governing board, which has final administrative responsibility, approves all personnel actions, appoints medical staff, and carries out similar management functions; • The ESRD facility’s director or administrator is under the supervision of the hospital’s chief executive officer and reports through that officer to the governing board; • The ESRD facility’s personnel policies and practices conform to those of the hospital; • The administrative functions of the ESRD facility (e.g., records, billing, laundry, housekeeping, and purchasing) are integrated with those of the hospital; and • The ESRD facility and hospital are financially integrated, as evidenced by the cost report, which must reflect allocation of hospital overhead to the facility through the required “step-down” methodology. CMS does not consider the following to mean that an ESRD facility is hospital based: the existence of an agreement between an ESRD facility and a hospital for the referral of patients, a shared service arrangement between a facility and a hospital, or the physical location of a dialysis unit on the premises of a hospital. 2. Independent ESRD Facility – Any ESRD facility that does not meet the criteria of a hospital-based ESRD facility. The following are some terms used to describe independent ESRD facilities: a. Renal Dialysis Facility - An independent, Medicare-certified unit that is approved to furnish outpatient maintenance dialysis services directly to ESRD patients and individuals with AKI. Under the ESRD PPS, CMS refers to renal dialysis facilities as ESRD facilities. b. Self-Dialysis Unit - A dialysis unit that furnishes self-dialysis services and is part of a Medicare- certified ESRD facility. c. Home Dialysis Training and Support ESRD Facility – A Medicare-certified ESRD facility that furnishes home dialysis training and support services. See 42 CFR § 494.100 for more information regarding Medicare certification requirements. d. Special Purpose Renal Dialysis Facility – A Medicare-certified ESRD facility that is approved to furnish dialysis at special locations, on a short-term basis, to a group of dialysis patients otherwise unable to obtain treatment in their geographical area. The special locations must be either special rehabilitative (including vacation) locations serving ESRD patients temporarily residing there, or locations in need of ESRD facilities under emergency circumstances. C. Renal Dialysis Services Renal dialysis services are all items and services used to furnish outpatient maintenance dialysis to individuals for the treatment of ESRD in the ESRD facility or in a beneficiary’s home. Renal dialysis services include but are not limited to: • All items and services included under the composite rate for renal dialysis services as of December 31, 2010 (see §20.2.E, §20.3.F, and §70.B of this chapter for more information); • Erythropoiesis stimulating agents (ESAs) and their oral or other forms of administration (see §20.3.A of this chapter for more information); • Injectable drugs and biological products and their oral or other forms of administration furnished for the treatment of ESRD (see §20.3.B, §20.3.C and §20.3.D of this chapter for more information); • Non-injectable drugs and biological products and other forms of administration with no injectable functional equivalent furnished for the treatment of ESRD (effective January 1, 2025, see §20.3 of this chapter for more information); • Diagnostic laboratory tests (see §20.2 of this chapter for more information); • Home and self-dialysis training (see §30.2 of this chapter for more information); and • All supplies, equipment, and support services necessary for the effective performance of a beneficiary’s dialysis furnished in the ESRD facility or in a beneficiary’s home (see §20.4 of this chapter for more information). See §20 of this chapter for more information regarding renal dialysis items and services. D. Services Provided Under an Arrangement A Medicare-certified ESRD facility may enter into written arrangements with a second ESRD facility to provide certain covered outpatient dialysis items or services to patients. When services are provided under this type of arrangement, the first ESRD facility retains professional and financial responsibility for those services and also for billing Medicare for them. The first ESRD facility may bill the patient for the applicable coinsurance and deductible amounts. The second ESRD facility is permitted to seek payment only from the first ESRD facility and may not bill the patient or Medicare. E. Types of Dialysis 1. Outpatient Maintenance Dialysis - Outpatient maintenance dialysis is furnished to ESRD patients on an outpatient basis by a Medicare certified ESRD facility and is paid under the ESRD PPS. Types of outpatient maintenance dialysis include: a. In-Facility Dialysis - Dialysis furnished on an outpatient basis in a Medicare-certified ESRD facility. This could include staff-assisted dialysis, self-dialysis, or nocturnal dialysis provided at an ESRD facility. b. Home Dialysis - Dialysis performed at an ESRD patient’s home, including in skilled nursing facilities and nursing facilities, by the ESRD patient or a caregiver who has completed an appropriate course of training as specified in 42 CFR § 494.100(a). c. Staff-Assisted Dialysis - Dialysis performed by the staff of the ESRD facility in the ESRD facility. d. Self-Dialysis - Dialysis performed by an ESRD patient in-facility or at an ESRD patient’s home with the expectation that the patient, or a caregiver, performs their dialysis treatment with little or no professional assistance. The patient or caregiver must have completed an appropriate course of training as specified in 42 CFR §494.100(a). e. Nocturnal Dialysis – Dialysis performed overnight at home or in-facility for >5 hours per treatment, 3-7 days a week. 2. Back-Up Dialysis - Dialysis given to patients under special circumstances. Examples include: dialysis of a home dialysis patient in an ESRD facility when the patient’s equipment fails or when a patient loses their caregiver, inpatient dialysis when a patient’s illness requires more comprehensive care, and preoperative and postoperative dialysis provided to transplant patients. 3. Acute Kidney Injury (AKI Dialysis) – AKI dialysis is furnished to individuals with AKI on an outpatient basis by a Medicare certified ESRD facility or a hospital outpatient dialysis unit. When AKI dialysis is furnished in a Medicare certified ESRD facility, it is paid under the ESRD PPS. When AKI dialysis is furnished in a hospital outpatient dialysis unit, it is paid under the hospital outpatient prospective payment system. For billing and payment instructions for AKI dialysis furnished in a hospital outpatient dialysis unit see Pub. 100-04, chapter 4, §200.2 and Pub. 100-02, chapter 1, section 10. Payment policy for AKI dialysis in an ESRD facility is available in section §100.2 of this chapter. F. Home Dialysis - Supplies, Equipment, and Support Services ESRD facilities are responsible for furnishing supplies, equipment, and support services for home dialysis. ESRD facilities are financially responsible and may not bill Medicare or the patient for separate payment. If an ESRD facility arranges for a supplier to furnish renal dialysis supplies and equipment, the supplier may seek payment only from the ESRD facility and may not bill Medicare or the patient for separate payment. The ESRD facility may not bill the beneficiary directly for any renal dialysis supplies, services, or equipment. For further discussion on ESRD PPS payment refer to §20.1 of this chapter. 1. Home Dialysis Equipment - Home dialysis equipment includes all of the medically necessary equipment ordered by the attending physician, for example: artificial kidneys, automated peritoneal dialysis machines, and support equipment. Home dialysis supplies and equipment may be covered if used by an ESRD beneficiary in a nursing facility or a skilled nursing facility. See §40.C and §40.D of this chapter for more information. 2. Installation - Installation includes (but is not limited to): the identification of any minor plumbing and electrical changes required to accommodate the equipment, the ordering and performing of these changes, delivery of the equipment and its actual installation (i.e., hookup), as well as any necessary testing to assure proper installation and function. Disposal of equipment is also included. Minor plumbing and electrical changes include those parts and labor required to connect the dialysis equipment to plumbing and electrical lines that already exist in the room where the patient will dialyze. Medicare does not cover wiring or rewiring of the patient’s home or installing any plumbing to the patient’s home or to the room of the home where the patient will dialyze. 3. Maintenance - Maintenance includes (but is not limited to): travel to the patient’s home, transportation of the equipment to a repair site, the actual performance of the maintenance or repair, and necessary parts. Water purification equipment maintenance includes (but is not limited to): replacing the filter on a reverse osmosis device, regenerating the resin tanks on a deionization device, using chemicals in a water softener, and periodic water testing to assure proper performance. Routine maintenance customarily performed by a patient is not a covered service, except for the cost of parts involved in the maintenance furnished by the ESRD facility to the patient. 4. Supplies - Supplies include all durable and disposable items and medical supplies necessary for the effective performance of a patient’s dialysis. Supplies include (but are not limited to): dialyzers, forceps, sphygmomanometer with cuff and stethoscope, scales, scissors, syringes, alcohol wipes, sterile drapes, needles, topical anesthetics, and gloves. 5. Support Services – Home dialysis support services identified at 42 CFR §§ 410.52 and 494.100 may be furnished in the home or in the ESRD facility. These services include (but are not limited to): Monitoring home dialysis progress, emergency visits to the home by ESRD facility personnel, unscheduled visits to an ESRD facility as needed and renal dialysis laboratory tests covered under the ESRD PPS. See §30.1.A of this chapter for more information. 6. Support Equipment - Support equipment is equipment used in conjunction with the basic dialysate delivery system. Such equipment includes (but is not limited to): pumps (such as blood and heparin pumps), alarms (such as bubble detectors), water purification equipment used to improve the quality of the water used for dialysis, and adjustable dialysis chairs. G. Overview of Medicare’s ESRD Payment Policy 1. ESRD PPS – Section 153(b) of Pub. L. 110-275, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), amended section 1881(b) of the Social Security Act to require the implementation of an ESRD bundled payment system, effective January 1, 2011. Under MIPPA, the ESRD PPS replaced the basic case-mix adjusted composite rate payment system and the methodologies for the reimbursement of separately billable outpatient renal dialysis items and services. The ESRD PPS provides a case-mix and facility-level adjusted single payment to ESRD facilities for renal dialysis services provided in an ESRD facility or in a beneficiary’s home. (See §10.C of this chapter for the items and services considered to be “renal dialysis services.”) To account for higher resource utilization, the ESRD PPS applies case-mix adjusters to the base rate and, when applicable, also includes an add-on for home and self-dialysis training and an outlier payment. The ESRD PPS provided for a 4-year transition period under which facilities may have received a blend of the payment methodology prior to January 1, 2011 (that is, the basic case-mix adjusted composite rate payment system) and the ESRD PPS. Since 2014, all ESRD facilities that receive Medicare payment have been paid 100 percent under the ESRD PPS. The ESRD PPS combines payment, for what had previously been composite rate and separately billable outpatient renal dialysis items and services, into a single base rate for both adult and pediatric patients. The per dialysis treatment base rate is subsequently adjusted to reflect: • Patient-level adjustments for: o case-mix, (see §60.A.1 of this chapter for adult patient adjustments and §60.A.6 of this chapter for pediatric patient adjustments) o An onset of dialysis adjustment for adult patients that have Medicare ESRD entitlement during their initial 4 months of dialysis, (see §60.A.4 of this chapter) • Facility-level adjustments for: o A low-volume facility adjustment for ESRD facilities that meet certain criteria, (see §60.B.1 of this chapter) o A wage index adjustment to reflect differences in wage levels among the urban and rural areas in which ESRD facilities are located, (see §60.B.2 of this chapter) o A rural adjustment, effective January 1, 2016 • Other adjustments: o A home or self-dialysis training add-on, (see §60.C.1 of this chapter) o An outlier payment, (see §60.D of this chapter) o A transitional drug add-on payment adjustment (TDAPA), (see §20.3.1.C of this chapter) o A transitional add-on payment adjustment for new and innovative equipment and supplies (TPNIES), (see §20.4.1 of this chapter) o A post-TDAPA add-on payment adjustment, (see §60.C.5 of this chapter) o A transitional pediatric ESRD add-on payment adjustment (TPEAPA), (see §60.C.6 of this chapter) The ESRD PPS implemented consolidated billing edits for certain renal dialysis laboratory services, drugs and biological products, equipment, and supplies to ensure that payment for renal dialysis services is not made to providers or suppliers other than the ESRD facility. A service furnished by an ESRD facility that is not for the treatment of ESRD must be submitted with an AY modifier to allow for separate payment outside of the ESRD PPS. The list of renal dialysis services identified for the ESRD PPS consolidated billing may be viewed at <http://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/ESRDpayment/Consolidated_Billing.html>. Note that this list is not exhaustive, and ESRD facilities are responsible and are paid for furnishing all renal dialysis services under the ESRD PPS. 2. Basic Case-Mix Adjusted Composite Rate Payment System – The basic case-mix adjusted composite rate payment system was implemented in CY 2005 and maintained until 2014 for purposes of the blended payment during the ESRD PPS transition period. It applied patient-level case-mix adjusters, additional payment for home and self-dialysis training, and a drug add-on to the composite rate. The drug add-on accounted for the difference between the methodologies of payment for separately billed drugs and biological products prior to the enactment of the revised drug pricing specified in the Medicare Modernization Act of 2003 (MMA). For more information on the history of the composite rate see Appendix C. 3. Composite Rate –The composite rate was the first step Medicare made toward creating a bundled payment for renal dialysis items and services. It covered routine laboratory testing, certain drugs, equipment and supplies, and support services furnished for outpatient maintenance dialysis in Medicare-certified ESRD facilities. Under the composite rate methodology, separate payment was made to ESRD facilities for most drugs and biological products furnished to ESRD patients. For more information regarding composite rate items and services, see §20.1, for composite rate laboratory services, see §20.2.E, and for composite rate drugs, see §20.3.F of this chapter. 4. Formerly Separately Billable Services (FSBs) – Services which were not included in the composite rate and were therefore separately billable while the composite rate system was in effect before the ESRD PPS was implemented on January 1, 2011. FSBs are included in the ESRD PPS bundled payment. FSBs consist mainly of certain drugs and biological products and certain laboratory tests furnished for the treatment of ESRD, including ESAs. 5. “Time on Machine” Data – Beginning January 1, 2025, ESRD facilities must report “time on machine” data (the number of minutes between the start and end of hemodialysis treatment, without accounting for interruptions, a beneficiary receives during the billing period in center in an ESRD facility) using the D6 value code on ESRD PPS claims for all in-center hemodialysis treatments. The CY 2024 ESRD PPS final rule finalized the addition of § 413.198(b)(5), which states that ESRD facilities must submit data and information in the formats established by CMS for the purpose of estimating patient-level and facility level variation in resource use, including “time on machine” data.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Medicare provides payment under the ESRD PPS for all renal dialysis services for outpatient maintenance dialysis, when they are furnished to Medicare ESRD patients, for the treatment of ESRD by a Medicare- certified ESRD facility or a special purpose renal dialysis facility. Renal dialysis services are the items and services included under the composite rate and the items and services that were separately paid as of December 31, 2010 that were used for the treatment of ESRD. Renal dialysis services are furnished in various settings, including hospital outpatient ESRD facilities, independent ESRD facilities, or in the patient’s home. Renal dialysis items and services furnished at ESRD facilities or in the patient’s home differ according to the types of patients being treated, the types of equipment and supplies used, the preferences of the treating physician, and the capability and makeup of the staff. Although not all facilities provide an identical range of services, the most common elements of renal dialysis treatment include: • Laboratory tests; • Drugs and biological products; • Equipment and supplies - dialysis machine use and maintenance; • Personnel services; • Administrative services; • Overhead costs; • Monitoring access and related de-clotting or referring the patient, and • Direct nursing services, which include registered nurses, licensed practical nurses, technicians, social workers, and dietitians.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) Beginning January 1, 2011, all renal dialysis services (defined at §10.C of this chapter) are included in the ESRD PPS. Renal dialysis services include, but are not limited to, the items and services included under the composite rate as of December 31, 2010. Historically the composite payment rate (defined at §10.G.3 of this chapter) was the methodology for paying for dialysis services. The composite rate was a comprehensive payment for all modes of in-facility and home dialysis. On January 1, 2011, the composite rate was incorporated into the ESRD PPS payment methodology. Most items and services related to the treatment of the patient’s end-stage renal disease were covered under the composite rate payment, except physicians’ professional services, separately billable laboratory services, and separately billable drugs. If a facility, either directly or under an arrangement, failed to furnish any part of the items and services covered under the composite rate, then the ESRD facility could not be paid any amount for the service. This payment was subject to the normal Part B deductible and co-insurance requirements. Below are examples of items and services included under the composite rate and furnished, either directly or under arrangement, by the ESRD facility. • Dialysate; • Cardiac monitoring; • Catheter changes; • Suture removal; • Dressing changes; • Crash cart usage for cardiac arrest; • De-clotting of shunt performed by ESRD facility staff in the dialysis unit; • All oxygen and its administration furnished in the dialysis unit; • Staff time to administer blood; • Staff time to administer separately billable parenteral items; and • Staff time to collect specimens for laboratory tests.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) All laboratory services furnished to individuals for the treatment of ESRD are included in the ESRD PPS and are not paid separately as of January 1, 2011. Payments for these services were incorporated into the ESRD PPS base rate. The laboratory services include, but are not limited to: • Laboratory tests included under the composite rate as of December 31, 2010 (discussed below); and • Formerly separately billable Part B laboratory tests that were billed by ESRD facilities and independent laboratories, for ESRD patients. Composite rate laboratory tests are listed in §20.2.E of this chapter. More information regarding composite rate laboratory tests can be found in Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §50.1, §60.1, and §80. As discussed below, composite rate laboratory services should not be reported on claims. The following table lists the drug categories that were excluded from the ESRD PPS and the rationale for their exclusion. Laboratory services furnished to monitor the medication levels of these drugs and biological products would not be considered for the treatment of ESRD. For example, laboratory testing for anti- psychotics is not included in the ESRD PPS. However, laboratory testing for drugs that regulate bone and mineral metabolism (e.g., calcimimetics) is included. DRUG CATEGORIES EXCLUDED FROM THE ESRD PPS BASE RATE FOR THE PURPOSE OF REPORTING LABORATORY TESTS Drug Category Rationale for Exclusion Anticoagulant Drugs labeled for non-renal dialysis conditions and not for vascular access. Antidiuretic Used to prevent fluid loss. Antiepileptic Used to prevent seizures. Anti-inflammatory May be used to treat kidney disease (glomerulonephritis) and other inflammatory conditions. Antipsychotic Used to treat psychosis. Antiviral Used to treat viral conditions such as shingles. Cancer management Includes oral, parenteral and infusions. Cancer drugs are covered under a separate benefit category. Cardiac management Drugs that manage blood pressure and cardiac conditions. Cartilage Used to replace synovial fluid in a joint space. Coagulants Drugs that cause blood to clot after anti-coagulant overdose or factor VII deficiency. Cytoprotective agents Used after chemotherapy treatment. Endocrine/metabolic management Used for endocrine/metabolic disorders such as thyroid or endocrine deficiency, hypoglycemia, and hyperglycemia. Erectile dysfunction management Androgens were used prior to the development of ESAs for anemia management and currently are not recommended practice. Also used for hypogonadism and erectile dysfunction. Gastrointestinal management Used to treat gastrointestinal conditions such as ulcers and gallbladder disease. Immune system management Anti-rejection drugs covered under a separate benefit category. Migraine management Used to treat migraine headaches and symptoms. Musculoskeletal management Used to treat muscular disorders such as prevent muscle spasms, relax muscles, improve muscle tone as in myasthenia gravis, relax muscles for intubation and induce uterine contractions. Pharmacy handling for oral anti- cancer, anti-emetics and immunosuppressant drugs Not a function performed by an ESRD facility. Pulmonary system management Used for respiratory/lung conditions such as opening airways and newborn apnea. Radiopharmaceutical procedures Includes contrasts and procedure preparation. Unclassified drugs Should only be used for drugs that do not have a HCPCS code and therefore cannot be identified. Vaccines Covered under a separate benefit category. The distinction of what is considered to be a “renal dialysis laboratory test” is a clinical decision determined by the ESRD patient’s ordering practitioner. If a laboratory test is ordered for the treatment of ESRD, then the laboratory test is not paid separately. Payment for all renal dialysis laboratory tests furnished under the ESRD PPS is included in the base rate, which is paid directly to the ESRD facility responsible for the patient’s care. The ESRD facility must furnish the laboratory tests directly, or under arrangement, and report such tests on the ESRD facility claim. An ESRD facility must report renal dialysis laboratory services on its claims in order for the laboratory tests to be included in the outlier payment calculation (with the exception of composite rate laboratory tests). Renal dialysis laboratory services that were or would have been paid separately under Medicare Part B prior to January 1, 2011, are priced for the outlier payment calculation using the Clinical Laboratory Fee Schedule. Further information regarding the outlier policy can be found in §60.D of this chapter. Certain laboratory services are subject to Part B consolidated billing requirements and are no longer separately payable when provided to ESRD beneficiaries by providers other than the ESRD facility. The list at the following website includes the renal dialysis laboratory tests that are routinely performed for the treatment of ESRD and that are used to enforce consolidated billing edits to ensure that payment is not made for renal dialysis laboratory tests outside of the ESRD PPS: < https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Consolidated_Billing.> Payment for the laboratory tests identified on this list is included in the ESRD PPS. If any laboratory test is ordered for the treatment of ESRD, then the laboratory test is considered to be included in the ESRD PPS and is the responsibility of the ESRD facility. Additional renal dialysis laboratory tests may be added to the consolidated billing list through administrative issuances in the future. A. Laboratory Services Furnished for Reasons Other Than for the Treatment of ESRD 1. Independent Laboratory A patient’s physician or practitioner responsible for their ESRD care may order a laboratory test that is included on the list of items and services subject to consolidated billing edits for reasons other than for the treatment of ESRD. When this occurs, the patient’s physician or practitioner should notify the independent laboratory or the ESRD facility (with the appropriate clinical laboratory certification in accordance with the Clinical Laboratory Improvement Amendments) that furnished the laboratory service that the test is not a renal dialysis service, so that entity may bill Medicare separately using the AY modifier. The AY modifier serves as an attestation that the item or service is medically necessary for the patient but is not being used for the treatment of ESRD. NOTE: The ESRD PPS base rate accounts for all ESRD facility staff time during a dialysis session. Therefore, ESRD facility staff time used to furnish laboratory services for reasons other than for the treatment of ESRD is included in the ESRD PPS and is not billed separately. 2. Hospital-Based Laboratory Hospital outpatient clinical laboratories furnishing renal dialysis laboratory tests to ESRD patients for reasons other than the treatment of ESRD may submit a claim for separate payment using the AY modifier. The AY modifier serves as an attestation that the item or service is medically necessary for the patient but is not being used for the treatment of ESRD. NOTE: The ESRD PPS base rate accounts for all ESRD facility staff time during a dialysis session. Therefore, ESRD facility staff time used to furnish laboratory services for reasons other than for the treatment of ESRD is included in the ESRD PPS and is not billed separately. B. Laboratory Services Performed in Emergency Rooms or Emergency Departments In an emergency room or emergency department, the ordering physician or practitioner may not know, at the time the laboratory test is being ordered, if it is being ordered as a renal dialysis service. Consequently, emergency rooms or emergency departments are not required to append an AY modifier to these laboratory tests when submitting claims with dates of service on or after January 1, 2012. When a renal dialysis laboratory service is furnished to an ESRD patient in an emergency room or emergency department on a different date of service, hospitals can append an ET modifier to the laboratory tests furnished to ESRD patients, to indicate that the laboratory test was furnished in conjunction with the emergency visit. Appending the ET modifier indicates that the laboratory service being furnished on a day other than the emergency visit is related to the emergency visit, and at the time, the ordering physician was unable to determine if the test was ordered for reasons of treating the patient’s ESRD. Allowing an emergency room or department to bypass consolidated billing edits for laboratory testing does not mean that ESRD facilities should send patients to other settings for routine laboratory testing for the purpose of avoiding financial responsibility for renal dialysis items and services. For additional information regarding laboratory services furnished in a variety of settings, see Pub. 100-04, Medicare Claims Processing Manual, chapter 16, §30.3 and §40.6. C. Hepatitis B Laboratory Services for Transient Patients Laboratory testing for hepatitis B is a renal dialysis service. Effective January 1, 2011, hepatitis B testing is included in the ESRD PPS and therefore cannot be billed separately to Medicare. The Conditions for Coverage for ESRD facilities require routine hepatitis B testing (42 CFR §494.30(a)(1)). The ESRD facility is responsible for the payment of the laboratory test, regardless of frequency. If an ESRD patient wishes to travel, the patient’s home ESRD facility should have systems in place for communicating hepatitis B test results to the destination ESRD facility. D. Laboratory Services Routinely Furnished Under the Composite Rate Payment System Historically (i.e., prior to the implementation of the ESRD PPS), the costs of certain ESRD laboratory services furnished for outpatient maintenance dialysis by either the ESRD facility’s staff or an independent laboratory were included in the composite rate. Therefore, payment for all of these laboratory tests was included in the ESRD facility’s composite rate and the tests could not have been billed separately to the Medicare program. The following three sections discuss laboratory tests that, prior to the ESRD PPS, were furnished to ESRD beneficiaries on a routine basis under the composite rate payment system. Some laboratory tests were included in the composite payment rate and some were separately payable. Under the ESRD PPS, to the extent any of the laboratory tests discussed below are furnished for the treatment of ESRD and were included in the composite payment rate, these tests are not eligible for outlier payment and are not reported on the ESRD claim. Note: There are no requirements under the ESRD PPS regarding frequency, as it relates to payment for renal dialysis laboratory tests. Laboratory tests should be ordered as medically necessary and should not be restricted due to financial reasons. 1. Laboratory tests routinely furnished and included in the composite payment rate when they met coverage requirements with regard to frequency If any of these tests were performed at a frequency greater than that specified, the additional tests were separately billable but covered only if they were reasonable and medically necessary. a. Hemodialysis, IPD, CCPD, and Hemofiltration • Per Treatment - All hematocrit, hemoglobin, and clotting time tests furnished incident to dialysis treatments; • Weekly - Prothrombin time for patients on anticoagulant therapy and Serum Creatinine; • Weekly or Thirteen Per Quarter - BUN; and • Monthly - Serum Calcium, Serum Potassium, Serum Chloride, CBC, Serum Bicarbonate, Serum Phosphorous, Total Protein, Serum Albumin, Alkaline Phosphatase, aspartate amino transferase (AST) (SGOT) and LDH. b. CAPD • Monthly – BUN, Creatinine, Sodium, Potassium, CO2, Calcium, Magnesium, Phosphate, Total Protein, Albumin, Alkaline Phosphatase, LDH, AST, SGOT, HCT, Hbg, and Dialysate Protein. 2. Laboratory tests routinely furnished that were separately payable to the ESRD facility and not included in the composite payment rate • Hemodialysis, IPD, CCPD, and Hemofiltration o Serum Aluminum - one every 3 months o Serum Ferritin - one every 3 months • CAPD o WBC, RBC, and Platelet count – One every 3 months o Residual renal function and 24-hour urine volume – One every 6 months 3. Automated Multi-Channel Chemistry (AMCC) Tests Clinical diagnostic laboratory tests that comprise the AMCC (listed in Appendix A and B) could either be considered included in the composite payment rate or considered to be non-composite rate (that is, separately billable) laboratory services. To determine if separate payment was allowed for non-composite rate tests for a particular date of service, 50 percent or more of the covered tests must be non-composite rate tests. Under the composite payment system prior to 2011, Medicare applied the following to AMCC tests for ESRD beneficiaries: • Payment was the lowest rate for services performed by the same provider, for the same beneficiary, for the same date of service. • The A/B Medicare Administrative Contractor (MAC) identified, for a particular date of service, the AMCC tests ordered that were included in the composite rate and those that were not included. The composite rate tests were defined for Hemodialysis, IPD, CCPD, and Hemofiltration (see Appendix A) and for CAPD (see Appendix B). • If 50 percent or more of the covered tests were included under the composite rate payment, then all submitted tests were included within the composite payment. In this case, no separate payment in addition to the composite rate was made for any of the separately billable tests. • If less than 50 percent of the covered tests were composite rate tests, all AMCC tests submitted for that Date of Service (DOS) were separately payable. • A non-composite rate test was defined as any test separately payable outside of the composite rate or beyond the normal frequency covered under the composite rate that was reasonable and necessary.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) Except as noted below, all drugs and biological products used for the treatment of ESRD are included in the ESRD PPS and are not separately paid as of January 1, 2011, as payments for these items were incorporated into the base rate. The drugs and biological products include, but are not limited to: • Renal dialysis drugs and biological products included under the composite rate as of December 31, 2010 (discussed below); • Former separately billable Part B injectable drugs and biological products used for the treatment of ESRD; • Oral or other forms of drugs and biological products with an injectable functional equivalent used for the treatment of ESRD formerly billed under Part D; and • Oral or other forms of drugs and biological products used for the treatment of ESRD without an injectable functional equivalent (effective January 1, 2025.) See §60.D of this chapter for details on drug eligibility under the outlier payment policy. Drugs and biological products furnished to ESRD beneficiaries that are not used for the treatment of ESRD may be paid separately. When drugs or biological products are furnished to an ESRD beneficiary and are not a renal dialysis service, the ESRD facility or other provider can append the claim line with the AY modifier to receive separate payment. For more information regarding the AY modifier refer to Pub. 100- 04, Medicare Claims Processing Manual, chapter 8, §60.2.1.1. Drugs and biological products identified for consolidated billing are always considered to be renal dialysis services when furnished by the ESRD facility or physician receiving the Monthly Capitation Payment (MCP) (discussed in §40.E of this chapter), and therefore no separate payment is made to ESRD facilities with or without the AY modifier. With regard to other providers and suppliers, when these products are furnished to ESRD beneficiaries they are usually not separately payable. That is, other providers and suppliers furnishing drugs and biological products subject to the ESRD PPS consolidated billing could only receive separate payment under another payment system in certain circumstances: For example, if the drug or biological product was furnished for other labeled indications or the ESRD beneficiary received emergency dialysis in a hospital. Information regarding consolidated billing requirements for drugs and biological products can be found in §20.3.F of this chapter and in Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1.1. The list of drugs and biological products used for the ESRD PPS consolidated billing may be viewed at http://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/ESRDpayment/Consolidated_Billing.html. This list is used to enforce consolidated billing edits, which ensure that payment is not made outside of the ESRD PPS for these renal dialysis drugs and biological products. This is not an all-inclusive list, and any drug or biological product that falls within an ESRD PPS functional category is also included under the ESRD PPS (see §20.3.A below). Providers and suppliers other than ESRD facilities furnishing those drugs and biological products for the treatment of ESRD must look to the ESRD facility for payment. NOTE: Effective January 1, 2012, and January 1, 2013, ESRD facilities and other providers may receive separate payment for vancomycin and daptomycin, respectively, by placing the AY modifier on the claim, when the drug is furnished for reasons other than the treatment of ESRD. The ESRD facility must indicate the appropriate ICD diagnosis code for which the vancomycin or daptomycin is indicated. See Pub.100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1.1 for additional information. A. ESRD PPS Functional Categories The ESRD PPS functional category is a distinct grouping of drugs or biological products, as determined by CMS, whose end action effect is the treatment or management of a condition or conditions associated with ESRD. The Drug Designation Process is dependent on the ESRD PPS functional categories, as discussed in section 20.3.1. Drugs and biological products included in the ESRD PPS base rate that are “always” considered to be renal dialysis services are those used for access management, anemia management, bone and mineral metabolism management, and cellular management. ESRD facilities are responsible for furnishing these drugs directly or under arrangement. This includes any drug or biological product that is furnished by the ESRD facility either in the facility or taken by the patient at home. Erythropoiesis stimulating agents (ESAs), such as epoetin alfa (EPOGEN®) and darbepoetin alfa (ARANESP®), when furnished by an ESRD facility, are always considered to be renal dialysis services and included in the ESRD PPS. Prior to January 1, 2020, monthly dosages of these ESAs were subject to Medicare’s ESA claims monitoring policy as discussed in Pub.100-04, Medicare Claims Processing Manual, chapter 8, §60.4.1. Prior to January 1, 2020, edits were applied prior to pricing so that ESAs were not overvalued in determining eligibility for outlier payments. Effective January 1, 2020, the ESA monitoring policy is no longer applicable under the ESRD PPS. Functional Categories Included in the ESRD PPS Base Rate, Always Considered to be Renal Dialysis Services, and Not Separately Payable for ESRD Facilities ESRD PPS Functional Category Description and Examples Access Management Drugs/biological products used to ensure access by removing clots from grafts, reverse anticoagulation if too much medication is given, and provide anesthetic for access placement. Anemia Management Drugs/biological products used to stimulate red blood cell production and/or treat or prevent anemia. Examples of drugs/biological products in this category include ESAs and iron. Bone and Mineral Metabolism Drugs/biological products used to prevent/treat bone disease secondary to dialysis. Examples of drugs/biological products in this category include phosphate binders and calcimimetics. Cellular Management Drugs/biological products used for deficiencies of naturally occurring substances needed for cellular management. This category includes levocarnitine. Drugs and biological products included in the ESRD PPS base rate that may be used for both the treatment of ESRD and for reasons other than the treatment of ESRD are those used as antiemetics, anti-infectives, antipruritics, anxiolytics, excess fluid management, fluid and electrolyte management (including volume expanders), and pain management. ESRD facilities are responsible for furnishing these drugs directly or under arrangement when they are prescribed for the treatment of ESRD. This includes any drug or biological product that is furnished in the ESRD facility or taken by the patient outside of the ESRD facility. ESRD facilities are responsible for furnishing antibiotics for access site infections directly or under arrangement. When antibiotics are used at home by a patient to treat an infection of the catheter site or peritonitis associated with peritoneal dialysis, the antibiotics are included in the ESRD PPS and may not be paid separately. This includes antibiotics that may be added to a patient’s dialysate solution for the purposes of vascular access-related and peritonitis infections. Any other drugs or biological products (other than those categories described above and below), when used for the treatment of ESRD, are also included in the ESRD PPS. For example, • Patient A experiences nausea or pain during a hemodialysis treatment and requires medications. Any medication furnished during the dialysis treatment or after the treatment is considered a renal dialysis service and may not be billed separately. • Patient B experiences anxiety with dialysis treatments and is prescribed anti-anxiety medication during and between the dialysis treatments. Any medication furnished in preparation for the dialysis treatment, during the dialysis treatment or after the dialysis treatment, is considered a renal dialysis service and may not be billed separately. • Any drug or biological product added to patient dialysate solutions. Functional Categories Included in the ESRD PPS Base Rate but May be Used for Dialysis and Non- Dialysis Purposes ESRD PPS Functional Category Description and Examples Antiemetic Drugs/biological products used to prevent or treat nausea and vomiting secondary to dialysis. Excludes antiemetics used in conjunction with chemotherapy, as these are covered under a separate benefit category. Anti-infectives Drugs/biological products used to treat infections. May include antibacterial and antifungal drugs. Antipruritic Drugs/biological products in this category are included for their action to treat itching secondary to dialysis but may have multiple clinical indications. Anxiolytic Drugs/biological products in this category are included for the treatment of restless leg syndrome secondary to dialysis but may have multiple clinical indications. Excess Fluid Management Drug/biological products/fluids used to treat fluid excess or fluid overload. Fluid and Electrolyte Management Including Volume Expanders Intravenous drugs/biological products/fluids used to treat fluid and electrolyte needs. Pain Management Drugs/biological products used to treat vascular access site pain and to treat pain medication overdose. B. Injectable Drugs and Biological Products All injectable drugs or biological products used for the treatment of ESRD are included in the ESRD PPS and are not separately paid. This includes renal dialysis drugs and biological products that, prior to the implementation of the ESRD PPS, were separately billable under Part B. Injectable drugs and biological products that may be used for both the treatment of ESRD and for treatment of non-ESRD conditions continue to be paid separately when used for non-ESRD conditions and reported on the claim with an AY modifier. See §20.4.C of this chapter for more information on the AY modifier. NOTE: ESRD patients should not be sent to other settings for the purpose of receiving separate payment for renal dialysis injectable drugs and biological products or for the purpose of avoiding financial responsibility for renal dialysis items and services. ESRD facilities must report the appropriate Healthcare Common Procedure Coding System (HCPCS) codes used for supplies utilized during the administration and furnishing of renal dialysis drugs and biological products, including drugs and biological products furnished in the beneficiary’s home. These supplies include: • A4657: Injection administration-supply charge (includes the cost of alcohol swab, syringe, and gloves) and • A4913: IV administration-supply charge (includes the cost of IV solution administration set, alcohol swab, syringe, and gloves). A4913 should only be used when an IV solution set is required for a drug to be given. See Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1 for billing procedures. These supplies are eligible for payment as outlier services in accordance with §60.D of this chapter. C. Oral or Other Forms of Injectable Drugs and Biological Products The ESRD PPS includes certain drugs and biological products that were previously paid under Part D. Oral or other forms of injectable renal dialysis drugs and biological products—for example, Vitamin D analogs, Levocarnitine, antibiotics or any other oral or other form of injectable drug or biological product furnished as renal dialysis services—are also included in the ESRD PPS and may not be separately paid. NOTE: Beginning January 1, 2019, oral levocarnitine is no longer considered a renal dialysis service, since the oral form is not indicated for dialysis related carnitine deficiency. The ESRD facility should report any drug or biological product furnished on the ESRD claim with the line item date of service and the quantity of the drug or biological product furnished at the time of the visit. For claims processing instructions see Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1.2. For oral or other forms of renal dialysis drugs that are filled at the pharmacy for home use, ESRD facilities should report one line-item per prescription, but only for the quantity of the drug expected to be taken during the claim billing period. For example: A prescription for oral vitamin D was ordered for one pill, to be taken 3 times daily, for a period of 45 days. The patient began taking the medication on April 15, 2011. On the April claim, the ESRD facility would report the appropriate National Drug Code (NDC) code for the drug with the quantity 45 (15 days x 3 pills per day). The remaining pills, which would be taken in May, would appear on the May claim for a quantity of 90 (30 days x 3 pills per day). Prescriptions for a 3-month supply of the drug would never be reported on a single claim. Only the amount expected to be taken during the claim billing period would be reported on that claim. Oral and other forms of injectable renal dialysis drugs are eligible for consideration as outlier services. See the CMS website at http://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/ESRDpayment/Outlier_Services.html for a list of these drugs. CMS prices these drugs using the best available data from Part D, which is generally national average drug prices based on the Medicare Prescription Drug Plan Finder. Payment also includes a mean dispensing fee that is applied to each NDC included on the monthly claim, in accordance with Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1.2. NOTE: Oral antibiotics are not listed as outlier services due to the administrative burden of maintaining an accurate and timely list of all antibiotics covered under Part D. D. Oral-Only Renal Dialysis Service Drugs and Biological Products Oral-only forms of renal dialysis drugs and biological products with no injectable functional equivalent or other form of administration other than an oral form are included in the ESRD PPS as Part B renal dialysis services effective January 1, 2025. NOTE: As discussed in the CY 2011 ESRD PPS final rule (75 FR 49038 through 49044), the incorporation of oral-only drugs and biological products was originally delayed until January 1, 2014. As a result of legislation, implementation of renal dialysis oral-only drugs and biological products was delayed until January 1, 2025. E. Drugs and Biological Products Furnished for Reasons Other than for the Treatment of ESRD Drugs and biological products furnished by an ESRD facility that are not used for the treatment of ESRD may be billed separately when coded with the AY modifier. The AY modifier serves as an attestation that the item or service is deemed reasonable and necessary for the dialysis patient but is not being used for the treatment of ESRD. Drugs and biological products furnished by the ESRD facility that are considered to always be renal dialysis services are not paid separately with or without the AY modifier. See Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.2.1.1 for more information. NOTE: The ESRD PPS base rate accounts for all ESRD facility staff time during a dialysis session. Therefore, staff time used to furnish drugs and biological products for reasons other than for the treatment of ESRD is included in the ESRD PPS and is not billed separately. F. Drugs and Biological Products Under the Composite Rate Prior to the implementation of the ESRD PPS, certain drugs used in furnishing outpatient maintenance dialysis treatments were considered composite rate drugs and not billed separately. Payments for these drugs are included in the ESRD PPS. Historically, drugs that were used as a substitute for any of these drugs, or were used to accomplish the same effect, were also covered under the composite rate. The following list is comprised of drugs and biological products under the composite rate. Staff time and supplies used to furnish these drugs were covered under the composite rate, are currently included under the ESRD PPS, and are not billed separately. • Heparin • Mannitol* • Glucose • Antiarrhythmics • Saline** • Antihypertensives • Protamine • Pressor Drugs • Antihistamines • Local Anesthetics • Heparin Antidotes • Dextrose • Apresoline (hydralazine) • Benadryl • Inderal • Dopamine • Hydralazine • Levophed • Insulin • Lanoxin • Verapamil • Lidocaine • Solu-cortef • Antibiotics*** *Albumin may be reasonable and medically necessary for the treatment of certain medical complications in renal dialysis patients. If albumin is used for fluid management as a volume expander, then payment for it is included in the ESRD facility’s ESRD PPS payment for maintenance dialysis. **Used in delivery of other drugs, such as Albumin. ***Antibiotics - Effective January 1, 2012, antibiotics (when used at home by a patient to treat an infection of the catheter site or peritonitis associated with peritoneal dialysis) are no longer considered composite rate drugs. Under the ESRD PPS, all antibiotics used to treat vascular access-related and peritonitis infections, including those furnished in the home, are included in the ESRD PPS and are not eligible for separate payment, although they may be eligible for outlier payments. For more information regarding the outlier policy see §60.D of this chapter. Thrombolytic drugs (such as heparin) furnished by ESRD facilities to Medicare ESRD beneficiaries for access management purposes are recognized as composite rate drugs under the ESRD PPS. Effective January 1, 2012, thrombolytics are not eligible for outlier payments. Effective January 1, 2013, payment for thrombolytic drugs is included in the ESRD PPS and may not be separately paid when furnished to an ESRD Medicare beneficiary. Refer to 42 CFR §413.237 (a)(1)(i) for more information. Composite rate drugs are eligible for bad debt payments and, effective January 1, 2025, eligible for outlier payments. For more information regarding the bad debt policy, see §80 of this chapter. H. Drug Overfill and Discarded Drug Policy Medicare does not pay for additional medications in drug containers provided at no cost to the ESRD facility. ESRD facilities may not receive additional payment under the ESRD PPS when they furnish drug overfill medications to Medicare beneficiaries. Drug overfill amounts are not eligible for outlier payments. In addition, beginning January 1, 2025, ESRD facilities must report and document any discarded amount of a renal dialysis drug or biological product from a single-dose container or single-use package that is paid for under the ESRD PPS using the JW or JZ modifier in accordance with 42 CFR § 413.198(b)(5)(ii), (ii), and (6). For additional information about the use of the JW and JZ modifiers, please see Pub. 100-04, Chapter 17, § 40.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) A. Definition of a New Renal Dialysis Drug or Biological Product A “new renal dialysis drug or biological product” is an injectable, intravenous, oral or other form or route of administration drug or biological product that is used to treat or manage a condition(s) associated with ESRD. It must be: (1) approved by the Food and Drug Administration (FDA) on or after January 1, 2020, under section 505 of the Federal Food, Drug, and Cosmetic Act or section 351 of the Public Health Service Act; (2) commercially available, and; (3) designated by CMS as a renal dialysis service under §413.171. B. Determination of Whether a New Renal Dialysis Drug or Biological Product is Included in the ESRD PPS Bundled Payment To determine when a new renal dialysis drug or biological product is included in the ESRD PPS bundled payment, CMS will: • Review the new product’s FDA labeling data and information; • Review the new product’s information presented for obtaining a HCPCS code; and • Conduct an internal medical review following the announcement of the new product’s FDA and HCPCS decision. 1. If the new renal dialysis drug or biological product is used to treat or manage a condition for which there is an existing ESRD PPS functional category, the new renal dialysis drug or biological product is considered included in the ESRD PPS bundled payment, and the following steps occur: • The new renal dialysis drug or biological product is added to the existing ESRD PPS functional category. • Unless excluded, the new renal dialysis drug or biological product is paid for using the Transitional Drug Add-On Payment Adjustment (TDAPA) (see section 20.3.1.C below) if it meets the TDAPA eligibility requirements outlined at §413.234(c)(5). Drugs excluded from TDAPA eligibility, effective January 1, 2020, include drugs approved by the FDA under section 505(j) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) and drugs approved under section 505(c) of the FD&C Act that are classified by FDA as new drug application (NDA) Types 3, 5, 7 or 8, Type 3 in combination with Type 2 or Type 4, Type 5 in combination with Type 2, or Type 9 when the “parent NDA” is Type 3, 5, 7 or 8. NOTE: If not eligible for the TDAPA, the new renal dialysis drug or biological product qualifies as an ESRD outlier service. For more information regarding the outlier policy see §60.D of this chapter. 2. If the new renal dialysis drug or biological product is used to treat or manage a condition for which there is not an existing ESRD PPS functional category, the new renal dialysis drug or biological product is not considered included in the ESRD PPS bundled payment and the following steps occur: • CMS notifies the TDAPA applicant of its TDAPA determination. • CMS adds a new ESRD PPS functional category or revises an existing ESRD PPS functional category through rulemaking for the condition that the new renal dialysis drug or biological product is used to treat or manage. • The new renal dialysis drug or biological product is paid for using the TDAPA for a period of at least 2 years until sufficient claims data for rate setting analysis is available. • Following payment of the TDAPA, CMS undertakes rulemaking to modify the ESRD PPS base rate, if appropriate, to account for the new renal dialysis drug or biological in the ESRD PPS bundled payment. NOTE: Following payment of the TDAPA, the new renal dialysis drug or biological product qualifies as an ESRD outlier service. C. Transitional Drug Add-On Payment Adjustment (TDAPA) The TDAPA is a payment adjustment under the ESRD PPS for certain new renal dialysis drugs and biological products. To be eligible for the TDAPA a drug must have an HCPCS application submitted in accordance with the official Level II HCPCS coding procedures and have submitted an application for the TDAPA prior to January 1, 2028, or within three years of FDA approval under section 505 of the Federal Food, Drug, and Cosmetic Act or section 351 of the Public Health Service Act. Applications for the TDAPA under the ESRD PPS must be submitted in the electronic application intake system, Medicare Electronic Application Request Information SystemTM (MEARISTM). Information regarding the application process, any renal dialysis drugs and biological products that have been determined eligible for the TDAPA, and their respective payment amounts is available on the CMS website: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/ESRD-Transitional-Drug 1. New renal dialysis drugs and biological products that fall in an existing ESRD PPS functional category and are eligible for the TDAPA. Basis of Payment The TDAPA is based on 100 percent of average sales price (ASP), which CMS receives from the drug or biological product manufacturer. Subject to the ASP conditional policy (described below in § 20.3.1.C.3), if ASP is not available, then the TDAPA is based on 100 percent of wholesale acquisition cost (WAC) and, when WAC is not available, the payment is based on the drug manufacturer's invoice. Duration of the TDAPA The TDAPA for these products is paid for 2 years. The TDAPA payment period begins on the effective date of the CMS Change Request (CR) implementing the TDAPA for the drug or biological product. During the time a new renal dialysis drug or biological product is eligible for the TDAPA, it is not an eligible ESRD outlier service as defined under 42 CFR § 413.237(a)(1) and therefore is ineligible for outlier payment. 2. New renal dialysis drugs and biological products that do not fall in an existing ESRD PPS functional category and are eligible for the TDAPA. Basis of Payment In general, the TDAPA is based on 100 percent of ASP, which CMS receives from the drug or biological product manufacturer. Subject to the ASP conditional policy (described below in 20.3.1.C.3), if ASP is not available, then the TDAPA is based on 100 percent of WAC and, when WAC is not available, the payment is based on the drug manufacturer's invoice. Under 42 CFR § 413.234(c)(4), the TDAPA for phosphate binders is based on 100 percent of ASP plus an additional amount derived from 6 percent of per-patient phosphate binder spending based on utilization and cost data. Duration of the TDAPA The TDAPA is paid until sufficient claims data for rate setting analysis for the new renal dialysis drug or biological product is available, but not for less than 2 years. The TDAPA payment and data collection periods for these drugs and biological products begin on the effective date of the applicable CMS ESRD PPS annual update CR for MACs and ESRD facilities. During the time a new renal dialysis drug or biological product is eligible for the TDAPA, it is not an eligible outlier service as defined under 42 CFR § 413.237(a)(1) and therefore is ineligible for outlier payment. 3. ASP conditional policy If CMS does not receive a full calendar quarter of ASP data for a new renal dialysis drug or biological product within 30 days of the last day of the 3rd calendar quarter after CMS begins applying the TDAPA for the product, CMS will no longer apply the TDAPA for that product beginning no later than 2-calendar quarters after CMS determines a full calendar quarter of ASP data is not available. If CMS stops receiving the latest full calendar quarter of ASP data for a new renal dialysis drug or biological product during the applicable time period the TDAPA is applied, CMS will no longer apply the TDAPA for the product beginning no later than 2-calendar quarters after CMS determines that the latest full calendar quarter of ASP data is not available. NOTE: for purposes of this conditional policy, in circumstances where a manufacturer submitted ASP data reflecting zero or negative sales during the TDAPA period, CMS is considered to have received the latest full calendar quarter of ASP data, and CMS would not discontinue TDAPA payment under the conditional policy in § 413.234(c). Information regarding the submission of ASP data is available on the CMS website: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Part-B-Drugs/McrPartBDrugAvgSalesPrice. D. Determination of When an Oral-Only Drug is No Longer Oral-Only An “oral-only drug” is a drug or biological product with no injectable functional equivalent or other form of administration other than an oral form. An “oral-only drug” is no longer considered “oral-only” if an injectable functional equivalent or other form of administration of the oral-only drug is approved by the FDA.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) All medically necessary equipment and supplies used to furnish dialysis (in-facility or in a patient’s home) are not separately paid as of January 1, 2011, and payments for these items were incorporated into the ESRD PPS base rate. These equipment and supplies include: • Equipment and supplies included under the composite rate (see §20.1 of this chapter) as of December 31, 2010, • Equipment and supplies that were formerly billed by ESRD facilities and paid separately by Medicare (i.e., supplies used to administer drugs and biological products), and • Equipment and supplies furnished to home patients that were under Method II* prior to January 1, 2011, and billed by Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) suppliers and paid separately by Medicare. * Prior to the ESRD PPS, under Method II, the beneficiary dealt directly with a DMEPOS supplier to secure home dialysis equipment and supplies (including supportive equipment). Beginning January 1, 2011, Method II is no longer an option for home dialysis items and services under Medicare. As a result, effective January 1, 2011, the ESRD facility assumes responsibility for furnishing all equipment and supplies for all its patients who dialyze in-facility and those who dialyze at home. ESRD facilities and MCP physicians and practitioners may order dressings or protective access coverings, including catheter coverings, for a patient to use on their dialysis access site. These dressings or protective access coverings used during or after dialysis to protect a dialysis patient’s access site including, for example, coverings used for day-to-day activities such as bathing, are considered to be renal dialysis services, and the ESRD facilities is responsible for providing them. Medicare payment for vascular access equipment and supplies is included in the ESRD PPS for all dialysis patients regardless of the method of dialysis or where they receive dialysis treatments. For more information on MCP physicians and practitioners, see Pub. 100-04, chapter 8, section 140. When dialysis access has been surgically placed in a patient to enable an ESRD facility to provide dialysis treatment, and the patient has started dialysis, the dressing changes are included in the ESRD PPS whether they are furnished in the facility or in the home by the ESRD facility. ESRD facilities may not receive payment for renal dialysis equipment and supplies from ESRD beneficiaries. A. Equipment and Supplies Used for Reasons Other Than for the Treatment of ESRD 1. ESRD Facilities Occasionally ESRD facilities furnish items and services that are not used for the treatment of ESRD, primarily drugs and biological products. When this occurs, ESRD facilities can bill separately by using the AY modifier for the appropriate HCPCS codes used for the administration-supply of the drug or biological product that is being used for reasons other than for the treatment of ESRD. Any equipment or supply billed using the AY modifier will not be considered an eligible ESRD outlier service. These supplies include: • A4657: Injection administration-supply charge (includes the cost of alcohol swab, syringe, and gloves) and • A4913: IV administration-supply charge (includes the cost of IV solution administration set, alcohol swab, syringe, and gloves). A4913 should only be used when an IV solution set is necessary for drugs or biological products given for reasons other than for the treatment of ESRD. 2. Other Providers and Suppliers There are renal dialysis equipment and supplies that may also be used in other provider settings for reasons other than for the treatment of ESRD. These equipment and supplies can be found in the document entitled “Items and Services Subject to Consolidated Billing for the ESRD PPS” located at the ESRD Payment website: http://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/ESRDpayment/Consolidated_Billing.html. To allow DMEPOS suppliers to receive payment for furnishing these services to other provider types, the DMEPOS suppliers can bill the DME MAC for the supplies included on this list with the AY modifier, to indicate that the equipment is used for reasons other than for the treatment of ESRD. There are renal dialysis equipment and supplies that are not used in other provider settings. These equipment and supplies are also listed in the document entitled “Items and Services Subject to Consolidated Billing for the ESRD PPS.” These supplies and equipment are not otherwise covered by Medicare; therefore, DMEPOS suppliers are not able to bill any of the supplies on this list using the AY modifier.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Beginning January 1, 2020, CMS provides a transitional add-on payment adjustment for new and innovative equipment and supplies (TPNIES) to ESRD facilities for furnishing a covered equipment or supply that meets certain eligibility criteria. The intent of the TPNIES, as established in § 413.236, is to facilitate beneficiary access to certain qualifying, new and innovative renal dialysis equipment and supplies by providing an add-on payment adjustment to support ESRD facilities in the uptake of these new and innovative equipment and supplies under the ESRD PPS. CMS considers whether a new renal dialysis equipment or supply meets the eligibility criteria and announces the results in the Federal Register as part of the annual ESRD PPS rulemaking. Applications for the TPNIES under the ESRD PPS must be submitted in the electronic application intake system, MEARIS™, accessible at https://mearis.com.gov. The annual ESRD PPS proposed rule will describe each complete application received by the deadline. The annual ESRD PPS final rule will address public comments received and include the final CMS determination on the TPNIES application. CMS approvals included in the annual ESRD PPS final rule will be implemented via the ESRD PPS annual update change request that will provide technical instructions on how ESRD facilities are to report the equipment or supply on the ESRD claim. This change request will initiate the TPNIES period for the equipment or supply, and it will end 2 years from the change request’s effective date. For example, any equipment or supply approved for the TPNIES for CY 2021, the TPNIES will begin on January 1, 2021 and end on December 31, 2022. Annual TPNIES application deadlines are available on the CMS website: https://www.cms.gov/medicare/esrd-pps/esrd-pps-transitional-add-payment-adjustment-new-and-innovative- equipment-and-supplies-tpnies The TPNIES is paid to an ESRD facility for furnishing a covered equipment or supply only if the item meets the eligibility criteria described in section 20.4.2. Basis of Payment The TPNIES is based on 65 percent of the MAC-determined price. The MACs, on behalf of CMS, will establish prices for new and innovative renal dialysis equipment and supplies that meet the TPNIES eligibility criteria using verifiable information from the following sources, if available: 1. The invoice amount, facility charges for the item, discounts, allowances, and rebates; 2. The price established for the item by other MACs and the sources of information used to establish that price; 3. Payment amounts determined by other payers and the information used to establish those payment amounts; and 4. Charges and payment amounts required for other equipment and supplies that may be comparable or otherwise relevant. Duration of the TPNIES The TPNIES is paid for 2 calendar years, beginning on January 1 and ending on December 31. Following payment of the TPNIES, the ESRD PPS base rate will not be modified, and the new and innovative renal dialysis equipment or supply will be an eligible outlier service. For more information regarding the outlier policy see §60.D of this chapter.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Effective January 1, 2021, the eligibility criteria for TPNIES require that the equipment or supply: 1. Has been designated by CMS as a renal dialysis service under § 413.171; 2. Is new, meaning a complete application has been submitted to CMS within 3 years of the date of the FDA marketing authorization; 3. Is commercially available by January 1 of the particular calendar year, meaning the year in which the payment adjustment would take effect; 4. Has a Healthcare Common Procedure Coding System (HCPCS) Level II code application submitted, in accordance with the HCPCS Level II coding procedures on the CMS website, by the HCPCS Level II code application deadline for biannual Coding Cycle II for non-drug and non-biological items, supplies, and services as specified in the HPCPCS Level II coding guidance on the CMS website prior to the particular calendar year. HCPCS coding procedures and deadlines are available on the CMS website: https://www.cms.gov/Medicare/Coding/MedHCPCSGenInfo/HCPCSCODINGPROCESS; 5. Is innovative, meaning it meets the criteria specified in § 412.87(b)(1). An equipment or supply is considered innovative if it represents an advance that substantially improves, relative to technologies previously available, the diagnosis or treatment of Medicare beneficiaries (i.e., it offers a “Substantial Clinical Improvement” over existing technologies). 6. Is not a capital-related asset, except for capital-related assets that are home dialysis machines. Note: In the CY 2021 ESRD PPS final rule CMS finalized an exception for capital related assets which are home dialysis machines when used in the home for a single patient (see §20.4.3 of this chapter for more information) CMS uses the following parameters to evaluate Substantial Clinical Improvement for purposes of the TPNIES (see 42 CFR § § 413.236(b)(5) and 412.87(b)(1)): (i) The totality of the circumstances is considered when making a determination that a new renal dialysis equipment or supply represents an advance that substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of Medicare beneficiaries. (ii) A determination that a new renal dialysis equipment or supply represents an advance that substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of Medicare beneficiaries means one of the following: (A) The new renal dialysis equipment or supply offers a treatment option for a patient population unresponsive to, or ineligible for, currently available treatments. (B) The new renal dialysis equipment or supply offers the ability to diagnose a medical condition in a patient population where that medical condition is currently undetectable, or offers the ability to diagnose a medical condition earlier in a patient population than allowed by currently available methods and there must also be evidence that use of the new renal dialysis service to make a diagnosis affects the management of the patient. (C) The use of the new renal dialysis equipment or supply significantly improves clinical outcomes relative to renal dialysis services previously available as demonstrated by one or more of the outcomes described below. (1) A reduction in at least one clinically significant adverse event, including a reduction in mortality or a clinically significant complication. (2) A decreased rate of at least one subsequent diagnostic or therapeutic intervention. (3) A decreased number of future hospitalizations or physician visits. (4) A more rapid beneficial resolution of the disease process treatment including, but not limited to, a reduced length of stay or recovery time. (5) An improvement in one or more activities of daily living. (6) An improved quality of life. (7) A demonstrated greater medication adherence or compliance. (D) The totality of the circumstances otherwise demonstrates that the new renal dialysis equipment or supply substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of Medicare beneficiaries. (iii) Evidence from published or unpublished information sources from within the United States or elsewhere may be sufficient to establish that a new renal dialysis equipment or supply represents an advance that substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of Medicare beneficiaries. Information source may include the following: (A) Clinical trials; (B) Peer reviewed journal articles; (C) Study results; (D) Meta-analyses; (E) Consensus statements; (F) White papers; (G) Patient surveys; (H) Case studies; (I) Reports; (J) Systematic literature reviews; (K) Letters from major healthcare associations; (L) Editorials and letters to the editor; and, (M) Public comments. (N) Other appropriate information sources may be considered. (iv) The medical condition diagnosed or treated by the new renal dialysis equipment or supply may have a low prevalence among Medicare beneficiaries. (v) The new renal dialysis equipment or supply may represent an advance that substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of a subpopulation of patients with the medical condition diagnosed or treated by the new renal dialysis equipment or supply; and

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Effective January 1, 2021, eligibility for the TPNIES is extended to capital-related assets that are home dialysis machines when used in the home for a single patient that meet the eligibility requirements in section 20.1.2. As with other renal dialysis equipment and supplies potentially eligible for the TPNIES, CMS will evaluate the application to determine whether the home dialysis machine represents an advance that substantially improves, relative to renal dialysis services previously available, the diagnosis or treatment of Medicare beneficiaries, and meets the other requirements under 42 CFR § 413.236(b). For additional information on payment of the TPNIES for capital-related assets, see Pub 100-04 Chapter 8 § 20.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Home dialysis is performed at an ESRD patient’s home, including in skilled nursing facilities and nursing facilities, by the ESRD patient or a caregiver who has completed an appropriate course of training as specified in 42 CFR § 494.100(a).

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) Effective January 1, 2011, payment for renal dialysis services furnished for home dialysis are covered under the ESRD PPS and are not separately paid. ESRD facilities shall not bill Medicare beneficiaries directly when they furnish renal dialysis items and services included under the ESRD PPS. The ESRD facility receives the same bundled payment for home patients as it would receive for an in-facility patient under the ESRD PPS. Note: this includes all renal dialysis services furnished by the ESRD facility’s staff. The ESRD facility is responsible for the overall management of the home dialysis patient, including assuring that the patient is provided with equipment and supplies that are functional. This means the ESRD facility is responsible for delivering, installing, monitoring and maintaining supplies and equipment necessary to furnish all modalities of home dialysis either directly or under arrangement. For additional information regarding ESRD facility conditions for coverage for home dialysis services, refer to 42 CFR Part 494. A. Home Dialysis Equipment and Supplies All medically necessary equipment (including supportive equipment), supplies, and other items for home dialysis ordered by an MCP physician or practitioner that were included in the composite rate, are included under the ESRD PPS, and payments for these items were incorporated into the base rate. The MCP physician’s or practitioner’s order determines that an equipment or supply is furnished for the treatment of ESRD and therefore the responsibility of the ESRD facility. The order also provides documentation for CMS to use in determining if the equipment or supply is reasonable and necessary. The ESRD facility with which the patient is associated assumes responsibility for furnishing all home dialysis equipment, supplies, and support services either directly or under arrangements to all of its home dialysis patients. 1. Home Dialysis Equipment Furnished to Home Hemodialysis and Peritoneal Dialysis Patients Can Include: • All reasonable and necessary expenses incurred in the original installation of home dialysis equipment. Medicare does not pay for expenses attributable to home improvement (e.g., plumbing or electrical work), and there is no separate payment under the ESRD PPS for installation expenses even when covered. ESRD facilities are responsible for testing and assurance of equipment performance as specified in the ESRD Facility Conditions for Coverage in 42 CFR Part 494. • Supportive equipment that is used in conjunction with the basic dialysate delivery system, including blood pumps, heparin pumps, air bubble detectors, blood leak detectors, and unipuncture devices. • Adjustable chairs, such as recliners, as these chairs serve to preserve patients’ health by allowing rapid manipulation of body position when medical circumstances warrant such changes during dialysis (e.g., when acute hypotension occurs and the patient is in danger of going into shock). • Nonmedical items are also included in the ESRD PPS base rate and may not be billed separately. For example, if a home patient is wheelchair bound and it is medically necessary for the patient to weigh themselves before and after a dialysis treatment, the ESRD facility is responsible for furnishing the patient with a wheelchair scale. 2. Home Dialysis Supplies Furnished to Home Hemodialysis and Peritoneal Dialysis Patients ESRD facilities are responsible for supplies reasonable and necessary for the effective performance of all modalities of home dialysis, for example, alcohol wipes, sterile drapes, gloves, telfa pads, bandages, etc. Reasonable and necessary supplies may also include but are not limited to: start-up durable supplies (whether or not they are part of a start-up kit) such as weight scales, sphygmomanometer, I.V. stand, and dialysate heaters; and consumable and disposable supplies, such as dialysate, tubing, and gauze pads. Instruments and nonmedical supplies, such as scales, stopwatches, and blood pressure apparatus are included in the ESRD PPS. C. Home Dialysis Hemodialysis and Peritoneal Dialysis Support Services Home dialysis support services identified at 42 CFR §§ 410.52 and 494.100 may be furnished in the home or in the ESRD facility. Support services include (but are not limited to): 1. Periodic monitoring of the patient’s home adaptation, including visits to the patient’s home by facility personnel in accordance with the patient’s plans of care; 2. Emergency visits to the home by qualified ESRD facility personnel; 3. Services provided by a qualified social worker and a qualified dietitian, made in accordance with a plan prepared and periodically reviewed by a professional team which includes the physician; 4. Individual’s unscheduled visits to an ESRD facility made on an as-needed basis; e.g., assistance with difficult access situations; 5. Renal dialysis laboratory tests covered under the ESRD PPS; 6. Providing, installing, repairing, testing, and maintaining home dialysis equipment, including appropriate water testing and treatment; 7. Ordering and delivering renal dialysis supplies on an ongoing basis; 8. Maintaining and submitting all required documentation to the ESRD network; 9. A complete medical record keeping system that ensures continuity of care; 10. Changing essential tubing; 11. Watching the patient perform dialysis to assure that it is done correctly and to review any aspects of the technique that may require modification; and 12. Inspecting the access site and documenting any access site infections that may require a physician intervention or hospitalization. The full range of home dialysis support services required by home patients are included in the ESRD PPS. Home dialysis support services must be furnished periodically. These services will usually be furnished during a periodic follow-up visit, but they may be furnished at separate times. They may be furnished in the ESRD facility or in the home. NOTE: For additional information on renal dialysis services furnished on or after January 1, 2011, and paid under the ESRD PPS, refer to §20 of this chapter. B. In-facility Dialysis Sessions Furnished to Home Patients Who Are Traveling Patients who are normally home dialysis patients may be dialyzed by a Medicare certified ESRD facility on an in-facility basis when traveling away from home. Patients who normally dialyze in an ESRD facility may wish to dialyze temporarily in another facility or as home dialysis patients while they travel or vacation. See Medicare Claims Processing Manual, Chapter 8, “Outpatient ESRD Hospital, Independent Facility, and Physician/Supplier Claims,” §100, for billing services when traveling. C. Staff Assisted Home Dialysis Staff-assisted home dialysis may include ESRD facilities sending staff to assist with home dialysis, but such services may not be billed to Medicare separately, because the cost of all ESRD facility staff time is included in the base rate.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) Self-dialysis and home dialysis training are programs provided by Medicare certified ESRD facilities that educate ESRD patients and their caregivers to perform self-dialysis in the ESRD facility or home dialysis (including CAPD and CCPD) with little or no professional assistance. Self-dialysis training can occur in the patient’s home or in the facility when it is provided by the qualified staff of the ESRD facility. CMS expects that the patients who elect home dialysis are good candidates for home dialysis training, and therefore, will successfully complete their method of training before reaching the maximum number of sessions allotted. Dialysis training services are paid for in accordance with Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §50.8. Effective January 1, 2025, ESRD facilities may bill for the home and self-dialysis add-on training adjustment described at §60.C.1 for training sessions for AKI patients. Home dialysis training services and supplies may include, but are not limited to, personnel services; dialysis supplies, parenteral items used in dialysis, written training manuals and materials, and renal dialysis laboratory tests. For more information on the requirements for ESRD facilities, see 42 CFR Part 494. An ESRD facility may bill a maximum of 25 training sessions per patient for hemodialysis training and 15 sessions for CCPD and CAPD. For information on how home dialysis training treatments are paid, see §60.C.1 of this chapter. NOTE: ESRD facilities that are certified for home dialysis training and support services are expected to provide training throughout the home dialysis experience. Information regarding home dialysis training certification may be found at the following link: http://www.cms.gov/Medicare/Provider-Enrollment-and- Certification/GuidanceforLawsAndRegulations/Dialysis.html. A. Hemodialysis Training The average training time for hemodialysis is based upon 5-hour sessions given 3 times per week. Training programs are designed to accommodate the caregiver and the beneficiary when appropriate. Specifically, both can be trained to perform the dialysis treatment in its entirety. Sometimes the beneficiary plays a secondary role. In other programs, the beneficiary performs most of the treatment and is only aided or overseen by their caregiver. B. Peritoneal Dialysis (PD) Training The home peritoneal dialysis training is covered for up to 15 sessions. Additional CAPD training sessions are covered only when documented as being reasonable and necessary. However, extra training sessions raise questions about either the adequacy of PD for the patient or the patient’s capacity to learn or perform the PD technique. The patient’s physician should address these questions in the explanation of the need for extra training sessions. The MAC will make a determination whether or not to cover training sessions in excess of 15. 1. Continuous Ambulatory Peritoneal Dialysis (CAPD) Training The CAPD training is furnished in sessions that can last up to 8 hours (one session per day) 5 - 6 days per week. Typically, 6 - 8 CAPD exchanges can be performed per day for the purpose of teaching the patient the CAPD technique; however, no specific number of exchanges is required. Normally patients are trained within 2 weeks (5 - 6 training sessions per week); however, up to 15 sessions (i.e., 15 training days) may be covered routinely. Supplemental Dialysis during CAPD Training It may be necessary to supplement the patient’s dialysis during CAPD training with intermittent peritoneal dialysis, because the patient has not yet mastered the CAPD technique. Generally, no more than three supplemental intermittent peritoneal dialysis sessions are required during the course of CAPD training, and these may be covered routinely. If more than three sessions are billed during training, the claims must be documented for medical necessity. Under certain circumstances, the form of supplemental dialysis may be hemodialysis. Once the patient is trained, CAPD is primarily a home service, because the patient performs CAPD 24 hours a day. Persons who are primarily treated by CAPD may also require in-facility dialysis, either intermittent peritoneal or hemodialysis, occasionally. 2. Continuous Cycling Peritoneal Dialysis (CCPD) Training Continuous cycling peritoneal dialysis training is furnished in sessions of 8 hours per day 5 days per week. Typically, five exchanges can be performed per day to teach the patient the technique; however, no specific number of exchanges is required. Most patients are trained within 2 weeks; however, up to 15 sessions may be covered routinely. The A/B MAC (A) will determine whether or not training sessions over 15 are medically necessary. 3. Retraining Payment is made for retraining self-dialysis education after a patient or caregiver has completed the initial program if the patient continues to be an appropriate candidate for home dialysis. Most patients receive additional training on the use of new equipment or upon a change in their caregiver, or a change in modality. The ESRD facility may not bill for retraining services when they install home dialysis equipment or furnish monitoring services. For example, an ESRD facility nurse may not bill for retraining sessions to update treatment records, order new supplies, or add additional medicine for the treatment of infection. NOTE: When retraining and educational services are furnished to a patient or caregiver already knowledgeable in some other form of self-dialysis or if training is being done for a change of equipment, fewer sessions are necessary because of the transferability of certain basic skills. Criteria for retraining are explained in greater detail in Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §50.8.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) ESRD beneficiaries may receive other services that may be related to their ESRD diagnosis but are excluded from the ESRD PPS payment. Similarly, for AKI beneficiaries, some services related to their diagnosis may be excluded from the AKI dialysis payment. A. Coverage under the Home Health Benefit for ESRD Patients Services that are covered under the ESRD PPS are excluded from coverage under the Medicare home health benefit. Under the home health benefit, services can be provided to dialysis patients as long as the condition that necessitates home health care is not ESRD and as long as home health coverage conditions are met. This is true even where the primary condition relates to kidney failure. For example, Medicare will pay for home health care, such as for decubitus care or for severe hypotension, that is not included in the ESRD PPS. Medicare patients can receive care under both the ESRD benefit and the home health benefit. The key is whether or not the services are being furnished for the treatment of the patient’s ESRD. Surgical dressing changes that are furnished for the treatment of ESRD are to be provided by the ESRD facility, but dressing changes furnished for reasons other than for the treatment of ESRD may be provided under the home health benefit, provided all eligibility criteria have been met. See 42 CFR § 409.49(e). B. Coverage under the Hospice Benefit If the patient’s terminal condition is unrelated to ESRD, the patient may receive covered services under both the ESRD benefit and the hospice benefit. Hospice agencies can provide hospice services to patients who wish to continue dialysis treatment. C. Skilled Nursing Facility (SNF) Patients Needing Dialysis Services Section 4432(b) of the Balanced Budget Act (BBA) requires consolidated billing for SNFs. Dialysis and certain dialysis-related services including covered ambulance transportation to obtain the dialysis services are excluded from SNF consolidated billing, and the services may be billed separately. For more information regarding ESRD patients also receiving services in a SNF, see Pub. 100-02, chapter 8, §10.2 and Pub. 100-04, chapter 6, §20.2.1. D. Nursing Homes and/or Long Term Care Facility (LTC) Patients Needing Dialysis Services Medicare ESRD beneficiaries who reside in a SNF or NF and who meet the home dialysis requirements set forth under 42 CFR §494.100 are considered home dialysis patients. All home dialysis items and services are paid under the ESRD PPS, and no separate payment will be made to the SNF or NF. E. Physician’s Services for ESRD Beneficiaries Physician services are excluded from the ESRD PPS. Payment for physician’s services is subject to the guidelines in Pub. 100-02, Medicare Benefit Policy Manual, Chapter 15, §30. Medicare pays physician’s services furnished in connection with dialysis sessions for outpatients who are on maintenance dialysis in an ESRD facility or at home by the MCP method or the initial method. For patients who dialyze at home, the ESRD-related services included in the MCP may be provided via telehealth. The MCP physician (or practitioner) must furnish at least one face-to-face patient visit per month for the home dialysis MCP service. See Pub. 100-04, Medicare Claims Processing Manual, Chapter 8 § 140 and Chapter 12 § 190.3.4, for payment instructions. For physician responsibilities, refer to 42 CFR §414.310. F. Renal Dialysis Services Furnished During the Creation or Revision of a Vascular Access The creation or revision of an ESRD patient’s vascular access is usually performed in hospital outpatient departments. Laboratory services, drugs and biological products, and equipment and supplies furnished to ESRD beneficiaries for the treatment of ESRD on the day a procedure is performed to create or revise a vascular access site are not considered to be renal dialysis services. The physicians furnishing renal dialysis services that are subject to the ESRD PPS consolidated billing requirements during the creation or revision of a vascular access for an ESRD beneficiary should bill those services separately with an AY modifier. The appropriate HCPCS or CPT® code indicating the creation or revision of an access site is required on the claim. Items and services that are subject to the ESRD PPS consolidated billing requirements may be found at http://www.cms.gov/ESRDPayment/50_Consolidated_Billing.asp#TopOfPage. G. Noninvasive Vascular Studies for ESRD Patients For dialysis to be performed, there must be a means of access so that the exchange of waste products may occur. As part of the dialysis treatment, ESRD facilities are responsible for monitoring access to determine if the access site is functioning correctly. Procedures associated with monitoring access may include, but are not limited to, taking venous pressure, aspirating thrombus, observing elevated recirculation time, reduced urea reduction ratios, or collapsed shunt, etc. All such procedures are included under the ESRD PPS. Non-invasive vascular studies, such as duplex and Doppler flow scans, are not covered as separately billable services if used to monitor a patient’s vascular access site. If an ESRD facility or a renal physician determines it is reasonable and necessary to monitor the patient’s access site with a non-invasive vascular study (e.g. duplex or Doppler) and does not have the equipment to perform the procedure, the ESRD facility or physician may arrange for the service to be furnished by another source. The alternative source, such as an independent diagnostic testing facility, must look to the ESRD facility for payment. Doppler flow studies may be considered appropriate in the presence of signs or symptoms of possible failure of the ESRD patient’s vascular access site, and when the results are used in determining the clinical course of the treatment for the patient. Routine monitoring is included under the ESRD PPS and includes monitoring by noninvasive Doppler flow studies. Examples supporting the medical necessity for Doppler flow studies include: • Elevated dynamic venous pressure >200mm HG when measured during dialysis with the blood pump set on a 200cc/min., • Access recirculation of 12 percent or greater, • An otherwise unexplained urea reduction ratio <60 percent, and • An access with a palpable “water hammer” pulse on examination, (which implies venous outflow obstruction). Absent documentation supporting the necessity of more than one study, Medicare will limit payment to either a Doppler flow study or an arteriogram (fistulogram, venogram). An example of when both studies may be clinically necessary is when a Doppler flow study demonstrates: • Reduced flow (blood flow rate less than 800cc/min); or • A decreased flow of 25 percent or greater from previous study; and • The physician requires an arteriogram to define the problem. This policy is applicable to claims from ESRD facilities and all other sources, such as independent diagnostic testing facilities and hospital outpatient departments. The professional component of the procedure is included in the MCP. The professional component is denied if billed by the MCP physician. Medically necessary services that are included or bundled into the MCP (e.g., test interpretations) are separately payable when furnished by physicians other than the MCP physician. The MCP physician is identified by the performing provider number that billed MCP services identified by the HCPCS code 90995. Additional information can be found in Pub. 100-04, Medicare Claims Processing Manual, chapter 8 § 180. H. Nutritional Services ESRD facilities are required, in accordance with 42 CFR §494.80(a)(6) and §494.90(a)(2), to evaluate a patients’ nutritional status and expected to assist the patient in achieving their nutritional goals by providing education, counseling, and encouragement. These services are included in the ESRD PPS. Nutritional items, such as nutritional supplements, are not considered related to the treatment of ESRD and are not included in the ESRD PPS as renal dialysis services. Intradialytic Parenteral Nutrition (IDPN) and Intraperitoneal Nutrition (IPN) are not considered renal dialysis services and are therefore not included in the ESRD PPS bundled payment. IDPN and IPN are covered under Medicare Part D. Part B coverage for parenteral nutrition is limited to individuals with a non-functioning digestive tract. When an ESRD facility furnishes a non-ESRD drug, including IDPN or IPN, the staff time is already included in the ESRD PPS payment and, therefore, such costs should not be included in Part D payments. Payment under Part D is limited to the drug ingredients that meet the definition of a Part D drug, subject to the relevant requirements of 42 CFR § 423.120(d), and may include a dispensing fee to cover certain labor costs and pharmacy overhead as permitted under 42 CFR § 423.100. In the case that a pharmacy extemporaneously compounds IPN by adding amino acids to a dialysate, there has been confusion as to whether this falls under Part B or Part D. Dialysate is considered to be a supply related to the renal dialysis treatment, which falls under the ESRD PPS payment and is not separately billable under Part B. Although the dialysate is not separately billable, it is still considered a Part B drug. Therefore, IPN is a Part B compound in accordance with 42 CFR § 423.120(d)(1)(i), and coverage for the entire compound, including ingredients that would independently meet the definition of a Part D drug, would not be available under Medicare Part D. I. Immunizations Immunizations may be separately billed when furnished by an ESRD facility to a Medicare ESRD beneficiary. For further detail, see Pub. 100-04, Medicare Claims Processing Manual, chapter 8, §60.6. J. Blood Products Payment for furnishing blood, blood products, or blood supplies is excluded from the ESRD PPS and will remain separately billable when they are administered in an ESRD facility. For further detail, see Pub. 100-04, chapter 8, §60.3.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) Updates to the provisions under the ESRD PPS are discussed through rulemaking on a yearly basis. The updates are implemented through Recurring Update Notifications. A. Per Treatment Unit of Payment Under the ESRD PPS payment is made on a per treatment basis. The ESRD PPS base rate is the per treatment unit of payment that applies to both adult and pediatric patients. ESRD facilities furnishing dialysis treatments in-facility are paid for up to 3 treatments per week. ESRD facilities treating patients at home regardless of modality receive payment for 3 hemodialysis (HD) equivalent treatments per week. Payment for additional treatments may be considered when there is medical justification for more than 3 weekly treatments. For more information regarding home dialysis, see §30 of this chapter. ESRD facilities furnishing dialysis in-facility or in a patient’s home are paid for a maximum of 13 treatments during a 30 day month and 14 treatments during a 31 day month unless there is justification that additional treatments are reasonable and necessary. Frequency of Dialysis Sessions by Dialysis Modality and Treatment Setting* Dialysis Modality In-Facility Home Hemodialysis 3 per week Maximum of 3 per week regardless of frequency Hemofiltration 3 per week 3 per week Ultrafiltration 3 per week Maximum of 3 per week, regardless of frequency Peritoneal Dialysis (e.g., CAPD and CCPD) HD-equivalent sessions HD-equivalent sessions – Paid using the daily rate ** Intermittent Peritoneal Dialysis (IPD) 3 per week HD-equivalent sessions * Regardless of dialysis modality or treatment setting, payments for additional treatments may be made when they are reasonable and necessary. The A/B MAC (A) reviews the medical justification and is responsible for making the decision on the appropriateness of the extra treatment. ** Hemodialysis-equivalent home CCPD and CAPD is paid for using a daily rate. This daily rate is equal to 3/7ths of the payment amount for an in-center hemodialysis treatment, as one week of daily home CCPD or CAPD treatments is considered equivalent to 3 in-center hemodialysis treatments. 1. Hemodialysis: Payment Based on Standard of Three Treatments per Week Hemodialysis is typically furnished 3 times per week in sessions of 3 to 5 hours in duration. If the ESRD facility bills for any treatments in excess of this frequency, a medical justification that the treatment is reasonable and necessary is required to be furnished to the A/B MAC (A) and must be based upon an individual patient’s need. The A/B MAC (A) reviews the medical justification for each additional treatment and is responsible for making the decision on the appropriateness of the extra treatment(s) and payments for these additional treatments. When treatments are given in excess of 13 or 14 treatments per month (depending on the number of days in the month) without medical justification, the CG modifier shall be appended to the claim line for the date of service associated with the excess treatment. This modifier indicates that the facility attests the additional treatment does not meet medical justification requirements and should not be paid separately. 2. Hemofiltration Hemofiltration is an alternative to peritoneal dialysis and hemodialysis. Hemofiltration may be routinely performed either in an ESRD facility or at home in 3 weekly sessions. See §10.A.3 of this chapter. 3. Ultrafiltration When ultrafiltration is performed the same day as the dialysis treatment; there is no separate payment. When ultrafiltration is performed on a day other than the day of a dialysis treatment, the ESRD facility must document in the medical record why the ultrafiltration could not have been performed at the time of the dialysis treatment. For the ESRD facility to be paid for the ultrafiltration, the ESRD facility must report the appropriate diagnosis code and the A/B MAC (A) must verify the medical justification to determine that the ultrafiltration services were reasonable and necessary. If the A/B MAC (A) considers the justification appropriate, the ESRD facility will receive the ESRD PPS per treatment payment. For more information regarding ultrafiltration, see Pub. 100-04, Chapter 8, §50.7. 4. Peritoneal Dialysis: Payment Based on Hemodialysis Equivalent Sessions For home patients undergoing peritoneal dialysis (PD), the number of days of PD regardless of the number of dialysate exchanges performed each day, is converted to HD-equivalent sessions. This is accomplished by dividing the number of days of PD by 7 and multiplying the result by 3. Example: Joe is a home CCPD patient who undergoes PD for 24 days. The number of HD- equivalent sessions is 24/7 x 3 or 10.28571. The number of HD-equivalent sessions or treatments for which case-mix adjusted prospective payments are applicable, is 10.28571. Note: because home CAPD and CCPD patients generally receive dialysis treatments daily, these modalities are paid a daily rate, which is calculated by multiplying the in-center hemodialysis payment rate for that patient by 3 and dividing by 7. This is an alternative method of paying a comparable rate for hemodialysis- equivalent sessions, which is more appropriate for these daily modalities. The daily rate is not paid for IPD, since IPD may not be furnished every day (as discussed in the next subsection). Although CAPD and CCPD patients are home dialysis patients, occasionally it may be necessary to perform dialysis in-facility. The number of HD-equivalent sessions for PD performed in-facility is limited to 3 weekly, regardless of the number of days PD is furnished in-facility. However, each day of in-facility PD is treated as one HD-equivalent session, up to a maximum of 3 per week. Example: Mary is a home CCPD patient. After 21 days on CCPD in a month, Mary’s cycler required repair. Mary received CCPD in-center for 4 consecutive days before returning to home CCPD. The number of HD-equivalent sessions for which payments under the ESRD PPS may be made is 12, determined as follows: Home CCPD HD-equivalent sessions 21/7 x 3 = 9 In-center PD HD-equivalent sessions (limited to 3) 3 Total HD-equivalent sessions 12 Mary’s ESRD facility would receive the case-mix adjusted ESRD PPS base rate for 12 treatments in the month. 5. Intermittent Peritoneal Dialysis (IPD) Maintenance Intermittent Peritoneal Dialysis (IPD) is usually accomplished in sessions of 10 to 12 hours in duration. Sometimes it is accomplished in fewer weekly sessions of longer duration. The payment applicable for maintenance IPD, as well as the ESRD facility’s actual payment for maintenance IPD, depends on the treatment setting (in-facility or at home). Payment for in-facility IPD follows the same payment rules as hemodialysis, i.e., 3 sessions per week (see Pub. 100-04, chapter 8, §50.5 and §50.6.2). Payment for home IPD is based on a weekly equivalence of 3 sessions per week (see Pub. 100-04, chapter 8, §80.3, §80.3.1, and §80.4). If additional dialysis beyond the usual weekly maintenance dialysis is required because of special circumstances, the ESRD facility’s claim for these extra services must be accompanied by a medical justification for payment to be made. 6. Uncompleted Dialysis Treatments under the ESRD PPS Medicare only pays for one completed dialysis treatment per day. If a dialysis treatment is started, (i.e., a patient is connected to the machine and a dialyzer and blood lines are used), but the treatment is not completed for some unforeseen, but valid reason, (e.g., a medical emergency when the patient must be rushed to an emergency room), and the patient returns the same day and completes the treatment, the facility is paid for one treatment. When there is a sudden onset of acute symptoms during the dialysis treatment and there is an emergency, the ESRD facility does what is necessary to provide the beneficiary emergency care (including calling 911). The hospital outpatient department provides emergency care and if it is unlikely the patient is able to return to the ESRD facility, the hospital outpatient department furnishes the dialysis treatment for the day. Emergency renal dialysis services furnished in a hospital emergency room are separately paid, when justification that they are reasonable and necessary is submitted on the claim, and when the absence of immediate medical attention in the emergency room could reasonably be expected to result in either: • Placing the patient’s health in serious jeopardy; • Serious impairment to bodily functions; or • Serious dysfunction of any bodily organ or part. If a patient was taken to a hospital and was furnished a dialysis treatment while in the emergency room, then the ESRD facility will not receive payment for the treatment and only the hospital will be paid. See Pub.100-04, chapter 4, section 200.2 for additional information. Renal dialysis services, such as de-clotting of shunts, suture removal, or furnishing renal dialysis drugs that may be furnished in other settings such as a hospital outpatient department or physician’s office, are paid separately only if the services could not have been furnished in the ESRD facility. 7. Vaccines and Their Administration ESRD facilities may bill separately for both the vaccine and the administration of the vaccine under Chapter 18 of the Provider Reimbursement Manual (PRM) (Section 10.2.2.1). Independent ESRD facilities are paid at the Medicare Physician Fee Schedule rate, and Hospital Based ESRD facilities are paid reasonable cost. Vaccinations for COVID-19 are paid at a reasonable cost when performed at a renal dialysis facility. The general rates for COVID-19 vaccines do not apply for renal dialysis facilities. B. Market Basket For renal dialysis services furnished on or after January 1, 2012, CMS annually updates the ESRD PPS base rate by the ESRD bundled market basket percentage increase factor minus a productivity adjustment factor (the growth in the multifactor productivity is derived by subtracting the contribution of labor and capital input growth from output growth). The market basket is routinely rebased periodically so that the cost weights reflect changes between base periods in the mix of goods and services that ESRD facilities purchase to furnish ESRD treatment.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) As discussed in 20.3.D of this chapter, CMS finalized a policy in the CY 2011 ESRD PPS final rule (75 FR 49044) to delay payment for oral-only renal dialysis drugs and biological products under the PPS until January 1, 2014. This was further delayed until CY 2025 as a result of legislation. Calcimimetics are a renal dialysis drug that falls within the bone and mineral metabolism functional category. Prior to CY 2018, calcimimetics were considered oral-only and were excluded from the ESRD PPS; however, an injectable calcimimetic was approved by the FDA in 2017. Beginning January 1, 2018, injectable and oral calcimimetics were incorporated into the ESRD PPS and paid under the TDAPA for an initial TDAPA period of 2 years, which was extended in the CY 2020 ESRD PPS final rule to include a third year. Effective January 1, 2021, the ESRD PPS base rate increased by $9.93 to account for oral and injectable calcimimetics. Using the total units of oral and injectable calcimimetics and the total number of paid hemodialysis-equivalent dialysis treatments furnished, as derived from Medicare ESRD facility claims (that is, the 837-institutional form with bill type 072X) for the third and fourth quarters of calendar year 2018 and for the full calendar year 2019 and the weighted average ASP based on the most recent determinations by CMS, CMS used the following methodology to calculate the average per treatment payment amount for calcimimetics that is added to the ESRD PPS base rate (see 42 CFR § 413.234(f)).

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) The ESRD PPS includes patient-level adjustments (also known as the case-mix adjustments), facility-level adjustments, and training adjustments, as well as an outlier payment. In addition, the ESRD PPS includes certain add-on payment adjustments as discussed in § 60.C of this chapter. Under the ESRD PPS, the beneficiary co-insurance amount is 20 percent of the total ESRD PPS payment, after the deductible (see §60.E of this chapter). Note: In general, the ESRD PPS case-mix adjustments, facility level adjustments and add-on payment adjustments do not apply to AKI beneficiaries. The only payment adjustments that apply to AKI dialysis claims are the ESRD PPS wage index and, beginning January 1, 2025, the add-on payment adjustment for home and self-dialysis training. A. Patient-level case-mix adjustments The ESRD PPS base rate is adjusted for characteristics of both adult and pediatric patients to account for case-mix variability. Pediatric patient-level adjusters (see §60.A.6 of this chapter), consist of combinations of two age categories and two dialysis modalities. The adult case-mix adjusters include age, body surface area (BSA), low body mass index (BMI), and six comorbidity categories (three acute and three chronic), and the onset of renal dialysis. Based on the refinement of the ESRD PPS, effective January 1, 2016, adult case-mix payment adjustments are made for four comorbidity categories (two acute and two chronic) as indicated in the chart below. The comorbidity categories of bacterial pneumonia monoclonal gammopathy were removed. 1. Adult case-mix adjusters This section presents a list of the ESRD PPS case-mix adjusters for adults and provides several examples using the adult case-mix adjusters implemented in CY 2011 and refined in CY 2016. Any revisions to the case-mix adjusters will be addressed in subsequent rulemaking. Adult Patient-Level Characteristics Adjustment Value CY 2011- 2015 Beginning CY 2016 Age: 18-44 1.171 1.257 Age: 45-59 1.013 1.068 Age: 60-69 1.000 1.070 Age: 70-79 1.011 1.000 Age: 80+ 1.016 1.109 Body Surface Area (per 0.1 m2) 1.020 1.032 Low Body Mass Index (BMI <18.5) 1.025 1.017 Onset of Renal Dialysis <4 Months 1.510 1.327 Pericarditis (acute) 1.114 1.040 Bacterial pneumonia (acute)* 1.135 --- Gastro-intestinal tract bleeding (acute) 1.183 1.082 Hereditary hemolytic or sickle cell anemia (chronic) 1.072 1.192 Myelodysplastic syndrome (chronic) 1.099 1.095 Monoclonal gammopathy (chronic)* 1.024 --- *Were removed effective January 1, 2016. Calculating the ESRD PPS Bundled Payment Amount The following example demonstrates the calculation of the ESRD PPS bundled payment in an urban area with a wage index of 1.10. Before giving the particulars of the dialysis patient for the example, shown first is how to calculate the labor-adjusted base rate, which is the starting point for the computation of the case- mix adjusted base rate (the examples below use rates effective January 1, 2026). • Base rate: $281.71 • Labor-related share of base rate: $281.71 * 0.552 = $155.50 • Wage index adjusted labor-related share: $155.50 * 1.1000 = $171.05 • Non labor-related share of base rate: $281.71 * (1 - 0.552) = $126.21 • Wage index adjusted base rate: $171.05 + $126.21 = $297.26 Provided next is the continuation of the example with the inclusion of the patient characteristics portion of the payment. A 45 year old male Medicare beneficiary is 187.96 cm. (1.8796 m.) in height and weighs 95 kg. He receives dialysis in an ESRD facility on January 1, 2026. Using the formula for BMI, note that the patient is not underweight, having a BMI of 26.89 kg/m2, which is greater than the threshold value of 18.5 kg/m2. BMIPatient = weightkg /height (m2) = 95/1.87962 = 95/3.5329 = 26.89 The formula for calculation of a patient’s BSA is: • 0.007184 multiplied by height in meters 0.725 multiplied by weight in kg. 0.425 • or BSA = 0.007184 * heightcm0.725* weightkg0.425 The BSA for the patient in this example is calculated as: BSAPatient = 0.007184 * 187.96.725 * 95.425 = 0.007184 * 44.5346 * 6.9268 = 2.2161 Using the adult case-mix adjusters table shown above, the BSA multiplier is 1.032. The patient’s case- mix adjustment or payment multiplier (PM) based on his BSA of 2.2161 is computed as follows: PM BSA = 1.032(2.2161-1.90)/0.1 = 1.0323.161 = 1.1047 The example patient’s PM would reflect the applicable case-mix adjustments from the adult case-mix adjusters table above for both age and BSA and may be expressed as: PMPatient = PMage * PMBSA = 1.068 * 1.1047 = 1.1798 The example patient’s ESRD payment rate for treatments furnished in his ESRD facility (assuming a wage index of 1.000) would be: $281.71* 1.1798 = $332.36 NOTE: This example is computed without regard to other adjustments (e.g., outlier payments, training add- on, low-volume adjustment, etc.). Additionally, this case-mix adjustment multiplier would be applied to any post-TDAPA add-on payment adjustment amounts applicable for the claim. For example, if the post-TDAPA add-on payment adjustment amount for the quarter of the claim in question was $0.50, the post-TDAPA add-on to the per-treatment payment rate would be: $0.50*1.1798 = $0.59 2. Patient Age There are 5 age categories for adults (18-44; 45-59; 60-69; 70-79; and 80 and above) in the ESRD PPS and each category has a separate case-mix adjuster. Note that when a beneficiary reaches a birthday that results in a different age category, the age change is effective from the first day of the birthday month, regardless of the date the birthday occurs in that month. The case-mix adjustment factor corresponding to the age of the dialysis patient is multiplied by the wage index adjusted base rate as a step in the calculation of the ESRD PPS per treatment payment amount. The examples shown below draw on values from the table of the CY 2016 adult case-mix adjusters as well as the discussion of the wage adjusted ESRD PPS base rate found in the section above (examples below are using rates effective January 1, 2026). • Example 1: Mr. Taylor is 38 years of age and is classified in the 18-44 age group with an associated case- mix adjuster of 1.257. Applying the case-mix adjuster of 1.257 to the wage index adjusted base rate of $281.71 (assuming a wage index of 1.000) yields the age adjusted base rate amount of $354.11 ($281.71 x 1.257 = $354.11). • Example 2: Mrs. Williams was born on July 4, 1936. On June 15, 2016, she is 79 years old and is classified in the 70-79 age category with a case-mix adjustment of 1.000 (the reference group). However, beginning with dialysis treatments occurring on and after July 1, 2016, she will move into the 80+ age group with an associated case-mix multiplier of 1.109. • Example 3: Mr. Davis was born on September 29, 1971. For dialysis treatments occurring in August 2016, he is 44 years old and would be classified in the 18-44 age group with an associated case-mix adjuster of 1.257. Beginning with dialysis treatments occurring on and after September 1, 2016, he is classified in the 45-59 age category with a case-mix adjuster of 1.068 because he is considered to have attained age 45 on September 1. 3. Body Size: Low Body Mass Index (BMI) and/or Body Surface Area (BSA) Low BMI and BSA are two measures used to estimate body size. Both measures are strong predictors of variation in costs and are closely associated with the duration and intensity of dialysis necessary to achieve a therapeutic dialysis target for ESRD patients. Both are objective measures that are computed using height and weight data located on the patient claim. The BMI and BSA are calculated for all beneficiaries. Low BMI is associated with higher costs due to additional resources that may be necessary to address malnutrition or frailty. BSA is associated with higher costs due to more time on the dialysis machine. Although height and weight are taken at intervals throughout any given month of dialysis treatment, the measurements for the purpose of payment must be taken as follows: • The dry weight of the patient is measured and recorded in kilograms immediately following the last dialysis session of the month. • The patient height is measured and recorded in centimeters during the last dialysis session of the month. The measurement is required no less frequently than once per year. The formula for the calculation of the BMI is weight in kilograms divided by height in meters squared, or kg/m2. As an example, the designated low BMI adjustment factor of 1.017 (see §60.A.1 of this chapter) is only applied for those beneficiaries with a BMI value that is less than 18.5kg/m2 which is a clinical measure of being underweight and an indicator of malnutrition. The formula for the calculation of the BSA is BSA = w0.425 * h0.725 * 0.007184 where w and h represent weight in kilograms and height in centimeters. The BSA factor is defined as an exponent equal to the value of the patient’s BSA minus the reference BSA of 1.90 divided by 0.1. Using the example of adult adjusters above, the BSA adjustment factor of 1.032 is then exponentiated based on the calculated BSA factor as 1.032(BSA-1.90)/0.1. The reference BSA used to calculate the BSA is the national average among Medicare dialysis patients. 4. Onset of Dialysis Effective January 1, 2016, the ESRD PPS onset of renal dialysis adjustment is 1.327. An ESRD facility may only receive the onset of dialysis adjustment for adult Medicare ESRD beneficiaries. The onset period is defined as the initial 120 days of outpatient maintenance dialysis, which is designated by the first date of when regular chronic dialysis began as reported on the CMS Form 2728. The onset of dialysis adjustment factor is a multiplier used in the calculation of the ESRD PPS per treatment payment amount for dialysis furnished in either an ESRD facility or home setting. For example, when a dialysis patient is not eligible for the Medicare ESRD benefit at the initiation of their maintenance dialysis but is Medicare eligible at the end of 85 days, the onset of dialysis adjustment will be applied to the ESRD facility’s ESRD PPS base rate for each treatment furnished in the following 35 days. However, if the patient is not Medicare eligible at any time during the initial 120 days of receiving maintenance dialysis, the onset of dialysis adjustment will not apply. The onset of dialysis adjustment is a one-time adjustment. It is not applied when a patient changes ESRD facilities or after a failed transplant. If a patient changes or transfers to another ESRD facility during the initial 120 days, the new ESRD facility will only receive the onset of dialysis adjustment for the remaining time. In other words, the 120 day “clock” does not start over. If the onset of dialysis adjustment is being applied to the ESRD PPS base rate, then those treatments would not be eligible for the comorbidity adjustment nor any applicable training adjustment(s). However, those treatments are eligible for an outlier payment when appropriate. 5. Comorbidity Categories The two acute comorbidity categories are pericarditis and gastro-intestinal tract bleeding with hemorrhage. The two chronic comorbidity categories are myelodysplastic syndrome and hereditary hemolytic anemia (including sickle cell anemia). For each patient only the single comorbidity with the largest adjustment factor will be applied to the payment calculation, as explained in the CY 2011 ESRD PPS final rule (75 FR 49106). The related comorbidity diagnosis codes can be found at the CMS ESRD Payment Web site located at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/Patient-Level- Adjustments.html NOTE: Prior to January 1, 2016, the ESRD PPS included payment adjustments for the comorbidity categories of bacterial pneumonia and monoclonal gammopathy, which were removed effective January 1, 2016. The ESRD facility is responsible for obtaining documentation of the presence of an acute or chronic comorbidity. If an ESRD facility is unaware of the existence of a comorbidity because it does not impact the facility’s costs, then the ESRD facility should not expect to receive a comorbidity adjustment. The comorbidity payment adjustment is only applied if the appropriate diagnosis code, specified under one of the categories above, is identified on the ESRD claim. Comorbidities other than the two acute and the two chronic conditions identified above do not qualify for a comorbidity adjustment. Even if an ESRD patient has or has had one of the four conditions that would qualify for a comorbidity payment adjustment, the condition must be currently active and have an effect on the cost of care for the ESRD facility to be eligible to receive the adjustment. To qualify for the comorbidity adjustment there must be adherence to diagnosis coding requirements. Diagnosis codes are updated annually as stated in Pub. 100-04, Chapter 23, section 10, are posted at http://www.cms.gov/Medicare/Coding/ICD10/index.html, and are effective each October 1st. For transfer patients, it is expected that ESRD facilities will work together on the appropriate transfer of information to facilitate appropriate billing for dialysis services. The counting of treatments for an acute comorbidity adjustment is based on the patient and not on the ESRD facility. Therefore, counting does not restart when a beneficiary moves to a new ESRD facility, but rather continues for the remaining 4 months. a. Duration of Acute Comorbidity Adjustment Payment for an acute comorbidity adjustment begins in the month in which the diagnosis is established and lasts for the next 3 consecutive patient months. A patient month is any month in which a dialysis treatment is furnished, and an acute comorbidity applies. The acute diagnosis comorbidity adjustment is applied to each dialysis treatment for 4 patient months. If a second comorbidity is diagnosed during that period (either acute or chronic), then the adjustment is made using the higher adjustment factor. At no time is an adjustment applied for more than one comorbidity. When there is a recurrence of an acute comorbidity within the 4 patient-month period, there will not be an extension of the 4 patient-month adjustment. A recurrence is defined as a new episode of a comorbidity that was previously experienced by an individual beneficiary. However, if the recurrence happens after the completion of the 4-month period, then a new comorbidity adjustment for 4 months would start. • Example – A male patient has been receiving hemodialysis since January 2010. He had a 2-week hospitalization due to a fracture in mid-January 2016. During his stay in the hospital, he was diagnosed with gastro-intestinal tract bleeding with hemorrhage on January 20, 2016. He resumed his outpatient maintenance dialysis on January 29, 2016. The 4 patient-months in which the patient’s ESRD facility would be eligible to have the comorbidity adjustment applied to each dialysis treatment are January through April 2016. b. Duration of Chronic Comorbidity Adjustment The chronic diagnosis comorbidity adjustment is applicable only when the comorbidity has an effect on the cost of dialysis care and when that chronic diagnosis comorbidity appears on the claim. The adjustment does not automatically continue each month. When an acute diagnosis comorbidity with a higher adjustment value is applicable at the same time a chronic comorbidity applies, then the higher adjustment will be applied for 4 patient-months, and then revert to the lower chronic comorbidity payment adjustment factor. 6. Pediatric case-mix adjusters: Age and dialysis modality Pediatric patients are beneficiaries with ESRD who are under the age of 18. The same base rate is used for adult and pediatric patients, which is also adjusted by the area wage index. However, the base rate for pediatric patients is not adjusted for case-mix as adjustments used for adult patients. The pediatric payment adjustments use only two age categories (<13, age 13-17) and dialysis modality (PD or HD). The pediatric case-mix adjusters, applicable for CY 2011, are shown below. These values are presented for the purpose of demonstrating the computations shown in the examples in the following sections. Any revisions to the case-mix adjusters will be published in subsequent rulemaking. Based on the two classification categories for age and modality, there are four pediatric classification groups. Pediatric Patient-Level Characteristics Adjustment Value CY 2011- 2015 Beginning CY 2016 Age: <13, Modality: PD 1.033 1.063 Age:<13, Modality: Hemo 1.219 1.306 Age:13-17, Modality: PD 1.067 1.102 Age:13-17, Modality: Hemo 1.277 1.327 ESRD facilities receive an additional transitional pediatric ESRD add-on payment adjustment (TPEAPA) for renal dialysis services furnished to pediatric ESRD patients (as defined at §413.171). This TPEAPA represents an increase in payment of 30% of the per-treatment payment amount. The TPEAPA is not an increase to the case-mix adjustment factors displayed above, but it functions similarly to an increase to the above case-mix adjustment factors of 30% (1.3 multiplier). The TPEAPA applies for calendar years 2024, 2025 and 2026 as CMS collects additional data on the costs associated with treating pediatric ESRD patients. The TPEAPA does not impact the outlier services multipliers or the outlier payment in any way. ESRD facilities do not receive the low-volume adjustment, described in §60.B.1, or the rural adjustment, described in §60.B.3, for pediatric beneficiaries. However, they are eligible for training add-on and outlier payments (described in §60.C.1 and §60.D, of this chapter respectively). The following example demonstrates the calculation of the payment rate for a pediatric patient who receives dialysis at an ESRD facility and is located in an urban area with a wage index of 1.10. The example also shows the application of the training add-on for eligible training treatments. Before giving the particulars of the pediatric dialysis patient, shown first is the calculation of the labor-adjusted base rate of $297.26, which is the starting point for the computation of the case-mix adjusted base rate (the examples below use rates effective January 1, 2026). • Base rate: $281.71 • Labor-related share of base rate: $281.71 * 0.552 = $155.50 • Wage index adjusted labor-related share: $155.50 * 1.1000 = $171.05 • Non labor-related share of base rate: $281.71 * (1 - 0.552) = $126.21 • Wage index adjusted base rate: $171.05 + $126.21 = $297.26 Provided next is the continuation of the example with the characteristics of the pediatric patient. • Andrew, a 12-year-old male, has been on CCPD since June 2020. His mother, who assists him with his dialysis at home, is no longer able to assist with dialysis beginning May 10, 2026. His aunt, who lives nearby, has agreed to be the caregiver and assist him with his dialysis. The aunt required 17 training sessions at an ESRD facility in order to become knowledgeable and skilled sufficiently to perform this role. These training sessions began May 16 and ended June 10. The above pediatric classification table reveals that Andrew’s pediatric dialysis classification group is cell 1, with an associated patient multiplier of 1.063. During the months of May and June 2026, the ESRD payment rate per HD- equivalent treatment at a facility with a wage index of 1.1 would be: $297.26 * 1.063 = $315.99 • However, the ESRD facility is entitled to receive payment for a maximum of 15 training treatments furnished in connection with a new caregiver. Because the amount of the training add-on is adjusted by the ESRD facility’s wage index (1.10), the amount of the training add-on is calculated as follows: Training rate: $95.60 Wage index: 1.10 Training payment: $95.60 * 1.10 = $105.16 NOTE: This example is computed without regard to other adjustments (e.g., outlier payments.) • For treatments furnished to pediatric ESRD patients in calendar years 2024, 2025 and 2026, a TPEAPA of 30% of the per treatment payment amount would be added to the payment amount. Case-mix adjusted payment rate: $315.99 TPEAPA multiplier: 0.3 TPEAPA amount: : $315.99* 0.3 = $94.80 • Additionally, the above case-mix adjustment multiplier and the TPEAPA would be applied to any post- TDAPA add-on payment adjustment amounts applicable for the claim. For example, if the post-TDAPA add-on payment adjustment amount for the quarter of the claim in question was $0.50, the post-TDAPA add-on to the per-treatment payment rate would be: $0.50 * 1.063 * 1.3 = $0.69 NOTE: the post-TDAPA add-on payment adjustment amount is only adjusted by the patient-level case-mix adjusters and the TPEAPA. Facility level adjustment factors (e.g. LVPA, rural adjustment) and other add- on payment adjustments (home and self-dialysis training add-on, outlier payment) are not applied to the post-TDAPA add-on payment adjustment. • For the maximum number of 15 training treatments for which the training adjustment may be provided in connection with a PD patient, the payment rate, including the add-on payment adjustments, would be: ($297.26 * 1.063) + $105.16 + $94.80 + 0.69 = $516.64 B. Facility-level adjustments There are three facility-level adjustments in the ESRD PPS. The first adjustment accounts for ESRD facilities furnishing a low-volume of dialysis treatments. The second adjustment reflects urban and rural differences in area wage levels using an area wage index developed from Core Based Statistical Areas (CBSAs). The third is a rural adjustment beginning in CY 2016. 1. Low-Volume Adjustment ESRD facilities that qualify as being low-volume can receive the low-volume payment adjustment (LVPA) applied to each dialysis treatment they furnish beginning on or after January 1, 2011. For CY 2011 the payment adjustment was 18.9 percent, and beginning January 1, 2016, the payment adjustment was 23.9 percent. Beginning January 1, 2025, the payment adjustment will be 28.4 percent for facilities furnishing less than 3,000 treatments and 18.1 percent for facilities furnishing between 3,000 and 3,999 treatments. a. Low-Volume Criteria To be eligible for the low-volume adjustment, an ESRD facility must meet specific criteria: • The ESRD facility must have furnished less than 4,000 dialysis treatments in each of the 3 cost reporting years preceding its payment year. This 3 year eligibility period is based on the ESRD facility’s as-filed or final settled 12- consecutive month cost reports. o The term “payment year” is the period of time that is used for determining payment to ESRD facilities, which is a calendar year. The ESRD PPS is based on a calendar year which begins January 1 of each year. o The eligibility years are defined as the 3 years preceding the payment year and are based on cost reporting periods—specifically, the cost reporting periods that end in the 3 years immediately preceding the payment year. The cost reporting periods must report costs for 12 consecutive months. • For purposes of determining eligibility for the low-volume adjustment, the number of “treatments” is the total number of treatments furnished to Medicare and non-Medicare patients. For peritoneal dialysis (PD) patients, 1 week of PD is considered equivalent to 3 hemodialysis (HD) treatments. For example, a patient on PD for 21 days would have (21/7) x 3 or 9 HD-equivalent treatments. See §50.A.4 of this chapter for more information on hemodialysis equivalent treatments. The ESRD facility must not have opened, closed, or received a new provider number due to a change in ownership, (see Pub. 100-07, chapter 3, §3210), in the 3 years preceding the payment year. o This 3-year period is based on the ESRD facility’s as-filed or final settled 12-consecutive month cost reports that end in the 3 years immediately preceding the ESRD PPS payment year. o An ESRD facility is determined to be “opened” when the ESRD facility is a new establishment newly surveyed by the state and Medicare, is certified for Medicare participation, receives a provider number, and begins furnishing Medicare certified outpatient maintenance dialysis treatments. o If there is a change in ownership that does not result in a change in provider number but does cause a change in the fiscal year reporting to that of the new provider, the A/B MAC (A) should combine the reporting periods for determining eligibility to the LVPA. For example, prior to a change of ownership (CHOW), Facility A had a cost reporting period that spanned January 1 through December 31. Facility A had a CHOW mid-year that did not result in a new provider transaction access number (PTAN) but caused a break in the cost reporting period. The A/B MAC (A) would add Facility A’s cost report that spanned January 1 through May 31 to its cost report that spanned June 1 through December 31 to verify the total treatment count. The other situation that could occur is when a CHOW results in a change of the original fiscal period. For example, prior to a CHOW, Facility B had a cost reporting period that spanned January 1 through December 31 and, based on its cost reports for 2012 and 2013, it met the LVPA eligibility criteria. Then, Facility B had a CHOW in the beginning of 2014 that did not result in a new PTAN but changed its cost reporting period to that of its new owner, October 1, 2014, through September 30, 2015. This scenario would create a short and a long cost report that would not total 12 months that the A/B MAC (A) would need to review for verification. That is, Facility B would have a cost report that spanned January 1, 2014, through July 31, 2014 (7 months) and a cost report that spanned August 1, 2014 through September 30, 2015 (14 months). In this situation, the A/B MAC (A) should combine the two non-standard cost reporting periods that in combination may exceed 12-consecutive months and prorate the data to equal a full 12-consecutive month period. o Beginning January 1, 2019, if there is a CHOW that results in a change in provider number due to a facility-type change (for example, hospital based dialysis facility to independent dialysis facility) and the new owner accepts the Medicare agreement, the ESRD facility can qualify for the LVPA if they otherwise meet the LVPA eligibility criteria. This policy does not extend to CHOWs where a new PTAN is issued for any other reason. o Effective January 1, 2019, ESRD facilities that change their fiscal year end for cost reporting purposes, outside of a CHOW, qualify for the LVPA if they otherwise meet the LVPA eligibility criteria. When this occurs, the MACs will combine the two nonstandard cost reporting periods of less than 12 months to equal a full 12- consecutive month period or combine the two non-standard cost reporting periods, that in combination may exceed 12-consecutive months, and prorate the data to equal a full 12-consecutive month period. This does not impact or change requirements for reporting, as established by the MACs, or those set forth in § 413.24(f)(3). • Effective January 1, 2016, the ESRD facility must not be located within 5 road miles of another ESRD facility under common ownership. The geographic proximity criterion is applicable to all ESRD facilities that are Medicare certified to furnish outpatient maintenance dialysis treatments. For the purpose of determining the number of treatments furnished by the ESRD facility, the number of treatments considered furnished by the ESRD facility would be equal to the aggregate number of treatments furnished by the other ESRD facilities that are both under common ownership, and 5 road miles or less from the ESRD facility in question. For example, ESRD facility A received its Medicare certification on February 1, 2011, allowing them to bill and receive payment for outpatient maintenance dialysis that they furnish to Medicare beneficiaries. ESRD facility A will need to meet the low-volume criteria for 3 years. When the ESRD facility A submits its attestation to the A/B MAC (A), the A/B MAC (A) will need to consider ESRD facility A’s ownership and the ownership of all of the ESRD facilities located within a 5 road mile radius or less when determining total treatments. A/B MACs (A) shall use the Provider Enrollment, Chain, and Ownership System (PECOS) (or the most recent available Medicare enrollment system) to locate the ESRD facility’s ownership information. A/B MACs (A) shall refer to 42 CFR §421.404(a) when determining common ownership. Prior to January 1, 2016, ESRD facilities that were Medicare certified prior to January 1, 2011, were grandfathered into the geographic proximity criterion. Beginning January 1, 2025, the structure of the LVPA will change to include two tiers. ESRD facilities that furnish fewer than 3,000 treatments will fall into the first tier, and facilities that furnish 3,000 or more treatments but fewer than 4,000 treatments will fall into the second. An ESRD facility's LVPA tier will be determined based on the median treatment count of the last three cost-reporting years, rather than using a single year treatment count. Facilities that fall into the first tier will receive a 28.4 percent adjustment, and facilities that fall into the second tier will receive an 18.1 percent adjustment. Should a facility receive an exception under § 413.232(g)(5) in one or more of the past three cost- reporting years, the median treatment count of the unaffected cost-reporting years will be used to make the facility's tier determination. In the case that a facility does not have cost-reporting data from the last 3 years that are unaffected by a disaster or other emergency, the facility will be assigned to a tier based on their last full year of unaffected treatment volume, assuming all LVPA eligibility criteria are met. Two-Tier LVPA Structure Effective January 1, 2025 Tier LVPA Adjuster Tier 1 (less than 3,000) 28.4% Tier 2 (3,000 – 3,999) 18.1% For example, if cost-reporting data indicated that an ESRD facility furnished 2,500, 2,999, and 4,500 treatments in the 3 years preceding the payment year, but the facility received an exception under § 413.232(g)(5) during the year it furnished 4,500 treatments, the median treatment count from the two prior years (2,500 and 2,999) would be used determine the facility’s LVPA tier, which would place the facility in tier 1. The facility would then receive a 28.4 percent payment adjustment for all of the treatments furnished during the payment year. NOTE: The low-volume adjustment does not apply to dialysis treatments provided to pediatric patients. b. ESRD Facility Attestation Instruction for Low-Volume Adjustment In order to receive the low-volume adjustment under the ESRD PPS, each individual ESRD facility must submit an attestation statement each year to its A/B MAC (A). The attestation must state that the ESRD facility qualifies as a low-volume facility in accordance with 42 CFR §413.232 as described above. Specifically, the attestation states that the ESRD facility was low- volume for the first 2 eligibility years and that they will be for the third eligibility year, that is, the cost reporting period ending in the year that immediately precedes the payment year. In most cases, the A/B MACs (A) will not have received the third eligibility year’s cost report and will rely on the attestation in order to allow the application of the adjustment. November 1st of each year is the mandatory deadline for the submission of attestations for ESRD facilities that believe they are eligible to receive the low-volume payment adjustment. If the ESRD facility qualifies for LVPA based on the three prior years (i.e., the treatment counts in each of the three cost reports) then it will receive the LVPA adjustment in that 4th year, which is the payment year. Should the facility exceed the 4,000 treatment count in that payment year, it will qualify for the full LVPA adjustment during the entire payment year; however, the facility will not qualify for three subsequent payment years. Beginning January 1, 2019, ESRD facilities may request an extraordinary circumstance exception to the November 1 deadline. In order to request an extraordinary circumstance exception, the facility is required to submit a narrative explaining the rationale for the exception to their MAC. The MAC will evaluate the narrative to determine if an exception is justified. The determination will be final, with no appeal. However, for new or resubmitted attestations applicable to payment years 2011 to 2015, to allow A/B MACs (A) and facilities adequate time to review policy clarifications related to the low volume adjustment, the attestation deadline was extended to December 31, 2014. For attestations applicable to payment year 2016, the attestation deadline was extended to December 31, 2015, to allow A/B MACs (A) and facilities adequate time to review policy changes finalized in the CY 2016 ESRD PPS final rule. The attestation deadline for payment year 2021 was extended until December 31, 2020, due to the extraordinary circumstance of COVID-19 for all ESRD facilities requesting the LVPA. A/B MACs (A) have a maximum of 60 days to verify attestations for implementation of the low-volume adjustment beginning January 1 of the following payment year. A/B MACs (A) shall notify the ESRD facilities no later than September 1 of each year that they need to submit the low-volume attestation no later than November 1 of each year in order to receive the adjustment the following payment year. A/B MACs (A) may not accept attestations submitted after the mandatory deadline. If an ESRD facility is receiving the low-volume payment adjustment and will qualify for the adjustment in the subsequent payment year they must submit another attestation. If the ESRD facility does not submit an attestation, the A/B MAC (A) should no longer apply the low-volume payment adjustment beginning January 1 of the next payment year and the ESRD facility cannot receive the low-volume payment adjustment until the following payment year. An ESRD facility should notify its A/B MAC if it determines that it did not maintain low-volume status for its cost reporting period ending immediately preceding the payment year or if it finds that it will not remain low-volume for any subsequent cost reporting year. The A/B MAC (A) is responsible to reconcile incorrect payments made to ESRD facilities retroactively, if needed, to ensure overpayments have not been made. If an A/B MAC (A) determines that an ESRD facility has received the low-volume adjustment in error, the A/B MAC (A) is required to adjust all of the ESRD facility’s affected claims to remove the adjustment within 6 months of finding the error. The A/B MAC (A) shall: • Recoup low-volume adjustment payments made to an ESRD facility that failed to meet the low-volume adjustment criteria defined in 42 CFR §413.232(b)(1). Recoupment shall occur when the A/B MAC (A) receives the as-filed cost report for the third eligibility year and finds that the ESRD facility did not meet the eligibility criteria. Recoupment shall also occur if any cost reports used for eligibility are subsequently found to have not met the low-volume criteria, for example, reopening or appeals. A/B MACs (A) shall reprocess claims paid during the payment year in which the ESRD facility incorrectly received the low- volume payment adjustment. Recoup low-volume adjustment payments made to an ESRD facility that failed to meet the low-volume adjustment criteria defined in 42 CFR §413.232(b)(2). A/B MACs (A) shall use PECOS (or most recent Medicare enrollment system) to locate the ESRD facility’s ownership information at the time of verification to determine if the ESRD facility is in the process of a CHOW. A/B MACs (A) shall use the current owner provided in PECOS. If the ESRD facility was in the process of a CHOW, recoupment shall occur when the CHOW is effective and the new owner is assigned a new provider number. A/B MACs(A) shall reprocess claims paid during the payment year in which the ESRD facility incorrectly received the low-volume payment adjustment. If an ESRD facility does not remain low-volume for each of the 3 years (described above in §60.B.1.a) immediately preceding the payment year, the ESRD facility cannot be eligible for the adjustment until it can demonstrate again that for 3 years it has met the low-volume criteria. Example - Provider 21-25XX is an independent ESRD facility that has a June 30th cost report year end. The ESRD facility concluded in October 2010 that it met the criteria of a low- volume facility. For its cost reporting periods, 7/1/2007 – 6/30/2008, 7/1/2008 – 6/30/2009, and 7/1/2009 – 6/30/2010, it did not open, close, or have a change of ownership and furnished less than 4,000 dialysis treatments in each of those cost reporting periods. In October 2010, the ESRD facility sent its A/B MAC (A) an attestation stating that it believes that it meets the low-volume criteria and would like to begin to receive the low-volume adjustment. The A/B MAC (A) receives the attestation on November 1st and then has 60 days (that is, until December 30th) to verify if the ESRD facility qualifies as a low-volume facility. On December 28th the A/B MAC (A) was able to verify that provider 21-25XX met the criteria and allowed for the adjustment to be applied to each dialysis treatment the ESRD facility furnished beginning January 1, 2011. Determining Low-Volume Eligibility in Hospitals with Multiple Subunits and Satellites A hospital may be affiliated with multiple hospital-based ESRD facilities. In addition, an individual hospital-based ESRD facility may have several locations that are subsumed under it, billing under the same ESRD facility provider number. Verification of an ESRD facility’s low-volume status is based on the A/B MAC’s (A) review of the total treatment count on an ESRD facility’s (or a hospital’s) cost report. In the situation where a hospital has multiple locations of a hospital-based ESRD facility under its governing body, the aggregate cost and treatment data of all of the locations (not just the treatment count of one of the subunits or satellite entities) are reported on the hospital’s cost report I series. In the case where a hospital has multiple locations and treatment counts are aggregated in the hospital’s cost report, the A/B MAC (A) may consider other supporting documentation which may include individual facility treatment counts, rather than the hospital’s cost report alone. The hospital must provide the documentation to support the total treatment count for all the facilities that make up the total treatment count on the cost report for the A/B MAC (A) to review, even if not all the facilities are applying for the low volume adjustment. LVPA Eligibility for Cost Reporting Periods Ending in 2020 For ESRD facilities that have an increase in their treatment counts for cost reporting periods ending in 2020 that are COVID-related such that the increase prevents them from qualifying for the LVPA, CMS will hold these facilities harmless from losing the LVPA. For purposes of determining LVPA eligibility for payment years 2021, 2022, and 2023, CMS will only consider total dialysis treatments furnished for any 6 months of a facility’s cost-reporting period ending in 2020; ESRD facilities will select those 6 months (consecutive or nonconsecutive) during which treatments will be counted for purposes of the LVPA determination. ESRD facilities will attest that their total dialysis treatments for those 6 months of their cost-reporting period ending in 2020 are less than 2,000 and that, although the total number of treatments furnished in the entire year otherwise exceeded the LVPA threshold, the excess treatments furnished were due to temporary patient shifting resulting from the COVID–19 PHE. MACs will annualize the total dialysis treatments for the total treatments reported in those 6 months by multiplying by 2. ESRD facilities will be expected to provide supporting documentation to the MACs upon request. c. LVPA Emergency Provisions Beginning January 1, 2024, ESRD facilities that are affected by disasters and other emergencies may qualify for exceptions to certain eligibility requirements for the LVPA. These exceptions affect both an ESRD facility that closes as a result of a disaster or other emergency, along with a facility that surpasses the LVPA treatment threshold eligibility requirement due to treating patients with ESRD who are displaced from their usual ESRD facility because of the disaster or other emergency. First, an ESRD facility may request an exception to the eligibility requirement at 42 CFR § 413.232(b)(2). This exception would allow the ESRD facility to close and reopen in response to a disaster or other emergency and still receive the LVPA. If an ESRD facility is affected by a disaster or other emergency and the ESRD facility closes and re-opens later, the ESRD facility must request an exception from CMS in writing in order to continue to be eligible for the LVPA. Written requests must be sent to the ESRD Payment Mailbox (ESRDPAYMENT@cms.hhs.gov) within 60 days of the facility’s closure. Additionally, the ESRD facility must inform the MAC of the request. CMS will review the request within 30 days of receipt and either approve the request based on a determination that the ESRD facility closed due to a disaster or other emergency, or deny the request, and would inform both the ESRD facility and the MAC of its decision. Second, an ESRD facility may request an exception to the eligibility requirement at 42 CFR § 413.232(b)(1). This exception would allow the ESRD facility to receive the LVPA even if it exceeds the LVPA treatment volume threshold (i.e., 4,000 treatments) if its treatment count increases due to temporary patient shifting due to a disaster or other emergency. For the purposes of this exception, temporary patient shifting is defined as providing renal dialysis services to one or more patient(s) at any time through the end of the calendar year following the 12-month period. This 12-month period begins on the date the accepting ESRD facility first begins providing renal dialysis services to the displaced patient(s). The accepting ESRD facility must submit to CMS a written request for this exception. These written requests must be sent to the ESRD Payment Mailbox (ESRDPAYMENT@cms.hhs.gov) no later than the annual attestation deadline of November 1st or 30 days after the end of the cost reporting year for which the ESRD facility is attesting, whichever is later. In addition, the accepting ESRD facility must attest to its MAC that it furnished treatments equal to or in excess of 4,000 in the cost reporting year due to temporary patient-shifting as a result of the closure or operational disruption of an ESRD facility due to a disaster or other emergency. CMS will review the exception request and notify the ESRD facility and the MAC within 30 days if the ESRD facility qualifies for the exception. If CMS approves the request, the ESRD facility is paid the low-volume adjustment on claims for Medicare beneficiaries, on the basis of the exception during the payment year in which the temporary patient-shifting occurred, so long as all other requirements for the low-volume adjustment are met. For any future payment year, the ESRD facility would not be prevented from receiving the low-volume adjustment if the ESRD facility meets or exceeds the 4,000 treatment threshold in a cost reporting year due to temporary patient-shifting as a result of the disaster or other emergency that resulted in another ESRD facility’s closure or operational disruption, so long as all other requirements for the low- volume adjustment are met. These exceptions are set forth at 42 CFR §§ 413.232(g)(5) and (g)(6). 2. Wage index The wage index adjustment is applied when calculating the ESRD PPS payment in order to account for geographic differences in area wage levels. Each ESRD facility‘s payment is adjusted using the wage index for the CBSA in which the ESRD facility is located. Rural ESRD facilities use the statewide average. The wage index values and the budget neutrality adjustment factor are updated during rulemaking, are issued via annual Recurring Update Notifications, and are posted on the ESRD Payment Webpage. Prior to 2025, the ESRD PPS used the wage index calculated based on data collected from CMS-certified hospitals nationwide for purposes of the acute care hospital inpatient prospective payment system (IPPS). CMS used the IPPS wage index values for each CBSA prior to the application of certain adjustments and modifications applicable to hospitals under the IPPS (i.e., the pre-floor, pre-reclassification wage index). When this IPPS-based wage index was in use, CMS also adopted methodologies for calculating wage index values for ESRD facilities that are located in urban and rural areas where there is no hospital data. For urban areas with no hospital data, CMS computed the average wage index value of all urban areas within the state to serve as a reasonable proxy for the wage index of that urban CBSA, that is, CMS used that value as the wage index. For rural areas with no hospital data, CMS computed the wage index using the average wage index values from all contiguous CBSAs to represent a reasonable proxy for that rural area. For a full discussion, see CY 2011 and CY 2012 ESRD PPS final rules at 75 FR 49116 through 49117 and 76 FR 70239 through 70241, respectively. For CY 2021, CMS adopted the CBSA delineations as described in the September 14, 2018 Office of Management and Budget (OMB) Bulletin No. 18-04. As a result, several counties now have new CBSA numbers. In addition, CMS applied a 5 percent cap on any decrease in an ESRD facility’s wage index from the ESRD facility’s final wage index in CY 2020. This transition was phased in over 2 years, where the reduction in an ESRD facility’s wage index was capped at 5 percent in CY 2021 (that is, no cap would be applied to the reduction in the wage index for the second year (CY 2022)). These policies were applied budget neutrally and incorporated into the overall ESRD PPS wage index budget neutrality adjustment. In the CY 2023 ESRD PPS final rule CMS finalized making the 5 percent cap on decreases in wage index permanent. This rule also finalized a wage index floor of 0.600. These policies are applied budget neutrally and incorporated into the overall ESRD PPS wage index budget neutrality adjustment. Beginning for CY 2025 the ESRD PPS uses a new wage index methodology, which uses data from the Bureau of Labor Statistics (BLS) Occupational Employment Wages & Statistics (OEWS). The new methodology uses mean hourly wage data from BLS OEWS data, which is then weighted by a national ESRD facility occupational mix derived from freestanding ESRD facility cost report data. The BLS OEWS wage data includes data from freestanding ESRD facilities and similar care locations, whereas the prior ESRD PPS wage index methodology was based on the IPPS wage index, which is derived from inpatient acute care hospital data. CMS still applies the wage index floor of 0.600 and the 5 percent cap on wage index decreases finalized in CY 2023. For CY 2025, CMS adopted the most recent CBSA delineations as described in the July 21, 2023, OMB Bulletin No. 23-01. As a result, several counties now have new CBSA numbers. ESRD facilities may confirm their CBSA delineation status and wage index value on the CMS website at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ESRDpayment/End-Stage-Renal- Disease-ESRD-Payment-Regulations-and-Notices. 3. Rural adjustment Beginning January 1, 2016, the ESRD PPS provides a 1.008 percent payment adjustment for ESRD facilities located in a rural CBSA. When CMS adopted the newest CBSA definitions according to OMB Bulletin 23-01, CMS also adopted a phase-out policy for ESRD facilities which were located in a rural CBSA in CY 2024 but were re- designated to an urban CBSA in CY 2025. These facilities, which would otherwise lose the rural adjustment for CY 2025 instead receive 2/3rd of the rural adjustment for 2025, a 1.0053 percent payment adjustment, and 1/3rd of the rural adjustment for 2026, a 1.0027 percent payment adjustment. 4. Non-Contiguous Areas Payment Adjustment Beginning January 1, 2026, ESRD facilities located in certain non-contiguous areas of the United States for which CMS has identified as having higher non-labor costs receive an increase to the non-labor portion of the ESRD PPS bundled payment. This increase is 1.21 for ESRD facilities in Hawaii and 1.25 for ESRD facilities in Alaska, Guam, American Samoa, and the Northern Marianas Islands. The non- labor related share of the ESRD PPS base rate is 44.8%. Below is an example calculation using the CY 2026 ESRD PPS final base rate of 281.71 for an ESRD facility in Alaska with a wage index of 1.0775: CY 2026 Base Rate: $281.71 Labor related share: 0.552 Non-labor related share: 0.448 Wage index: 1.0775 Alaska NAPA Factor: 1.25 Labor related portion: $281.71 * 0.552 * 1.0775 = $167.56 Non-labor related portion: $281.71 * 0.448 * 1.025 = $157.76 Wage-adjusted base rate: $167.56 + $157.76 = $325.32 The wage-adjusted base rate of $325.32 is the figure to which other case-mix and facility level adjustment factors would be applied. C. Add-On Payment Adjustments Payment amounts under the ESRD PPS are adjusted by several add-on payment adjustments as described below. 1. Training and Retraining Add-On Payment Adjustment A training add-on payment adjustment is available under the ESRD PPS. The training add-on payment is computed by using the national average hourly wage for nurses from the Bureau of Labor Statistics. The payment accounts for 1.5 hours of nursing time for each training treatment that is furnished and is adjusted by the geographic area wage index. The training add-on payment applies to both peritoneal dialysis and hemodialysis training treatments, and added to the ESRD PPS payment, when a training treatment is provided by a Medicare certified training ESRD facility. An ESRD facility may bill a maximum of 25 training sessions per patient for hemodialysis training, and 15 sessions for CCPD and CAPD training. ESRD facilities should not expect additional reimbursement beyond the maximum sessions. CMS expects that ESRD patients who opt for home dialysis are good candidates for home dialysis training and will successfully complete their method of training before reaching the maximum number of allotted training treatments. For more information regarding dialysis training, see §30.2 of this chapter. For more information regarding retraining, see §30.2.E of this chapter. Beginning for CY 2025, the training and retraining add-on payment adjustment is allowed for claims for renal dialysis services provided to AKI beneficiaries. This is the only add-on payment adjustment extended to AKI dialysis claims. 2. Outlier Payment The ESRD PPS provides additional payment for high cost outliers due to unusual variations in the type or amount of medically necessary care when applicable. Outlier payments are based on a comparison of the predicted Medicare allowable payment (MAP) per treatment to actual incurred expenditure per treatment for services that were or would have been considered separately billable prior to the implementation of the ESRD PPS. The ESRD PPS outlier policy is set forth at 42 CFR § 413.237. For more information regarding the ESRD outlier services included in the outlier calculation and an example of the outlier calculation, see §60.D of this chapter. 3. TDAPA The Transitional Drug Add-on Payment Adjustment (TDAPA) is an add-on payment adjustment for claims for services provided to patients who utilize certain new renal dialysis drugs and biological products. The TDAPA is set forth at 42 CFR § 413.234(c). The TDAPA is explained in further detail in §20.3.1 of this chapter. 4. TPNIES The Transitional Add-On Payment Adjustment for New and Innovative Equipment and Supplies (TPNIES) is an add-on payment adjustment for claims for services provided to patients who utilize certain new and innovative renal dialysis equipment and supplies. The TPNIES is set forth at 42 CFR § 413.236. The TPNIES is explained in further detail in §20.4.1 of this chapter. 5. Post-TDAPA Add-on Payment Adjustment The post-TDAPA add-on payment adjustment is an add-on payment adjustment for all ESRD PPS patients for 3 years following the end of the TDAPA period for certain renal dialysis drugs and biological products. The amount of the post-TDAPA add-on payment adjustment for a drug or biological product is calculated based on 65% of the total payment for that drug or biological product across the most recent available 12 months of claims data and is published in the annual ESRD PPS rule. The post-TDAPA add- on payment amount for a claim is adjusted by the patient-level case-mix adjusters described in §60.A of this chapter (for pediatric patients this includes the TPEAPA described below and in §60.C.6 of this chapter). The post-TDAPA add-on payment adjustment is only calculated for new renal dialysis drugs and biological products in existing ESRD PPS functional categories. The application of the post-TDAPA add-on payment adjustment is set forth at 42 CFR § 413.234(c)(3), and the methodology for calculating the post-TDAPA add-on payment adjustment is set forth at § 413.234(g). For drugs and biological products for which there is not 12 months of claims data available at the time of rulemaking, CMS publishes the post-TDAPA add-on payment adjustment amount in a change request 2 calendar quarters before the end of the TDAPA payment period for that drug or biological product. 6. TPEAPA The Transitional Pediatric ESRD Add-on Payment Adjustment (TPEAPA) is an add-on payment adjustment of 30 percent of the per-treatment payment amount applied to all claims for renal dialysis services provided to ESRD patients aged 18 or younger. The TPEAPA is 30 percent of the per-treatment payment amount for a patient, which reflects both the patient-level case mix adjusters, described in §60.A of this chapter, and the facility level adjusters, described in §60.B of this chapter, but does not include any of the other add-on payment adjustments described in this §60.C. The TPEAPA is a temporary adjustment, which is applied only for CYs 2024, 2025 and 2026. The TPEAPA is set forth at 413.235(b)(2). D. Outlier Policy The ESRD PPS provides additional payment for high cost outliers due to unusual variations in the type or amount of medically necessary care when applicable. Outlier payments are based on a comparison of the predicted Medicare allowable payment (MAP) per treatment to actual incurred expenditure per treatment for services which were or would have been considered separately billable prior to the implementation of the ESRD PPS. ESRD outlier services include: • Drugs and biological products used for the treatment of ESRD that were or would have been, prior to January 1, 2011, separately billable under Medicare Part B; • Laboratory tests used for the treatment of ESRD that were or would have been, prior to January 1, 2011, separately billable under Medicare Part B; • Medical or surgical supplies used to administer drugs and biological products used for the treatment of ESRD that were or would have been, prior to January 1, 2011, separately billable under Medicare Part B; and • Drugs and biological products used for the treatment of ESRD that were or would have been, prior to January 1, 2011, separately billable under Part D, including renal dialysis oral-only drugs effective January 1, 2025. • New and innovative renal dialysis equipment or supplies previously paid for using the TPNIES, regardless of whether the equipment or supply would have been separately billable prior to 2011 (excluding capital-related assets that are home dialysis machines). • Drugs and biological products that were historically included in the composite rate, as well as newer drugs and biological products that are currently included in the calculation of the post-TDAPA add-on payment adjustment. The list of renal dialysis services that are included as outlier services may be found at https://www.cms.gov/medicare/payment/prospective-payment-systems/end-stage-renal-disease- esrd/esrd-pps-outlier-services. NOTE: All renal dialysis service Part B drugs and biological products reported with a HCPCS code that is on the ASP List are included for outlier payments. The laboratory tests that comprise the AMCC panel do not qualify for an outlier payment, see §20.2.A for information regarding the 50/50 rule. ESRD facilities may receive outlier payments for the treatment of both adult and pediatric ESRD patients. An ESRD facility is eligible for an outlier payment if its actual or imputed MAP amount per treatment for ESRD outlier services exceeds a threshold. The MAP amount represents the average incurred amount per treatment for services that were or would have been considered separately billable services prior to January 1, 2011. The threshold is equal to the ESRD facility’s predicted ESRD outlier services MAP amount per treatment (which is case-mix adjusted) plus the fixed dollar loss (FDL) amount. In accordance with 42 CFR §413.237(c), facilities are paid 80 percent of the per treatment amount by which the imputed MAP amount for outlier services (that is, the actual incurred amount) exceeds this threshold. In the CY 2025 ESRD PPS final rule, CMS finalized a change that adds the case-mix adjusted post-TDAPA add-on payment adjustment amount to the predicted MAP for a patient. The MAP and FDL amounts are prospectively calculated each year with a target that outlier payments equal 1% of total ESRD PPS payments. For example, the average outlier services MAP amounts per treatment for pediatric and adult dialysis patients for CY 2026 were $50.19 and $23.68, respectively. After multiplication by applicable patient and facility specific adjusters to yield a predicted outlier services MAP amount, a fixed amount is added (the “fixed dollar loss” amount) to determine the outlier threshold. The fixed dollar loss amounts for CY 2026 were $162.43 for pediatric patients and $14.80 for adult patients. The CY 2026 values of the average outlier services MAP amount and the fixed dollar loss amount are used below for the purpose of following the outlier payment computation. These values may be revised as a result of subsequent rulemaking. In computing the MAP amount, the adjusters used are: Adult Characteristics Adjustment Value CY 2011- 2015 Beginning CY 2016 Age: 18-44 0.996 1.044 Age: 45-59 0.992 1.000 Age: 60-69 1.000 1.005 Age: 70-79 0.963 1.000 Age: 80+ 0.915 0.961 Body Surface Area 1.014 1.000 Low Body Mass Index (BMI <18.5) 1.078 1.090 Onset of Dialysis 1.450 1.409 Pericarditis 1.354 1.209 Bacterial pneumonia 1.422 --- Gastro-intestinal tract bleeding 1.571 1.426 Hereditary hemolytic or sickle cell anemia 1.225 1.999 Myelodysplastic syndrome 1.309 1.494 Monoclonal gammopathy 1.074 --- Low-volume facility adjustment (either tier) 0.975 0.955 Rural facility adjustment* --- 0.978 *For CY 2025 and 2026 ESRD facilities that were redesignated from rural to urban will receive 2/3rds and 1/3rd of the rural adjustment respectively. For the outlier services adjustment these values are 0.9853 for CY 2025 and 0.9927 for CY 2026. Pediatric Characteristics Adjustment Value CY 2011- 2015 Beginning CY 2016 Age: <13, Modality: PD 0.319 0.410 Age: <13, Modality: Hemo 1.185 1.406 Age: 13-17, Modality: PD 0.476 0.569 Age: 13-17, Modality: Hemo 1.459 1.494 Both the adult and pediatric CY 2016 separately billable case-mix adjusters are presented for the purpose of following the outlier payment computations shown below and may be revised as a result of subsequent rulemaking. 1. Outlier Payment Calculation The outlier payment computations use the case-mix adjusters for separately billable services. These adjusters are applied to the relevant outlier services MAP amount for either adult or pediatric patients discussed above to obtain the predicted MAP amount for outlier services, reflecting all patient-specific and any facility-specific adjustments. The following example shows how outlier payments are calculated under the ESRD PPS. For further information on the calculation of a patient’s BSA, see §60.A.1. The pricing amounts for laboratory services qualifying as outlier services are based on the Medicare Clinical Laboratory Fee Schedule. For injectable drugs and biological products, pricing is based on the latest available quarterly average sales price plus 6 percent (ASP + 6) methodology. For formerly Part D drugs with an injectable version, pricing is generally based on national average drug prices based on the Medicare Prescription Drug Plan Finder. For medical/surgical supplies, pricing is based on prices established by the local A/B MAC (A). For further information regarding A/B MAC (A) pricing of medical/surgical supplies, see Pub. 100- 04, chapter 8, §20.1. 2. Example of Outlier Payment The following is an example of the calculation of the outlier payment using rates effective January 1, 2026. John, a 68 year old male Medicare beneficiary, is 187.96 cm. in height and weighs 95 kg. John receives hemodialysis 3 times weekly. In January 2026, he was hospitalized for 4 days for a compound ankle fracture. During the hospitalization John did not undergo any dialysis treatments. After discharge John resumed his dialysis treatments but required additional laboratory testing and above-average doses of several injectable drugs, particularly EPO, to return his hemoglobin levels to the normal range. During January 2026, John received 9 hemodialysis treatments at his usual ESRD facility. The facility submitted a claim for eligible ESRD outlier services including drugs and biological products, laboratory tests, and supplies totaling $3,000.00. Begin by computing the predicted MAP amount per treatment based on the ESRD outlier services case-mix adjustment factors applicable to John. These factors are age and BSA. John’s BSA is 2.2161. Applying the ESRD outlier services multiplier from the table in §60.D for BSA, John’s ESRD outlier services payment multiplier for BSA is computed as follows: {1.000}{(2.2161-1.9)/0.1} = {1.000}{3.16135} = 1.000 Step 1: Determine the predicted, ESRD outlier services MAP amount using the product of all applicable case-mix adjusters. Using this calculated multiplier for BSA and the multiplier for age from the table in §60.D, John’s outlier services PM is calculated as: 1.005 * 1.000 = 1.005 As described in §60.C of this chapter, the (case-mix adjusted) post-TDAPA add-on payment adjustment amount is added to the predicted MAP for a patient. Supposing the post-TDAPA add-on payment adjustment amount for Q1 2025 is $0.50 and John’s applicable patient-level case-mix adjustment factors are age (1.070) and BSA ({1.032}{(2.2161-1.9)/0.1} = {1.032}{3.16135} = 1.105) the post-TDAPA add-on payment adjustment amount for John is $0.59 ($0.50*1.070*1.105). For CY 2026, the national average MAP amount per treatment for adult patients is $23.68. Therefore, the predicted MAP amount per treatment for John is: $23.68 * 1.005 + $0.59 = $24.39. Step 2: Determine the imputed average, per treatment, ESRD outlier services MAP amount based on utilization of all separately billable services on the monthly ESRD facility bill John’s imputed MAP amount per treatment is equal to the total amount of drugs and biological products, laboratory tests, and supplies submitted on the claim, divided by the number of treatments. This is calculated as: $3000.00 / 9 = $333.33. Step 3: Add the fixed dollar loss amount to the predicted, ESRD outlier services MAP amount Calculate the threshold per treatment by adding the CY 2026 FDL amount to the predicted MAP amount for John. The threshold amount for John is calculated to reflect the case-mix adjustments for age and BSA. Threshold = Predicted MAP amount ($24.39) + FDL ($14.80) = $39.19 Because John’s imputed MAP amount per treatment was $333.33, which exceeds the sum of the predicted MAP amount and FDL amount ($39.19), John’s ESRD facility is eligible for outlier payments. Step 4: Calculate outlier payment per treatment The outlier payments for John’s 9 treatments are calculated as the amount by which the imputed MAP amount exceeds the threshold, then multiplied by the 80 percent loss-sharing ratio. Imputed MAP amount minus Threshold: $333.33 - $39.19 = $294.14 Outlier payments per treatment: $294.14 * .80 = $235.31 Total outlier payments: $235.31 * 9 = $2117.79 E. Co-Insurance Eighty percent of the total ESRD PPS payment amount for renal dialysis services furnished by ESRD facilities to ESRD beneficiaries is paid by Medicare. ESRD beneficiaries are responsible for the remaining 20 percent after the deductible. Therefore, the beneficiary co-insurance amount under the ESRD PPS is 20 percent of the total ESRD PPS payment, which includes the ESRD PPS base rate and all applicable payment adjustments, including any applicable add-on payment adjustments such as the TPNIES and the TDAPA, any applicable training add-on amounts, and any applicable outlier payments. For example, under the ESRD PPS the patient’s co-insurance liability is based on the payment made to the ESRD facility and NOT on specific renal dialysis items and services. Therefore, any renal dialysis service drug or biological product or laboratory service furnished to a beneficiary would NOT require a separate co-insurance amount, because the renal dialysis service drug or biological product or laboratory service is included in the single payment made to the ESRD facility. In the event a claim is reprocessed and the amount that was paid to the ESRD facility changes, the ESRD facility is responsible for reconciling with the ESRD patient any overpayment or underpayment of co-insurance or deductible amounts paid to the ESRD facility.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26)

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) In accordance with 42 CFR §§ 413.89 and 413.178, bad debt payments are made for unpaid Medicare deductibles and co-insurance amounts for only those items and services associated with the composite rate that was in effect prior to the implementation of the ESRD PPS on January 1, 2011. That is, only the bad debt amounts associated with the composite rate portion of the single ESRD PPS bundled payment will be used to determine an ESRD facility’s allowable bad debt payments. The composite rate portion of the ESRD PPS payment includes drugs, biological products, and laboratory tests that were included in the composite rate and their substitutes which would have been included. A facility-specific composite cost percentage will be applied to the total bad debt amount associated with the ESRD PPS payment to compute the bad debt amount for only the composite rate services. Effective January 1, 2013, the cap on bad debt reimbursement is no longer applied. General requirements and policies for payment of bad debts attributable to unpaid Medicare deductibles and co-insurance are found in chapter 3 of the Provider Reimbursement Manual, Part 1(PRM) (CMS Pub. 15-1) and cost reporting worksheets and instructions in the PRM Part 2 (CMS Pub. 15-2).

(Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13) The implementation of the ESRD PPS does not have an effect on the 30 month coordination period and MSP rules. See Pub. 100-05, Chapter 2, §20 for the MSP and coordination of benefit provisions that are applicable to ESRD beneficiaries.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) On June 29, 2015, the Trade Preferences Extension Act of 2015 (TPEA) (Pub. L. 114-27) was enacted. In the TPEA, Congress amended the Social Security Act (the Act) to include coverage and provide for payment for dialysis furnished by an ESRD facility to an individual with AKI. Specifically, section 808(a) of the TPEA amended section 1861(s)(2)(F) of the Act by including coverage for renal dialysis services furnished on or after January 1, 2017, by a renal dialysis facility or provider of services currently paid under section 1881(b)(14) of the Act to an individual with AKI. In addition, section 808(b) of the TPEA amended section 1834 of the Act by adding a new subsection (r). Subsection (r)(1) of section 1834 of the Act provides that in the case of renal dialysis services (as defined in subparagraph (B) of section 1881(b)(14) of the Act) furnished under Part B by a renal dialysis facility or a provider of services paid under such section during a year (beginning with 2017) to an individual with AKI, the amount of payment under Part B for such services shall be the base rate for renal dialysis services determined for such year under such section, as adjusted by any applicable geographic adjustment applied under subparagraph (D)(iv)(II) of such section and may be adjusted by the Secretary (on a budget neutral basis for payments under section 1834(r)

(Rev. 240, Issued: 01-19-18, Effective: 01-01-17, Implementation: 02- 20-18) Section 1834(r)(2) of the Act defines “individual with acute kidney injury'' to mean an individual who has acute loss of renal function and does not receive renal dialysis services for which payment is made under section 1881(b)(14) of the Act.

(Rev. 240, Issued: 01-19-18, Effective: 01-01-17, Implementation: 02- 20-18) The payment rate for AKI Dialysis is the ESRD PPS per treatment base rate updated annually by the market basket, less the productivity adjustment and adjusted by any other adjustment factor applied to the ESRD PPS base rate.

(Rev. 240, Issued: 01-19-18, Effective: 01-01-17, Implementation: 02- 20- 18) The payment rate for AKI dialysis is adjusted by the geographic adjustment factor that is applied to the ESRD PPS base rate for a particular facility, which is the same wage index applied under the ESRD PPS.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Beginning for 2025 ESRD facilities are allowed to bill for the ESRD PPS home and self- dialysis training add-on payment adjustments on claims for renal dialysis services provided to AKI beneficiaries. For these beneficiaries, the add-on payment adjustment is applied in the same way as under the ESRD PPS, a payment of $95.60 multiplied by the ESRD facility’s wage index value, as described in §60.C of this chapter. As this adjustment is required to be extended in a budget neutral basis under section 1834(r) of the Act, we finalized a reduction that rounds to $0.00 per treatment to the AKI dialysis payment rate in the CY 2025 ESRD PPS final rule based on a calculation of estimated training payments. For more information, please see Pub 100-04 Chapter 8 § 40.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Drugs, biological products, laboratory services, and supplies that are considered to be renal dialysis services under the ESRD PPS as defined in 42 CFR § 413.171, are considered to be renal dialysis services for patients with AKI. As such, no separate payment would be made for renal dialysis drugs, biological products, laboratory services, and supplies that are included in the ESRD PPS base rate when they are furnished by an ESRD facility to an individual with AKI. Other items and services furnished to beneficiaries with AKI that are not considered to be renal dialysis services as defined in 42 CFR § 413.171, but that are related to their dialysis treatment as a result of their AKI and that an ESRD facility might furnish to a beneficiary with AKI, would be separately payable. In particular, an ESRD facility could seek separate payment for drugs, biological products, laboratory services, and supplies that ESRD facilities are certified to furnish and that would otherwise be furnished to a beneficiary with AKI in a hospital outpatient setting. Items and services included on the consolidated billing list are not separately payable for patients with AKI, except for items and services that are not considered included in the ESRD PPS base rate. All dialysis treatments, that is, hemodialysis and peritoneal dialysis, furnished to individuals with AKI in an ESRD facility will be paid the AKI dialysis payment rate. This includes any treatments that exceed the three times-weekly limitation applied to treatments furnished to ESRD beneficiaries. CMS expects that individuals with AKI will need renal dialysis services for a finite number of days since the intent of the dialysis for these patients is curative.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A. Dialysis Modality Beneficiaries with AKI can receive their dialysis via the most clinically appropriate in-facility modality. B. Uncompleted Dialysis Treatment Generally, CMS only pays for one treatment per day across all settings. However, similar to the policy applied under the ESRD PPS for treatments for patients with ESRD, in the interest of fairness and in accordance with Chapter 8, section 10.2 of the Medicare Claims Processing Manual, if a dialysis treatment is started, that is, a patient is connected to the machine and a dialyzer and blood lines are used, but the treatment is not completed for some unforeseen, but valid reason, for example, a medical emergency when the patient must be rushed to an emergency room, both the ESRD facility and the hospital would be paid. This is considered to be a rare occurrence that must be fully documented to the A/B MAC's satisfaction. C. Home and Self-Dialysis Due to the nature of AKI, dialysis treatments at home or self-dialysis in the dialysis facility are not permitted. Specifically, these patients require supervision by qualified staff during their dialysis and close monitoring through laboratory tests to ensure that they are receiving the necessary care to improve their condition and get off of dialysis. Therefore, the home dialysis benefit does not extend to beneficiaries with AKI. D. Vaccines and Their Administration Section 1881(b)(14)(B) of the Act specifically excludes vaccines covered under section 1861(s)(10) of the Act from the ESRD PPS. However, ESRD facilities are identified as an entity that can bill Medicare for vaccines and their administration. Therefore, ESRD facilities may furnish vaccines to beneficiaries with AKI and bill Medicare in accordance with billing requirements in the Medicare Claims Processing Manual (Pub. 100-04, Chapter 18 Preventive and Screening Services, section 10.2). The staff time associated with vaccine administration is covered in the AKI dialysis payment rate. E. Telehealth Since telehealth dialysis services are limited to renal dialysis services for home dialysis patients telehealth related to renal dialysis services is not available for beneficiaries with AKI. F. ESRD Conditions for Coverage (CfCs) The ESRD CfCs at 42 CFR part 494 are health and safety standards that all Medicare participating dialysis facilities must meet. These standards set baseline requirements for patient safety, infection control, care planning, staff qualifications, record keeping, and other matters to ensure that all patients, including ESRD and AKI patients, receive safe and appropriate care. Payment for Erythropoietin Stimulating Agents (ESAs) and the ESA Monitoring Policy for AKI Patients ESAs are included in the bundled payment amount for treatments administered to patients with AKI. The Non-ESRD HCPCS codes should be used (J0881, J0883, J0885, J0888, Q0138, Q5106) and reported using revenue code 0636. The ESA monitoring policy has not yet been extended to AKI patients receiving treatment in an ESRD facility. Since this policy is not applicable to these treatments, the value codes used to report hemoglobin and hematocrit levels are not required when billing for ESAs.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Beneficiaries with AKI can receive their dialysis via the most clinically appropriate modality.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Generally, CMS only pays for one treatment per day across all settings. However, similar to the policy applied under the ESRD PPS for treatments for patients with ESRD, if a dialysis treatment is started, that is, a patient is connected to the machine and a dialyzer and blood lines are used, but the treatment is not completed for some unforeseen, but valid reason, for example, a medical emergency when the patient must be rushed to an emergency room, both the ESRD facility and the hospital would be paid. This is considered to be a rare occurrence that must be fully documented to the A/B MAC’s satisfaction. Please see §50.A.6 of this chapter or Pub. 100-04 Chapter 8 §10.2 for additional information.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Beginning on January 1, 2025, the home dialysis benefit defined at 42 CFR § 410.52 will be extended to beneficiaries with AKI for both PD and HD. The payment amount for home dialysis for AKI beneficiaries will be the same as the payment amount for in-center dialysis for AKI beneficiaries, consistent with payment parity within the ESRD PPS (based on the ESRD PPS base rate adjusted for geographic area according to the wage index, described in §60.B.2 of this chapter). The ESRD PPS add-on payment adjustment for home and self-dialysis training will also be extended to AKI beneficiaries using a home modality, in the same amount as for patients with ESRD ($95.57). The limit for training treatments for PD and HD will be 15 and 25 per patient, respectively, excluding retraining sessions.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Section 1881(b)(14)(B) of the Act specifically excludes vaccines covered under section 1861(s)(10) of the Act from the ESRD PPS. However, ESRD facilities are identified as an entity that can bill Medicare for vaccines and their administration. Therefore, ESRD facilities may furnish vaccines to beneficiaries with AKI and bill Medicare in accordance with billing requirements in the Medicare Claims Processing Manual (Pub. 100-04, Chapter 18 Preventive and Screening Services, section 10.2). The staff time associated with vaccine administration is covered in the AKI dialysis payment rate.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Telehealth dialysis services are limited to renal dialysis services for home dialysis patients. See Pub. 100-04, Chapter 12 §190.3.4 for more information about telehealth services.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) The ESRD Facility CfCs at 42 CFR part 494 are health and safety standards that all Medicare participating dialysis facilities must meet. These standards set baseline requirements for patient safety, infection control, care planning, staff qualifications, record keeping, and other matters to ensure that all patients, including ESRD and AKI patients, receive safe and appropriate care.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) ESAs are included in the bundled payment amount for treatments administered to patients with AKI. The Non-ESRD HCPCS codes should be used (J0881, J0883, J0885, J0888, Q0138, Q5106) and reported using revenue code 0636.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) Regarding transitioning patients from AKI to ESRD, CMS maintains flexibility for physicians to determine when an AKI patient has regained kidney function, or whether the transition must be made to ESRD treatment. This is a medical decision that should be supported by laboratory tests and the withdrawal of dialysis to determine the extent of recovery of renal function. The goal of AKI treatment should be to have the kidneys return to normal functioning. Physicians complete the ESRD Medical Evidence Report for Medicare Entitlement and/or Patient Registration (CMS 2728, OMB No. 0938-0046) to formally transition the patient from AKI to ESRD for the purposes of registering the patient as an ESRD beneficiary and ensuring appropriate payment under the Medicare ESRD benefit.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) As of January 1, 2021, the TDAPA and TPNIES are payment policies under the ESRD PPS and are only applicable for ESRD beneficiaries; therefore, the TDAPA and TPNIES are not applicable to renal dialysis services provided to beneficiaries who have AKI.

(Rev. 240, Issued: 01-19-18, Effective: 01-01-17, Implementation: 02- 20-18) Physicians are able to bill separately for services provided to individuals with AKI. CMS expects providers to follow correct coding guidelines and use the appropriate HCPCS or CPT codes for the items and services provided to the patient. The following CPT codes are available for ESRD facilities and physician’s offices to use when billing for physicians’ services provided in either an ESRD facility (place of service 65) or a physician’s office (place of service 11): • 90935 - Hemodialysis procedure with single evaluation by a physician or other qualified health care professional; • 90937 - Hemodialysis procedure requiring repeated evaluation(s) with or without substantial revision of dialysis prescription; • 90945 - Dialysis procedure other than hemodialysis (eg, peritoneal dialysis, hemofiltration, or other continuous replacement therapies), with single evaluation by a physician or other qualified health care professional; • 90947 - Dialysis procedure other than hemodialysis (eg, peritoneal dialysis, hemofiltration, or other continuous renal replacement therapies) requiring repeated evaluations by a physician or other qualified health care professional, with or without substantial revision of dialysis prescription. Please note: this is not an exhaustive list – as indicated above, CMS expects facilities and physician’s offices to bill the appropriate codes.

(Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13)

(Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13)

(Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13) Appendix A (Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13) Composite Rate Tests for Hemodialysis, IPD, CCPD, and Hemofiltration (Items in bold are non composite rate test) Chemistry CPT Code Monthly Weekly 13 x Quarter Albumin 82040 X Alkaline Phosphates 84075 X ALT (SGPT) 84460 AST (SGOT) 84450 X Bilirubin, total 82247 Bilirubin, direct 82248 Calcium 82310 X Calcium ionized (billed with modifier CD or CE) 82330 X Calcium ionized (billed with modifier CF) 82330 X Chloride 82435 X Cholesterol 82465 CK, CPK 82550 CO2 (bicarbonate) 82374 X Creatinine 82565 X GGT 82977 Glucose 82947 LDH 83615 X Phosphorus 84100 X Potassium 84132 X Protein, total 84155 X Sodium 84295 Triglycerides 84478 Urea nitrogen (BUN) 84520 X Uric Acid 84550 Appendix B (Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13) Composite Rate Tests for CAPD (Items in bold are non composite rate test) Chemistry CPT Code Monthly Weekly 13 x Quarter Albumin 82040 X Alkaline Phosphatase 84075 X ALT (SGPT) 84460 AST (SGOT) 84450 X Bilirubin, total 82247 Bilirubin, direct 82248 Calcium 82310 X Calcium ionized (billed with modifier CD or CE) 82330 X Calcium ionized (billed with modifier CF) 82330 X Chloride 82435 Cholesterol 82465 CK, CPK 82550 CO2 (bicarbonate) 82374 X Creatinine 82565 X GGT 82977 Glucose 82947 LDH 83615 X Phosphorus 84100 X Potassium 84132 X Protein, total 84155 X Sodium 84295 X Triglycerides 84478 Urea nitrogen (BUN) 84520 X Uric Acid 84550 Appendix C (Rev. 171, Issued: 06-07-13, Effective: 01-01-11, Implementation: 09-09-13) Brief History of ESRD Composite Payment Rates for Outpatient Maintenance Dialysis Effective January 1, 2005, section 623 of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA) amended section 1881(b)(7) of the Act to require a 1.6 percent increase to the ESRD composite payment rate. The MMA also required a drug add-on adjustment to the composite payment rate to account for the difference between pre-MMA payments for separately billable drugs and payments based on revised drug pricing for 2005 which used average acquisition costs. For CY 2005, CMS computed a drug add-on adjustment of 8.7 percent. Effective January 1, 2006, section 5106 of the Deficit Reduction Act of 2005 amended section 1881(b)(12) of the Act to require a 1.6 percent increase to the ESRD composite payment rate. In addition, because the drug add-on adjustment is determined as a percentage of the composite payment rate, CMS must adjust the drug add-on adjustment to account for the 1.6 percent increase to the composite payment rate in order to ensure that the total dollars allocated from the drug add-on adjustment remains constant. The growth update to the drug add-on adjustment of 1.4 percent was unchanged; therefore the total drug add-on adjustment to the composite payment rate for 2006 was 14.5 percent. For dialysis services furnished on or after January 1, 2007 through March 31, 2007, the growth update to the drug add-on adjustment to the composite payment rate was 0.5 percent. As a result, the drug add-on adjustment to the composite payment rate for 2007 increased from 14.5 percent to 15.1 percent. For dialysis services furnished on or after April 1, 2007, section 103 of the Tax Relief and Health Care Act of 2006 amended section 1881(b)(12) of the Act to require a 1.6 percent increase to the ESRD composite payment rate. The effect of the 1.6 percent increase to the composite payment rate was a reduction in the drug add-on adjustment from 15.1 percent to 14.9 percent. Effective January 1, 2008, there was no increase to the composite payment rate however; the drug add-on adjustment to the composite payment rate was increased by a growth update of 0.5 percent. As a result, the drug add-on adjustment to the composite payment rate for CY 2008 increased from 14.9 percent to 15.5 percent. Effective January 1, 2009, section 153 of the Medicare Improvements for Patients and Providers Act of 2008 amended section 1881(b)(12) of the Social Security Act to require a 1 percent increase to the ESRD composite payment rate and that hospital-based ESRD facilities are paid the same composite payment rate as independent ESRD facilities. The effect of the 1 percent increase in the composite payment rate is a reduction in the drug add-on adjustment from 15.5 percent to 15.2 percent. Effective January 1, 2010, CMS continued to apply the growth update to the drug add-on adjustment to the composite payment rate, which was 0.percent. As a result, the drug add-on adjustment to the composite payment rate for 2010 was reduced from 15.2 to 15.0 percent. Also, as required by the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), CMS applied a 1.0 increase to the ESRD composite payment rate. Section 153 of the MIPPA amended section 1881(b)(12) of the Social Security Act to require a 4-year transition (phase-in) from the current composite payment system to the ESRD Prospective Payment System (PPS). Effective January 1, 2011, CMS continued to apply the growth update to the drug add-on adjustment to the composite payment rate portion of the blended payment rate, which was 0.percent. As a result, the drug add-on adjustment to the composite payment rate portion of the blended payment for 2010 is reduced from 15.0 to 14.7 percent. For a detailed description of the transition period, see §70 of this chapter. For further information on the drug add on amounts for CY 2012 and 2013, see the respective ESRD final rules. Effective 2014, the drug add-on will no longer be applied. Future updates will be issued via Recurring Update Notifications.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178, RDF-230 Introduction Kidney transplantation is the preferred form of treatment for patients with ESRD. Medicare has developed a method of payment for the variety of medical services required to support a kidney transplant program, including payment for Medicare’s share of the costs of kidney procurement. See 42 CFR § 413.400, et seq. for Medicare’s organ acquisition payment regulations. In addition, Medicare has developed coverage and payment criteria for medically necessary services provided to potential kidney donors and recipients. In some situations, these services are provided before the effective date of Medicare entitlement for the potential kidney transplant recipient. Medicare pays for the covered services provided to a Medicare patient who receives a kidney transplant from a living or deceased donor. Expenses in providing kidneys to a transplant hospital (TH) (a transplant program within a hospital that meets that meets Medicare conditions of participation) or organ procurement organization (OPO) are included in the TH’s living or deceased donor kidney acquisition cost center, or the OPO’s kidney acquisition cost center, respectively. To participate in the Medicare program, any TH or OPO must be a member of the Organ Procurement and Transplantation Network (OPTN). Hospitals are required to notify the OPO designated for their service areas of individuals whose death is imminent or who have died in the hospital (See 42 CFR § 482.45(a)(1) for notification requirements, and 42 CFR § 413.404, for rules pertaining to THs and OPOs in developing a living and deceased donor standard acquisition charge for organs.) See the OPTN Web site at https://optn.transplant.hrsa.gov/about/search-membership/ to search for transplant hospitals, including hospitals that have kidney transplant programs.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) A3-3178.1, RDF-231 After a patient is diagnosed as having ESRD, the physician should determine if the patient is suitable for kidney transplantation. If the patient is a suitable kidney transplant candidate, a living donor transplant is considered first because of the high success rate in comparison to a deceased donor transplant. Whether one or multiple potential donors are available, the following sections provide a general description of the usual course of events in preparation for a living donor kidney transplant.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) A3-3178.2, RDF-231 Those who are willing and medically able to donate a kidney are tested to determine whether they are of the same blood type as the recipient. After blood typing, the recipient and the donors are tissue typed. Only those candidates with blood and tissue types similar to the recipient are considered further. After tissue typing, those medically suitable donors are evaluated on physical, psychological, and social factors. Potential donors who remain after the above testing may be hospitalized for about two days for further evaluation using procedures not appropriately performed on outpatients. These procedures may include intravenous urography and renal arteriography. If the results of the above tests identify several suitable donors, the most suitable donor is selected, and arrangements are made for the transplant. At such time, the donor and recipient will enter the hospital to undergo the excision and transplantation, respectively. When tests do not identify an acceptable living donor, the patient is considered for a kidney transplant using a deceased donor and placed on hemo- or peritoneal dialysis, if this has not already proved necessary. If the ultimate goal is transplantation, the patient is registered with a registry for a kidney transplant.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.3 All hospital outpatient services provided to living donors and recipients in anticipation of a transplant during the pre-entitlement period and after entitlement, but prior to admission to the hospital for transplantation, are covered. Such services would include kidney recipient registration fees (see 42 CFR § 413.402(b)(6) for additional requirements related to registry fees), laboratory tests (including tissue typing of recipient and donors), and general medical evaluations of the recipient and the donor(s). Pretransplant physicians’ services are also covered.

(Rev. 13599, Issued: 01-30-26 , Effective: 05-01-26, Implementation: 05-01-26 ) A3-3178.4 The following rules apply to kidney transplant inpatient medical evaluations when the kidney recipient has Medicare entitlement or is in the pre-entitlement period. The pre- entitlement period is that period prior to the patient’s actual Medicare entitlement, during which services are furnished in anticipation of a transplant, after the patient has been diagnosed to have end stage renal disease. If the potential kidney recipient does not have Medicare entitlement, or is not in the pre-entitlement period, Medicare will not cover services rendered to the potential kidney recipient or to the living donor for medical evaluations.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.5, RDF-233.1 When a living donor is admitted to a hospital (before admission for excising the donor kidney) for a medical evaluation in anticipation of a kidney donation, all hospital and physicians’ services costs applicable to medical evaluation are considered kidney acquisition service costs. As such, the hospital statistics (charges, patient days, etc.) and the physicians’ charges should be treated in accordance with all other kidney acquisition service statistics, and the related costs are included in the Medicare hospital cost report for kidney acquisition. When the living donor subsequently enters the hospital for the actual excision, the hospital costs of services rendered to the donor will continue to be treated as kidney acquisition costs under Part A. However, at that point physician services are no longer considered kidney acquisition costs and are not reimbursable under Part A. Instead, during the living donor’s inpatient stay for the excision surgery and during any subsequent living donor inpatient stays resulting from a direct complication of the kidney donation, physician services are billed under Part B. They are billed in the normal manner but on the account of the Medicare transplant recipient at 100 percent of the fee schedule. Note that services furnished to living kidney donors are covered under the Medicare Beneficiary Identifier of the Medicare transplant recipient. Services listed in the following sections are also covered. However, they are not billed as such but become a part of the kidney acquisition costs and are included in the kidney acquisition cost center on the Medicare hospital cost report.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.6, RDF-233, RDF-233.2 When a potential kidney recipient is admitted to a hospital (before admission for the actual transplant) solely for a medical evaluation for an anticipated kidney transplant, all hospital and physicians’ services costs applicable to the anticipated transplant are considered kidney acquisition costs.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.7, RDF-233.3 When a potential kidney recipient is admitted to a hospital for a medical reason other than in anticipation of a transplant, but during the stay, a medical evaluation for an anticipated kidney transplant is performed, all hospital and physicians’ services costs applicable to the medical evaluation are considered kidney acquisition costs. Accordingly, those services will be treated the same as the services described in section 140.6. However, all hospital and physicians’ services applicable to the nontransplant related services (i.e., related to the medical services for which the patient was actually admitted) must not be included with kidney acquisition costs; instead the costs of such services must be billed in the same manner as any other inpatient service on the account of the recipient. These latter services may be billed to the Medicare program only if the recipient has actual Medicare entitlement.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.8, RDF-233.4 When the medical evaluation for a transplant is performed on the recipient or the living donor during the same inpatient stay in which the actual transplant occurs, all such services will be billed, and the costs will be accumulated in the normal manner. For example, all hospital services rendered to the donor will be considered kidney acquisition costs. However, all physicians’ services rendered to the living donor and all hospital and physicians’ services rendered to the recipient will be billed in the same manner as any other inpatient services on the account of the recipient.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) The term Medicare Beneficiary Identifier (MBI) is a general term describing a beneficiary's Medicare identification number. For purposes of this manual, Medicare beneficiary identifier references both the Health Insurance Claim Number (HICN) and the Medicare Beneficiary Identifier (MBI) for certain business areas that will continue to use the HICN as part of their processes. The donor of a kidney for a Medicare beneficiary transplant recipient is covered for an unlimited number of days of care in connection with the kidney removal operation. Days of inpatient hospital care used by the donor in connection with the kidney removal operation shall not be charged against either party’s utilization record. However, the program’s assumption of liability is limited to those donor expenses that are incurred directly in connection with the kidney donation. Coverage of kidney donor services includes postoperative recovery services directly related to the kidney donation. For routine follow-up care, the period of postoperative recovery ceases when the donor no longer exhibits symptoms related to the kidney donation. Claims for services rendered more than 3 months after donation surgery will be reviewed. However, follow-up examinations may be covered up to 6 months after the donation to monitor for possible complications. The requirement that additional payment cannot be made for services included in the donor’s kidney removal charge still applies. Regarding donor follow-up: Expenses incurred by the transplant hospital for routine donor follow-up care are included in the transplant hospital’s kidney acquisition cost center. Follow-up services performed by the operating physician are included in the 90-day global payment for the surgery. Beyond the 90-day global payment period, follow-up services are billed to Part B using the recipient’s MBI. Routine follow-up services billed to Medicare by a physician other than the operating physician for up to 3 months following donation surgery should be billed under the recipient’s MBI. Regarding donor complications: Expenses incurred for complications that arise with respect to the donor are covered only if they are directly attributable to the donation surgery. Complications that arise after the date of the donor’s discharge will be billed under the transplant recipient’s MBI. This is true of both facility cost and physician services. The Medicare Administrative Contractor reviews costs for kidney donor complications billed under the transplant recipient’s MBI. In all of these situations, the kidney donor is not responsible for co-insurance or deductible.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.11 If the transplant recipient has exhausted Part A benefits while the kidney donor still requires and receives inpatient hospital care, the program continues to pay for such donor care under Part A at 100 percent reimbursement.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.12 Costs incurred by the transplant hospital in connection with the acquisition of a deceased donor kidney are reimbursable by the program through the kidney acquisition cost center on the hospital’s Medicare cost report. Acquisition costs involved in procuring the deceased donor’s kidney are set forth in 42 CFR § 413.402(b) and include: (1) Tissue typing, including tissue typing furnished by independent laboratories. (2) Donor and beneficiary evaluation. (3) Other costs associated with excising organs, such as general routine and special care services (for example, intensive care unit or critical care unit services), provided to the living or deceased donor. (4) Operating room and other inpatient ancillary services applicable to the living or deceased donor. (5) Organ preservation and perfusion costs. (6) Organ Procurement and Transplantation Network registration fees, and the reasonable and necessary cost of other fees, such as the registration fees for a kidney paired exchange, to register candidates for organ transplants. These allowable registry fees must support or promote organ transplantation and must not be duplicative in nature. (7) Surgeons' fees for excising deceased organs (currently limited to $1,250 for kidneys). (8) Transportation of the: (i) Excised organ to the transplant hospital; and (ii) Deceased donor to procure organs when it is necessary to preserve clinical outcomes or to avoid loss of potentially transplantable organs. (9) Costs of organs acquired from other hospitals or organ procurement organizations. (10) Hospital costs normally classified as outpatient costs applicable to organ excisions (services include donor and recipient tissue typing, work-up, and related services furnished prior to inpatient admission). (11) Costs of services applicable to organ excisions which are rendered by residents and interns not in approved teaching programs. (12) All pre-admission services applicable to organ excisions, such as laboratory, electroencephalography, and the costs of physicians' services.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.13, RDF-232 When there is no suitable living donor, a patient with renal failure may be considered for a deceased donor transplant. In such cases, the services provided to recipients of “living donor” kidneys (i.e., tissue typing and other related tests) are also provided to potential recipients of deceased donor kidneys. However, because a kidney may not be available for a long period of time, additional services may be provided in the form of direct physician care for the patient’s renal condition, and certain tests may be performed on a regular basis to allow the physician to have current information regarding the status of the patient and their suitability for transplant. In addition, the number of mixed lymphocyte cultures which are prepared whenever a kidney is procured that may suit the recipient depends on the number of kidneys which become available for transplant.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.14 See section 140.17

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.15 When two kidneys are obtained from a deceased donor, and both kidneys are shipped to the same transplant hospital or OPO, the hospital should adjust its normal charges to reflect any increased perfusion, preservation, and shipping costs due to the additional kidney. On the other hand, when the kidneys are sent to separate organizations or transplant hospitals, the excising hospital should prorate its charges to the receiving organizations so that the total charges do not exceed the amount that would have been billed if one transplant hospital or OPO had received both kidneys. Under 42 CFR § 413.412(c), for Medicare cost allocation purposes, OPOs and THs count (1) En bloc kidneys procured and transplanted en bloc (two kidneys transplanted as one unit) as one total usable kidney. En bloc kidneys transplanted into a Medicare beneficiary count as one Medicare usable kidney. (2) En bloc kidneys procured en bloc but separated and transplanted into two different recipients as two total usable kidneys. For each kidney transplanted into a Medicare beneficiary, count each as one Medicare usable kidney.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.16 Typical provider costs involved in excising a deceased donor kidney whether or not it is eventually transplanted include: • Intensive care costs; • Surgeon’s services, anesthetist services, operating room, preservation supplies (perfusion materials and equipment), preservation technician’s services, donor evaluation and support, pathology, central exchange costs (transportation and packaging), and reasonable administration costs (overhead items).

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.17 Pursuant to 42 CFR § 413.402(d), the following represents some transplant related items and services that are not covered and for which no program payment can be made: (1) Items or services that are not related or reasonable to acquire a kidney for transplantation, non-allowable administrative and general costs, or costs that are not related to patient care, are not considered kidney acquisition costs. (2) Examples of items or services that are not kidney acquisition costs include, but are not limited to the following: • Kidney donor burial and funeral expenses; • Transportation costs of the deceased donor after kidney procurement for funeral services or for burial; • Transportation costs for a living kidney donor (including travel, room, and board expenses incurred by a living donor; • Fees or in-center payments for kidney donor referrals; • Costs associated with and incurred for OPO-sponsored seminars where continuing education credits are given and where the attendee is not on the OPO's staff (as described at § 486.326(b)); • Unreasonable costs incurred for administrator's duties associated with professional organizations; • Travel, room, and board expenses (to any transplant center) incurred by the recipient; and • Reimbursement for the kidney itself when the living donor or the deceased donor’s next of kin sells the kidney.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.18 A. Tissue Typing Tissue typing of the recipient, as well as tissue typing and tests to determine the suitability of a living donor or a deceased donor kidney, are covered as medical expenses, necessary for the treatment of an eligible recipient. The costs of these services are covered under the hospital insurance or medical insurance programs (Part B coverage after recipient has exhausted Part A), and are reflected in the kidney acquisition costs. B. Preservation Laboratories The services performed by preservation laboratories are medically necessary for the treatment of a beneficiary’s illness. A participating hospital is reimbursed for the reasonable cost of such services which its own laboratory performs or which the hospital purchases from a freestanding preservation laboratory or OPO. C. Registration Fees A participating hospital which expects to perform a kidney transplant will be reimbursed the reasonable cost for OPTN registration fees, and the reasonable and necessary cost of other fees, such as the registration fees for a kidney paired exchange, to register candidates for organ transplants. These allowable registry fees must support or promote organ transplantation and must not be duplicative in nature. (42 CFR § 413.402(b)(6)). The reasonable cost incurred is attributable to listing the patient and the patient’s blood characteristics with a professionally recognized organization that maintains a registry of potential transplant candidates, and which provides a regular listing of such patients to hospitals engaged in kidney procurement.

(Rev. 13599, Issued: 01-30-26, Effective: 05-01-26, Implementation: 05-01-26) A3-3178.19 The excising hospital plays an important part in the national organ procurement effort. Most of these hospitals are community hospitals and neither excise kidneys on a regular basis nor perform transplants. A hospital that excises but does not transplant kidneys must be certified to participate in the Medicare program. Where the hospital is not participating in the Medicare program, organs may be accepted from it only if they cannot be obtained from any other source. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R13599BP 01/30/2026 Update to Pub. 100-02, Chapter 11 End- Stage Renal Disease (ESRD) through Calendar Year (CY) 2026 05/01/2026 13944 R257BP 03/01/2019 Update to Publication 100-02 Provide Language-Only Changes for the New Medicare Card Project 04/01/2019 11170 R254BP 12/13/2018 Implementation of Changes in the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) and Payment for Dialysis Furnished for Acute Kidney Injury (AKI) in ESRD Facilities for Calendar Year (CY) 2019 01/07/2019 11021 R250BP 10/25/2018 Implementation of Changes in the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) and Payment for Dialysis Furnished for Acute Kidney Injury (AKI) in ESRD Facilities for Calendar Year (CY) 2019 01/07/2019 11021 R245BP 08/03/2018 System Changes to Implement Epoetin Alfa Biosimilar, Retacrit for End Stage Renal Disease (ESRD) and Acute Kidney Injury (AKI) Claims 01/07/2019 10839 R244BP 07/20/2018 Internet Only Manual (IOM) Update to Publication 100-02, Chapter 11 - End Stage Renal Disease (ESRD), Section 100 10/23/2018 10809 R240BP 01/19/2018 Internet Only Manual (IOM) Update to Pub. 100-02, Chapter 11 - End Stage Renal Disease (ESRD), Section 100 02/20/2018 10366 R224BP 06/03/2016 Update to Pub. 100-02, Chapter 11 End- Stage Renal Disease (ESRD) for Calendar Year (CY) 2016 09/06/2016 9541 R219BP 01/13/2016 Calendar Year (CY) 2016 Eligibility Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) Low-Volume Payment Adjustment (LVPA) 01/22/2016 9478 R218BP 01/08/2016 Calendar Year (CY) 2016 Eligibility Changes to the End-Stage Renal Disease (ESRD) Prospective Payment System (PPS) Low-Volume Payment Adjustment (LVPA) – Rescinded and replaced by Transmittal 219 01/22/2016 9478 R200BP 12/02/2014 Implementation of Changes in the End-Stage Renal Disease Prospective Payment System (ESRD PPS) for Calendar Year (CY) 2015 01/05/2015 8978 R199BP 11/14/2014 Implementation of Changes in the End-Stage Renal Disease Prospective Payment System (ESRD PPS) for Calendar Year (CY) 2015 – Rescinded and replaced by Transmittal 200 01/05/2015 8978 R197BP 10/24/2014 Clarification of the End Stage Renal Disease (ESRD) Prospective Payment System (PPS) Low Volume Adjustment 01/05/2015 8898 R195BP 10/102014 Clarification of the End Stage Renal Disease (ESRD) Prospective Payment System (PPS) Low Volume Adjustment – Rescinded and replaced by Transmittal 197 01/12/2015 8898 R177BP 12/13/2013 Implementation of Changes in the End-Stage Renal Disease Prospective Payment System (ESRD PPS) for Calendar Year (CY) 2014 01/06/2014 8472 R174BP 11/29/2013 Implementation of Changes in the End-Stage Renal Disease Prospective Payment System (ESRD PPS) for Calendar Year (CY) 2014 – Rescinded and replaced by Transmittal 177 01/06/2014 8472 R171BP 06/07/2013 Implementation of the End Stage Renal Disease (ESRD) Prospective Payment System (PPS) 09/09/2013 8261 R148BP 01/28/2011 Billing for Donor Post-Kidney Transplant Complication Services 04/02/2012 7523 R136BP 01/28/2011 Clarification of Existing Policy Regarding Items and Services Included Under End Stage Renal Disease (ESRD) Composite Payment Rate 02/25/2011 7312 R98BP 12/12/2008 Implementation of Changes in End Stage Renal Disease (ESRD) Payment for Calendar Year 2009 01/05/2009 6216 R83BP 02/15/2008 Clinical Lab: New Automated Test for the AMCC Panel Payment Algorithm 07/07/2008 5874 R67BP 03/09/2007 2007 Update to the End Stage Renal Disease Composite Payment Rates 04/02/2007 5535 R61BP 11/24/2006 Implementation of Changes in End Stage Renal Disease (ESRD) Payment for Calendar Year (CY) 2007 01/02/2007 5407 R50BP 06/02/2006 Immunosuppressive Therapy For Kidney Transplant 07/03/2006 4143 R44BP 02/10/2006 Update to the ESRD Composite Payment Rate 02/13/2006 4291 R35BP 06/03/2005 Automated Multi-Channel Chemistry (AMCC) for Continuous Ambulatory Peritoneal Dialysis (CAPD) and Non-CAPD Patients 07/05/2005 3802 R27BP 11/23/2004 New ESRD Composite Payment Rates Effective January 1, 2005 01/03/2005 3554 R08BP 03/05/2004 Policy Changes to Reflect Billing for Darbepoetin Alfa and Epoetin 04/05/2004 2984 R07BP 02/20/2004 Restoring Composite Rate Exceptions for Pediatric Facilities Under the ESRD Composite Rate System 04/01/2004 3119 R01BP 10/01/2003 Introduction to the Benefit Policy Manual N/A N/A Back to top of Chapter

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) The purpose of a Comprehensive Outpatient Rehabilitation Facility (CORF) is to permit the beneficiary to receive multidisciplinary rehabilitation services at a single location in a coordinated fashion. Section 1861(cc) of the Social Security Act specifies that no service may be covered as a CORF service if it would not be covered as an inpatient hospital service if provided to a hospital patient. This does not mean that the beneficiary requires a hospital level of care or meets other requirements unique to hospital care. This provision merely requires that the service, if otherwise covered, would be covered if provided in a hospital. CORF services are covered only if they relate directly to the rehabilitation for the treatment of injured, disabled, or sick patients. CORF services are not covered if not reasonable and medically necessary for the diagnosis, or treatment of illness, or injury, or to improve the function of a malformed body member. Thus, there must be potential for restoration or improvement of lost or impaired functions. For example, treatments involving repetitive exercises (i.e., maintenance programs, general conditioning or ambulation) that do not require the skilled services of physical therapists, occupational therapists, speech-language pathologists or respiratory therapists are not covered. Nonmedical personnel such as family members or exercise instructors could perform these activities in the patient’s residence. It is not reasonable and medically necessary for such activities to be performed in a CORF setting by CORF personnel. See 42CFR 410.100 and sections 20.1 and 20.2 of this chapter for the list of required and optional services provided in a CORF. CORF services do not include the following: a) provision of hyperbaric oxygen services, b) infusion therapy services, c) cardiac rehabilitation services, or d) diagnostic sleep studies. They do not meet the definition of a CORF services and/or they do not relate to the rehabilitation plan of treatment. These services, and other services not specifically listed as CORF services, may be covered under another Medicare benefit category, such as physician services, incident-to physician services, and diagnostic services. Physical therapy, occupational therapy, and speech-language pathology services may be furnished in the patient’s home, as CORF services, when payment for these therapy services is not otherwise made under the Medicare home health benefit. However, since the CORF premise is the primary location for furnishing these services, it is expected that a clear majority of the physical therapy, occupational therapy and speech-language pathology services delivered will be provided on the CORF premises for all CORF patients. In addition to the above noted services, which may be provided in the home, a single home environment evaluation visit is a covered CORF service if it is included in the rehabilitation plan of treatment. The patient must be present during the home environment evaluation that is performed by the physical therapist, occupational therapist, or speech-language pathologist, as appropriate. The patient’s presence is necessary to assess the patient’s current or future ability to function safely in the home environment and to determine the potential impact the home situation will have on the patient’s rehabilitation goals. Services provided under the “incident to” benefit may not be recognized as CORF services. Services furnished by CORF personnel, including registered nurses, physical therapists, occupational therapists, speech-language pathologists, respiratory therapists, social workers and psychologists are not considered as furnished incident-to physician services. The CORF physician must be present in the facility for a sufficient time to ensure that CORF services are provided in accordance with accepted principles of medical practice. All CORF services must be provided within acceptable professional standards and practice (§§42CFR485.70, and 410.100).

(Rev. 1, 10-01-03) A3-3180, CORF-250

(Rev. 255, Issued: 01-25-19, Effective: 01- 01- 19, Implementation: 02-26-19) Section 1861(cc) of the Act defines a CORF as a facility that is primarily engaged in providing outpatient rehabilitation to the injured and disabled or to patients recovering from illness. The CORF must provide the following core CORF services: a) CORF physicians’ services, b) physical therapy services, and c) social and/or psychological services. Physical therapy services should comprise a clear majority of the total CORF services provided when the CORF offers the three core CORF services. A physician must certify, as a condition of payment, that all CORF services are required because the individual needs skilled rehabilitation services. Skilled rehabilitation services are defined as services requiring the skills of physical therapists, speech-language pathologists or occupational therapists. In addition, respiratory therapists are recognized to provide skilled respiratory therapy services only under the CORF benefit. A CORF is recognized as a provider of rehabilitation services. It is paid under the physician fee schedule for all CORF services and items except for CORF physician services (which are administrative in nature), drugs and biologicals and durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). To participate in Medicare, a CORF must furnish at least the following: • CORF physicians’ services - includes professional services performed by a doctor of medicine or osteopathy legally authorized to practice medicine and surgery by the State in which he/she performs services. These services are administrative in nature, such as consultation with, and medical supervision of, CORF qualified personnel, patient case review conferences, utilization review, and review of the rehabilitation plan of treatment, as appropriate. The physician must ensure that CORF services are provided in accordance with accepted principles of medical practice, medical direction and medical supervision. Subsequent to completing a 1-year hospital internship, the physician must have completed at least 1-year of training in the medical management of patients requiring rehabilitative services (42CFR485.70) or at least 1 year of full-time or part-time experience in a rehabilitation setting providing physician services similar to those required in a rehabilitation facility. A physician who specializes only in pulmonary rehabilitation does not meet these requirements as he/she is not likely to have the experience needed to medically manage patients that need physical therapy, occupational therapy and speech-language pathology services. Diagnostic or therapeutic services provided to a CORF patient by the CORF physician or other physician are not CORF physician services. Such services are separately payable to the physician and not the CORF under the physician fee schedule at the non- facility payment amount. These services should be billed as if they were provided in the physician’s office. (See 42CFR410.100(a) and section 40.1.) • Physical therapy services - include testing, measurement, assessment and treatment of the function, or dysfunction, of the neuromuscular, musculoskeletal, cardiovascular and respiratory system, and establishment of a maintenance therapy program for an individual whose restoration potential has been reached (See 42CFR410.100(b) and section 40.2); and • Social and/or psychological services – are covered only if the patient’s physician or the CORF physician establishes that the services directly relate to the patient’s rehabilitation plan of treatment and are needed to achieve the goals in the rehabilitation plan of treatment. Social and/or psychological services include only those services that address the patient’s response and adjustment to the rehabilitation treatment plan; rate of improvement and progress towards the rehabilitation goals, or other services as they directly relate to the physical therapy, occupational therapy, speech-language pathology, or respiratory therapy plan of treatment being provided to the patient. CORF social and/or psychological services do not include services for mental health diagnoses (See 42CFR410.100(h) and section 40.7.) To receive Medicare payment for covered services, the CORF must have adequate space and equipment necessary for any of the services provided. Additionally, in order to accept a patient, the CORF must be able to provide all of the services required by the patient, as established in the rehabilitation plan of treatment. If the CORF does not have the necessary qualified personnel to provide the service(s), it must arrange for the service(s) to be provided at the CORF, as needed. Functional reporting is required on claims for CORF physical therapy, occupational therapy, and speech-language pathology services by section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012. (See 42CFR410.105 and 42CFR410.59, 60, and 62.) NOTE: Functional reporting and its associated documentation requirements are no longer applicable for claims or medical records for dates of service on and after January 1, 2019. See the NOTE at the beginning of subsection F in Section 30 below for more information. The CORF services are subject to the Medicare Part B deductible and coinsurance provisions. The CORF may bill the beneficiary only for the unmet portion of the deductible and 20 percent of the fee schedule amount for covered services.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) In addition to the three required core CORF services, the CORF may furnish any of the other covered and medically necessary items and services listed in §20.2. These optional services must directly relate to, and be consistent with, the rehabilitation plan of treatment, and must be necessary to achieve the patient’s rehabilitation goals. When a CORF provides occupational therapy, speech-language pathology and/or respiratory therapy services in addition to the required physical therapy services, the physical therapy services shall represent the predominate rehabilitation service provided. For discussion of payment rules see section 30.1. The CORF may provide any or all of the following rehabilitation services: • Occupational therapy - services include assessment of an individual’s level of independent functioning, selection and teaching of task-oriented therapeutic activities to restore sensory-integrative functions, teaching of compensatory techniques to permit an individual with a physical or cognitive impairment or limitation to engage in daily activities (See 42CFR410.100(c) and section 40.3); • Speech - Language pathology - services for the diagnosis and treatment of speech and language disorders that create difficulties in communication or dysphagia (swallowing difficulties). (See 42CFR410.100(d) and section 40.4); • Respiratory therapy - services includes only those services that can be appropriately provided to CORF patients by a qualified respiratory therapist (42CFR485.70(j)) under a physician-established respiratory therapy plan of treatment in accordance with current medical and clinical standards (See 42CFR410.100(e) and section 40.5); • Prosthetic and orthotic devices - includes testing, fitting, or training in the use of such devices (See 42CFR410.100(f) and (g) and section 40.6); • Nursing – includes nursing services (e.g., teaching self catheterization) that directly relate to and are specified in the rehabilitation plan of treatment, are necessary for the attainment of the rehabilitation goals and are provided by a registered nurse as defined in 42CFR485.70(h). (See 42CFR410.100(i) and section 40.8); • Drugs -and biologicals – which are not excluded from Part B payment, including those that are self-administered, specified at 42CFR410.29, however, there are no drugs identified which can be provided in a CORF (Calendar Year (CY) 2008 Physician Fee Schedule (PFS) Rule 72 FR 66293). (See 42CFR410.100(j) and section 40.9); • Supplies and Durable Medical Equipment (DME) – CORFs may not bill separately for the supplies they furnish except for those cast and splint supplies that are used in conjunction with the corresponding Current Procedural Terminology code. (See 42CFR410.100(k) and section 40.6); and • A single physical therapy, occupational therapy, or speech-language pathology home environment evaluation visit as appropriate – this includes evaluating the potential impact of the home environment on the rehabilitation goals (See 42CFR410.100(l) and section 40.10).

(Rev. 255, Issued: 01-25-19, Effective: 01- 01- 19, Implementation: 02-26-19) A. Place of Treatment In general, CORF services, except for physical therapy, occupational therapy, speech- language pathology services, and the single home environment evaluation, must be furnished on the premises of the CORF. Physical therapy, occupational therapy, and speech-language pathology services provided in the home are not covered as CORF services if payment for such services is made under the Medicare home health benefit. Although, physical therapy, occupational therapy, and speech-language pathology services can be furnished in the patient’s home, a majority of these services must be provided on the CORF premises for all CORF patients. A single, home environment evaluation visit is a covered CORF service if it is included in the physical therapy, occupational therapy or speech-language pathology plan of treatment. A CORF cannot provide items or services that are not included in the definition of CORF services at 42CFR410.100 other than vaccines (CY 2008 PFS Rule 72 FR 66293). Those services included in the definition of CORF services are covered only to the extent that they support or further the rehabilitation plan of treatment. B. Personnel Qualification Requirements Services must be furnished or supervised by qualified personnel in accordance with regulation 42CFR485.70. Payment for social and/or psychological services, nursing services and respiratory therapy services is made when provided as specified in sections 40.7, 40.8 and 40.5 respectively of this chapter, as appropriate. Determinations regarding whether services are furnished in accordance with the conditions of participation and under the supervision of qualified personnel as noted at section 20.2 are primarily the responsibility of the State survey agency responsible for survey and certification of the facility. If services are not being furnished or appropriately supervised by qualified personnel, the Medicare contractor will withhold payment until the matter is resolved, as appropriate. C. Services Furnished Under Arrangements Any CORF service defined in §§20 or 40 may be furnished under arrangement and must meet the requirements of Pub. 100-01 chapter 5, section 10.3. D. Referral for Treatment To become a patient of a CORF, the beneficiary must be under the care of a physician who certifies that the beneficiary needs skilled rehabilitation services. The referring physician must advise the CORF of the beneficiary’s medical history, current diagnosis and medical findings, desired rehabilitation goals, and any contraindications to specific activity or intensity of rehabilitation services. If the rehabilitation goals for physical therapy, occupational therapy, speech-language pathology or respiratory therapy services are not specified by the referring physician, the CORF physician must establish them. E. Plan of Treatment The CORF services must be furnished under a written rehabilitation plan of treatment established and signed by a physician who has recently evaluated the patient. It is expected that the physician will establish the rehabilitation plan of treatment in consultation with the physical therapist, occupational therapist or speech-language pathologist who will provide the actual therapy. The physician wholly establishes the respiratory therapy plan of treatment. The physician may be either a CORF physician or the patient’s referring physician if the physician provides a detailed rehabilitation plan of treatment that meets the following requirements. The rehabilitation plan of treatment must be established and signed by a physician prior to the commencement of treatment in the CORF setting and contain the diagnosis, the type, amount, frequency, and duration of skilled rehabilitation services to be performed, and the anticipated skilled rehabilitation goals. The services furnished under the rehabilitation plan of treatment must be reasonable and medically necessary and relate directly to the rehabilitation of injured, disabled, or sick patients. The skilled rehabilitation goals for physical therapy, occupational therapy, and speech-language pathology plans of treatment must be consistent with those used for the Functional reporting pursuant to 410.105(d). For related documentation requirements, see subsection F below. For more details on documentation requirements, refer to chapter 15, section 220.3, of this manual. NOTE: Functional reporting and documentation requirements are no longer applicable for claims for dates of service on and after January 1, 2019. For more information, refer to the NOTE in subsection F below. The CORF physician or the referring physician for physical therapy, occupational therapy and speech-language pathology services, must review the plan of treatment at least once every 90 days certifying that the patient needs or continues to need skilled rehabilitation services, the rehabilitation plan of treatment is being followed and that the patient is making progress in attaining the established rehabilitation goals. The 90-day period begins with the first day of rehabilitation therapy. For respiratory therapy services, the CORF physician or the patient’s referring physician must review the rehabilitation plan of treatment at least every 60 days. The 60-day period begins with the first day of respiratory therapy treatment. (For survey and certification the plan of treatment review must meet the requirements at 42CFR 485.58(b)). When the patient has reached a point where no further progress is being made toward one or more of the rehabilitation goals, or the skills of a therapist are no longer required, Medicare coverage ends with respect to that aspect of the rehabilitation plan of treatment. F. Functional Reporting and Documentation Requirements for Physical Therapy, Occupational Therapy, and Speech-language Pathology Services. NOTE: In the calendar year (CY) 2019 Physician Fee Schedule (PFS) final rule, CMS-1693- F, after consideration of stakeholder comments for burden reduction, a review of all of the requirements under section 3005(g) of Middle Class Tax Relief and Jobs Creation Act of 2012 (MCTRJCA), and in light of the statutory amendments to section 1833(g) of the Act, via section 50202 of Bipartisan Budget Act of 2018 to repeal the therapy caps, CMS concluded that continued collection of functional reporting data through the same or reduced format would not yield additional information to inform future analyses or to serve as a basis for reforms to the payment system for therapy services. To reduce the burden of reporting for providers of therapy services, the CY 2019 PFS final rule ended the requirements of reporting the functional limitation nonpayable HCPCS G-codes and severity modifiers on claims for therapy services and the associated documentation requirements in medical records, effective for dates of service on and after January 1, 2019. The rule also revised regulation text at 42 CFR 410.59, 410.60, 410.61, 410.62, 410.105, accordingly. The instructions below apply only to dates of service when the functional reporting requirements were effective, January 1, 2013 through December 31, 2018. Functional reporting is required on claims for CORF physical therapy, occupational therapy, and speech-language pathology services by section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012. (See 42CFR410.105 and 42CFR410.59, 60, and 62.) The regulations implementing Section 3005(g) of the MCTRJCA require that nonpayable G-codes and severity modifiers be used to report the functional status of CORF patients receiving physical therapy, occupational therapy, and speech-language pathology services. This functional reporting is required to be included on claims at the beginning of treatment/outset of therapy, at specified reporting intervals which are consistent with those for progress reporting, and at discharge from therapy. In addition, functional reporting is required when an evaluative procedure, including a re-evaluative one, is billed. The functional G-codes and severity modifiers used in reporting the patient’s functional status shall be documented in each patient’s medical record. Refer to chapter 15, section 220 of this manual for instructions on selecting and documenting these functional G-codes and severity modifiers in the patient’s medical record. For details about the functional reporting requirements for G-codes and severity modifiers on claims for therapy services, see Pub. 100-04, Medicare Claims Processing Manual, chapter 5, section 10.6.

(Rev. 255, Issued: 01-25-19, Effective: 01- 01- 19, Implementation: 02-26-19) The payment basis for CORF services is 80 percent of the lesser of: (1) the actual charge for the service or (2) the physician fee schedule amount for the service when the physician fee schedule establishes a payment amount for such service. Payment for CORF services under the physician fee schedule is made for physical therapy, occupational therapy, speech-language pathology and respiratory therapy services, as well as the nursing and social and/or psychological services, which are a part of, or directly relate to, the rehabilitation plan of treatment. Payment for covered durable medical equipment, orthotic and prosthetic (DMEPOS) devices and supplies provided by a CORF is based upon: the lesser of 80 percent of actual charges or the payment amount established under the DMEPOS fee schedule; or, the single payment amount established under the DMEPOS competitive bidding program, provided that payment for such an item is not included in the payment amount for other CORF services. If there is no fee schedule amount for a covered CORF item or service, payment should be based on the lesser of 80 percent of the actual charge for the service provided or an amount determined by the local Medicare contractor. The following conditions apply to CORF physical therapy, occupational therapy, and speech-language pathology services; • Claims must contain the required functional reporting. (Reference: Sections 42 CFR 410.105.) Refer to Pub. 100-04, Medicare Claims Processing Manual, chapter 5, section 10.6. NOTE: Functional reporting and documentation requirements are no longer applicable for claims for dates of service on and after January 1, 2019. For more information, refer to subsection F in section 30 above. • The functional reporting on claims must be consistent with the functional limitations identified as part of the patient’s therapy plan of care and expressed as part of the patient’s therapy goals; effective for claims with dates of service on and after January, 1, 2013. (Reference: 42 CFR 410.105.) See Pub. 100-04, Medicare Claims Processing Manual, chapter 5, section 10.6. NOTE: Functional reporting and documentation requirements are no longer applicable for claims for dates of service on and after January 1, 2019. For more information, refer to subsection F in section 30 above. • The National Provider Identifier (NPI) of the certifying physician identified for a CORF physical therapy, occupational therapy, and speech-language pathology plan of treatment must be included on the therapy claim. This requirement is effective for claims with dates of service on or after October 1, 2012. (See Pub. 100-04, Medicare Claims Processing Manual, chapter 5, section 10.3.) Payment for CORF social and/or psychological services is made under the physician fee schedule only for HCPCS code G0409, as appropriate, and only when billed using revenue codes 0560, 0569, 0910, 0911, 0914 and 0919. Payment for CORF respiratory therapy services is made under the physician fee schedule when provided by a respiratory therapist as defined at 42CFR485.70(j) and, only to the extent that these services support or are an adjunct to the rehabilitation plan of treatment, when billed using revenue codes 0410, 0412 and 0419. Separate payment is not made for diagnostic tests or for services related to physiologic monitoring services which are bundled into other respiratory therapy services appropriately performed by a respiratory therapist, such as HCPCS codes G0237, G0238 and G0239. Payment for CORF nursing services is made under the physician fee schedule only when provided by a registered nurse as defined at 42CFR485.70(h) for nursing services only to the extent that these services support or are an adjunct to the rehabilitation plan of treatment. In addition, payment for CORF nursing services is made only when provided by a registered nurse. HCPCS code G0128 is used to bill for these services and only with revenue codes 0550 and 0559. For specific payment requirements for CORF items and services see Pub. 100-04, Medicare Claims Processing Manual, Chapter 5, Part B Outpatient Rehabilitation and CORF/OPT Services.

(Rev. 1, 10-01-03) A3-3183, CORF-253

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) Certain administrative services provided by a qualified physician, as defined at 42CFR485.70(a), associated with the CORF are considered CORF physician services, which are not billable by the CORF. These services include administrative services provided by the physician associated with the CORF, such as: • consultation with and medical supervision of nonphysician staff, • team conferences, • case reviews, and • other facility medical and administration activities necessary to the provision of skilled rehabilitation services, and • Other services that directly relate to the rehabilitation plan of treatment. Examinations for the purpose of establishing and reviewing the rehabilitation plan of care that do not result in a billable service would also represent CORF physician services. Physicians’ diagnostic and therapeutic services (e.g., evaluation and management services, debridement, electrocardiography (ECG)), furnished to an individual CORF patient are not CORF physicians’ services. They are physician services and are billable to the Medicare contractor, as appropriate. The physician, not the CORF, bills for and is paid by Medicare for these services. The physician claim must be clearly annotated to show the CORF as the place of treatment, which is paid at the nonfacility physician fee schedule rate.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) A qualified physical therapist, as defined at 42CFR485.70(e), has the knowledge, training, and experience required to evaluate and reevaluate, as appropriate, a patient's level of function, determine whether a physical therapy program could reasonably be expected to improve, restore, or compensate for lost function, and recommend to the physician a plan of treatment. The skills of a qualified physical therapist are required to evaluate and reevaluate the patient's level of function and to develop, in consultation with the physician as appropriate, the physical therapy plan of treatment. A qualified physical therapist assistant (PTA), as defined at 42CFR485.70(e), functioning under the supervision of the qualified physical therapist may carry out certain procedures of the physical therapy plan of treatment, in accordance with applicable State laws. Only the physical therapist, not the PTA can conduct the discharge visit as this visit is viewed as the final assessment of the patient’s progress toward attaining the goals of the physical therapy plan of treatment. Physical therapy is not required to effect improvement or restoration of function when a patient suffers a temporary loss or reduction of function (e.g., temporary weakness resulting from prolonged bed rest after major abdominal surgery) that can reasonably be expected to improve spontaneously as the patient gradually resumes normal activities. Accordingly, physical therapy furnished in such situations is not considered reasonable and necessary for the treatment of the individual's illness or injury and the services are excluded from coverage. All therapy coverage and documentation guidelines (except for development of plan of treatment) noted in Pub. 100-02, Benefit Policy Manual, chapter 15, sections 220- 220.3(E) apply to the CORF setting. NOTE: Supervision of CORF physical therapy services requires that the physical therapist must be on the premises of the CORF or must be available to the physical therapy assistant through direct telecommunications for consultation and assistance during the CORF’s operating hours. (See 42CFR485.58(d)(6)).

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) Occupational therapy is a medically prescribed treatment to improve or restore functions that have been impaired by illness or injury or, when function has been permanently lost or reduced by illness or injury, to improve the individual's ability to perform those tasks required for independent functioning. Occupational therapy services are covered CORF services if physical therapy services are the predominate rehabilitation services provided in the CORF. A qualified occupational therapist, as defined at 42CFR485.70(c), has the knowledge, training, and experience required to evaluate and reevaluate a patient's level of function, determine whether an occupational therapy program could reasonably be expected to improve, restore, or compensate for lost function, and recommend to the physician a plan of treatment. The skills of a qualified occupational therapist are required to evaluate and reevaluate the patient's level of function and to develop, in consultation with the physician as appropriate, the occupational therapy plan of treatment. A qualified occupational therapy assistant, as defined at 42CFR485.70(c), functioning under the supervision of the qualified occupational therapist may also carry out various aspects, as appropriate, of the occupational therapy plan of treatment, in accordance with applicable State laws. Occupational therapist assistants are not allowed to conduct the discharge visit as this visit is viewed as the final assessment of the patient’s progress toward attaining the goals of the occupational therapy plan of treatment. NOTE: Supervision of CORF occupational therapy services requires that the occupational therapist either must be on the premises of the CORF or must be available to the occupational therapy assistant through direct telecommunications for consultation and assistance during the CORF’s operating hours. (See 42CFR485.58(d)(6)).

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) Services related to congenital speech difficulties, such as stuttering or lisping, are not covered. A qualified speech-language pathologist, as defined at 42CFR485.70(m), has the knowledge, training, and experience required to evaluate and reevaluate, as appropriate, a patient's level of function, determine whether a speech-language program could reasonably be expected to improve, restore, or compensate for lost function, and to recommend to the physician a plan of treatment. A qualified speech-language pathologist must evaluate and reevaluate the patient’s level of function to develop, in consultation with the physician as appropriate, the speech-language pathology plan of treatment. Speech-language pathology therapy services are covered CORF services if physical therapy services are the predominate rehabilitation services provided in the CORF.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) A respiratory therapy plan of treatment is wholly established and signed by the referring physician before the respiratory therapist initiates the actual treatment. A. Definition Respiratory therapy services include only those services that can be appropriately provided to CORF patients by a qualified respiratory therapist, as defined at 42CFR485.70(j), under a physician-established respiratory therapy plan of treatment. The facility physician must be present in the facility for a sufficient time to provide, in accordance with accepted principles of medical practice, medical direction, medical care services and consultation. Respiratory therapy services include the physiological monitoring necessary to furnish these services. Payment for these services is bundled into the payment for respiratory therapy services and is not payable separately. Diagnostic and other medical services provided in the CORF setting are not considered CORF services, and therefore may not be included in a respiratory therapy plan of treatment because these are covered under separate benefit categories. The respiratory therapist assesses the patient to determine the appropriateness of pursed lip breathing activity and may check the patient’s oxygen saturation level (via pulse oximetry). If appropriate, the respiratory therapist then provides the initial training in order to ensure that the patient can accurately perform the activity. The respiratory therapist may again check the patient’s oxygen saturation level, or perform peak respiratory flow, or check other respiratory parameters. These types of services are considered “physiological monitoring” and are bundled into the payment for HCPCS codes G0237, G0238 and G0239. Physiological monitoring also includes the provision of a 6-minute walk test that is typically conducted before the start of the patient’s respiratory therapy activities. The time to provide this walk “test” assessment is included as part of the HCPCS code G0238. When provided as part of a CORF respiratory therapy plan of treatment, payment for these monitoring activities is bundled into the payment for other services provided by the respiratory therapist, such as the three respiratory therapy specific G-codes. B. Guidelines for Applying Coverage Criteria There are some conditions for which respiratory therapy services may be indicated. However, respiratory therapy performed as part of a standard protocol without regard to the individual patient's actual condition, capacity for improving, and the need for such services as established, is not reasonable and medically necessary. All respiratory therapy services must meet the test of being “reasonable and medically necessary” pursuant to §1862(a)(1)(A) of the Act. Determinations of medical necessity are made based on local contractor decisions on a claim-by-claim basis. The three HCPCS codes G0237, G0238, and G0239 are specific to services provided under the respiratory therapy plan of treatment and, as such, are not designated as subject to the therapy caps. C. Patient Education Programs Instructing a patient in the use of equipment, breathing exercises, etc. may be considered reasonable and necessary to the patient's respiratory therapy plan of treatment and can usually be given to a patient during the course of treatment by the respiratory therapist. These educational instructions are bundled into the covered service and separate payment is not made.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) Prosthetic devices, other than dental devices and renal dialysis machines, are covered CORF services if they are included in the rehabilitation plan of treatment. Prosthetic devices (other than dental) are defined as devices that replace all or part of an internal body organ (including contiguous tissue), or which replace all or part of the function of a permanently inoperative or malfunctioning internal body organ. If the patient’s medical record, including the judgment of the physician, indicates the condition is of long and indefinite duration, the test of permanence is considered met. Coverage of a prosthetic device includes all services necessary for formulating its design, material, and component selection; measurement, fittings, static and dynamic alignments; and instructing the patient in its use. Such coverage is included as an integral part of the fabrication of the device. Orthotic devices include but are not limited to leg, arm, back, and neck splints or braces. They are rigid and semi-rigid devices supporting weak or deformed body members or restricting or eliminating motion in a diseased, dysfunctional, or injured body part. Elastic stockings, garter belts, and similar devices do not come within the scope of the definition of an orthotic or a device. Back braces include, but are not limited to, special corsets, e.g., sacroiliac, sacrolumbar, dorsolumbar corsets and belts. Examples of prosthetic devices include artificial legs and arms. Residual limb stockings and harnesses (including replacements) are also covered when these appliances are essential to the effective use of the artificial limb. In general, orthotics and prosthetics are covered when furnished in conjunction with a physician's service or on a physician's order. These devices are covered CORF services if included as part of the rehabilitation plan of treatment. The payment for an orthosis or prosthesis includes its design, materials, measurements, fabrications, testing, fitting, adjustments and training in the use of the device. Adjustments to an artificial limb or other appliance required by a change in the patient's condition are covered when ordered by the patient’s referring or CORF physician. Adjustments, repairs and replacements in these cases are covered even when the item had been in use before the beneficiary enrolled in Medicare Part B so long as the device continues to be medically required. CORFs may not bill separately for the supplies they furnish except for those cast and splint supplies that are used in conjunction with the corresponding Current Procedural Terminology code.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) Social and psychological services are covered CORF services if physical therapy services represent the predominate rehabilitation services provided in the CORF. Social and psychological services must be included as part of, or directly relate to, the rehabilitation plan of treatment. Social and psychological services must contribute to the improvement of the individual’s rehabilitation condition and may not relate to a mental health diagnosis. Social and psychological services include the assessment and treatment of a CORF patient’s mental health and emotional functioning and the response to, and rate of progress of the patient’s rehabilitation plan of treatment including physical therapy services, occupational therapy services, speech-language pathology services and respiratory therapy services. • CORF social and/or psychological covered services are the same, regardless of whether they are provided by a qualified social worker, as defined at 42CFR485.70(l), or a psychologist, as defined at 42CFR485.70(g). Therefore, a CORF may elect to provide these services when they are indicated. Qualifications for individuals providing CORF social and psychological services are, at a minimum, a Bachelors of Science Degree for a social worker and a Masters-level degree for a psychologist.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) CORF nursing services may only be provided by an individual meeting the qualifications of a registered nurse, as defined at 42CFR485.70(h). They must relate to, or be a part of, the rehabilitation plan of treatment. CORF nursing services must be reasonable and medically necessary and are provided as an adjunct to the rehabilitation plan of treatment. For example, a registered nurse may perform or instruct a patient, as appropriate, in the proper procedure of “in and out” urethral catheterization, tracheostomy tube suctioning, or the cleaning for ileostomy or colostomy bags. Nursing services may not substitute for or supplant the services of physical therapists, occupational therapists, speech-language pathologists and respiratory therapists, but instead must support or further the services and goals provided in the rehabilitation plan of treatment. CORF nursing services must be provided by a registered nurse and may only be coded as HCPCS code G0128 indicating that CORF “nursing services” were provided.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) There are no drugs and biologicals currently identified as appropriate for a therapy rehabilitation plan of treatment, CORFs may not submit claims for drugs and biologicals. If a drug or biological is identified in the future, the administration of such shall be consistent with the limitations established at 42CFR410.29.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) One single, home environment evaluation visit is a covered CORF service if it is included in the physical therapy, occupational therapy or speech-language pathology plan of treatment. The single home environment evaluation visit allows the evaluation of the patient in the home environment and the assessment of the potential impact on the patient’s rehabilitation goals. The purpose of the home environment evaluation is to permit the rehabilitation plan of treatment to be tailored to take into account the patient’s home environment. However, Medicare does not pay for physical alterations to the home that facilitates the patient’s rehabilitation. The patient must be present during the home environment evaluation visit, which must be performed by the physical therapist, occupational therapist or speech-language pathologist, as appropriate. The patient’s presence is necessary to fully evaluate the potential impact of the home situation on the rehabilitation goals as specified in the plan of treatment. The home environment evaluation visit is not covered as a routine service for all CORF patients. It is covered only if, in establishing or carrying out the physical therapy, occupational therapy, or speech-language pathology plan of treatment, there is a clear indication that the home environment might adversely affect the patient’s rehabilitation. Coverage is limited to the services of one professional, either a physical therapist, occupational therapist, or a speech-language pathologist who provides the therapy services established in the corresponding plan of treatment that identifies the necessity for the home environment evaluation visit.

(Rev. 111, Issued: 09-25-09; Effective Date: 07-07-08; Implementation Date: 10-26- 09) A CORF may provide pneumococcal pneumonia, influenza virus, and hepatitis B vaccines to its patients. While not included as a service under the CORF benefit, Medicare will make payment to the CORF for certain vaccines and their administration provided to CORF patients (CY 2008 PFS Rule 72 FR 66293). The following three vaccinations are covered in a CORF if a physician who is a doctor of medicine or osteopathy orders it for a CORF patient: • Pneumococcal pneumonia vaccine and its administration; • Hepatitis B vaccine and its administration furnished to a beneficiary who is at high or intermediate risk of contracting hepatitis B; and • Influenza virus vaccine and its administration Payment for covered pneumococcal pneumonia, influenza virus, and hepatitis B vaccines provided in the CORF setting is based on 95 percent of the average wholesale price. The CORF registered nurse provides administration of any of these vaccines using HCPCS codes G0008, G0009 or G0010 with payment based on CPT code 90471. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R255BP 01/25/2019 Updates to Reflect Removal of Functional Reporting Requirements and Therapy Provisions of the Bipartisan Budget Act of 2018 02/26/2019 11120 R165BP 12/21/2012 Implementing the Claims-Based Data Collection Requirement for Outpatient Therapy Services -- Section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012 01/07/2013 8005 R163BP 11/30/2012 Implementing the Claims-Based Data Collection Requirement for Outpatient Therapy Services -- Section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012 – Rescinded and replaced by Transmittal 165 01/07/2013 8005 R158BP 08/24/2012 Implementing the Claims-Based Data Collection Requirement for Outpatient Therapy Services -- Section 3005(g) of the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) of 2012 – Rescinded and replaced by Transmittal 163 01/07/2013 8005 R111BP 09/25/2009 Comprehensive Outpatient Rehabilitation Facility (CORF) Services 10/26/2009 6005 R21BP 09/24/2004 Medicare Comprehensive Outpatient Rehabilitation Facility Coverage 10/25/2004 3315 R1BP 10/01/2003 Introduction to the Benefit Policy Manual N/A N/A Back to top of Chapter

(Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18)

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Rural Health Clinics (RHCs) were established by the Rural Health Clinic Service Act of 1977 to address an inadequate supply of physicians serving Medicare beneficiaries in underserved rural areas, and to increase the utilization of nurse practitioners (NP) and physician assistants (PA) in these areas. RHCs have been eligible to participate in the Medicare program since March 1, 1978, and are paid an all-inclusive rate (AIR) for medically-necessary primary health services, and qualified preventive health services, furnished by an RHC practitioner. RHCs are defined in section 1861(aa)(2) of the Social Security Act (the Act) as facilities that are engaged primarily in providing services that are typically furnished in an outpatient clinic. RHC services are defined as: • Physician services; • Services and supplies furnished incident to a physician’s services; • NP, PA, certified nurse midwife (CNM), clinical psychologist (CP), clinical social worker (CSW), marriage and family therapist (MFT), and mental health counselor (MHC) services; and • Services and supplies furnished incident to an NP, PA, CNM, CP, MFT or MHC services. RHC services may also include nursing visits to patients confined to the home that are furnished by a registered professional nurse (RN) or a licensed professional nurse (LPN) when certain conditions are met. (See section 190 of this manual) To be eligible for certification as an RHC, a clinic must be located in a non-urbanized area, as determined by the U.S. Census Bureau, and in an area designated or certified within the previous 4 years by the Secretary, Health and Human Services (HHS), in any one of the four types of shortage area designations that are accepted for RHC certification. (See section 20 of this manual) In addition to the location requirements, an RHC must: • Employ an NP or PA; • Have an NP, PA, or CNM working at the clinic at least 50 percent of the time the clinic is operating as an RHC; • Directly furnish routine diagnostic and laboratory services; • Have arrangements with one or more hospitals to furnish medically necessary services that are not available at the RHC; • Have available drugs and biologicals necessary for the treatment of emergencies; • Meet all health and safety requirements; • Not be a rehabilitation agency or a facility that is primarily for mental health treatment; • Furnish onsite all of the following six laboratory tests: o Chemical examination of urine by stick or tablet method or both; o Hemoglobin or hematocrit; o Blood sugar; o Examination of stool specimens for occult blood; o Pregnancy tests; and o Primary culturing for transmittal to a certified laboratory. • Not be concurrently approved as an FQHC, and • Meet other applicable State and Federal requirements. RHCs can be either independent or provider-based. Independent RHCs are stand-alone or freestanding clinics and submit claims to a Medicare Administrative Contractor (A/B MAC). They are assigned a CMS Certification Number (CCN) in the range 3800-3974 or 8900-8999. Provider-based RHCs are an integral and subordinate part of a hospital (including a critical access hospital (CAH). They are assigned a CCN in the range 3400- 3499, 3975-3999, or 8500-8899. (NOTE: A provider-based CCN is not an indication that the RHC has met the qualifications for the special payment rules applicable to payment limits discussed in section 70.2 of this chapter.) The statutory requirements for RHCs are found in section 1861(aa) of the Act. The regulations pertaining to RHCs can be found at 42 CFR 405.2400 Subpart X and 42 CFR 491 Subpart A. For information on claims processing, see Pub. 100-04, Medicare Claims Processing Manual, chapter 9, http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/clm104c09.pdf For information on certification requirements, see Pub. 100-07, State Operations Manual, Chapter 2, and Appendix G, https://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/Downloads/som107c02.pdf

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Federally Qualified Health Centers (FQHCs) were established in 1990 by section 4161 of the Omnibus Budget Reconciliation Act (OBRA) of 1990 and were effective beginning on October 1, 1991. As with RHCs, they are also facilities that are primarily engaged in providing services that are typically furnished in an outpatient clinic. FQHCs were paid an AIR for primary health services and qualified preventive health services until October 1, 2014, when they began to transition to the FQHC prospective payment system (PPS). Beginning on January 1, 2016, all FQHCs are paid under the provisions of the FQHC PPS, as required by Section 10501(i)(3)(B) of the Affordable Care Act. FQHC services are defined as: • Physician services; • Services and supplies furnished incident to a physician’s services; • NP, PA, certified nurse midwife (CNM), clinical psychologist (CP), clinical social worker (CSW), marriage and family therapist (MFT), and mental health counselor (MHC) services; • Services and supplies furnished incident to an NP, PA, CNM, CP, MFT or MHC services; and • Outpatient diabetes self-management training (DSMT) and medical nutrition therapy (MNT) for beneficiaries with diabetes or renal disease. The statutory requirements that FQHCs must meet to qualify for the Medicare benefit are in section 1861(aa)(4) of the Act. No Part B deductible is applied to expenses for services that are payable under the FQHC benefit. An entity that qualifies as an FQHC is assigned a CCN in the range 1800-1989 and 1000-1199. FQHC services also include certain preventive primary health services. The law defines Medicare-covered preventive services provided by an FQHC as the preventive primary health services that an FQHC is required to provide under section 330 of the Public Health Service (PHS) Act. Medicare may not cover some of the preventive services that FQHCs provide, such as dental services, which are specifically excluded under Medicare law. There are 3 types of organizations that are eligible to enroll in Medicare as FQHCs: • Health Center Program Grantees: Organizations receiving grants under section 330 of the PHS Act, including Community Health Centers, Migrant Health Centers, Health Care for the Homeless Health Centers, and Public Housing Primary Care Centers; • Health Center Program Look-Alikes: Organizations that have been identified by HRSA as meeting the definition of “Health Center” under section 330 of the PHS Act, but not receiving grant funding under section 330; and • Outpatient health programs/facilities operated by a tribe or tribal organization (under the Indian Self-Determination Act) or by an urban Indian organization (under Title V of the Indian Health Care Improvement Act). NOTE: Information in this chapter applies to FQHCs that are Health Center Program Grantees and Health Center Program Look-Alikes. It does not necessarily apply to tribal or urban Indian FQHCs or grandfathered tribal FQHCs. An FQHC must: • Provide comprehensive services and have an ongoing quality assurance program; • Meet other health and safety requirements; • Not be concurrently approved as an RHC; and • Meet all requirements contained in section 330 of the Public Health Service Act, including: o Serve a designated Medically-Underserved Area (MUA) or Medically- Underserved Population (MUP); o Offer a sliding fee scale to persons with incomes below 200 percent of the federal poverty level; and o Be governed by a board of directors, of whom a majority of the members receive their care at the FQHC. Additional information on these and other section 330 requirements can be found at http://bphc.hrsa.gov/. Per 42 CFR 413.65(n), only FQHCs that were operating as provider-based clinics prior to 1995 and either a) received funds under section 330 of the PHS Act or b) were determined by CMS to meet the criteria to be a look-alike clinic, are eligible to be certified as provider-based FQHCs. Clinics that do not already have provider-based status as an FQHC are no longer permitted to receive the designation. For information on claims processing, see to Pub. 100-04, Medicare Claims Processing Manual, chapter 9, http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/clm104c09.pdf, and Pub. 100-07, State Operations Manual chapter 2, sections 2825 and 2826, http://www.cms.gov/Regulations- and-Guidance/Guidance/Manuals/downloads/som107c02.pdf.

(Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) To be eligible for certification as an RHC, a clinic must be located in 1) a non-urbanized area, as determined by the U.S. Census Bureau, and 2) an area designated or certified within the previous 4 years by the Secretary, HHS, in any one of the four types of shortage area designations that are accepted for RHC certification as listed in section 20.2. A clinic applying to become a Medicare-certified RHC must meet both the rural and underserved location requirements. Mobile clinics must have a fixed schedule that specifies the date and location for services, and each location must meet the location requirements. Existing RHCs are not currently required to continue to meet the location requirements. RHCs that plan to relocate or expand should contact their Regional Office (RO) to determine their location requirements. FQHCs may be located in rural or urban areas. FQHCs that are Health Center Program Grantees or Look-Alikes must be located in or serve people from a HRSA-designated MUA or MUP.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16) The U.S. Census Bureau determines if an area is an urbanized area (UA). Any area that is not in a UA is considered a non-urbanized area. A clinic located in an area that is not a UA would meet the RHC requirement for being in a non-urbanized area. Information on whether an area is in an urbanized area can be found at http://factfinder.census.gov; or http://www.raconline.org; or by contacting the appropriate CMS RO at http://www.cms.gov/RegionalOffices/.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16) The HRSA designates areas as MUAs/MUPs and/or Health Professional Shortage Areas (HPSAs). To be eligible for RHC certification, a clinic must be located in an area that has one of the following types of shortage area designations: • Geographic Primary Care HPSA; • Population-group Primary Care HPSA; • MUA (this does not include the population group MUP designation); or • Governor-Designated and Secretary-Certified Shortage Area (this does not include a Governor’s Medically Underserved Population designation). No other type of shortage area designation is accepted for purposes of RHC certification. The designation cannot be more than 4 years old in order to meet the requirement of being in a currently designated area. For RHC purposes, the age of the designation is calculated as the last day of the year 4 years from the date of the original designation, or the date the area was last designated. For example, a clinic that is located in an area that was most recently designated or updated on June 1, 2010, would be considered as meeting this location requirement through December 31, 2014. Areas that are listed as “proposed for withdrawal” are considered designated. The designation date is the date that the area was last updated, not when the area was proposed for withdrawal. To determine the designation date of an area that is listed as “proposed for withdrawal”, contact HRSA’s Shortage Designation Branch at sdb@hrsa.gov or call 1-888-275-4772.

(Rev. 166, Issued: 01-31-13, Effective: 03-01-13, Implementation: 03-01-13)

(Rev.12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) In addition to the location requirements, an RHC must: • Employ an NP or PA; and • Have an NP, PA, or CNM working at the clinic at least 50 percent of the time the clinic is operating as an RHC. The employment may be full or part time, and is evidenced by a W-2 form from the RHC. If another entity such as a hospital has 100 percent ownership of the RHC, the W- 2 form can be from that entity as long as all the non-physician practitioners employed in the RHC receive their W-2 from this owner. The following are examples of situations that would NOT satisfy the employment requirement: • An NP or PA who is employed by a hospital that has an ownership interest in the RHC but is not physically present and working in the RHC; • A CNM who is employed by the RHC; • An Advanced Practice Registered Nurse who is not an NP or PA; or • An NP or PA who is working as a substitute in an arrangement similar to a locum tenens physician. An RHC practitioner is a physician, NP, PA, CNM, CP, CSW, MFT or MHC. At least one of these practitioners must be present in the RHC and available to furnish patient care at all times the RHC is in operation. A clinic that is open solely to address administrative matters or to provide shelter from inclement weather is not considered to be in operation during this period and is not subject to the staffing requirements. An NP, PA, or CNM must be available to furnish patient care at least 50 percent of the time that the RHC is open to provide patient care. This requirement can be fulfilled through any combination of NPs, PAs, or CNMs as long as the total is at least 50 percent of the time the RHC is open to provide patient care. Only the time that an NP, PA, or CNM spends in the RHC, or the time spent directly furnishing patient care in another location as an RHC practitioner, is counted towards the 50 percent time. It does not include travel time to another location, or time spent not furnishing patient care when in another location outside the RHC (e.g. home, SNF, etc.). A clinic located on an island that otherwise meets the requirements for RHC certification is not required to employ an NP or PA, although it is still required to have an NP or PA at least 50 percent of the time that the RHC is in operation (OBRA ’89, Sec 4024). An island is a body of land completely surrounded by water, regardless of size and accessibility (e.g., bridges). As of July 1, 2014, RHCs may contract with non-physician practitioners (PAs, NPs, CNM, CPs or CSWs and MFTs and MHCs effective January 1, 2024) if at least one NP or PA is employed by the RHC (subject to the waiver provision for existing RHCs set forth at section 1861(aa)(7) of the Act). It is the responsibility of the RHC to assure that all staffing requirements are met and that RHC practitioners provide services in accordance with state and federal laws and regulations. See section 80.4 of this chapter for information on productivity standards for RHCs.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) An existing RHC may request a temporary staffing waiver if the RHC met the staffing requirements before seeking the waiver, and either or both of the following occur: • An NP or PA is not currently employed by the RHC. • An NP, PA, or CNM is not furnishing patient care at least 50 percent of the time the RHC operates. To receive a temporary staffing waiver, an RHC must demonstrate that it has made a good faith effort to recruit and retain the required practitioner(s) in the 90 day period prior to the waiver request. Recruitment activities should begin as soon as the RHC becomes aware that they will no longer be in compliance with this requirement. Good faith efforts can include activities such as advertising in an appropriate newspaper or professional journal, conducting outreach to an NP, PA, or CNM school, or other activities. Staffing waivers are for a period not to exceed 1 year. The waiver cannot be extended beyond 1 year, and another waiver cannot be granted until a minimum of 6 months have elapsed since the prior waiver expired. RHCs should continue their recruitment activities during the waiver period to avoid termination when the waiver period ends. An RHC will be terminated if any of the following occur: • The RHC does not meet the staffing requirements and does not request a temporary staffing waiver; • The RHC requests a temporary staffing waiver and the request is denied due to a lack of good faith effort to meet the requirements; • The RHC does not meet the staffing requirements and is not eligible for a temporary staffing waiver because less than 6 months have passed since the expiration of the previous waiver; • The RHC reaches the expiration date of the temporary staffing waiver and has not come into compliance; or • Other non-compliance issue.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) FQHCs must have a core staff of appropriately trained primary care practitioners and meet other clinical requirements. It is the responsibility of the FQHC to assure that all staffing requirements are met and that FQHC practitioners provide services in accordance with State and Federal laws and regulations. Additional information on FQHC staffing requirements can be found at: http://bphc.hrsa.gov/about/requirements/index.html.

(Rev.12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) An RHC or FQHC visit is a medically-necessary medical or mental health visit, or a qualified preventive health visit. The visit must be a face-to-face (one-on-one) encounter between the patient and a physician, NP, PA, CNM, CP, CSW, MFT or MHC during which time one or more RHC or FQHC services are rendered. Effective January 1, 2022, a mental health visit is a face-to-face encounter or an encounter furnished using interactive, real-time, audio and video telecommunications technology or audio-only interactions in cases where the patient is not capable of, or does not consent to, the use of video technology for the purposes of diagnosis, evaluation or treatment of a mental health disorder. A Transitional Care Management (TCM) service can also be an RHC or FQHC visit. Services furnished must be within the practitioner’s state scope of practice, and only services that require the skill level of the RHC or FQHC practitioner are considered RHC or FQHC visits. An RHC or FQHC visit can also be a visit between a home-bound patient and an RN or LPN under certain conditions. See section 190 of this chapter for information on visiting nursing services to home-bound patients. Under certain conditions, an FQHC visit also may be provided by qualified practitioners of outpatient DSMT and MNT when the FQHC meets the relevant program requirements for provision of these services. RHC and FQHC visits are typically evaluation and management (E/M) type of services or screenings for certain preventive services. A list of qualifying visits for FQHCs is located on the FQHC web page at https://www.cms.gov/Center/Provider-Type/Federally- Qualified-Health-Centers-FQHC-Center.html.

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) RHC or FQHC visits may take place in: • the RHC or FQHC, • the patient’s residence (including an assisted living facility), • a Medicare-covered Part A SNF (see Pub. 100-04, Medicare Claims Processing Manual, chapter 6, section 20.1.1), • the scene of an accident, or • the location of the patient during a Hospice election, including a patient’s residence or a Medicare certified facility RHC and FQHC visits may not take place in: • an inpatient or outpatient department of a hospital, including a CAH, or • a facility which has specific requirements that preclude RHC or FQHC visits (e.g., a Medicare comprehensive outpatient rehabilitation facility, a hospice facility (except when the RHC/FQHC is furnishing hospice attending physician services during a hospice election), etc.). Qualified services provided to a RHC or FQHC patient are considered RHC or FQHC services if: • the practitioner is compensated by the RHC or FQHC for the services provided; • the cost of the service is included in the RHC or FQHC cost report; and; • other requirements for furnishing services are met. This applies to full and part time practitioners, and it applies regardless of whether the practitioner is an employee of the RHC or FQHC, working under contract to the RHC or FQHC, or is compensated by the RHC or FQHC under another type of arrangement. RHCs and FQHCs should have clear policies regarding the provision of services in other locations and include this in a practitioner’s employment agreement or contract. RHCs and FQHCs providing RHC or FQHC services in locations other than the RHC or FQHC facility must continue to meet all certification and cost reporting requirements. Services in other locations may be subject to review by the A/B MAC. RHC or FQHC services furnished by an RHC or FQHC practitioner may not be billed separately by the RHC or FQHC practitioner, or by another practitioner or an entity other than the RHC or FQHC, even if the service is not a stand-alone billable visit. Services furnished to patients in any type of hospital setting (inpatient, outpatient, or emergency department) are statutorily excluded from the RHC/FQHC benefit and may not be billed by the RHC or FQHC.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) RHCs and FQHCs are required to post their hours of operations at or near the entrance in a manner that clearly states the days of the week and the hours that RHC or FQHC services are furnished, and days of the week and the hours that the building is open solely for administrative or other purposes, if applicable. This information should be easily readable, including by people with vision problems and people who are in wheel chairs. Qualified services provided to an RHC or FQHC patient other than during the posted hours of operation are considered RHC or FQHC services when the practitioner is compensated by the RHC or FQHC for the services provided, and when the cost of the service is included in the RHC’s cost report. Services furnished at times other than the RHC or FQHC posted hours of operation to Medicare beneficiaries who are RHC or FQHC patients may not be billed to Medicare Part B if the practitioner’s compensation for these services is included in the RHC/FQHC cost report. (See Section 100 on Commingling). This applies to full and part time practitioners, practitioners who are employees, practitioners working under contract to the RHC or FQHC, and practitioners who are compensated by the RHC or FQHC under another type of arrangement. RHCs and FQHCs should have clear policies regarding the provision of services at other times, and include this in a practitioner’s employment agreement or contract.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Except as noted below, encounters with more than one RHC or FQHC practitioner on the same day, or multiple encounters with the same RHC or FQHC practitioner on the same day, constitute a single RHC or FQHC visit and is payable as one visit. This policy applies regardless of the length or complexity of the visit, the number or type of practitioners seen, whether the second visit is a scheduled or unscheduled appointment, or whether the first visit is related or unrelated to the subsequent visit. This would include situations where an RHC or FQHC patient has a medically- necessary face-to-face visit with an RHC or FQHC practitioner, and is then seen by another RHC or FQHC practitioner, including a specialist, for further evaluation of the same condition on the same day, or is then seen by another RHC or FQHC practitioner, including a specialist, for evaluation of a different condition on the same day. Exceptions are for the following circumstances only: • The patient, subsequent to the first visit, suffers an illness or injury that requires additional diagnosis or treatment on the same day (for example, a patient sees their practitioner in the morning for a medical condition and later in the day has a fall and returns to the RHC or FQHC). In this situation only, the FQHC would use modifier 59 on the claim and the RHC would use modifier 59 or 25 to attest that the conditions being treated qualify as 2 billable visits; • The patient has a medical visit and a mental health visit on the same day (2 billable visits); • For RHCs only, the patient has an initial preventive physical exam (IPPE) and a separate medical and/or mental health visit on the same day (2 or 3 billable visits); or • An IOP service and medical visit on the same day. Note: A mental health visit and IOP service may occur on the same day; however, if a mental health visit is furnished on the same day as IOP services, payment will only be made at the IOP rate, and the mental health visit will be considered packaged. NOTE: These exceptions do not apply to grandfathered tribal FQHCs.

(Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Surgical procedures furnished in an RHC or FQHC by an RHC or FQHC practitioner are considered RHC or FQHC services. Procedures are included in the payment of an otherwise qualified visit and are not separately billable. If a procedure is associated with a qualified visit, the charges for the procedure go on the claim with the visit. Payment is included in the AIR when the procedure is furnished in an RHC, and payment is included in the PPS methodology when furnished in an FQHC. The Medicare global billing requirements do not apply to RHCs and FQHCs, and global billing codes are not accepted for RHC or FQHC billing or payment. Surgical procedures furnished at locations other than RHCs or FQHCs may be subject to Medicare global billing requirements. If an RHC or FQHC furnishes services to a patient who has had surgery elsewhere and is still in the global billing period, the RHC or FQHC must determine if these services have been included in the surgical global billing. RHCs and FQHCs may bill for a visit during the global surgical period if the visit is for a service not included in the global billing package. If the service furnished by the RHC or FQHC was included in the global payment for the surgery, the RHC or FQHC may not also bill for the same service. Services not included in the global surgical package are listed in Pub. 100-04, Medicare Claims Processing Manual, chapter 12, section 40.1.B, and include, but are not limited to: initial consultation by the surgeon to determine the need for major surgery; visits unrelated to the diagnosis for which the surgical procedure is performed (unless the visit occurs due to complications of the surgery); treatment for the underlying condition or an added course of treatment which is not part of normal recovery from surgery; etc. For additional information on global billing, see http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/clm104c12.pdf 40.5 - 3-Day Payment Window (Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Medicare’s 3-day payment window applies to outpatient services furnished by a hospital (or an entity that is wholly owned or wholly operated by the hospital). The statute requires that hospitals’ bundle the technical component of all outpatient diagnostic services and related non-diagnostic services (e.g., therapeutic) with the claim for an inpatient stay when services are furnished to a Medicare beneficiary in the 3 days (or, in the case of a hospital that is not a subsection (d) hospital, during the 1-day) preceding an inpatient admission in compliance with section 1886 of the Act. RHCs and FQHC services are not subject to the Medicare 3- day payment window requirements. For additional information on the 3 day payment window, see http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network- MLN/MLNMattersArticles/downloads/MM7502.pdf

(Rev. 166, Issued: 01-31-13, Effective: 03-01-13, Implementation: 03-01-13)

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) RHC services include: • Physicians' services, as described in section 110; • Services and supplies incident to a physician’s services, as described in section 120; • Services of NPs, PAs, and CNMs, as described in section 130; • Services and supplies incident to the services of NPs, PAs, and CNMs, as described in section 140; • CP and CSW services, as described in section 150; • MFT and MHC services, as described in section 150; • Services and supplies incident to the services of CPs and CSWs, as described in section 160; • Services and supplies incident to the services of MFTs and MHCs, as described in section 160; • Visiting nurse services to patients confined to the home, as described in section 190; • Certain care coordination services, as described in section 230; • Certain virtual communication services, as described in section 240; and • Intensive Outpatient Program (IOP) Services, as described in section 250. RHC services also include certain preventive services when specified in statute or when established through the National Coverage Determination (NCD) process and not specifically excluded (see section 220 – Preventive Health Services). These services include: • Influenza, Pneumococcal, Hepatitis B, COVID-19 vaccinations, and covered monoclonal antibody products used as pre-exposure prophylaxis prevention of COVID-19; • IPPE; • Annual Wellness Visit (AWV); and • Medicare-covered preventive services recommended by the U.S. Preventive Services Task Force (USPSTF) with a grade of A or B, as appropriate for the individual. • Drugs Covered as Additional Preventive Services (DCAPS) and related supply and administration fees. The professional component of the IPPE, AWV, and other qualified preventive services is paid based on the AIR.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) FQHC services include all of the RHC services listed in section 50.1 of this chapter. While the following services may also be furnished in an RHC, the statute specifically lists certain services as FQHC services, including but not limited to: • Screening mammography; • Screening pap smear and screening pelvic exam; • Prostate cancer screening tests; • Colorectal cancer screening tests; • DSMT services; • Diabetes screening tests; • MNT services; • Bone mass measurement; • Screening for glaucoma; • Cardiovascular screening blood tests; and • Ultrasound screening for abdominal aortic aneurysm.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) RHCs provide outpatient services that are typically furnished in a physician’s office or outpatient clinic and generally provide only limited emergency care. Neither independent nor hospital-based RHCs are subject to Emergency Medical Treatment and Active Labor Act regulations. However, RHC practitioners are required to provide medical emergency procedures as a first response to common life threatening injuries and acute illnesses and to have available the drugs and biologicals commonly used in life-saving procedures. The definition of a “first response” is a service that is commonly provided in a physician’s office. If a patient presents at the RHC with an emergency when the RHC is not open for patient care because a physician, NP, PA, CNM, CP, CSW, MFT or MHC is not present, other staff may attend to the patient until care of the individual can be transferred. Any care provided in this situation must be within the individual’s ability, training, and scope of practice, and in accordance with state laws, and would not be considered an RHC service. During their regular hours of operations, FQHC practitioners are required to provide medical procedures as a first response to common life threatening injuries and acute illnesses and to have available the drugs and biologicals commonly used in life-saving procedures. After their operating hours, FQHCs must provide telephone access to an individual who has the qualifications and training to exercise professional judgment in assessing a patient’s need for emergency medical care, and if appropriate, to refer the patient to an appropriate provider or facility that is open. Additional information on emergency preparedness requirements for RHCs and FQHCs can be found 42 CFR 491.12.

(Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) RHCs and FQHCs must be primarily engaged in furnishing primary care services, but may also furnish certain services that are beyond the scope of the RHC or FQHC benefit, such as laboratory services or the technical component of an RHC or FQHC service. If these services are authorized to be furnished by the RHC or FQHC and are covered under a separate Medicare benefit category, the services must be billed separately (not by the RHC or FQHC) to the appropriate A/B MAC under the payment rules that apply to the service. RHCs and FQHCs must identify and remove from allowable costs on the Medicare cost report all costs associated with the provision of non-RHC/FQHC services such as space, equipment, supplies, facility overhead, and personnel.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Certain services are not considered RHC or FQHC services either because they 1) are not included in the RHC or FQHC benefit, or 2) are not a Medicare benefit. Non- RHC/FQHC services include, but are not limited to: Medicare excluded services - Includes routine physical checkups, dental care (that are not inextricably linked to other covered medical services), hearing tests, routine eye exams, etc. For additional information, see Pub. 100-02, Medicare Benefit Policy Manual, Chapter 16, General Exclusions from Coverage, at http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/bp102c16.pdf Technical component of an RHC or FQHC service - Includes diagnostic tests such as x- rays, electrocardiograms (EKGs), and other tests authorized by Medicare statute or the NCD process. These services may be billed separately to the A/B MAC by the facility). (The professional component is an RHC or FQHC service if performed by an RHC or FQHC practitioner or furnished incident to an RHC or FQHC visit). Laboratory services - Although RHCs and FQHCs are required to furnish certain laboratory services (for RHCs see section 1861(aa)(2)(G) of the Act, and for FQHCs see section 330(b)(1)(A)(i)(II) of the PHS Act), laboratory services are not within the scope of the RHC or FQHC benefit. When clinics and centers separately bill laboratory services, the cost of associated space, equipment, supplies, facility overhead and personnel for these services must be adjusted out of the RHC or FQHC cost report. This does not include venipuncture, which is included in the AIR when furnished in an RHC by an RHC practitioner or furnished incident to an RHC service, and it is included in the per-diem payment when furnished in an FQHC by an FQHC practitioner or furnished incident to an FQHC service. Durable medical equipment - Includes crutches, hospital beds, and wheelchairs used in the patient’s place of residence, whether rented or purchased. Ambulance services - The ambulance transport benefit under Medicare Part B covers a medically necessary transport of a beneficiary by ambulance to the nearest appropriate facility that can treat the patient's condition, and any other methods of transportation are contraindicated. See https://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/bp102c10.pdf for additional information on covered ambulance services. Prosthetic devices - Prosthetic devices are included in the definition of “medical and other health services” in section 1861(s)(8) of the Act and are defined as devices (other than dental) which replace all or part of an internal body organ (including colostomy bags and supplies directly related to colostomy care), including replacement of such devices, and including one pair of conventional eyeglasses or contact lenses furnished subsequent to each cataract surgery with insertion of an intraocular lens. Other examples of prosthetic devices include cardiac pacemakers, cochlear implants, electrical continence aids, electrical nerve stimulators, and tracheostomy speaking valves. Body Braces – Includes leg, arm, back, and neck braces and their replacements. Practitioner services at certain other Medicare facility – Includes services furnished to inpatients or outpatients in a hospital (including CAHs), ambulatory surgical center, Medicare Comprehensive Outpatient Rehabilitation Facility, etc., or other facility whose requirements preclude RHC or FQHC services. (NOTE: Covered services provided to a Medicare beneficiary by an RHC or FQHC practitioner in a SNF may be an RHC or FQHC service.) Telehealth distant-site services - See section 200 of this chapter for additional information on telehealth services in RHCs and FQHCs. Hospice Services (with the exception of hospice attending physician services) – See section 210 of this chapter for additional information on hospice services in RHCs and FQHCs. Group Services – Includes group or mass information programs, health education classes, group therapy, or group education activities, including media productions and publications (except for certain IOP services, see section 250 of this chapter). For additional information on these services, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15 on Covered Medical and Other Health Service at http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/Downloads/bp102c15.pdf.

(Rev. 252, Issued: 12-07-18, Effective: 01-01-19, Implementation: 01- 02-19) RHCs and FQHCs must submit claims for RHC or FQHC services under the RHC or FQHC payment methodologies and are not authorized to submit claims under the Physician Fee Schedule (PFS) for RHC or FQHC services. Newly certified RHCs or FQHCs should work with their A/B MAC to ensure that all claims filed for RHC or FQHC services are paid as RHC or FQHC claims as of the date of their certification.

(Rev.239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Medicare pays 80 percent of the RHC AIR, subject to a payment limit, for medically- necessary medical, and qualified preventive, face- to- face (one-on-one) visits with an RHC practitioner (as defined in section 30) for RHC services (as defined in section 50.1), unless otherwise noted. The rate is subject to a payment limit, except for RHCs that have an exception to the payment limit (see section 70.2). An interim rate for newly certified RHCs is established based on the RHC’s anticipated average cost for direct and supporting services. At the end of the reporting period, the A/B MAC determines the total payment due and reconciles payments made during the period with the total payments due. In general, the AIR for an RHC is calculated by the A/B MAC by dividing total allowable costs by the total number of visits for all patients. Productivity, payment limits, and other factors are also considered in the calculation. Allowable costs must be reasonable and necessary and include practitioner compensation, overhead, equipment, space, supplies, personnel, and other costs incident to the delivery of RHC services. Services furnished incident to an RHC professional service are included in the AIR and are not billed as a separate visit. The professional component of a procedure is usually a covered service, but is not a stand-alone billable visit. The costs of covered services provided incident to a billable visit may be included on the RHC cost report. To receive payment for qualified services, HCPCS coding is required on all claims.

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) Prior to April 1, 2021, the RHC payment limit was set by Congress in 1988 and was adjusted annually based on the Medicare Economic Index (MEI). The payment limit was released annually via Recurring Update Notifications. Prior to April 1, 2021, a provider-based RHC that is an integral and subordinate part of a hospital (including a CAH), as described in regulations at 42 CFR 413.65, could receive an exception to the per- visit payment limit if: • the hospital had fewer than 50 beds as determined at 42 CFR 412.105(b); or • the hospital's average daily patient census count of those beds described in 42 CFR 412.105(b) did not exceed 40 and the hospital meets both of the following conditions: o it was a sole community hospital as determined in accordance with 42 CFR 412.92 or an essential access community hospital as determined in accordance with 42 CFR 412.109(a), and o it was located in a level 9 or level 10 Rural-Urban Commuting Area (RUCA). (For additional information on RUCAs, see http://depts.washington.edu/uwruca/. The exception to the payment limit applied only during the time that the RHC met the requirements for the exception.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Commingling refers to the sharing of RHC or FQHC space, staff (employed or contracted), supplies, equipment, and/or other resources with an onsite Medicare Part B or Medicaid fee-for-service practice operated by the same RHC or FQHC physician(s) and/or non-physician(s) practitioners. Commingling is prohibited in order to prevent: • Duplicate Medicare or Medicaid reimbursement (including situations where the RHC or FQHC is unable to distinguish its actual costs from those that are reimbursed on a fee-for-service basis), or • Selectively choosing a higher or lower reimbursement rate for the services. RHC and FQHC practitioners may not furnish or separately bill for RHC or FQHC- covered professional services as a Part B provider in the RHC or FQHC, or in an area outside of the certified RHC or FQHC space such as a treatment room adjacent to the RHC or FQHC, during RHC or FQHC hours of operation. If an RHC or FQHC practitioner furnishes an RHC or FQHC service at the RHC or FQHC during RHC or FQHC hours, the service must be billed as an RHC or FQHC service. The service cannot be carved out of the cost report and billed to Part B. If an RHC or FQHC is located in the same building with another entity such as an unaffiliated medical practice, x-ray and lab facility, dental clinic, emergency room, etc., the RHC or FQHC space must be clearly defined. If the RHC or FQHC leases space to another entity, all costs associated with the leased space must be carved out of the cost report. RHCs and FQHCs that share resources (e.g., waiting room, telephones, receptionist, etc.) with another entity must maintain accurate records to assure that all costs claimed for Medicare reimbursement are only for the RHC or FQHC staff, space, or other resources. Any shared staff, space, or other resources must be allocated appropriately between RHC or FQHC and non-RHC or non-FQHC usage to avoid duplicate reimbursement. This commingling policy does not prohibit a provider-based RHC from sharing its health care practitioners with the hospital emergency department in an emergency, or prohibit an RHC practitioner from providing on-call services for an emergency room, as long as the RHC would continue to meet the RHC conditions for coverage even if the practitioner were absent from the facility. The RHC must be able to allocate appropriately the practitioner's salary between RHC and non-RHC time. It is expected that the sharing of the practitioner with the hospital emergency department would not be a common occurrence. The A/B MAC has the authority to determine acceptable accounting methods for allocation of costs between the RHC or FQHC and another entity. In some situations, the practitioner’s employment agreement will provide a useful tool to help determine appropriate accounting.

(Rev. 252, Issued: 12-07-18, Effective: 01-01-19, Implementation: 01- 02-19) The term “physician” includes a doctor of medicine, osteopathy, dental surgery, dental medicine, podiatry, optometry, or chiropractic who is licensed and practicing within the licensee’s scope of practice, and meets other requirements as specified. Physician services are professional services furnished by a physician to an RHC or FQHC patient and include diagnosis, therapy, surgery, and consultation. The physician must either examine the patient in person or be able to visualize directly some aspect of the patient’s condition without the interposition of a third person’s judgment. Direct visualization includes review of the patient’s X-rays, EKGs, tissue samples, etc. Except for services that meet the criteria for authorized care management or virtual communications services, telephone or electronic communication between a physician and a patient, or between a physician and someone on behalf of a patient, are considered physicians’ services and are included in an otherwise billable visit. They do not constitute a separately billable visit. Qualified services furnished at an RHC or FQHC or other authorized site by an RHC or FQHC physician are payable only to the RHC or FQHC. RHC and FQHC physicians are paid according to their employment agreement or contract (where applicable).

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Dentists, podiatrists, optometrists, and chiropractors are defined as physicians in Medicare statute, and qualified services furnished by physicians are billable visits in an RHC or FQHC. These practitioners can provide RHC or FQHC services that are within their scope of practice and not excluded from coverage (e.g., Medicare coverage of chiropractic services is limited to manual manipulation of the spine for a demonstrated subluxation). An RHC or FQHC can bill for a face-to-face, medically necessary visit furnished by a dentist, podiatrist, optometrist, or chiropractor if the service furnished is a qualifying visit for RHCs or FQHCs and all other requirements are met. All services furnished must be within the state scope of practice for the practitioner, and all HCPCS codes must reflect the actual services that were furnished. RHCs and FQHCs are required to primarily provide primary health care. Since dentists, podiatrists, optometrists, and chiropractors are not considered primary care physicians, they do not meet the requirements to be either i) a physician medical director or ii) the physician or non-physician practitioner (NP, PA, or CNM) that must be available at all times the clinic is open. Therefore, a dentist, podiatrist, optometrist, or chiropractor can provide a medically necessary, face-to-face visit with an RHC or FQHC patient only when the statutory and regulatory staffing requirements are otherwise met. For additional information on these services, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15 on Covered Medical and Other Health Service at http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/bp102c15.pdf.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Except for comprehensive care plans that are a component of authorized care management services (see section 230), treatment plans and home care oversight provided by RHC or FQHC physicians to RHC or FQHC patients are considered part of the RHC or FQHC visit and are not a separately billable service.

(Rev. 263, Issued: Effective: 01-01-20, Implementation: 01-23-20) Freestanding RHCs and FQHCs may receive direct graduate medical education (GME) payment for residents if the RHC or FQHC incurs the salaries and fringe benefits (including travel and lodging expenses where applicable) of residents training at the RHC or FQHC. Allowable costs incurred by the RHC or FQHC for GME are paid on a reasonable cost basis and are not subject to the payment limit. RHCs and FQHCs may claim allowable costs only while residents are on their RHC or FQHC rotation. RHCs and FQHCs that are receiving GME payment may not separately bill for an RHC or FQHC visit provided by a resident, as the cost of these practitioners is included in the GME payment. A medically-necessary medical, or a qualifying preventive health, face- to-face encounter with a teaching physician who is an RHC or FQHC practitioner may be a billable visit if applicable teaching physician supervision and documentation requirements are met. Under Pub. 100-04, Chapter 12, section 100.1.1.C., the Primary Care Exception (PCE) only applies in an outpatient department or an ambulatory setting where a hospital is claiming on the cost report the residents for indirect medical education and direct GME purposes. Therefore, in the instance where the RHC or FQHC is incurring the cost of the resident(s), the PCE would not apply. For additional information see 42 CFR 405.2468 (f) and 42 CFR 413.75(b).

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) “Incident to” refers to services and supplies that are an integral, though incidental, part of the physician’s professional service and are: • Commonly rendered without charge and included in the RHC or FQHC payment; • Commonly furnished in an outpatient clinic setting; • Furnished under the physician’s direct supervision; except for authorized care management services which may be furnished under general supervision; and • Furnished by RHC or FQHC auxiliary personnel. Incident to services and supplies include: • Drugs and biologicals that are not usually self-administered, and Medicare- covered preventive injectable drugs (e.g., influenza, pneumococcal); • Venipuncture; • Bandages, gauze, oxygen, and other supplies; or • Services furnished by auxiliary personnel such as a nurse, medical assistant, or other clinical personnel acting under the supervision of the physician. Supplies and drugs that must be billed to the DME MAC or to Part D are not included. NOTE: Payment for Medicare-covered Part B drugs that are not usually self- administered and are furnished by an RHC or FQHC practitioner to a Medicare patient are included in the RHC AIR or the FQHC’s PPS per diem payment. However, Section 1861(s)(2)(G) of the Act provides an exception for RHCs when a physician prepares a specific formulation of an antigen for a patient if the antigen is “forwarded to another qualified person (including a rural health clinic) for administration to such patient…, by or under the supervision of another such physician.” An RHC practitioner (physician, NP, PA, or CNM) acting within their scope of practice may administer the drug and the cost of the administration may be included on the RHC's cost report as an allowable expense. The cost of the antigen prepared by a physician outside of the RHC is not included in the RHC AIR. Physicians who prepare an antigen that is forwarded to an RHC should submit a claim for the antigen in accordance with instructions from the contractor that processes their Part B claims and applicable CMS requirements.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Incident to services and supplies can be furnished by auxiliary personnel. All services and supplies provided incident to a physician’s visit must result from the patient’s encounter with the physician and be furnished in a medically appropriate timeframe. More than one incident to service or supply can be provided as a result of a single physician visit. Incident to services and supplies must be provided by someone who has an employment agreement or a direct contract with the RHC or FQHC to provide services. Services or supplies provided by individuals who are not employed by or under direct contract with the RHC or FQHC, even if provided on the physician’s order or included in the RHC or FQHC’s bill, are not covered as incident to a physician’s service. Services that are not considered incident to include the services of an independently practicing therapist who forwards his/her bill to the RHC or FQHC for inclusion in the entity’s statement of services, services provided by an independent laboratory or a hospital outpatient department, services furnished by a nurse, medical assistant, or other auxiliary personnel who is not an employee of or working under contract to the RHC or FQHC, including services provided by a third party under contract, etc. Services and supplies furnished incident to physician’s services are limited to situations in which there is direct physician supervision of the person performing the service, except for authorized care coordination services (as described in section 230) which may be furnished under general supervision. Direct supervision does not require the physician to be present in the same room. However, the physician must be in the RHC or FQHC and immediately available to provide assistance and direction throughout the time the incident to service or supply is being furnished. Effective January 1, 2024, behavioral health services can be furnished under general supervision of the physician (or other practitioner) when these services are provided by auxiliary personnel incident to the services of a physician (or another practitioner). When services and supplies are furnished incident to an RHC or FQHC visit, payment for the services are included in the RHC AIR or the FQHC PPS rate. An encounter that includes only an incident to service(s) is not a stand-alone billable visit for RHCs or FQHCs For services provided under direct supervision, the requirement that the supervising physician or practitioner must be immediately available to provide assistance and direction throughout the procedure may be satisfied through virtual presence using real-time, interactive audio and video telecommunications.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Except for authorized care coordination services, services furnished incident to a physician’s visit by RHC or FQHC auxiliary personnel in the patient’s home or location other than the RHC or FQHC must have direct supervision by the physician. For example, if an RHC or FQHC nurse accompanies the physician to a patient’s home and administers an injection, the nurse’s services would be considered incident to the physician’s visit. If the same nurse makes the call alone and administers an injection, the services are not incident to services since the physician is not providing direct supervision. The availability of the physician by telephone and the presence of the physician somewhere in the building does not constitute direct supervision. (This rule applies only to the incident to provision. It does not apply to visiting nursing services described in section 190.) For services provided under direct supervision, the requirement that the supervising physician or practitioner must be immediately available to provide assistance and direction throughout the procedure may be satisfied through virtual presence using real-time, interactive audio and video telecommunications. For information on supervision requirements for Part B services incident to physician services see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, section 60.1.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Services that are covered by Medicare but do not meet the requirements for a medically necessary or qualified preventive health visit with an RHC or FQHC practitioner (e.g., blood pressure checks, allergy injections, prescriptions, nursing services, etc.) are considered incident to services. The cost of providing these services may be included on the cost report, but the provision of these services does not generate a billable visit. Incident to services provided on a different day as the billable visit may be included in the charges for the visit if furnished in a medically appropriate timeframe. Incidental services or supplies must represent an expense incurred by the RHC or FQHC. For example, if a patient purchases a drug and the physician administers it, the cost of the drug is not covered and cannot be included on the cost report. If a Medicare-covered Part B drug is furnished by an RHC or FQHC practitioner to a Medicare patient as part of a billable visit, the cost of the drug and its administration is included in the RHC’s AIR or the FQHC’s PPS payment. RHCs and FQHCs cannot bill separately for Part B drugs or other incident to services or supplies.

(Rev. 252, Issued: 12- 07-18, Effective: 01-01-19, Implementation: 01- 02-19) Professional services furnished by an NP, PA, or CNM to an RHC or FQHC patient are services that would be considered covered physician services under Medicare (see section 110), and which are permitted by state laws and RHC or FQHC policies. Services may include diagnosis, treatment, and consultation. The NP, PA, or CNM must directly examine the patient, or directly review the patient’s medical information such as X-rays, EKGs and electroencephalograms, tissue samples, etc. Except for services that meet the criteria for authorized care management or virtual communication services, telephone or electronic communication between an NP, PA, or CNM and a patient, or between such practitioner and someone on behalf of a patient, are considered NP, PA, or CNM services, and are included in an otherwise billable visit. They do not constitute a separately billable visit.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16) Services performed by NPs, PAs, and CNMs must be: • Furnished under the general (or direct, if required by state law) medical supervision of a physician; • Furnished in accordance with RHC or FQHC policies and any physician medical orders for the care and treatment of a patient; • A type of service which the NP, PA, or CNM who furnished the service is legally permitted to furnish by the state in which the service is rendered; • Furnished in accordance with state restrictions as to setting and supervision; • Furnished in accordance with written RHC or FQHC policies that specify what services these practitioners may furnish to patients; and • A type of service which would be covered under Medicare if furnished by a physician.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16) RHCs and FQHCs which are not physician-directed must have an arrangement with a physician that provides for the supervision and guidance of NPs, PAs, and CNMs. The arrangement must be consistent with state law.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Section 1842(b)(6)(C) of the Act prohibits PAs from enrolling in and being paid directly for Part B services. The only exception to this is found in Section 4205(d)(3)(B) of the Balanced Budget Act (BBA), which amended Section 1842(b)(6)(C) of the Act to allow Medicare to directly pay a PA when the PA was the owner of an RHC for a continuous period beginning before the date of the enactment of the BBA, and ending on the date the Secretary determines the RHC no longer meets the requirements of Section 1861(aa)(2) of the Act.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Services and supplies that are integral, though incident to an NP, PA, or CNM service are: • Commonly rendered without charge or included in the RHC or FQHC payment • Commonly furnished in an outpatient clinic setting; • Furnished under the direct supervision of an NP, PA, or CNM, except for authorized care management services which may be furnished under general supervision; and • Furnished by a member of the RHC or FQHC staff. NOTE: The direct supervision requirement is met in the case of an NP, PA, or CNM who supervises the furnishing of the service only if such a person is permitted to exercise such supervision under the written policies governing the RHC or FQHC. Services and supplies covered under this provision are generally the same as described in section 120 as incident to a physician’s services and include services and supplies incident to the services of an NP, PA, or CNM. For services provided under direct supervision, the requirement that the supervising physician or practitioner must be immediately available to provide assistance and direction throughout the procedure may be satisfied through virtual presence using real-time, interactive audio and video telecommunications.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) A CP is an individual who: • Holds a doctoral degree in psychology, and • Is licensed or certified, on the basis of the doctoral degree in psychology, by the state in which he or she practices, at the independent practice level of psychology to furnish diagnostic, assessment, preventive, and therapeutic services directly to individuals. For additional information on CP’s, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, section 160. A CSW is an individual who: • Possesses a master’s or doctor’s degree in social work; • After obtaining the degree, has performed at least 2 years of supervised clinical social work; and • Is licensed or certified as a clinical social worker by the state in which the services are performed; or, in the case of an individual in a state that does not provide for licensure or certification, meets the requirements listed in 410.73(a)(3)(i) and (ii). For additional information on CSW’s, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, section 170. A MFT is an individual who: • Possesses a master's or doctor's degree which qualifies for licensure or certification as a marriage and family therapist pursuant to State law of the State in which such individual furnishes the services defined as marriage and family therapist services; • After obtaining such degree, has performed at least 2 years or 3,000 hours of post master’s degree clinical supervised experience in marriage and family therapy in an appropriate setting such as a hospital, SNF, private practice, or clinic; and • Is licensed or certified as a marriage and family therapist by the State in which the services are performed. A MHC is an individual who: • Possesses a master's or doctor's degree which qualifies for licensure or certification as a mental health counselor, clinical professional counselor, professional counselor under the State law of the State in which such individual furnishes the services defined as mental health counselor services; • After obtaining such a degree, has performed at least 2 years or 3,000 hours of post master’s degree clinical supervised experience in mental health counseling in an appropriate setting such as a hospital, SNF, private practice, or clinic; and • Is licensed or certified as a mental health counselor, clinical professional counselor, professional counselor by the State in which the services are performed. For additional information on MFTs and MHCs, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 15, sections 330 and 340, respectively. Services may include diagnosis, treatment, and consultation. The CP, CSW, MFT or MHC must directly examine the patient, or directly review the patient’s medical information. Except for services that meet the criteria for authorized care management or virtual communication services, telephone or electronic communication between a CP, CSW, MFT or MHC and a patient, or between such practitioner and someone on behalf of a patient, are considered CP, CSW, MFT or MHC services and are included in an otherwise billable visit. They do not constitute a separately billable visit. CSWs are statutorily authorized (1861(hh)(2) of the Act) to furnish services for the diagnosis and treatment of mental illnesses only. MFTs and MHCs are statutorily authorized (section 1861(lll)(1) and 1861(lll)(3) of the Act, respectively) to furnish services for the diagnosis and treatment of mental illnesses only. Services that are covered are those that are otherwise covered if furnished by a physician or as incident to a physician’s professional service. Services that a hospital or SNF is required to provide to an inpatient or outpatient as a requirement for participation are not included. Services performed by CPs, CSWs, MFTs and MHCs must be: • Furnished in accordance with RHC or FQHC policies and any physician medical orders for the care and treatment of a patient; • A type of service which the CP, CSW, MFT or MHC who furnished the service is legally permitted to furnish by the state in which the service is rendered; and • Furnished in accordance with state restrictions as to setting and supervision, including any physician supervision requirements.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Services and supplies that are integral, though incident to a CP, CSW, MFT or MHC service are: • Commonly rendered without charge or included in the RHC or FQHC payment; • Commonly furnished in an outpatient clinic setting; • Furnished under the direct supervision of the CP, CSW, MFT and MHC except for authorized care management services which may be furnished under general supervision; and • Furnished by a member of the RHC or FQHC staff. NOTE: The direct supervision requirement is met in the case of a CP, CSW, MFT or MHC who supervises the furnishing of the service only if such a person is permitted to exercise such supervision under the written policies governing the RHC or FQHC. Services and supplies covered under this provision are generally the same as described in section 120 as incident to a physician’s services and include services and supplies incident to the services of a CP, CSW, MFT or MHC. For services provided under direct supervision, the requirement that the supervising physician or practitioner must be immediately available to provide assistance and direction throughout the procedure may be satisfied through virtual presence using real-time, interactive audio and video telecommunications.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) A mental health visit is a medically-necessary face-to-face encounter between an RHC or FQHC patient and an RHC or FQHC practitioner during which time one or more RHC or FQHC mental health services are rendered. Effective January 1, 2022, a mental health visit is a face-to-face encounter or an encounter furnished using interactive, real-time, audio and video telecommunications technology or audio-only interactions in cases where the patient is not capable of, or does not consent to, the use of video technology for the purposes of diagnosis, evaluation or treatment of a mental health disorder. The requirement that there must be an in-person mental health service furnished within 6 months prior to the furnishing of the mental health service furnished via telecommunications and that an in-person mental health service (without the use of telecommunications technology) must be provided at least every 12 months while the beneficiary is receiving services furnished via telecommunications technology for diagnosis, evaluation, or treatment of mental health disorders, unless, for a particular 12-month period, the physician or practitioner and patient agree that the risks and burdens outweigh the benefits associated with furnishing the in-person item or service, and the practitioner documents the reasons for this decision in the patient’s medical record will not apply to services furnished before January 31, 2026. RHCs and FQHCs are instructed to append modifier 95 (Synchronous Telemedicine Service Rendered via Real-Time Interactive Audio and Video Telecommunications System) in instances where the mental health visit was furnished using audio-video communication technology and to append modifier 93 (Synchronous Telemedicine Service Rendered Via Telephone or Other Real-Time Interactive Audio-Only Telecommunications System) in cases where the service was furnished using audio only communication. Mental health services that qualify as stand-alone billable visits in an FQHC are listed on the FQHC center website, http://www.cms.gov/Center/Provider- Type/FederallyQualified-Health-Centers-FQHC- Center.html. Services furnished must be within the practitioner’s state scope of practice. Medicare-covered mental health services furnished incident to an RHC or FQHC visit are included in the payment for a medically necessary mental health visit when an RHC or FQHC practitioner furnishes a mental health visit. Group mental health services do not meet the criteria for a one-one-one, face-to-face encounter in an FQHC or RHC. Note: Beginning January 1, 2024, group therapy with physicians or psychologists or other mental health professionals to the extent authorized under State law may be covered and paid under the IOP benefit (see section 250 of this chapter). A mental health service should be reported using a valid HCPCS code for the service furnished, a mental health revenue code, and for FQHCs, an appropriate FQHC mental health payment code. For detailed information on reporting mental health services and claims processing, see Pub. 100-04, Medicare Claims Processing Manual, chapter 9, http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/clm104c09.pdf Medication management, or a psychotherapy “add on” service, is not a separately billable service in an RHC or FQHC and is included in the payment of an RHC or FQHC medical visit. For example, when a medically-necessary medical visit with an RHC or FQHC practitioner is furnished, and on the same day medication management or a psychotherapy add on service is also furnished by the same or a different RHC or FQHC practitioner, only one payment is made for the qualifying medical services reported with a medical revenue code. For FQHCs, an FQHC mental health payment code is not required for reporting medication management or a psychotherapy add on service furnished on the same day as a medical service.

(Rev. 263, Issued: Effective: 01-01-20, Implementation: 01-23-20) Physical Therapy (PT), Occupational Therapy (OT), and Speech Language Pathology (SLP) services may be provided in the RHC or FQHC directly by a physician, NP, or PA, if included in the practitioner’s scope of practice. A physician, NP, or PA may also supervise the provision of PT, OT, and SLP services provided incident to their professional services in the RHC or FQHC by a PT, OT, or SLP therapist. PT, OT, and SLP therapists who provide services incident to a physician, NP, or PA visit may be an employee of the RHC or FQHC or contracted to the RHC or FQHC. PT, OT, and SLP services furnished by an RHC or FQHC practitioner or furnished incident to a visit with an RHC or FQHC practitioner are not billable visits. If the services are furnished on a day when no otherwise billable visit has occurred, the PT, OT, or SLP service provided incident to the visit would become part of the cost of operating the RHC or FQHC. The cost would be included in the costs claimed on the cost report and there would be no billable visit.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16)

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) A visiting nurse provides skilled nursing services. The determination of whether a service requires the skills of a nurse is based on the complexity of the service (e.g., intravenous and intramuscular injections or insertion of catheters), the condition of the patient (e.g., a non-skilled service that, because of the patient’s condition, can only be safely and effectively provided by a nurse), and accepted standards of medical and nursing practice. All services must be reasonable and necessary to the diagnosis and treatment of the patient’s illness or injury within the context of the patient’s unique medical condition. A service that can be safely and effectively self-administered or performed by a nonmedical person without the direct supervision of a nurse, is not considered a skilled nursing service, even if provided by a nurse. A service which, by its nature, requires the skills of a nurse to be provided safely and effectively continues to be a skilled service even if it is taught to the patient, the patient’s family, or other caregivers. If a patient needs skilled nursing care and there is no one trained or able and willing to provide it, the services of a nurse would be reasonable and necessary to the treatment of the illness or injury. The determination of whether visiting nurse services are reasonable and necessary is made by the physician based on the condition of the patient when the services were ordered and what is reasonably expected to be appropriate treatment for the illness or injury throughout the certification period.

(Rev. 252, Issued: 12- 07-18, Effective: 01-01-19, Implementation: 01- 02-19) RHCs and FQHCs are paid for visiting nursing services when G0490 is on an RHC or FQHC claim and all of the following requirements are met: • The patient is considered confined to the home as defined in section 1835(a) of the Act and the Medicare Benefit Policy Manual, Chapter 7 (see http://www.cms.gov/Regulations-and- Guidance/Guidance/Manuals/downloads/bp102c07.pdf; • The RHC or FQHC is located in an area that has a shortage of home health agencies; • The services and supplies are provided under a written plan of treatment; • Nursing services are furnished on a part-time or intermittent basis only; and • Drugs and biological products are not provided.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) A shortage of HHAs exists if an RHC or FQHC is currently located in a county, parish or similar geographic area in which the Secretary has determined that: • There is no participating HHA under Medicare, or adequate home health services are not available to RHC or FQHC patients even though a participating HHA is in the area; or • There are patients whose homes are not within the area serviced by a participating HHA; or considering the area’s climate and terrain, whose homes are not within a reasonable traveling distance to a participating HHA.

(Rev. 220, Issued: 01-15-16, Effective: 02-01-16, Implementation: 02-01-16) RHCs or FQHCs that are located in an area that has not been determined to have a current HHA shortage and are seeking to provide visiting nurse services must make a written request to the CMS RO along with written justification that the area it serves meets the required conditions.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) For services and supplies that require a treatment plan, the treatment plan must be written and reviewed by a supervising physician, NP, PA, CNM, CP, CSW, MFT, or MHC as appropriate, at least once every 60 days; and meet other documentation requirements. If the patient does not receive at least one covered nursing visit in a 60-day period, the plan is considered terminated for the purpose of Medicare coverage unless: • The supervising physician has reviewed the plan of treatment and made a recertification within the 60-day period which indicates that the lapse of visits is a part of the physician’s regimen for the patient, or • Nursing visits are required at intervals less frequently than once every 60 days, but the intervals are predictable (e.g., it is predictable that a visit is required only every 90 days for the purpose of changing a silicone catheter, etc.). Home nursing visits furnished before the plan is put into writing are covered if authorized in writing by the supervising physician.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) On March 27, 2020, Congress signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Section 3704 of the CARES Act authorized RHCs and FQHCs to provide distant site telehealth services to Medicare patients during the COVID-19 PHE. Section 4113 of the Consolidated Appropriations Act, 2023, extended this authority through December 31, 2024 and section 2207(c) of the Full- Year Continuing Appropriations and Extensions Act, 2025 amended section 1834(m)(8) of the Act to continue payment for RHC and FQHC services as Medicare telehealth services through September 30, 2025. Most recently, section 6208 of the Continuing Appropriations, Agriculture, Legislative Branch, Military Construction and Veterans Affairs, and Extensions Act, 2026 extended these services through January 30, 2026. However, through regulation, CMS provides payment to RHCs and FQHCs when they furnish non-behavioral health visits via telecommunication technology, through December 31, 2026. That is, on a temporary basis, RHCs and FQHCs are paid under the methodology that has been in place for these services during and after the COVID- 19 PHE through December 31, 2026. Specifically, RHCs and FQHCs can bill for RHC and FQHC services furnished using telecommunication technology by reporting HCPCS code G2025 on the claim, including services furnished using audio-only communications technology through December 31, 2026. Payment for HCPCS code G2025 is based on the average amount for all PFS telehealth services on the telehealth list, weighted by volume for those services reported under the PFS. RHC and FQHC practitioners can provide distant site telehealth services – approved by Medicare as a distant site telehealth service under the physician fee schedule (PFS) – from any location in the United States (see 42 CFR 411.9(a)(1)), including their home, during the time that they’re employed by or under contract with the RHC or FQHC.

(Rev. 230, Issued: 12-09-16, Effective: 03-09-17, Implementation: 03-09-17)

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) Medicare beneficiaries who elect the Medicare hospice benefit may choose either an individual physician, NP or PA to serve as their designated attending practitioner (Section 1861(dd) of the Act). Beginning January 1, 2022, under section 132 of the CAA 2021, RHCs and FQHCs are authorized to serve in this role. A physician, NP, or PA who works for an RHC or FQHC may provide hospice attending physician services during a time when he/she is working for the RHC or FQHC (unless prohibited by their RHC or FQHC contract or employment agreement). The RHC or FQHC would bill for these services as they would for any other qualified service to be paid the RHC AIR or the FQHC PPS rate, respectively. A physician, NP, or PA who works for an RHC or FQHC may provide hospice attending services during a time when he/she is not working for the RHC or FQHC (unless prohibited by their RHC or FQHC contract or employment agreement). These services would not be considered RHC or FQHC services and the physician or NP would bill for these services under regular Part B rules using his/her own provider number. Any service provided to a hospice beneficiary by an RHC or FQHC practitioner must comply with Medicare prohibitions on commingling. (See section 100 of this chapter).

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) For hospice services that are not described above in section 210.1, RHCs and FQHCs can treat hospice beneficiaries for medical conditions not related to their terminal illness. However, if a Medicare beneficiary who has elected the hospice benefit receives care from an RHC or FQHC related to his/her terminal illness, the RHC or FQHC cannot be reimbursed for the visit, even if it is a medically necessary, face-to- face visit with an RHC or FQHC practitioner, since that would result in duplicate payment for services, except under either of the following circumstances: • The RHC or FQHC has a contract with the hospice provider to furnish core hospice services related to the patient’s terminal illness and related conditions when extraordinary circumstances exist within the hospice. Extraordinary circumstances are described as “unanticipated periods of high patient loads; staffing shortages due to illness or other short-term temporary situations that interrupt patient care; and temporary travel of a patient outside the hospice’s service area” (42CFR 418.64); • The RHC or FQHC has a contract with the hospice provider to furnish highly specialized nursing services that are provided by the hospice so infrequently that it would be impractical and prohibitively expensive for the hospice to employ a practitioner to provide these services. For example, a hospice may infrequently have a pediatric patient, and in those situations, contract with an RHC or FQHC that has a pediatric nurse on staff to furnish hospice services to the patient. In these situations, all costs associated with the provision of hospice services must be carved out of the RHC or FQHC cost report, and the RHC or FQHC would be reimbursed by the hospice. (42 CFR 418.64(b)(3)). Any service provided to a hospice beneficiary by an RHC or FQHC practitioner must comply with Medicare prohibitions on commingling. (See section 100 of this chapter).

(Rev. 230, Issued: 12-09-16, Effective: 03-09-17, Implementation: 03-09-17) RHCs and FQHCs are paid for the professional component of allowable preventive services when all of the program requirements are met and frequency limits (where applicable) have not been exceeded. The beneficiary copayment and deductible (where applicable) is waived by the Affordable Care Act for the IPPE and AWV, and for Medicare-covered preventive services recommended by the USPSTF with a grade or A or B.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Influenza (G0008), Pneumococcal (G0009), and COVID-19 (90480) Vaccines, and Certain COVID-19 Monoclonal Antibody Products Prior to July 1, 2025, influenza, pneumococcal, COVID-19 vaccines, and their administration were not paid at the time of service and were paid at 100 percent of reasonable cost through the cost report. Effective for dates of service on or after July 1, 2025, RHCs shall report all Part B preventive vaccines and their administration – pneumococcal, influenza, and COVID-19 on the claim at the time of service. A visit/encounter is not required for these services; however, if reported on the same day, the vaccines and administrations shall receive a separate payment. Coinsurance and deductible do not apply to these vaccines or their administration. Although paid at the time of service, payments for these services must be annually reconciled with the RHC’s actual vaccine and vaccine administration costs, to ensure these services are ultimately reimbursed at 100% of reasonable costs through the cost report. Each year, CMS updates the Seasonal Influenza Vaccines Pricing webpage: https://www.cms.gov/medicare/medicare-part-b-drug-average-sales-price/vaccine-pricing to reflect the seasonal influenza virus vaccines and their applicable payment allowances that are effective August 1 through July 31 of the following year. RHCs must refer to this webpage to ensure they are billing the appropriate HCPCS codes for the applicable influenza season. Note: An additional payment for influenza, pneumococcal, COVID-19 vaccine administration in the home can be made, provided that a home visit meets all the requirements of both part 405, subpart X, for RHC services provided in the home, and § 410.152(h)(3)(iii) for the in-home additional payment for Part B preventive vaccine administration. See Pub. 100-02, Chapter 15, Section 50.4.4.2.E. Covered monoclonal antibody products used as pre-exposure prophylaxis prevention of COVID-19 and their administration are paid at 100 percent of reasonable cost through the cost report. Monoclonal antibody products used for the treatment or for post-exposure prophylaxis of COVID-19 (when they are not purchased by the government) and their administration are paid through the cost report until the end of the calendar year in which the Emergency Use Authorization declaration for drugs and biological products with respect to COVID-19 ends. Hepatitis B Vaccine (G0010) Prior to January 1, 2025, hepatitis B vaccine and its administration was included in the RHC visit and was not separately billable. The cost of the vaccine and its administration could be included in the line item for the otherwise qualifying visit. A visit could not be billed if vaccine administration was the only service the RHC provides. The beneficiary coinsurance and deductible were waived. Effective January 1, 2025, payment for the hepatitis B vaccine and its administration is through the cost report and no longer included in the RHC AIR. Effective for dates of service on or after July 1, 2025, RHCs shall report all Part B preventive vaccines and their administration – including hepatitis B on the claim at the time of service. A visit/encounter is not required for these services; however, if a visit occurs on the same day, the vaccines and administrations shall receive a separate payment. Coinsurance and deductible do not apply to these vaccines or their administration. Note: An additional payment for hepatitis B vaccine administration in the home can be made, provided that a home visit meets all the requirements of both part 405, subpart X, for RHC services provided in the home, and § 410.152(h)(3)(iii) for the in-home additional payment for Part B preventive vaccine administration. See Pub. 100-02, Chapter 15, Section 50.4.4.2.E for more information. Although paid at the time of service, payments for these services must be annually reconciled with the RHC’s actual vaccine and vaccine administration costs, to ensure these services are ultimately reimbursed at 100% of reasonable costs through the cost report. Initial Preventive Physical Exam (G0402) The IPPE is a face-to-face one-time exam that must occur within the first 12 months following the beneficiary’s enrollment. The IPPE can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If an IPPE visit is furnished on the same day as another billable visit, two visits may be billed. The beneficiary coinsurance and deductible are waived. Annual Wellness Visit (G0438 and G0439) The AWV is a face-to-face personalized prevention visit for beneficiaries who are not within the first 12 months of their first Part B coverage period and have not received an IPPE or AWV within the past 12 months. Advance Care Planning (ACP) and administration of a standardized, evidence-based assessment of physical activity and nutrition can be furnished as a part of the AWV. The AWV can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If the AWV is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible are waived. More information regarding ACP and an evidence-based assessment of physical activity and nutrition as an optional AWV element is available on the CMS website: https://www.cms.gov/medicare/coverage/preventive-services/medicare-wellness- visits/annual-wellness-visit Diabetes Self-Management Training (G0108) and Medical Nutrition Therapy (97802 and 97803) Diabetes self-management training or medical nutrition therapy provided by a registered dietician or nutritional professional at an RHC may be considered incident to a visit with an RHC practitioner provided all applicable conditions are met. DSMT and MNT are not billable visits in an RHC, although the cost may be allowable on the cost report. RHCs cannot bill a visit for services furnished by registered dieticians or nutritional professionals. However, RHCs are permitted to become certified providers of DSMT services and report the cost of such services on their cost report for inclusion in the computation of their AIR. The beneficiary coinsurance and deductible apply. Screening Pelvic and Clinical Breast Examination (G0101) Screening pelvic and clinical breast examination can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible are waived. Screening Papanicolaou Smear (Q0091) Screening Papanicolaou smear can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible are waived. Prostate Cancer Screening (G0102) Prostate cancer screening can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible apply. Glaucoma Screening (G0117 and G0118) Glaucoma screening for high risk patients can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible apply. Lung Cancer Screening Using Low Dose Computed Tomography (LDCT) (G0296) LDCT can be billed as a stand-alone visit if it is the only medical service provided on that day with an RHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance and deductible are waived. Drugs Covered as Additional Preventive Services (DCAPS) DCAPS drugs, and any supply and administration fee, are paid at 100 percent of the Medicare payment amount. The Medicare payment amount for DCAPS drugs, and any supply and administration fee, is described in the Medicare Claims Processing Manual (100-04), Chapter 18, Section 250. The beneficiary coinsurance and deductible are waived. These services are separately billable and are paid on a claim-by-claim basis. Therefore, they do not affect any other claims billed on the same day. Coding for DCAPS drugs and related supply and administration fees is listed on the CMS webpage: • The coding and other guidance for Part B coverage and payment of PrEP for HIV is located at https://www.cms.gov/medicare/coverage/prep. The HCPCS code for the injection of PrEP for HIV is G0012. NOTE: Hepatitis C Screening (G0472) is a technical service only and therefore it is not paid as part of the RHC visit.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) When one or more qualified preventive service is provided as part of an RHC visit, charges for these services must be deducted from the total charge for purposes of calculating beneficiary copayment and deductible. For example, if the total charge for the visit is $150, and $50 of that is for a qualified preventive service, the beneficiary copayment and deductible is based on $100 of the total charge, and Medicare would pay 80 percent of the $100, and 100 percent of the $50 (minus any deductible). If no other RHC service took place along with the preventive service, there would be no copayment or deductible applied, and Medicare would pay 100 percent of the payment amount.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) FQHCs must provide preventive health services on site or by arrangement with another provider. These services must be furnished by or under the direct supervision of a physician, NP, PA, CNM, CP, CSW, MFT or MHC. Section 330(b)(1)(A)(i)(III) of the Public Health Service (PHS) Act required preventive health services can be found at http://bphc.hrsa.gov/policies regulations/legislation/index.html, and include: • prenatal and perinatal services; • appropriate cancer screening; • well-child services; • immunizations against vaccine-preventable diseases; • screenings for elevated blood lead levels, communicable diseases, and cholesterol; • pediatric eye, ear, and dental screenings to determine the need for vision and hearing correction and dental care; • voluntary family planning services; and • preventive dental services. NOTE: The cost of providing these services may be included in the FQHC cost report but they do not necessarily qualify as FQHC billable visits or for the waiver of the beneficiary coinsurance. Influenza (G0008), Pneumococcal (G0009), and COVID-19 (90480) Vaccines and Certain COVID-19 Monoclonal Antibody Products Prior to July 1, 2025, influenza, pneumococcal, and COVID-19 vaccines and their administration were not paid at the time of service and were paid at 100 percent of reasonable cost through the cost report. The cost was included in the cost report and no visit was billed. FQHCs must have included these charges on the claim if furnished as part of an encounter. The beneficiary coinsurance was waived. Effective for dates of service on or after July 1, 2025, FQHCs shall report all Part B preventive vaccines and their administration – pneumococcal, influenza, and COVID-19 - - on the claim at the time of service. A visit/encounter is not required for these services; however, if a visit occurs on the same day, the vaccines and administrations shall receive a separate payment. Coinsurance does not apply to these vaccines or their administration. Although paid at the time of service, payments for these services must be annually reconciled with the FQHC’s actual vaccine and vaccine administration costs, to ensure these services are ultimately reimbursed at 100% of reasonable costs through the cost report. Each year, CMS updates the Seasonal Influenza Vaccines Pricing webpage: https://www.cms.gov/medicare/medicare-part-b-drug-average-sales-price/vaccine-pricing to reflect the seasonal influenza virus vaccines and their applicable payment allowances that are effective August 1 through July 31 of the following year. FQHCs must refer to this webpage to ensure they are billing the appropriate HCPCS codes for the applicable influenza season. Note: An additional payment for influenza, pneumococcal, COVID-19 vaccine administration in the home can be made, provided that a home visit meets all the requirements of both part 405, subpart X, for FQHC services provided in the home, and § 410.152(h)(3)(iii) for the in-home additional payment for Part B preventive vaccine administration. See Pub. 100-02, Chapter 15, Section 50.4.4.2.E. Covered monoclonal antibody products used as pre-exposure prophylaxis prevention of COVID-19 and their administration are paid at 100 percent of reasonable cost through the cost report. Monoclonal antibody products used for the treatment or for post-exposure prophylaxis of COVID-19 (when they are not purchased by the government) and their administration are paid through the cost report until the end of the calendar year in which the Emergency Use Authorization declaration for drugs and biological products with respect to COVID-19 ends. Hepatitis B Vaccine (G0010) Prior to January 1, 2025, hepatitis B vaccine and its administration was included in the FQHC visit and was not separately billable. The cost of the vaccine and its administration could be included in the line item for the otherwise qualifying visit. A visit could not be billed if vaccine administration was the only service the FQHC provides. The beneficiary coinsurance was waived. Effective January 1, 2025, payment for the hepatitis B vaccine and its administration is through the cost report and no longer included in the FQHC PPS rate. Effective for dates of service on or after July 1, 2025, FQHCs shall report all Part B preventive vaccines and their administration – including hepatitis B, on the claim at the time of service. A visit/encounter is not required for these services; however, if a visit occurs on the same day, the vaccines and administrations shall receive a separate payment. Coinsurance does not apply to these vaccines. Although paid at the time of service, payments for these services must be annually reconciled with the FQHC’s actual vaccine and vaccine administration costs, to ensure these services are ultimately reimbursed at 100% of reasonable costs through the cost report. Note: An additional payment for hepatitis B vaccine administration in the home can be made, provided that a home visit meets all the requirements of both part 405, subpart X, for FQHC services provided in the home, and § 410.152(h)(3)(iii) for the in-home additional payment for Part B preventive vaccine administration. See Pub. 100-02, Chapter 15, Section 50.4.4.2.E for more information. Initial Preventive Physical Exam (G0402) The IPPE is a face-to-face one-time exam that must occur within the first 12 months following the beneficiary’s enrollment. The IPPE can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If an IPPE visit is furnished on the same day as another billable visit, FQHCs may not bill for a separate visit. These FQHCs will have an adjustment of 1.3416 to their PPS rate. The beneficiary coinsurance is waived. Annual Wellness Visit (G0438 and G0439) The AWV is a personalized face-to-face prevention visit for beneficiaries who are not within the first 12 months of their first Part B coverage period and have not received an IPPE or AWV within the past 12 months. Advance Care Planning (ACP) and administration of a standardized, evidence-based assessment of physical activity and nutrition can be furnished as a part of the AWV. The AWV can be billed as a stand- alone visit if it is the only medical service provided on that day with an FQHC practitioner. If the AWV is furnished on the same day as another medical visit, it is not a separately billable visit. FQHCs that are authorized to bill under the FQHC PPS will have an adjustment of 1.3416 to their PPS rate. The beneficiary coinsurance is waived. More information regarding ACP and an evidence-based assessment of physical activity and nutrition as an optional AWV element is available on the CMS website: https://www.cms.gov/medicare/coverage/preventive-services/medicare-wellness- visits/annual-wellness-visit Diabetes Self-Management Training (G0108) and Medical Nutrition Therapy (97802 and 97803) DSMT and MNT furnished by certified DSMT and MNT providers are billable visits in FQHCs when they are provided in a one-on-one, face-to-face encounter and all program requirements are met. Other diabetes counseling or medical nutrition services provided by a registered dietician at the FQHC may be considered incident to a visit with an FQHC provider. The beneficiary coinsurance is waived for MNT services and is applicable for DSMT. DSMT must be furnished by a certified DSMT practitioner, and MNT must be furnished by a registered dietitian or nutrition professional. Program requirements for DSMT services are set forth in 42 CFR 410 Subpart H for DSMT and in Part 410, Subpart G for MNT services, and additional guidance can be found at Pub. 100-02, chapter 15, section 300. Screening Pelvic and Clinical Breast Examination (G0101) Screening pelvic and clinical breast examination can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance is waived. Screening Papanicolaou Smear (Q0091) Screening Papanicolaou smear can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance is waived. Prostate Cancer Screening (G0102) Prostate cancer screening can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance applies. Glaucoma Screening (G0117 and G0118) Glaucoma screening for high risk patients can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance applies. Lung Cancer Screening Using Low Dose Computed Tomography (LDCT) (G0296) LDCT can be billed as a stand-alone visit if it is the only medical service provided on that day with an FQHC practitioner. If it is furnished on the same day as another medical visit, it is not a separately billable visit. The beneficiary coinsurance is waived. Drugs Covered as Additional Preventive Services (DCAPS) DCAPS drugs, and any supply and administration fee, are paid at 100 percent of the Medicare payment amount. The Medicare payment amount for DCAPS drugs, and any supply and administration fee, is described in the Medicare Claims Processing Manual (100-04), Chapter 18, Section 250. The beneficiary coinsurance and deductible are waived. These services are separately billable and are paid on a claim-by-claim basis. Therefore, they do not affect any other claims billed on the same day. Coding for DCAPS drugs and related supply and administration fees is listed on the CMS webpage: • The coding and other guidance for Part B coverage and payment of PrEP for HIV is located at https://www.cms.gov/medicare/coverage/prep. The HCPCS code for the injection of PrEP for HIV is G0012. NOTE: Hepatitis C Screening (G0472) is a technical service only and therefore not paid as part of the FQHC visit.

(Rev. 239, Issued: 01-09-18, Effective: 1-22-18, Implementation: 1-22-18) Under the FQHC PPS, coinsurance will generally be 20 percent of the lesser of the FQHC’s charge or the PPS rate. When one or more qualified preventive services are provided as part of an FQHC visit, the A/B MAC will use the lesser of the FQHC’s charge for the specific FQHC payment code or the PPS rate to determine the total payment amount. To determine the amount of Medicare payment and the amount of coinsurance that should be waived, the A/B MAC will use the FQHC’s reported line- item charges and subtract the dollar value of the FQHC's reported line-item charge for the preventive services from the full payment amount. For FQHC claims that consist solely of preventive services that are exempt from beneficiary coinsurance, Medicare pays 100 percent of the lesser of the FQHC’s charge or the FQHC PPS rate, and no beneficiary coinsurance is assessed.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Care coordination services are RHC and FQHC services and include transitional care management (TCM), chronic care management (CCM), principal care management (PCM), chronic pain management (CPM), general behavioral health integration (BHI), Remote Patient Monitoring (RPM), Remote Therapeutic Monitoring (RTM), Community Health Integration (CHI), Principal Illness Navigation (PIN), Principal Illness Navigation Peer Support (PIN-PS), Advanced Primary Care Management (APCM) and psychiatric collaborative care model (CoCM) services. The RHC and FQHC face-to-face requirements are waived for these care management services. Effective January 1, 2017, care management services furnished by auxiliary personnel may be furnished under general supervision. (Note: General supervision does not require the RHC or FQHC practitioner to be in the same building or immediately available, but it does require the services to be furnished under the overall supervision and control of the RHC or FQHC practitioner.) Except for TCM services, care management services are paid separately from the RHC AIR or FQHC PPS. Prior to January 1, 2022, RHCs and FQHCs could not bill for care management services for a beneficiary if another practitioner or facility had already billed for care management services for the same beneficiary during the same time period. Effective January 1, 2022, RHCs and FQHCs may bill for care management and TCM services and other care management services (outside of the RHC AIR or FQHC PPS), for the same beneficiary during the same time period. Coinsurance and deductibles are applied as applicable to RHC claims, and coinsurance is applied as applicable to FQHC claims. Effective January 1, 2025, RHCs and FQHCs are required to bill the individual codes that make up the general care management HCPCS code, G0511. RHCs and FQHCs must report the individual CPT/HCPCS base codes and add-on codes (as necessary) for each of the care coordination services which replaced the reporting of HCPCS code G0511. Note: Effective January 1, 2026, RHCs and FQHCs can bill care coordination services established under the Physician Fee Schedule (PFS) as designated care management services. The care coordination codes can be found in the table entitled Designated Care Management Services, which is published annually with the PFS Final Rule Addenda on the CMS website. Care coordination services are paid separately and should meet all of the billing requirements. Except for TCM services, which can be an RHC or FQHC visit (see section 230.1 of this Chapter).

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) Effective January 1, 2013, RHCs and FQHCs are paid for TCM services furnished by an RHC or FQHC practitioner when all TCM requirements are met. TCM services must be furnished within 30 days of the date of the patient’s discharge from a hospital (including outpatient observation or partial hospitalization), SNF, or community mental health center. Communication (direct contact, telephone, or electronic) with the patient or caregiver must commence within 2 business days of discharge, and a face-to-face visit must occur within 14 days of discharge for moderate complexity decision making (CPT code 99495), or within 7 days of discharge for high complexity decision making (CPT code 99496). The TCM visit is billed on the day that the TCM visit takes place, and only one TCM visit may be paid per beneficiary for services furnished during that 30 day post- discharge period. TCM services are billed by adding CPT code 99495 or CPT code 99496 to an RHC or FQHC claim, either alone or with other payable services. If it is the only medical service provided on that day with an RHC or FQHC practitioner it is paid as a stand- alone billable visit. If it is furnished on the same day as another visit, only one visit is paid.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) General Care Management Services include: Chronic Care Management (CCM), Principal Care Management (PCM), Chronic Pain Management (CPM), General Behavioral Health Integration (BHI) services, Remote Patient Monitoring (RPM), Remote Therapeutic Monitoring (RTM), Community Health Integration (CHI), Principal Illness Navigation (PIN) and PIN Peer-Support (PIN-PS). Beneficiary consent remains in effect unless the beneficiary opts out of receiving care management services. If the beneficiary chooses to resume care management services after opting out, beneficiary consent is required before care management services can resume. If the beneficiary has not opted out of care management services but there has been a period where no care management services were furnished, a new beneficiary consent is not required.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) A separately billable initiating visit with an RHC or FQHC primary care practitioner (physician, NP, PA, or CNM) is required before care management services can be furnished. This visit can be an E/M, AWV, or IPPE visit, and must occur no more than one-year prior to commencing care management services. Care management services do not need to have been discussed during the initiating visit. Beneficiary consent to receive care management services can be obtained by auxiliary staff under general supervision of the RHC or FQHC primary care practitioner as well as by the billing practitioner, may be written or verbal and must be documented in the patient’s medical record before CCM services are furnished. The medical record should document that the beneficiary has been informed about the availability of care management services, has given permission to consult with relevant specialists as needed, and has been informed of all of the following: • There may be cost-sharing (e.g. deductible and coinsurance in RHCs, and coinsurance in FQHCs) for both in-person and non-face-to-face services that are provided; • Only one practitioner/facility can furnish and be paid for these services during a calendar month; and • They can stop care management services at any time, effective at the end of the calendar month.

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) Effective January 1, 2021, RHCs and FQHCs are paid for PCM services when a minimum of 30 minutes of qualifying PCM services are furnished during a calendar month. PCM services may be furnished to patients with a single high- risk or complex condition that is expected to last at least 3 months and may have led to a recent hospitalization, and/or placed the patient at significant risk of death. PCM service requirements include: • A single complex chronic condition lasting at least 3 months, which is the focus of the care plan; • The condition is of sufficient severity to place patient at risk of hospitalization or have been the cause of a recent hospitalization; • The condition requires development or revision of disease-specific care plan; • The condition requires frequent adjustments in the medication regiment; and • The condition is unusually complex due to comorbidities.

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) Effective January 1, 2023, RHCs and FQHCs are paid for CPM services when a minimum of 30 minutes of qualifying non-face-to-face CPM services are furnished during a calendar month. CPM services may be furnished to patients with multiple chronic conditions that involve chronic pain, and may include a person-centered plan of care, care coordination, medication management, and other aspects of pain care.

(Rev. 11803; Issued: 01-26-23; Effective: 01-01-23; Implementation: 02-27-23) BHI is a team-based, collaborative approach to care that focuses on integrative treatment of patients with primary care and mental or behavioral health conditions. Effective January 1, 2018, RHCs and FQHCs are paid for general BHI services when a minimum of 20 minutes of qualifying general BHI services during a calendar month is furnished to patients with one or more new or pre-existing behavioral health or psychiatric conditions being treated by the RHC or FQHC primary care practitioner, including substance use disorders, that, in the clinical judgment of the RHC or FQHC primary care practitioner, warrants BHI services. General BHI service requirements include: • An initial assessment and ongoing monitoring using validated clinical rating scales; • Behavioral health care planning in relation to behavioral/psychiatric health problems, including revision for patients who are not progressing or whose status changes; • Facilitating and coordinating treatment such as psychotherapy, pharmacotherapy, counseling and/or psychiatric consultation; and • Continuity of care with a designated member of the care team.

(Rev.12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, RHCs and FQHCs are paid for RPM services when a minimum of 20 minutes of qualifying non-face-to-face RPM services are furnished during a calendar month. RPM services include the collection, analysis, and interpretation of digitally collected physiologic data, followed by the development of a treatment plan, and the managing of a patient under the treatment plan. RHCs and FQHCs are also paid for the initial set-up and patient education on use of the equipment that stores the physiologic data for RPM services.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, RHCs and FQHCs are paid for RTM services when a minimum of 20 minutes of qualifying non-face-to-face RTM services are furnished during a calendar month. RTM services include remote monitoring of respiratory system status, musculoskeletal status, therapy adherence, or therapy response. RHCs and FQHCs are also paid for the initial set-up and patient education on use of the equipment that stores the physiologic data for RTM services.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, RHCs and FQHCs are paid for CHI services when a minimum of 60 minutes of qualifying non-face-to-face CHI services are furnished during a calendar month. CHI services include coordination of care, facilitation of access to services, and communication between settings to address the SDOH need(s) that may interfere with, or present a barrier to, the diagnosis or treatment of a patient.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, RHCs and FQHCs are paid for PIN services when a minimum of 60 minutes of qualifying non-face-to-face PIN services are furnished during a calendar month. PIN services include health care navigation as part of the treatment plan for a serious, high-risk disease expected to last at least 3 months, that places the patient at significant risk of hospitalization or nursing home placement, acute exacerbation/decompensation, functional decline, or death.

(Rev.12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, RHCs and FQHCs are paid for PIN-PS services when a minimum of 60 minutes of qualifying PIN-PS services are furnished during a calendar month. PIN-PS services include the treatment of high-risk behavioral health conditions.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Advanced Primary Care Management services combine elements of several existing care management and communication technology-based services that include essential elements such as Chronic Care Management (CCM), Transitional Care Management (TCM), and Principal Care Management (PCM). Effective January 1, 2025, RHCs and FQHCs can bill for APCM services once per patient per calendar month using an APCM HCPCS code when the billing requirements are met. APCM services aren’t time based. Effective January 1, 2026, RHCs and FQHCs can bill optional add-on codes for APCM services that would facilitate providing complementary BHI or CoCM services. Detailed information regarding APCM can be found on the CMS Website: https://www.cms.gov/medicare/payment/fee-schedules/physician-fee-schedule/advanced- primary-care-management-services

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) CCM services furnished between January 1, 2016, and December 31, 2017, are paid based on the PFS national average non-facility payment rate when CPT code 99490 is billed alone or with other payable services on an RHC or FQHC claim. CCM or general BHI services furnished between January 1, 2018, and December 31, 2018, are paid at the average of the national non-facility PFS payment rate for CPT codes 99490 (30 minutes or more of CCM services), 99487 (60 minutes or more of complex CCM services), and 99484 (20 minutes or more of general behavioral health integration services), when general care management HCPCS code G0511 is on an RHC or FQHC claim, either alone or with other payable services. CCM or general BHI services furnished on or after January 1, 2019, are paid at the average of the national non-facility PFS payment rate for CPT codes 99490, 99487, 99484, and 99491(30 minutes or more of CCM furnished by a physician or other qualified health care professional), when general care management HCPCS code G0511 is on an RHC or FQHC claim, either alone or with other payable services. CCM, PCM or general BHI services furnished on or after January 1, 2021 are paid at the average of the national non-facility PFS payment rate for CPT codes 99490, 99487, 99484, and 99491, and CPT codes 99424 (30 minutes or more of PCM services furnished by physicians or non-physician practitioners (NPPs)) and 99426 (30 minutes or more of PCM services furnished by clinical staff under the direct supervision of a physician or NPP), when general care management HCPCS code G0511 is on an RHC or FQHC claim, either alone or with other payable services. CCM, PCM, CPM or general BHI services furnished on or after January 1, 2023 are paid at the average of the national non-facility PFS payment rate for CPT codes 99490, 99487, 99484, 99491, 99424, 99426, and G3002 (30 minutes or more of CPM services) when general care management HCPCS code G0511 is on an RHC or FQHC claim, either alone or with other payable services. The payment rate for HCPCS code G0511 is updated annually based on the PFS amounts for these codes. CCM, PCM, CPM, general BHI, RPM, RTM, CHI or PIN services furnished on or after January 1, 2024, are paid at the weighted average of the national non-facility PFS payment rate by taking the utilization of the base code for the service furnished and any applicable add-on codes used in the same month, as well as any base code reported alone in a month, when general care management HCPCS code G0511 is on an RHC or FQHC claim, either alone or with other payable services. The actual utilization of the services that comprise G0511 will be obtained by using the most recently available data for the services paid under the PFS. The payment rate for HCPCS code G0511 is updated annually based on the PFS amounts for these codes. RHCs and FQHCs may bill HCPCS code G0511 multiple times in a calendar month for the codes listed in the table below as long as all requirements are met and there is not double counting. For example, RHCs and FQHCs can bill HCPCS code G0511 twice for 20 minutes of qualifying CCM services and 30 minutes of qualifying PCM services, as long as, the clinical staff minutes do not overlap. Effective January 1, 2025, RHCs and FQHCs are required to bill the individual CPT/HCPCS base codes and add-on codes for each of the care coordination services to receive payment separate from the RHC AIR or FQHC PPS. Billing the individual codes replaced the reporting of HCPCS code G0511. Care coordination services are paid at the national non-facility PFS payment rates. Note: CMS permitted billing of HCPCS code G0511 to continue through September 30, 2025. Advanced Primary Care Management Services (APCM) furnished on or after January 1, 2025, are paid at the national non-facility PFS payment rates. A list of all care coordination services for RHCs and FQHCs are available on the RHC and FQHC websites at https://www.cms.gov/Center/Provider-Type/Rural- Health-Clinics-Center and https://www.cms.gov/medicare/payment/prospective- payment-systems/federally-qualified-health-centers-fqhc-center, respectively. Coinsurance For FQHCs, coinsurance for care coordination services is 20 percent of the lesser of submitted charges or the national non-facility PFS payment rate for each individual HCPCS code. For RHCs, coinsurance for care coordination services is 20 percent of the lesser of the submitted charges or the national non-facility PFS payment rate for each individual HCPCS code. Care coordination costs are reported in the non- reimbursable section of the cost report and are not used in determining the RHC AIR or the FQHC PPS rate.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Psychiatric CoCM is a specific model of care provided by a primary care team consisting of a primary care provider and a health care manager who work in collaboration with a psychiatric consultant to integrate primary health care services with care management support for patients receiving behavioral health treatment. It includes regular psychiatric inter-specialty consultation with the primary care team, particularly regarding patients whose conditions are not improving. The primary care team regularly reviews the beneficiary’s treatment plan and status with the psychiatric consultant and maintains or adjusts treatment, including referral to behavioral health specialty care, as needed. Patients with mental health, behavioral health, or psychiatric conditions, including substance use disorders, who are being treated by an RHC or FQHC practitioner may be eligible for psychiatric CoCM services, as determined by the RHC or FQHC primary care practitioner. A separately billable initiating visit with an RHC or FQHC primary care practitioner (physician, NP, PA, or CNM) is required before psychiatric CoCM services can be furnished. This visit can be an E/M, AWV, or IPPE visit, and must occur no more than one-year prior to commencing care management services. Psychiatric CoCM services do not need to have been discussed during the initiating visit, and the same initiating visit can be used for psychiatric CoCM as for CCM and BHI services, as long as it occurs with an RHC or FQHC primary care practitioner within one year of commencement of psychiatric CoCM services. Beneficiary consent to receive care management services must be obtained either by or under the direct supervision of the RHC or FQHC primary care practitioner, may be written or verbal and must be documented in the patient’s medical record before psychiatric CoCM services are furnished. The medical record should document that the beneficiary has been informed about the availability of care management services, has given permission to consult with relevant specialists as needed, and has been informed of all of the following: • There may be cost-sharing (e.g. deductible and coinsurance in RHCs, and coinsurance in FQHCs) for both in-person and non-face-to-face services that are provided; • Only one practitioner/facility can furnish and be paid for these services during a calendar month; and • They can stop care management services at any time, effective at the end of the calendar month. Beneficiary consent remains in effect unless the beneficiary opts out of receiving care management services. If the beneficiary chooses to resume care management services after opting out, beneficiary consent is required before care management services can resume. If the beneficiary has not opted out of care management services but there has been a period where no care management services were furnished, a new beneficiary consent is not required. Behavioral Health Care Manager Requirements The behavioral health care manager is a designated individual with formal education or specialized training in behavioral health, including social work, nursing, or psychology, and has a minimum of a bachelor’s degree in a behavioral health field (such as in clinical social work or psychology), or is a clinician with behavioral health training, including RNs and LPNs. The behavioral health care manager furnishes both face-to- face and nonface-to-face services under the general supervision of the RHC or FQHC practitioner and may be employed by or working under contract to the RHC or FQHC. The behavioral health care manager: • Provides assessment and care management services, including the administration of validated rating scales; • Provides behavioral health care planning in relation to behavioral/psychiatric health problems, including revision for patients who are not progressing or whose status changes; • Provides brief psychosocial interventions; • Maintains ongoing collaboration with the RHC or FQHC practitioner; • Maintains a registry that tracks patient follow-up and progress; • Acts in consultation with the psychiatric consultant; • Is available to provide services face-to-face with the beneficiary; and • Has a continuous relationship with the patient and a collaborative, integrated relationship with the rest of the care team. Psychiatric Consultant Requirements The psychiatric consultant is a medical professional trained in psychiatry and qualified to prescribe the full range of medications. The psychiatric consultant is not required to be on site or to have direct contact with the patient and does not prescribe medications or furnish treatment to the beneficiary directly. The psychiatric consultant: • Participates in regular reviews of the clinical status of patients receiving psychiatric CoCM services; • Advises the RHC or FQHC practitioner regarding diagnosis and options for resolving issues with beneficiary adherence and tolerance of behavioral health treatment; making adjustments to behavioral health treatment for beneficiaries who are not progressing; managing any negative interactions between beneficiaries’ behavioral health and medical treatments; and • Facilitates referral for direct provision of psychiatric care when clinically indicated. Payment for Psychiatric CoCM Psychiatric CoCM services furnished on or after January 1, 2019, are paid at the average of the national non-facility PFS payment rate for CPT codes 99492 (70 minutes or more of initial psychiatric CoCM services) and CPT code 99493 (60 minutes or more of subsequent psychiatric CoCM services) when psychiatric CoCM HCPCS code, G0512, is on an RHC or FQHC claim, either alone or with other payable services. This rate is updated annually based on the PFS amounts for these codes. At least 70 minutes in the first calendar month, and at least 60 minutes in subsequent calendar months, of psychiatric CoCM services must have been furnished in order to bill for this service. Coinsurance for psychiatric CoCM services is 20 percent of the lesser of submitted charges or the payment rate for G0512. Psychiatric CoCM costs are reported in the nonreimbursable section of the cost report and are not used in determining the RHC AIR or the FQHC PPS rate. G0512 can be billed once per month per beneficiary when all requirements have been met. Only services furnished by an RHC or FQHC practitioner or auxiliary personnel that are within the scope of service elements can be counted toward the minimum 60 minutes that is required to bill for psychiatric CoCM services and does not include administrative activities such as transcription or translation services. Effective January 1, 2026, RHCs and FQHCs must report the individual CPT/HCPCS base codes and add-on codes for each of the psychiatric CoCM services. Billing of the individual codes replaced the reporting of HCPCS code G0512. Psychiatric CoCM services are paid separately at the national non-facility PFS payment rates. A claim should not contain both G0512 and the corresponding CPT/HCPCS codes. Only the individual CPT/HCPCS codes will be paid.

(Rev. 13600; Issued: 02-20-26; Effective: 01-01-26; Implementation:03-23-26) Virtual communication services are RHC and FQHC services and include communications-based technology and remote evaluation services. The RHC and FQHC face-to-face requirements are waived when these services are furnished to an RHC or FQHC patient. Effective January 1, 2019, RHCs and FQHCs receive an additional payment for the costs of communication technology-based services or remote evaluation services that are not already captured in the RHC AIR or the FQHC PPS payment when the requirements for these services are met. Coinsurance and deductibles apply to RHC claims, and coinsurance applies to FQHC claims for these services. Requirements The following requirements must be met for RHCs and FQHCs to bill for virtual communication services: • At least 5 minutes of communications-based technology or remote evaluation services are furnished by an RHC or FQHC practitioner to a patient that has had a billable visit in the RHC or FQHC within the previous year; and • The medical discussion or remote evaluation is for a condition not related to an RHC or FQHC service provided within the previous 7 days, and does not lead to an RHC or FQHC service within the next 24 hours or at the soonest available appointment. If the discussion between the patient and the RHC or FQHC practitioner is related to a billable visit furnished by the RHC or FQHC within the previous 7 days or within the next 24 hours or at the soonest available appointment, the cost of the RHC or FQHC practitioner’s time would be included in the RHC AIR or the FQHC PPS payment and is not separately billable. Beneficiary consent to receive virtual communication services may be obtained under general supervision by auxiliary staff. Payment for Virtual Communication Services Virtual communication services furnished by RHCs and FQHCs on or after January 1, 2019 through December 31, 2025, are paid at the average of the national non-facility PFS payment rate for HCPCS code G2012 (communication technology-based services), and HCPCS code G2010 (remote evaluation services), when the virtual communication HCPCS code, G0071, is on an RHC or FQHC claim, either alone or with other payable services. The payment rate for HCPCS code G0071 is updated annually based on the PFS amounts for these codes. Effective January 1, 2026, RHCs and FQHCs must report the individual CPT/HCPCS base codes and add-on codes for each of the virtual communication services. Billing of the individual codes replaced the reporting of HCPCS code G0071. Virtual communication services will be paid separately at the national non-facility PFS payment rates. A claim should not contain both G0071 and the corresponding CPT/HCPCS codes. Only the individual CPT/HCPCS codes will be paid. Note: Due to the similarities between CPT code 98016 and HCPCS code G2012, HCPCS code G2012 was replaced with CPT 98016. That is, HCPCS code G2012 was terminated effective December 31, 2024.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) Effective January 1, 2024, section 4124 of the Consolidated Appropriations Act of 2023 (CAA, 2023) establishes Medicare coverage and payment for Intensive Outpatient Program (IOP) services for individuals with mental health needs when furnished by hospital outpatient departments, Community Mental Health Centers (CMHCs), Rural Health Clinics (RHCs), and Federally Qualified Health Centers (FQHCs). An IOP is a distinct and organized outpatient program of psychiatric services provided for individuals who have an acute mental illness, which includes, but is not limited to conditions such as depression, schizophrenia, and substance use disorders. For information regarding IOP services scope of benefits and services, certification and plan of care requirements, see Pub. 100-02, Medicare Benefit Policy Manual, chapter 6, section 70.4.

(Rev. 12832; Issued: 09-12-24; Effective:01-01-24; Implementation:10-14-24) The CAA, 2023 requires payment for IOP services furnished by RHCs and FQHCs to be made at the same payment rate as if it were furnished by a hospital. Section 4124(c) of the CAA, 2023 also requires that costs associated with IOP services furnished by RHCs and FQHCs to not be used to determine payment amounts under the RHC all-inclusive rate (AIR) methodology or FQHC prospective payment system (PPS). FQHCs that contract with MA organizations must be paid at least the same amount they would have received for the same service under the FQHC PPS. This provision ensures FQHCs are paid at least the Medicare amount for FQHC services. Therefore, if the MA organization contract rate is lower than the amount Medicare would otherwise pay for FQHC services, FQHCs that contract with MA organizations would receive a wrap-around payment from Medicare to cover the difference. IOP services are included as part of the wrap-around payment policy. Effective January 1, 2024, payment for IOP Services furnished by RHCs will be the rate determined for (Intensive Outpatient (3 services per day) for hospital-based IOPs) and not the RHC AIR. Payment for IOP services furnished in FQHCs will be the lesser of a FQHC’s actual charges or the rate determined for hospital-based IOPs and not the FQHC PPS. Additionally, grandfathered tribal FQHCs will have their payment based on the IHS Medicare outpatient per visit rate when furnishing IOP services. That is, payment is based on the lesser of a grandfathered tribal FQHC’s actual charges or the IHS Medicare outpatient per visit rate. Multiple Visits When IOP services are furnished on the same day as a mental health visit or on the same day as a medical visit, all services are covered under Medicare Part B. However, in the event IOP services are furnished on the same day as a mental health visit, CMS will make one payment at the IOP rate. That is, payment for the mental health visit will be included under the IOP rate. In the event IOP services are furnished on the same day as a medical visit, CMS will make one payment for the medical visit under the FQHC PPS or under the RHC AIR methodology and one payment for IOP services at the IOP rate. Transmittals Issued for this Chapter Rev # Issue Date Subject Impl Date CR# R13600BP 02/20/2026 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update for Calendar Year (CY) 2026 03/23/2026 14363 R13547BP 12/18/2025 Revisions to Publication 100-04, Medicare Claims Processing Manual, Chapters 9, 18, and Publication 100-02, Medicare Benefit Policy Manual, Chapter 13 To Include Updated Information 01/20/2026 14254 R12832BP 09/12/2024 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 10/14/2024 13493 R11803BP 01/26/2023 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 02/27/2023 13063 R10729BP 04/26/2021 Updates to Medicare Benefit Policy Manual for Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Services (Manual Updates Only) 05/26/2021 12252 12/20/2019 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 01/23/2020 11575 R252BP 12/07/2018 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 01/02/2019 11019 R239BP 01/09/2018 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 01/22/2018 10350 R238BP 11/17/2017 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Medicare Benefit Policy Manual Chapter 13 Update 02/15/2018 10350 R230BP 12/09/2016 Rural Health Clinic (RHC) and Federally Qualified Health Center (FQHC) Updates 03/09/2016 9864 R220BP 01/15/2016 Rural Health Clinic and Federally Qualified Health Center - Medicare Benefit Policy Manual Update 02/01/2016 9442 R217BP 12/31/2015 Rural Health Clinic and Federally Qualified Health Center - Medicare Benefit Policy Manual Update – Rescinded and replaced by Transmittal 220 02/01/2016 9442 R201BP 12/12/2014 Medicare Benefit Policy Manual - RHC and FQHC Update - Chapter 13 01/05/2015 8981 R173BP 11/22/2013 Medicare Benefit Policy Manual - RHC and FQHC Update - Chapter 13 01/06/2014 8504 R166BP 01/31/2013 Reorganization of Chapter 13 03/01/2013 7824 R114BP 10/30/2009 Outpatient Mental Health Treatment Limitation 01/04/2010 6686 R49BP 03/31/2006 Payment of Federally Qualified Health Centers (FQHCs) for Diabetes Self-Management Training Services (DSMT) and Medical Nutrition Therapy (MNT) Services 06/29/2006 4385 R40BP 11/18/2005 Skilled Nursing Facility Prospective Payment System 02/16/2006 4079 R1BP 10/01/2003 Introduction to the Benefit Policy Manual N/A N/A Back to top of Chapter