Washington Apple Health (Medicaid)
Inpatient Hospital
Services Billing
Guide
October 1, 2021
2 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Disclaimer
Every effort has been made to ensure this guide’s accuracy. If an actual or
apparent conflict between this document and an HCA rule arises, HCA rules
apply.
Billing guides are updated on a regular basis. Due to the nature of content
change on the internet, we do not fix broken links in past guides. If you find a
broken link, please check the most recent version of the guide. If this is the most
recent guide, please notify us at askmedic[email protected].gov.
About this guide
*
This publication takes effect October 1, 2021, and supersedes earlier billing
guides to this program. Unless otherwise specified, the program in this guide is
governed by the rules found in Chapter 182-550 WAC.
The Health Care Authority is committed to providing equal access to our services.
If you need an accommodation or require documents in another format, please
call 1-800-562-3022. People who have hearing or speech disabilities, please call
711 for relay services.
Washington Apple Health means the public health insurance
programs for eligible Washington residents. Washington Apple
Health is the name used in Washington State for Medicaid, the
children’s health insurance program (CHIP), and state-only
funded health care programs. Washington Apple Health is
administered by the Washington State Health Care Authority.
Refer also to HCA’s ProviderOne billing and resource guide for valuable
information to help you conduct business with the Health Care Authority.
How can I get HCA Apple Health provider documents?
To access providers alerts, go to HCA’s provider alerts webpage.
To access provider documents, go to HCA’s provider billing guides and fee
schedules webpage.
Where can I download HCA forms?
To download an HCA form, see HCA’s Forms & Publications webpage. Type only
the form number into the Search box (Example: 13-835).
*
This publication is a billing instruction.
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Copyright disclosure
Current Procedural Terminology (CPT) copyright 2020 American Medical
Association (AMA). All rights reserved. CPT is a registered trademark of the AMA.
Fee schedules, relative value units, conversion factors and/or related components
are not assigned by the AMA, are not part of CPT, and the AMA is not
recommending their use. The AMA does not directly or indirectly practice
medicine or dispense medical services. The AMA assumes no liability for data
contained or not contained herein.
What has changed?
Subject Change Reason for Change
Provider
preventable
readmissions
Added note box regarding
the 14-day readmission rule
Clarification that this
section does not replace
the 14-day readmission
rule in WAC 182-550-
2900
Provider
preventable
readmission
Revised note box regarding
billing guidance
Clarification that the act
of a client leaving against
medical advice (AMA) is
not a provider
preventable condition
Validation of DRG
assignment
Added bullets regarding
source authority for
inpatient coding
Clarification to specify
nationally recognized
source authority used for
correct coding
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Table of Contents
Resources Available .......................................................................................................................... 9
Definitions ......................................................................................................................................... 10
Client Eligibility................................................................................................................................ 22
How do I verify a client’s eligibility? ................................................................................. 22
Verifying eligibility is a two-step process: ................................................................. 22
Are clients enrolled in an HCA-contracted managed care organization (MCO)
eligible? .......................................................................................................................................... 23
Managed care enrollment ................................................................................................. 24
Clients who are not enrolled in an HCA-contracted managed care plan for
physical health services ...................................................................................................... 25
Integrated managed care .................................................................................................. 25
Integrated Apple Health Foster Care (AHFC) ........................................................... 26
Fee-for-service Apple Health Foster Care .................................................................. 27
What if a client has third-party liability (TPL)? ............................................................. 27
Payment for Services .................................................................................................................... 28
How do I get paid? .................................................................................................................... 28
Payment adjustments.......................................................................................................... 28
General payment policies....................................................................................................... 29
Psychiatric services ............................................................................................................... 29
Inpatient hospital psychiatric transfers ....................................................................... 29
Transfers .................................................................................................................................... 29
Hospital readmissions ......................................................................................................... 31
Provider preventable readmissions .............................................................................. 31
What are HCA’s payment methods? ................................................................................. 35
What are HCA’s payment methods for state-administered programs? ........... 36
Diagnosis related group (DRG) payment method (inpatient primary
payment method) ................................................................................................................. 36
Validation of DRG assignment ........................................................................................ 38
Valid DRG codes .................................................................................................................... 38
DRG relative weights ........................................................................................................... 38
DRG conversion factors ...................................................................................................... 38
High outliers (DRG) .............................................................................................................. 38
Qualifying for high outlier payment using DRG payment method................ 39
Calculating Medicaid high outlier payment ............................................................. 39
Calculating state-only-funded program high outlier for state administered
program (SAP) claims .......................................................................................................... 40
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Transfer information for DRG payment method .................................................... 41
Per diem payment method ............................................................................................... 42
Services paid using the per diem payment method ............................................. 42
Hospitals paid using the per diem payment method ........................................... 42
Transfers (per diem) ............................................................................................................. 43
Fixed per diem payment method – (LTAC) .................................................................... 43
Transfers (per diem - LTAC) ............................................................................................. 43
Ratio of costs-to-charges (RCC) payment method .................................................... 44
Hospitals paid using the RCC payment method ..................................................... 44
Certified public expenditure (CPE) ................................................................................ 44
Payment for services provided to clients eligible for Medicare and Medicaid
............................................................................................................................................................ 44
Recoupment of payments ..................................................................................................... 45
Noted Exceptions .................................................................................................................. 45
Program Limitations ..................................................................................................................... 46
Medical necessity ....................................................................................................................... 46
Unbundling ................................................................................................................................... 46
Routine supplies .................................................................................................................... 46
Components of room and board ................................................................................... 46
Lab and pharmacy services ............................................................................................... 47
Equipment ................................................................................................................................ 47
Respiratory therapy .............................................................................................................. 48
Specific items/services not covered ............................................................................. 48
Administrative days .................................................................................................................. 49
Rate guideline for new hospitals ........................................................................................ 49
Major trauma services ............................................................................................................. 49
Increased payments for major trauma care .............................................................. 49
How does a hospital qualify for TCF payments from HCA? .............................. 50
TCF payments to hospitals for transferred trauma cases ................................... 50
TCF payment calculation ................................................................................................... 51
Cap on TCF payments ......................................................................................................... 51
Use appropriate condition codes when billing for qualified trauma cases 52
Trauma claim adjustments ................................................................................................ 52
Injury severity score (ISS) .................................................................................................. 53
Contacts ..................................................................................................................................... 53
Authorization ................................................................................................................................... 54
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General authorization .............................................................................................................. 54
Authorization requirements for selected surgical procedures ......................... 55
“Write or fax” PA ........................................................................................................................ 55
How does HCA approve or deny PA requests? ............................................................ 55
Expedited prior authorization (EPA) ................................................................................. 56
Surgical procedures that require a medical necessity review by HCA .............. 56
Transgender health services ............................................................................................. 56
Surgical procedures that require a medical necessity review by Comagine
Health ......................................................................................................................................... 58
Breast Surgeries ..................................................................................................................... 58
Newborn Deliveries .............................................................................................................. 58
Approved bariatric hospitals and associated clinics .................................................. 59
Acute physical medicine and rehabilitation (PM&R) ................................................. 59
Inpatient psychiatric admissions ........................................................................................ 59
Long-term acute care (LTAC) ............................................................................................... 59
Out-of-state hospital admissions (does not include hospitals in designated
bordering cities) ......................................................................................................................... 60
Out-of-country hospital admissions ................................................................................. 60
Acute hospital withdrawal management ........................................................................ 61
Hospitals approved for withdrawal management services .................................... 61
Chemical-using pregnant (CUP) women ......................................................................... 61
Acute hospital withdrawal management services ...................................................... 61
What are the medical inpatient withdrawal management criteria? ............... 62
Do withdrawal management services need to be authorized? ........................ 62
What is HCA’s allowed length of stay (LOS) for claims? ..................................... 63
How do I bill HCA for medical inpatient withdrawal management services
exceeding the 3 or 5-day LOS limitation? .................................................................. 63
Payment methods ..................................................................................................................... 66
For medical inpatient withdrawal management claims paid using the per
diem payment method ....................................................................................................... 66
HCA-approved centers of excellence (COE) .................................................................. 66
Covered transplants ............................................................................................................. 67
Experimental transplant procedures ................................................................................. 67
Payment limitations .................................................................................................................. 67
Ventricular assist device (VAD) and percutaneous ventricular assist device
(PVAD) services ........................................................................................................................... 68
Transcatheter aortic valve replacement (TAVR) .......................................................... 68
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Utilization Review ........................................................................................................................... 69
What is utilization review (UR)? .......................................................................................... 69
HCA program integrity retrospective UR ....................................................................... 69
Changes in admission status ................................................................................................ 70
What is admission status? ................................................................................................. 70
When is a change in admission status required? ................................................... 70
When can an admission status change from inpatient to outpatient
observation status? .............................................................................................................. 71
When can an admission status change from outpatient observation to
inpatient status? .................................................................................................................... 71
When can an admission status change from inpatient or outpatient
observation to outpatient status? ................................................................................. 72
When can an admission status change from outpatient surgery/procedure
to outpatient observation or inpatient admission status? ................................. 72
Acute care transfers .................................................................................................................. 73
Coding and DRG validations................................................................................................. 73
DRG outliers ................................................................................................................................. 73
Length-of-stay (LOS) reviews ............................................................................................... 73
Hospital readmissions ............................................................................................................. 74
Provider preventable conditions (PPCs) .......................................................................... 74
Medical record requests for retrospective UR .............................................................. 74
Hospital-issued notice of noncoverage (HINN) .......................................................... 75
Adverse determination appeal process ........................................................................... 76
General Billing .................................................................................................................................. 77
What are the general billing requirements? .................................................................. 77
How do I bill for clients who are eligible for only a part of the hospital stay?
............................................................................................................................................................ 77
How are outpatient hospital services prior to admission paid? ........................... 78
How are outpatient hospital services during an inpatient admission paid? .. 79
Newborn practices to promote breastfeeding ............................................................. 79
How do I bill for neonates/newborns? ............................................................................ 79
Neonatal/newborn coding ............................................................................................... 79
Birth weight coding.............................................................................................................. 80
Newborn eligibility and billing ....................................................................................... 80
Placed in Out of Home Placement? .............................................................................. 80
Neonate revenue code descriptions ................................................................................. 83
How do I bill for immediate postpartum long acting reversible contraception
(LARC)? ........................................................................................................................................... 86
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Submitting adjustments to a paid inpatient hospital claim ................................... 86
Present on admission indicators ......................................................................................... 86
How to indicate a POA on a direct data entry claim............................................. 87
How to indicate a POA on an electronic claim ........................................................ 87
Billing Specific to Hospital Services ....................................................................................... 89
Interim billing .............................................................................................................................. 89
Inpatient hospital stays without room charges ........................................................... 89
How do I bill for administrative days? ............................................................................. 89
How do hospitals bill for acute inpatient stay when a client elects hospice? 90
Questions and Answers from NUBC Manual ............................................................ 91
How do CPE hospitals bill for services provided to blind and disabled clients
enrolled in managed care? .................................................................................................... 91
How do effective dates for procedure and/or diagnosis codes affect
processing of my claims? ....................................................................................................... 91
How do I bill for clients covered by Medicare Part B only (No Part A), or has
exhausted Medicare Part A benefits prior to the stay? ............................................ 92
What HCA pays the hospital ............................................................................................ 93
How do I bill for clients when Medicare coverage begins during an inpatient
stay or Medicare Part A has been exhausted during the stay?............................. 93
Required consent forms for hysterectomies ................................................................. 94
Completing the Claim .................................................................................................................. 95
How do I bill claims electronically? ................................................................................... 95
What does HCA require from the provider-generated explanation of
Medicare benefit (EOMB) to process a claim? ......................................................... 95
Specific instructions for Medicare crossover claims .................................................. 95
How do I submit institutional services on a crossover claim? .......................... 95
How do I submit institutional services for inpatient clients who are eligible
for Medicare Part B Benefits but not eligible for Medicare Part A Benefits
or Medicare Part A benefits are exhausted? ............................................................. 96
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Definitions
This section defines terms and abbreviations, including acronyms, used in this
billing guide. Refer to Chapter 182-500 WAC for a complete list of definitions for
Washington Apple Health and WAC 182-550-1050 for definition specific to this
program.
Acute – A medical condition of severe intensity with sudden onset. For the
purposes of the acute physical medicine and rehabilitation (Acute PM&R)
program, acute means an intense medical episode, not longer than three months.
Acute care - Care provided for patients who are not medically stable or have not
attained a satisfactory level of rehabilitation. These patients require frequent
monitoring by a health care professional to maintain their health status.
Acute physical medicine and rehabilitation (Acute PM&R) - A comprehensive
inpatient rehabilitative program coordinated by an interdisciplinary team at an
HCA-approved rehabilitation facility. The program provides 24-hour specialized
nursing services and an intense level of therapy for specific medical conditions for
which the client shows significant potential for functional improvement. Acute
PM&R is a 24-hour inpatient comprehensive program of integrated medical and
rehabilitative services provided during the acute phase of a client's rehabilitation.
Administrative day – One or more days of a hospital stay in which an acute
inpatient or observation level of care is not medically necessary, and a lower level
of care is appropriate.
Administrative day rate - The statewide Medicaid average daily nursing facility
rate as determined by HCA.
All-Patient DRG Grouper (AP-DRG) - A computer software program that
determines the medical and surgical diagnosis related group (DRG) assignments
used by HCA for inpatient admissions between August 1, 2007, and June 30,
2014.
All-Patient Refined DRG Grouper (APR-DRG) - A computer software program
that determines the medical and surgical diagnosis related group (DRG)
assignments used by HCA for inpatient admissions on and after July 1, 2014.
Allowable - The calculated amount for payment, after exclusion of any
"nonallowed service or charge," based on the applicable payment method before
final adjustments, deductions, and add-ons.
Allowed amount - The initial calculated amount for any procedure or service,
after exclusion of any "nonallowed service or charge," that HCA allows as the
basis for payment computation before final adjustments, deductions, and add-
ons.
Allowed charges – The total billed charges for allowable services.
Allowed covered charges – The total billed charges for allowable services minus
the billed charges for noncovered services, denied services, or both.
American Society of Addiction Medicine (ASAM) - A professional medical
society dedicated to increasing access and improving the quality of addiction
treatment.
11 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Ancillary services - Additional or supporting services provided by a hospital to a
client during the client’s hospital stay. These services include, but are not limited
to, all of the following:
• Laboratory
• Radiology
• Drugs
• Delivery room
• Operating room
• Postoperative recovery rooms
• Other special items and services Appropriate level of care - The level of care
required to best manage a client's illness or injury based on either of the
following:
• The severity of illness presentation and the intensity of services received
• A condition-specific episode of care Assignment - A process in which a
doctor or supplier agrees to accept the Medicare program's payment as
payment in full, except for specific deductible and coinsurance amounts
required of the patient.
Audit - An assessment, evaluation, examination, or investigation of a health care
provider's accounts, books and records, including both of the following:
• Health, financial and billing records pertaining to billed services paid by HCA
through Washington Apple Health by a person not employed or affiliated with
the provider, for the purpose of verifying the service was provided as billed
and was allowable under program regulations
• Health, financial, and statistical records, including mathematical computations
and special studies conducted in support of the Medicare cost report (Form
2552-96 and 2552-10 or successor form), submitted to HCA for the purpose
of establishing program rates for payment to hospital providers
Authorization – See Prior authorization and Expedited prior authorization
(EPA).
Authorization number - A nine-digit number, assigned by HCA that identifies
individual requests for services or equipment. The same authorization number is
used throughout the history of the request, whether it is approved, pended, or
denied.
Bedside nursing services – Services included under the room and board services
paid to the facility. These services include, but are not limited to: medication
administration, IV hydration and IV medication administration, vaccine
administration, dressing applications, therapies, glucometry testing,
catheterizations, tube feedings and irrigations, and equipment monitoring
services.
Billed charge - The charge submitted to HCA by the provider.
Bordering city hospital - A hospital located outside Washington State and
located in one of the bordering cities listed in WAC 182-501-0175.
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Budget neutral – Aggregate payments to hospitals stay the same regardless of
any changes made to the payment method. See also Budget neutrality factor.
Budget neutrality factor - A multiplier used by HCA to ensure that
modifications to the payment method and rates are budget neutral. See also
Budget neutral.
Budget target – Funds appropriated by the legislature or through HCA’s budget
process to pay for a specific group of services, including anticipated caseload
changes or vendor rate increases.
Budget target adjuster - A multiplier to the outpatient prospective payment
system (OPPS) payment to ensure aggregate payments do not exceed the
established budget target.
Bundled services - Interventions integral to or related to the major procedure.
Case mix – A relative value assigned to a DRG or classification of patients in a
medical care environment representing the resource intensity demands placed on
an institution.
Case mix index (CMI) - The average relative weight of all cases treated in a
hospital during a defined period.
Centers for Medicare and Medicaid Services (CMS) – See WAC 182-500-0020.
Change of ownership - Occurrence of the following events describes common
forms of changes of ownership, but is not intended to represent an exhaustive list
of all possible situations:
• A change in composition of a partnership
• A sale of an unincorporated sole proprietorship
• The statutory merger or consolidation of two or more corporations
• Leasing of all or part of a provider's facility if the leasing affects utilization,
licensure or certification of the provider entity
• The transfer of a government-owned institution to a governmental entity or to
a governmental corporation
• Donation of all or part of a provider's facility if the donation affects licensure
or certification of the provider entity
• A disposition of all or some portion of a provider's facility or assets through
sale, scrapping, involuntary conversion, demolition, or abandonment if the
disposition affects licensure or certification of the provider entity
Children’s Health Insurance Program (CHIP) - The federal Title XXI program
under which medical care is provided to uninsured children younger than age 19.
Children's hospital - A hospital primarily serving children. (WAC 182-550-1050)
Client – A person who receives or is eligible to receive services through HCA
programs.
CMS PPS input price index - A measure, expressed as a percentage, of the
annual inflationary costs for hospital services.
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Comorbidity - Of, relating to, or caused by a disease other than the principal
disease.
Complication - A disease or condition occurring subsequent to or concurrent
with another condition and aggravating it.
Comprehensive hospital abstract reporting system (CHARS) - The
Department of Health's (DOH’s) inpatient hospital data collection, tracking, and
reporting system.
Condition-specific episode of care – Care provided to a client based on the
client’s primary condition, complications, comorbidities, standard treatments, and
response to treatments.
Conversion factor - A hospital-specific dollar amount that represents a hospital's
average cost of treating clients. It is calculated from the hospital's cost report by
dividing the hospital's costs for treating Medicaid and CHIP clients during a base
period by the number of Medicaid and CHIP discharges during that same period
and adjusting for the hospital's case mix.
Core provider agreement (CPA) – The basic contract HCA holds with providers
serving Washington Apple Health clients.
Cost report - See Medicare cost report.
Costs - HCA-approved operating, medical education, and capital-related costs
(capital costs) as reported and identified on the “cost report.”
Covered services – See WAC 182-501-0060.
Covered hospital service - A service that is provided by a hospital, covered
under a Washington Apple Health program, and is within the scope of an eligible
client's Washington Apple Health program.
Critical border hospital - An acute care hospital located in a bordering city that
HCA has, through analysis of admissions and hospital days, designated as critical
to provide elective health care for HCA's Washington Apple Health clients.
Current Procedural Terminology (CPT) - A systematic listing of descriptive
terms and identifying codes for reporting medical services, procedures, and
interventions performed by physicians. CPT is copyrighted and published
annually by the American Medical Association (AMA).
Deductible - The amount a client is responsible for, before an insurer, such as
Medicare, starts paying; or the initial specific dollar amount for which the client is
responsible.
Diagnosis code - A set of numeric or alphanumeric characters assigned by the
current published ICD coding guidelines used by HCA as a shorthand symbol to
represent the nature of a disease or condition.
Diagnosis related group (DRG) – A classification system that categorizes
hospital patients into clinically coherent and homogenous groups with respect to
resource use. Classification of patients is based on the current published ICD
coding guidelines used by HCA, the presence of a surgical procedure, patient
age, presence or absence of significant comorbidities or complications, and other
relevant criteria.
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Direct medical education costs - The direct costs of providing an approved
medical residency program as recognized by Medicare.
Discharging hospital - The institution releasing a client from the acute care
hospital setting.
Discount factor – The percentage applied to additional significant procedures
when a claim has multiple significant procedures or when the same procedure is
performed multiple times on the same day. Not all significant procedures are
subject to a discount factor.
Disproportionate share hospital (DSH) payment - A supplemental payment
made by HCA to a hospital that qualifies for one or more of the disproportionate
share hospital programs identified in the state plan.
Disproportionate share hospital (DSH) program - A program through which
HCA makes payment adjustment(s) to eligible hospitals that serve a
disproportionate number of low-income clients in accordance with legislative
direction and established payment methods. See 1902(a)(13)(A)(iv) of the Social
Security Act. See also WAC 182-550-4900 through 182-550-5400.
Distinct unit - A Medicare-certified distinct area for psychiatric, rehabilitation, or
withdrawal management (previously detox) services which has been certified by
Medicare within an acute care hospital or approved by HCA within a children's
hospital.
DRG - See Diagnosis related group.
DRG allowed amount – The DRG relative weight multiplied by the conversion
factor.
DRG average length-of-stay - HCA’s average length-of-stay for a DRG
classification established during an HCA DRG rebasing and recalibration project.
HCA uses 3M Health Information System’s national APR-DRG relative weights and
average lengths of stay.
DRG-exempt services - Services paid through methods other than DRG, such as
per diem rate or a ratio of costs-to-charges (RCC).
DRG payment - The total payment made by HCA for a client’s inpatient hospital
stay. The DRG payment is the DRG allowed amount plus the high outlier minus
any third-party liability, client participation, Medicare payment, and any other
adjustments applied by HCA.
Elective procedure or surgery - A non-emergency procedure or surgery that
can be scheduled at the client’s and provider’s convenience.
Emergency medical condition – See WAC 182-500-0030.
Emergency room or emergency facility or emergency department - A distinct
hospital-based facility which provides unscheduled services to clients who require
immediate medical attention. An emergency department must be capable of
providing emergency medical, surgical, and trauma care services twenty-four
hours a day, seven days a week. A physically separate extension of an existing
hospital emergency department may be considered a freestanding emergency
department as long as the extension provides comprehensive emergency
15 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
medical, surgical, and trauma care services twenty-four hours a day, seven days a
week.
Emergency services - Health care services required by and provided to a client
after the sudden onset of a medical condition manifesting itself by acute
symptoms of sufficient severity that the absence of immediate medical attention
could reasonably be expected to result in placing the client’s health in serious
jeopardy; serious impairment to bodily functions; or serious dysfunction of any
bodily organ or part. For HCA payment to a hospital, inpatient maternity services
are treated as emergency services.
Enhanced ambulatory patient groupings (EAPG) – The payment system used
by HCA to calculate reimbursement to hospitals for the facility component of
outpatient services on and after July 1, 2014. This system uses 3M Health
Information System’s EAPGs as the primary basis for payment.
Equivalency factor (EF) - A factor that may be used by HCA in conjunction with
other factors to determine the level of a state-administered program payment.
See WAC 182-550-4800.
Exempt hospital—DRG payment method – A hospital that for a certain client
category is reimbursed for services to Washington Apple Health clients through
methodologies other than those using DRG conversion factors.
Expedited prior authorization (EPA) - See WAC 182-500-0030
Experimental service - A procedure, course of treatment, drug, or piece of
medical equipment, which lacks scientific evidence of safety and effectiveness.
See WAC 182-531-0050. A service is not "experimental" if the service is both of
the following:
• Is generally accepted by the medical profession as effective and appropriate
• Has been approved by the Federal Food and Drug Administration (FDA) or
other requisite government body if such approval is required
Fee-for-service – See WAC 182-500-0035.
Fiscal intermediary - Medicare's designated fiscal intermediary for a region or
category of service, or both.
Fixed per diem rate - A daily amount used to determine payment for specific
services provided in long-term acute care (LTAC) hospitals.
Formal release – When a client does one of the following:
• Discharges from a hospital or distinct unit
• Dies in a hospital or distinct unit
• Transfers from a hospital or distinct unit as an acute care transfer
• Transfers from the hospital or distinct unit to a designated psychiatric unit or
facility, or a designated acute rehabilitation unit or facility
Global surgery days - The number of preoperative and follow-up days that are
included in the payment to the physician for the major surgical procedure.
16 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Graduate medical education costs - The direct and indirect costs of providing
medical education in teaching hospitals. See Direct medical education costs and
Indirect medical education costs.
Grouper - See All-patient DRG grouper (AP-DRG) and All-patient refined DRG
grouper (APR-DRG).
Health Care Authority (HCA/Medicaid agency) - The Washington State agency
that administers Washington Apple Health programs.
High outlier - A DRG claim that is classified by HCA as being allowed a high
outlier payment that is paid under the DRG payment method, does not meet the
definition of administrative day, and has extraordinarily high costs as
determined by HCA. See WAC 182-550-3700.
High outlier claim- Medicaid/CHIP per diem – A claim classified by HCA as
being allowed a high outlier payment that is paid under the per diem payment
method, does not meet the definition of administrative day, and has
extraordinarily high costs as determined by HCA. See WAC 182-550-3700.
High outlier claim- State-administered program DRG – A claim paid under the
DRG payment method that does not meet the definition of administrative day,
and has extraordinarily high costs as determined by HCA. See WAC 182-550-
3700.
High outlier claim- State-administered program per diem - A claim that is
classified by HCA as being allowed as a high outlier payment, that is paid under
the per diem payment method, does not meet the definition of administrative
day, and has extraordinarily high costs as determined by HCA. See WAC 182-550-
3700.
Hospice - A medically-directed, interdisciplinary program of palliative services for
terminally ill clients and the clients' families. Hospice is provided under
arrangement with a Washington state-licensed and Title XVIII-certified
Washington state hospice.
Hospital - An entity that is licensed as an acute care hospital in accordance with
applicable state laws and regulations, or the applicable state laws and regulations
of the state in which the entity is located when the entity is out-of-state, and is
certified under Title XVIII of the federal Social Security Act. The term “hospital”
includes a Medicare- or state-certified distinct rehabilitation unit, a “psychiatric
hospital” as defined in this section, or any other distinct unit of the hospital.
Hospital cost report – See Medicare cost report.
Hospital covered service – Any service, treatment, equipment, procedure, or
supply provided by a hospital, covered under a Washington Apple Health
program, and is within the scope of an eligible client’s Washington Apple Health
program.
Indirect medical education costs - The indirect costs of providing an approved
medical residency program as recognized by Medicare.
Inflation adjustment - For cost inflation, this is the hospital inflation adjustment.
This adjustment is determined by using the inflation factor method approved by
the legislature. For charge inflation, this is the inflation factor determined by
comparing average discharge charges for the industry from one year to the next,
17 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
as found in the Comprehensive Hospital Abstract Reporting System (CHARS)
Hospital Census and Charges Payer report.
Inpatient hospital admission - A formal admission to a hospital, based on an
evaluation of the client using objective clinical indicators for the purpose of
providing medically necessary, acute inpatient care. These indicators include
assessment, monitoring, and therapeutic services as required to best manage the
client's illness or injury. All applicable indicators must be documented in the
client's health record. The decision to admit a client to inpatient status should be
based on the condition-specific episode of care, severity of illness presented, and
the intensity of services rendered. HCA does not consider inpatient hospital
admissions as covered or noncovered solely on the basis of the length of time
the client actually spends in the hospital. Generally, a client remains overnight
and occupies a bed. Inpatient status can apply even if the client is discharged or
transferred to another acute hospital and does not actually use a hospital bed
overnight. For HCA to recognize a stay as inpatient, there must be a physician
admission order in the client's medical record indicating the status as inpatient.
Inpatient Medicaid DRG conversion factor - The conversion factor is a rate that
is multiplied by a DRG relative weight to pay Medicaid and CHIP claims under the
DRG payment method. See WAC 182-550-3800 for how this conversion factor is
calculated.
Inpatient services – Health care services provided to a client whose condition
warrants formal admission and treatment in a hospital.
Inpatient state-administered program conversion factor - A DRG conversion
factor reduced from the inpatient Medicaid DRG conversion factor to pay a
hospital for inpatient services provided to a client eligible under a state-
administered program. The conversion factor is multiplied by a DRG relative
weight to pay claims for clients under the DRG payment method.
Intermediary – See Fiscal intermediary.
International Classification of Diseases (ICD) - The systematic listing of
diseases, injuries, conditions, and procedures as numerical or alpha numerical
designations (coding).
Length of stay (LOS) - The number of days of inpatient hospitalization,
determined by counting the total number of days from the admission date to the
discharge date, and subtracting one day.
Long term acute care (LTAC) services - Inpatient intensive long term care
services provided in HCA-approved LTAC hospitals to eligible Washington Apple
Health clients who meet criteria for Level 1 or Level 2 services. See WAC 182-550-
2565 through 182-550-2596.
Major diagnostic category (MDC) - One of the mutually exclusive groupings of
principal diagnosis areas in the AP-DRG and APR-DRG classification systems.
Medical education costs - The expenses incurred by a hospital to operate and
maintain a formally organized graduate medical education program.
Medically necessary – See WAC 182-500-0070.
Medical visit – Diagnostic, therapeutic, or consultative services provided to a
client by a health care professional in an outpatient setting.
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Medicare cost report - The Medicare cost report (Form 2552-10), or successor
document, completed and submitted annually by a hospital provider.
Medicare crossover - A claim involving a client who is eligible for both Medicare
benefits and Medicaid.
Medicare Part A - See WAC 182-500-0070.
Medicare Part B - See WAC 182-500-0070.
Medicare payment principles - The rules published in the federal register
regarding payment for services provided to Medicare clients.
Mental health designee - A professional contact person authorized by the
Division of Behavioral Health and Recovery, who operates under the direction of
a prepaid inpatient health plan (PIHP). See WAC 182-550-2600.
Military hospital - A hospital reserved for the use of military personnel, their
dependents, and other authorized users.
Modifier - A two-digit alphabetic and/or numeric identifier added to the
procedure code to indicate the type of service performed. The modifier provides
the means by which the reporting hospital can describe or indicate that a
performed service or procedure has been altered by some specific circumstance
but not changed in its definition or code. The modifier can affect payment or be
used for information only. Modifiers are listed in fee schedules.
National correct coding initiative (NCCI) – A national standard for the accurate
and consistent description of medical goods and services using procedural codes.
The standard is based on coding conventions defined in the American Medical
Associations' Current Procedural Terminology (CPT®) manual, current standards
of medical and surgical coding practice, input from specialty societies, and
analysis of current coding practices. The centers for Medicare and Medicaid
services (CMS) maintain NCCI policy.
NCCI edit - A software step used to determine if a claim is billing for a service
that is not in accordance with federal and state statutes, federal and state
regulations, HCA fee schedules, billing instructions, and other publications. HCA
has the final decision whether the NCCI edits allow automated payment for
services that were not billed in accordance with governing law, NCCI standards,
or HCA policy.
Newborn or neonate or neonatal - A person younger than 29 days old.
Non-allowed service or charge - A service or charge billed by the provider as
noncovered or denied by HCA. This service or charge cannot be billed to the
client except under the conditions identified in WAC 182-502-0160.
Noncovered charges - Billed charges a provider submits to HCA on the claim
and indicates them on the claim as noncovered.
Noncovered service or charge - A service or charge HCA does not consider or
pay for as a hospital covered service. This service or charge may not be billed to
the client, except under the conditions identified in WAC 182-502-0160.
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Observation services – A well-defined set of clinically appropriate services
furnished while determining whether a client will require formal inpatient
admission or be discharged from the hospital. Services include ongoing short-
term treatment, monitoring, assessment, and reassessment. Rarely do reasonable
and necessary observation services exceed forty-eight hours. HCA or its designee
may determine through the retrospective utilization review process that an
inpatient hospital service should have been billed as an observation service.
Operating costs - All expenses incurred in providing accommodation and
ancillary services, excluding capital and medical education costs.
Orthotic device or orthotic - A corrective or supportive device that either:
• Prevents or corrects physical deformity or malfunction.
• Supports a weak or deformed portion of the body.
Out-of-state hospital - Any hospital located outside the state of Washington
and the designated bordering cities (see WAC 182-501-0175). For Washington
Apple Health clients requiring psychiatric services, an out-of-state hospital means
any hospital located outside the state of Washington.
Outliers - Cases with extraordinarily high or low costs when compared to other
cases in the same DRG.
Outpatient care – See Outpatient hospital services.
Outpatient hospital - A hospital authorized by the Department of Health (DOH)
to provide outpatient services.
Outpatient hospital services - Those health care services that are within a
hospital's licensure and provided to a client who is designated as an outpatient.
Outpatient observation - See Observation services.
Outpatient prospective payment system (OPPS) – The payment system used
by HCA to calculate reimbursement to hospitals for the facility component of
outpatient services.
Outpatient surgery - A surgical procedure that is not expected to require an
inpatient hospital admission.
Per diem - A method which uses a daily rate to calculate payment for services
provided as a hospital covered service.
PM&R - See Acute PM&R.
Primary care case management (PCCM) - The coordination of health care
services under HCA’s Indian health center or tribal clinic managed care program.
See WAC 182-538-068.
Principal diagnosis – The condition chiefly responsible for the admission of the
patient to the hospital.
Prior authorization (PA) – See WAC 182-500-0085.
Private room rate - The rate customarily charged by a hospital for a one-bed
room.
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Prospective payment system (PPS) - A payment system in which what is
needed to calculate payments (methods, types of variables, and other factors) is
set in advance and is knowable by all parties before care is provided. In a
retrospective payment system, what is needed (actual costs or charges) is not
available until after care is provided.
Prosthetic device or prosthetic - A replacement, corrective, or supportive device
prescribed by a physician or other licensed practitioner, within the scope of his or
her practice as defined by state law, to do one of the following:
• Artificially replace a missing portion of the body
• Prevent or correct physical deformity or malfunction
• Support a weak or deformed portion of the body
Psychiatric hospital - A Medicare-certified distinct psychiatric unit, a Medicare-
certified psychiatric hospital, or a state-designated pediatric distinct psychiatric
unit in a Medicare-certified hospital. Eastern State Hospital and Western State
Hospital are excluded from this definition.
Ratable - A factor used to calculate inpatient payments for state-administered
programs.
Ratio of costs-to-charges (RCC) - A method used to pay hospitals for some
services exempt from the DRG payment method. It also refers to the percentage
applied to a hospital's allowed covered charges for medically necessary services
to determine estimated costs, as determined by HCA, and payment to the
hospital for some DRG-exempt services.
Rebasing - The process used by HCA to update hospital payment policies,
related variables (rates, factors, thresholds, multipliers, and caps) and system
processes (edits, adjudication, grouping, etc.).
Recalibration - The process of recalculating DRG relative weights using historical
data.
Rehabilitation units - Specifically identified rehabilitation hospitals and
designated rehabilitation units of hospitals that meet HCA and Medicare criteria
for distinct rehabilitation units.
Relative weights - See DRG relative weight.
Revenue code - A nationally-assigned coding system for billing inpatient and
outpatient hospital services, home health services, and hospice services.
Room and board - Routine supplies and services provided to a client during the
client's hospital stay. This includes, but is not limited to, a regular or special care
hospital room and related furnishings, room supplies, dietary and bedside
nursing services, and the use of certain hospital equipment and facilities.
Rural hospital - An acute care health care facility capable of providing or
assuring availability of inpatient and outpatient hospital health services in a rural
area.
Semi-private room rate - A rate customarily charged for a hospital room with
two to four beds; this charge is generally lower than a private room rate and
higher than a wardroom
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Significant procedure – A procedure, therapy, or service provided to a client
that constitutes one of the primary reasons for the visit to the health care
professional and represents a substantial portion of the resources associated with
the visit.
Specialty hospitals - Children's hospitals, psychiatric hospitals, cancer research
centers or other hospitals which specialize in treating a particular group of
patients or diseases.
State plan - The plan filed by HCA with the CMS, Department of Health and
Human Services (DHHS), outlining how the state will administer Medicaid and
CHIP services, including the hospital program.
Status indicator (SI) - A code assigned to each medical procedure or service by
HCA that contributes to the selection of a payment method.
Subacute care - Care provided to a client which is less intensive than that given
at an acute care hospital. Skilled nursing, nursing care facilities, and other
facilities provide subacute care services.
Substance Use Disorder (SUD) – An alcohol or drug addiction, or a dependence
on one or more substances.
Survey – An inspection or review conducted by a federal, state, or private agency
to evaluate and monitor a facility's compliance with program requirements.
Swing bed – An inpatient hospital bed certified by CMS for either acute inpatient
hospital or skilled nursing services.
Swing bed day - A day in which a client is receiving skilled nursing services in a
hospital designated swing bed at the hospital's census hour.
Total patient days - All patient days in a hospital for a given reporting period,
excluding days for skilled nursing, nursing care, and observation days.
Transfer - To move a client from one acute care setting to a higher level acute
care setting for emergency care or to a post-acute, lower level care setting for
ongoing care.
Transferring hospital - The hospital or distinct unit that transfers a client to
another acute care or subacute facility or distinct unit, or to a nonhospital setting.
UB-04 - The uniform billing document required for use nationally by hospitals,
nursing facilities, hospital-based skilled nursing facilities, home health agencies,
and hospice agencies in billing for services provided to patients. This document
includes the current national uniform billing data element specifications
developed by the National Uniform Billing Committee and approved and
modified by the Washington State Payer Group or HCA.
Vendor rate increase - An adjustment determined by the legislature that may be
used to periodically increase rates for payment to vendors, including health care
providers that do business with the state.
Washington Apple Health program - Any health care program administered
through HCA.
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Client Eligibility
Most Apple Health clients are enrolled in an HCA-contracted managed care
organization (MCO). This means that Apple Health pays a monthly premium to an
MCO for providing preventative, primary, specialty, and other health services to
Apple Health clients. Clients in managed care must see only providers who are in
their MCO’s provider network, unless prior authorized or to treat urgent or
emergent care. See HCA’s Apple Health managed care webpage for further
details.
It is important to always check a client’s eligibility prior to
providing any services because it affects who will pay for the
services.
How do I verify a client’s eligibility?
Check the client’s services card or follow the two-step process below to verify
that a client has Apple Health coverage for the date of service and that the
client’s benefit package covers the applicable service. This helps prevent
delivering a service HCA will not pay for.
Verifying eligibility is a two-step process:
Step 1. Verify the patient’s eligibility for Apple Health. For detailed
instructions on verifying a patient’s eligibility for Apple Health,
see the Client Eligibility, Benefit Packages, and Coverage Limits
section in HCA’s ProviderOne Billing and Resource Guide.
If the patient is eligible for Apple Health, proceed to Step 2. If
the patient is not eligible, see the orange note box below.
Step 2. Verify service coverage under the Apple Health client’s
benefit package. To determine if the requested service is a
covered benefit under the Apple Health client’s benefit package,
see HCA’s Program Benefit Packages and Scope of Services
webpage.
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Note: Patients who are not Apple Health clients may submit an
application for health care coverage in one of the following ways:
- By visiting the Washington Healthplanfinder’s website.
- By calling the Customer Support Center toll-free at: 855-
WAFINDER
- (855-923-4633) or 855-627-9604 (TTY)
- By mailing the application to: Washington Healthplanfinder,
PO Box 946, Olympia, WA 98507
In-person application assistance is also available. To get
information about in-person application assistance available in
their area, people may visit the Washington Healthplanfinder’s
website or call the Customer Support Center.
Are clients enrolled in an HCA-contracted managed
care organization (MCO) eligible?
Yes. Most Medicaid-eligible clients are enrolled in one of HCA-contracted
managed care organizations (MCOs). For these clients, managed care enrollment
will be displayed on the client benefit inquiry screen in ProviderOne. All services
must be requested directly through the client’s primary care provider (PCP).
Clients can contact their MCO by calling the telephone number provided to them.
All medical services covered under an HCA-contracted MCO must be obtained by
the client through designated facilities or providers. The MCO is responsible for
payment of:
• Covered services
• Services referred by a provider participating with the MCO to an outside
provider
• Facility fees associated with dental professional fees
Note: Site of service prior authorization for eligible managed
care clients will continue to be determined by HCA for facilities
associated with dental procedure codes.
For certified public expenditure (CPE) hospitals that provide medical services to
Categorically Needy Medicaid Blind/Disabled clients, bill those services fee-for-
service to HCA. (For more information on billing for services provided to these
clients, refer to the RAC eligibility codes.) In order to process those claims, the
CPE hospital must obtain prior authorization from the MCO and submit that
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information to HCA in the Claim Note field on the claim in the manner shown
below:
PA from [MCO Name]: [Authorization number]
Note: To prevent billing denials, check the client’s eligibility prior
to scheduling services and at the time of the service, and make
sure proper authorization or referral is obtained from the HCA-
contracted MCO, if appropriate. Providers must receive
authorization from the client’s MCO primary care provider before
providing services, except for emergency services. See HCA’s
ProviderOne Billing and Resource Guide for instructions on how
to verify a client’s eligibility.
A client’s enrollment can change monthly. Providers who are not
contracted with the MCO must receive approval from both the
MCO and the client’s primary care provider (PCP) prior to serving
a managed care client.
Send claims to the client’s MCO for payment. Call the client’s MCO to discuss
payment prior to providing the service. Providers may bill clients only in very
limited situations as described in WAC 182-502-0160.
Managed care enrollment
Apple Health (Medicaid) places clients into an HCA-contracted MCO the same
month they are determined eligible for managed care as a new or renewing
client. This eliminates a person being placed temporarily in FFS while they are
waiting to be enrolled in an MCO or reconnected with a prior MCO. This
enrollment policy also applies to clients in FFS who have a change in the program
they are eligible for. However, some clients may still start their first month of
eligibility in the FFS program because their qualification for MC enrollment is not
established until the month following their Medicaid eligibility determination.
New clients are those initially applying for benefits or those with changes in their
existing eligibility program that consequently make them eligible for Apple
Health managed care. Renewing clients are those who have been enrolled with
an MCO but have had a break in enrollment and have subsequently renewed
their eligibility.
Checking eligibility
• Providers must check eligibility and know when a client is enrolled and with
which MCO. For help with enrolling, clients can refer to the
Washington
Healthplanfinder’s Get Help Enrolling page.
• MCOs have retroactive authorization and notification policies in place. The
provider must know the MCO’s requirements and be compliant with the
MCO’s policies.
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Clients have a variety of options to change their plan:
• Available to clients with a Washington Healthplanfinder account:
Go to Washington HealthPlanFinder website.
• Available to all Apple Health clients:
o Visit the ProviderOne Client Portal website:
o Call Apple Health Customer Service at 1-800-562-3022. The automated
system is available 24/7.
o Request a change online at ProviderOne Contact Us (this will generate
an email to Apple Health Customer Service). Select the topic
“Enroll/Change Health Plans.”
For online information, direct clients to HCA’s Apple Health Managed Care
webpage.
Clients who are not enrolled in an HCA-contracted
managed care plan for physical health services
Some Medicaid clients do not meet the qualifications for managed care
enrollment. These clients are eligible for services under the FFS Medicaid
program. In this situation, each Integrated Managed Care (IMC) plan will have
Behavioral Health Services Only (BHSO) plans available for Apple Health clients
who are not in managed care. The BHSO covers only behavioral health treatment
for those clients. Clients who are not enrolled in an HCA-contracted managed
care plan are automatically enrolled in a BHSO with the exception of American
Indian/Alaska Native clients. Some examples of populations that may be exempt
from enrolling into a managed care plan are Medicare dual-eligible, American
Indian/Alaska Native, Adoption support and Foster Care
Integrated managed care
Clients qualified for managed care enrollment will receive all physical health
services, mental health services, and substance use disorder treatment through
their HCA-contracted managed care organization (MCO).
Clients living in an integrated managed care region will enroll with an MCO of
their choice that is available in that region. If the client does not choose an MCO,
the client will be automatically enrolled into one of the available MCOs, unless
the client is American Indian/Alaska Native (AI/AN). Clients currently enrolled in
one of the available MCOs in their region may keep their enrollment when the
behavioral health services are added.
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American Indian/Alaska Native (AI/AN) clients have two
options for Apple Health coverage:
- Apple Health Managed Care; or
- Apple Health coverage without a managed care plan (also
referred to as fee-for-service [FFS])
If a client does not choose an MCO, they will be automatically
enrolled into Apple Health FFS for all their health care services,
including comprehensive behavioral health services. See the
Health Care Authority’s (HCA) American Indian/Alaska Native
webpage.
For more information about the services available under the FFS
program, see HCA’s Mental Health Services Billing Guide and
the Substance Use Disorder Billing Guide.
For full details on integrated managed care, see HCA’s Apple Health managed
care webpage and scroll down to “Changes to Apple Health managed care.”
Integrated Apple Health Foster Care (AHFC)
Children and young adults in the Foster Care, Adoption Support and Alumni
programs who are enrolled in Coordinated Care of Washington’s (CCW) Apple
Health Foster Care program receive both medical and behavioral health services
from CCW.
Clients under this program are:
• Under the age of 21 who are in foster care (out of home placement)
• Under the age of 21 who are receiving adoption support
• Age 18-21 years old in extended foster care
• Age 18 to 26 years old who aged out of foster care on or after their 18th
birthday (alumni)
These clients are identified in ProviderOne as “Coordinated Care
Healthy Options Foster Care.”
The Apple Health Customer Services staff can answer general questions about
this program. For specific questions about Adoption Support, Foster Care or
Alumni clients, contact HCA’s Foster Care Medical Team at 1-800-562-3022, Ext.
15480.
27 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Fee-for-service Apple Health Foster Care
Children and young adults in the fee-for-service Apple Health Foster Care,
Adoption Support and Alumni programs receive behavioral health services
through the regional Behavioral Health Services Organization (BHSO). For details,
see HCA’s Mental Health Services Billing Guide, under How do providers identify
the correct payer?
What if a client has third-party liability (TPL)?
If the client has third-party liability (TPL) coverage (excluding Medicare), prior
authorization must be obtained before providing any service requiring prior
authorization. For more information on TPL, refer to HCA’s ProviderOne Billing
and Resource Guide.
28 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Payment for Services
How do I get paid?
You must follow the general billing requirements in HCA ProviderOne Billing and
Resource Guide. Also see General Billing for specific hospital inpatient
information. The revenue code grid is available under the Inpatient Prospective
Payment System (IPPS) heading on HCA’s Hospital Reimbursement webpage.
Payment adjustments
Enhanced payment for services related to
the treatment of COVID-19
Retroactive to dates of service on and after March 1, 2020,
until further notice, inpatient hospital claims paid under DRG
pricing methodology (including Diagnosis Related Group (DRG)
high outlier and transfer case pricing) are approved for a 20%
increase in payment for services related to the treatment of
COVID-19. This enhanced payment will continue until the
declared state of emergency is discontinued.
See the Apple Health (Medicaid) Inpatient Hospital Rate
Increase for COVID-19 Related Services FAQ for information on
how to bill and receive the enhanced payment.
HCA may adjust payment when one or more of the following occur:
• A claim qualifies as a high outlier.
• A claim is paid by the DRG method and a client transfers from one acute care
hospital or distinct unit.
• A client is not eligible for a Washington Apple Health program on one or
more days of the hospital stay.
• A client has third-party liability coverage at the time of admission to the
hospital or distinct unit.
• A client is eligible for Part B Medicare, the hospital submitted a timely claim to
Medicare for payment, and Medicare has made a payment for the Part B
hospital charges.
• A client has state-only funded eligibility as indicated by the client’s Recipient
Aid Category (RAC), the hospital’s payment methodology, and the service
provided. Payments for inpatient state-administered programs may be
reduced for these clients. See WAC 182-550-4800.
• HCA identifies an enhanced payment due to a provider preventable condition,
hospital-acquired condition, serious reportable event, or a condition not
present on admission.
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• A client is discharged from an inpatient hospital stay and, within fourteen
calendar days, is readmitted as an inpatient to the same hospital or an
affiliated hospital. See Hospital readmissions for more information.
• A readmission is due to a complication arising from a previous admission. See
Provider preventable readmissions for more information.
General payment policies
Psychiatric services
Policy and billing information for inpatient psychiatric admissions and hospital-
based outpatient services at community hospitals is located in HCA’s Mental
Health Services Billing Guide.
Inpatient hospital psychiatric transfers
HCA requires a transferring hospital to obtain prior authorization (PA) and
include the authorization number in the client’s records:
• Contact the appropriate mental health designee to obtain the following:
o Prior approval of post-stabilization care
o An authorization number
• Include the authorization number in the client’s records for the receiving
hospital and on the claim submitted by the receiving hospital (refer to the
Mental Health Services Billing Guide).
Exception: The transferring hospital does not need PA for clients
who are enrolled in one of the recipient aid categories (RAC)
listed in HCA’s Mental Health Services Billing Guide Part II: High-
Acuity Services.
Transfers
The transferring acute care facility or distinct unit may receive a pro-rated
Diagnosis-Related Group (DRG) payment if the length of stay (LOS) plus one day
is less than HCA’s established DRG average LOS. HCA requires use of the patient
status code for “transfers” as defined in the UB-04 Manual. See Transfer
information for the DRG payment method.
HCA does not pay:
• A transferring hospital for a non-emergency case when the transfer is to
another acute care hospital.
• Any additional amount if a hospital transfers to another acute care hospital or
distinct unit and the receiving facility or distinct unit transfers the client back
to the original transferring hospital or distinct unit.
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Note: For specific billing examples, see information under How
do I bill for clients who are eligible for only a part of the
hospital stay?
When a client’s eligibility has changed from fee-for-service (FFS)
to managed care during a continuous hospital stay, or if the
client becomes eligible for Medicaid and enrolled with an HCA-
contracted managed care organization (MCO) on the first day of
the same month after the admission date but during the
admission, the claim must include a comment in the following
format:
“Continuous hospital stay MM/DD/YYYY- MM/DD/YYYY”
The first date is the date of the initial admission for the current
episode of care.
The second date is the date of the client’s discharge for the
current episode of care.
If on the initial admission date the client is FFS, HCA is
responsible for payment for a continuous stay including
transfers. Conversely, if on the initial admission date the client is
managed care enrolled, the MCO is responsible for payment for
a continuous stay including transfers.
See the examples below:
Example A:
A client is admitted to Hospital A on 01/01/2001, then is
transferred to Hospital B on 01/15/2001, and finally discharged
from Hospital B on 01/30/2001. The claim note would say:
“Continuous hospital stay 01/01/2001- 01/30/2001”
Example B:
A client is admitted to the hospital on 06/28/2016 and
discharged on 07/15/2016, but the client’s eligibility for Medicaid
and managed care enrollment does not begin until 07/01/2016.
HCA covers this admission. The claim note would say:
“Continuous hospital stay 06/28/2016 – 07/15/2016”
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Hospital readmissions
HCA does not pay for two separate inpatient hospitalizations if a client is
readmitted to the same or an affiliated hospital or distinct unit within 14 calendar
days of discharge, and HCA determines one inpatient hospitalization does not
qualify for a separate payment.
HCA or an HCA-contracted MCO may perform a retrospective prepayment
utilization review of hospital readmissions for clients who are readmitted as an
inpatient to the same hospital or an affiliated hospital within 14 calendar days.
(Refer to your client’s MCO for details specific to that MCO.) HCA may request
medical records for the retrospective utilization review.
Note: When HCA requests medical records, do not resubmit
the claim(s).
Submit requested records through HCA’s Secure File Transfer Portal. Please do
not send hardcopies of records.
Medical records that HCA requests must be received within 60 days of HCA’s
request-date to avoid further denial and/or recoupment of all associated claims.
Provider preventable readmissions
Applicability
This section applies only to payments made for medically necessary inpatient
hospital services provided to Medicaid fee-for-service (FFS) clients and managed
care enrollees.
This section does not apply to:
• Critical access hospitals as defined in WAC 182-550-2598.
• Psychiatric admissions.
• Professional claims submitted for services rendered in the inpatient setting
during a readmission.
Note: The client’s MCO will determine provider preventability as
a post payment review, and if indicated, payment will be
recouped. Patients are not liable for payment of provider
preventable readmissions.
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Provider preventable readmissions
Note: The provider preventable readmissions instructions in this
guide do not replace or supersede information found in WAC
182-550-2900; the 14-day readmission rule still applies. This
section only applies to payments made for medically necessary
inpatient hospital services provided to Medicaid fee-for-service
clients.
HCA considers a readmission “preventable” if there was a reasonable expectation
that it could have been caused by one or more of the following:
• The quality of care provided during the initial admission (a specific quality
concern, known at the time of treatment, and resulting in the readmission,
must be identified.)
• Inadequate discharge planning, discharge process and discharge follow-up
and care.
Note: Providers must create a complete and thorough discharge
plan that addresses all aspects of home care and follow-up. See
WAC 182-550-2950 for additional details.
If issues with quality of care, discharge planning or follow-up occurred, but
cannot be reasonably considered the cause of the readmission, HCA does not
recoup payment.
If a readmission is determined to be “preventable,” HCA may request medical
records to review both the index admission and any readmission(s) for
consideration of appropriate payment. The initial request for medical records will
include instructions on how to submit the medical records to HCA.
Exclusions
HCA excludes readmissions under the following circumstances from provider
preventable readmissions:
• Readmission for reasons unrelated to conditions or care from the first
admission
• Hospitalization with a discharge status of "left against medical advice" for
prior admission
Note: When a client leaves the hospital against medical advice
and is readmitted to the same acute care hospital for evaluation
and management of the medical condition that was the reason
for the client’s prior encounter, then, for billing purposes, the
hospital must bill both encounters as one claim.
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• Planned readmissions, including but not limited to:
o Required treatments for cancer, including treatment related sequelae as
well as care for advanced stage cancer
o Repetitive, planned treatments or procedures for conditions such as
chronic anemia, burn therapy, and renal failure
o Planned therapeutic or procedural admissions following diagnostic
admissions, when the therapeutic treatment clinically could not occur
during the same admit
• Planned admission to a different hospital or hospital unit for continuing care
(can include mental health/substance use disorder transfers, rehabilitation
transfers, etc., which may be technically coded as discharge/admission for
billing reasons)
• End of life and hospice care
• Readmission due to patient nonadherence to the discharge plan, despite
appropriate discharge planning and supports. This also includes cases where
the recommended discharge plan was refused by the patient, and a less
appropriate alternative plan was made to accommodate patient preferences;
this must be clearly documented in the client’s record
• Obstetrical readmissions for birth after an antepartum admission
• Admissions with a primary diagnosis of mental health or substance abuse
disorder issue
• Neonatal readmissions
• Transplant readmissions within 180 days of the transplant
• Readmissions when the first admission occurred in a different hospital system
Billing for planned readmissions
Example on how to bill for planned readmissions
To bill initial admission:
A client is admitted with cholecystitis for medical management
and discharged with a plan to readmit within 30 days for surgical
intervention.
If HCA payment policy (e.g., transfers) does not specify a
requirement for a different discharge status, the initial admission
claim must include discharge status code “81” (planned
readmission).
34 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
If HCA payment policy (e.g., transfers) does specify a
requirement for a different discharge status, the initial admission
claim must be submitted with “81” in the Billing Note section.
To bill a planned readmission:
The client above is admitted to the hospital for the planned
readmission for surgical intervention.
The subsequent admission claim must include “SCI=PR” (planned
readmission) in the Billing Note section.
In situations where the claim must be prepared using the Billing
Note section for both required data elements described above,
submit the claim using this format: “SCI=PR” “81”
To support data collection related to socio-economic status (SES), HCA asks
hospitals to include diagnosis codes Z59.0 and Z59.1 related to homelessness on
claims billed to HCA.
Dispute resolution process for provider preventable readmissions
If a hospital disputes a determination for recoupment for a fee-for-service client,
HCA follows the process in WAC 182-502-0050.
If a hospital disputes a recoupment determination for an HCA-contracted
managed care organization (MCO) client, the hospital must follow the MCO’s
internal dispute resolution process. If the hospital exhausts the MCO’s internal
dispute resolution process and continues to dispute the determination, HCA
follows the 14-day readmission review program described in the Apple Health
contract.
35 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
What are HCA’s payment methods?
HCA’s claim payment for an inpatient stay is determined by the payment method.
HCA pays hospitals for inpatient hospital covered services provided to clients
using the following methods:
Payment Method
General Description of Payment
Formula WAC Reference
DRG (Diagnostic
Related Group)
The DRG specific relative weight
times hospital specific DRG
182-550-3000
Per Diem The hospital-specific daily rate for the
service (psych, rehab, withdrawal
management, or CUP) times covered
allowable days
182-550-2600 and 182-550-
4400
Fixed Per Diem for
Long Term Acute Care
(LTAC)
The fixed LTAC rate per day times the
allowed days plus the RCC times the
allowable covered ancillaries not
included in the daily rate
182-550-2595 and 182-550-
2596
Ratio of Costs-to-
Charges (RCC)
The RCC times the covered allowable
charges
182-550-4500
Cost Settlement with
RCC
The RCC times the covered allowable
charges (subject to hold harmless
and other settlement provisions of
the Certified Public Expenditure
program)
182-550-4650 and 182-550-
4670
Cost Settlement with
Weighted Costs-to-
Charges (WCC)
The WCC times the covered
allowable charges subject to Critical
Access Hospital settlement provisions
182-550-2598
Military Depending on the revenue code
billed by the hospital, both of the
following:
• The RCC times the covered
allowable charges
• The military subsistence per diem
182-550-4300
Administrative Day The standard administrative day rate
times the days authorized by HCA,
added to the RCC times the ancillary
charges allowable and covered for
administrative days
182-550-3381 and 182-550-
4550
36 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
What are HCA’s payment methods for state-
administered programs?
HCA’s claim payment for an inpatient stay is determined by the payment method.
HCA pays hospitals for inpatient hospital covered services provided to state-
administered program (SAP) clients using the following methods described in
WAC 182-550-4800:
Payment Method General Description of Payment Formula
SAP DRG (Diagnostic Related
Group)
The DRG- specific relative weight times the hospital-
specific SAP DRG rate plus outlier if applicable. Total
payment cannot exceed billed charges.
SAP Per Diem The hospital-specific SAP daily rate for the service (psych,
rehab, withdrawal management (previously detox), or
CUP) times the covered allowable days.
Medicaid Fixed Per Diem for Long
Term Acute Care (LTAC)
The Medicaid fixed LTAC rate per day times the allowed
days plus the ratio of cost to charges (RCC) times the
allowable covered ancillaries not included in the daily rate.
SAP Ratio of Cost-to-Charges (RCC) The SAP RCC times the billed covered allowable charges.
SAP Cost settlement with Ratio of
Cost-to-Charges
The initial ProviderOne payment equals Medicaid RCC
times the covered allowable charges. For hold harmless
settlement base payment calculations, payment equals the
SAP RCC times the allowed covered charges.
Cost Settlement with Weighted
Cost-to-Charges (WCC)
SAP pricing does not apply.
Administrative Day The standard administrative day rate times the days
authorized by HCA, combined with the SAP RCC times the
ancillary charges that are allowable and covered for
administrative days.
HCA provides inpatient hospital services to SAP clients, including incapacity-
based and aged, blind, and disabled medical care services as described in WAC
182-508-0005. HCA pays SAP claims using SAP rates rather than Medicaid or
CHIP rates.
Diagnosis related group (DRG) payment method (inpatient
primary payment method)
HCA assigns a DRG code to each claim for pricing in ProviderOne for an inpatient
hospital stay, using 3M™ APR-DRG software. That DRG code determines the
method used to pay claims for prospective payment system (PPS) hospitals. PPS
37 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
hospitals include all in-state and border area hospitals, except both of the
following:
• Critical access hospitals (CAH), which HCA pays per WAC 182-550-2598
• Military hospitals, which HCA pays using the following payment methods
depending on the revenue code billed by the hospital:
o Ratio of costs-to-charges (RCC)
o Military subsistence per diem
For each DRG code, HCA establishes an average length of stay (ALOS). HCA may
use the DRG ALOS as part of its authorization process, retrospective utilization
review process, and payment methods as specified in this guide.
An inpatient claim payment includes all hospital-covered services provided to a
client during days the client is eligible. This includes, but is not limited to, the
following:
• The inpatient hospital stay
• Outpatient hospital services, including preadmission, emergency department,
and observation services related to an inpatient hospital stay and provided
within one calendar day prior to a client's inpatient hospital stay. These
outpatient services must be billed on the inpatient hospital claim.
Any hospital-covered service for which the admitting hospital sends the client
to another facility or provider during the client's inpatient hospital stay, and
the client returns as an inpatient to the admitting hospital.
• The DRG payment method is based on all the following:
o The DRG code assigned to the claim by ProviderOne
o The relative weight assigned to the DRG code
o The hospital's specific DRG conversion factor
HCA pays prospective payment system (PPS) hospitals for services excluded from
the DRG payment method using the following rates:
• Per diem
o Psychiatric
o Rehabilitation
o Withdrawal management
o Chemical-using pregnant (CUP) women
o Long-term acute care (LTAC)
o Administrative day
• RCC
o Certified public expenditure (CPE) hospital
o Military hospital
38 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Validation of DRG assignment
HCA uses 3M Corporation’s APR-DRG software for grouping and assigning a DRG
code to each claim for payment purposes. The DRG code that HCA assigns is the
one used to pay the claim. HCA may review claims to verify appropriate diagnosis
and procedure codes, place of service, medical necessity, and other information.
If HCA determines information is inappropriate, HCA may make an adjustment or
recoup payment. Providers must submit claims with information that allows the
claim to group to an appropriate DRG and that provides proof of medical
necessity.
To ensure the appropriate DRG is assigned and paid, providers must bill inpatient
hospital claims in accordance with:
• The national uniform billing data element specifications in effect for the dates
of service:
o Developed by the National Uniform Billing Committee (NUBC).
o Approved or modified, or both, by the Washington payer group or HCA.
o In effect on the date of the client’s admission.
• The clinical modification coding guidelines and the procedural coding
guidelines in the current version of the International Classification of Diseases.
• Nationally recognized coding source authority.
Valid DRG codes
HCA does not pay for inpatient hospital stays that group to APR DRG codes 955
(Principal diagnosis invalid as discharge diagnosis) or 956 (Ungroupable). To get
paid, providers must use diagnosis and procedure codes that group to a valid
DRG.
DRG relative weights
HCA uses 3M Health Information System’s national relative weights to price
claims in ProviderOne.
DRG conversion factors
The conversion factor is also referred to as the DRG rate. HCA establishes the
DRG allowed amount for payment for that admission by multiplying the
hospital's conversion factor (CF) by the assigned DRG relative weight.
High outliers (DRG)
When a claim paid using the DRG payment method qualifies as a high outlier
payment, HCA adjusts the claim payment.
39 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Qualifying for high outlier payment using DRG payment
method
A claim is a high outlier if the claim’s estimated cost is greater than the DRG
allowed amount plus $40,000.
The estimated costs equal the total submitted charges minus any noncovered
and nonallowed charges multiplied by the hospital’s ratio of costs-to-charges
(RCC). The DRG allowed amount equals the hospital’s DRG rate multiplied by the
relative weight.
HCA uses 3M Health Information Systems national relative weights.
These criteria are also used to determine if a transfer claim qualifies for high
outlier payment for claims with admission dates before July 1, 2014. For transfer
claims submitted on or after July 1, 2014, HCA uses the prorated DRG amount to
determine if the transfer claim qualifies for high outlier payment. The prorated
DRG amount is the lesser of:
• The per diem DRG allowed amount (hospital’s rate times relative weight for
the DRG code assigned to the claim by HCA) divided by the average length of
stay (for the DRG code assigned by HCA for the claim) multiplied by the
client’s length of stay plus 1 day.
• The total DRG payment allowed amount calculation for the claim.
Calculating Medicaid high outlier payment
The high outlier payment is the difference between HCA’s estimated cost of
services associated with the claim and the high outlier threshold multiplied by a
percentage. The percentage varies according to the severity of illness (SOI) for
the DRG assigned to the claim:
• SOI 1 or 2 get 80%
• SOI 3 or 4 get 95%
High outlier examples by SOI are in the table below. They assume the following:
• DRG Allowed Amount = $10,000
• $10,000 = DRG Medicaid rate of $5,000 multiplied by a relative weight of 2.0
• Billed covered allowed charges = $250,000
• Hospital specific RCC = 0.40
40 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
DRG
SOI
Base
DRG
Allowed
Amount
Billed
Charges RCC Cost Threshold
Cost
Above
Threshold
Outlier
Percent Outlier
Total
Claim
Payment
A B C D F E G H I J
C*D $40,000+B F-E G*H B+I
1,2 $10,000 $250,000 0.40 $100,000 $50,000 $50,000 0.80 $40,000 $50,000
3,4 $10,000 $250.000 0.40 $100,000 $50,000 $50,000 0.95 $47,500 $57,500
Calculating state-only-funded program high outlier for
state administered program (SAP) claims
These high outlier payment rules are the same as for Medicaid claims except for
the following differences:
• HCA uses the SAP DRG rate instead of the Medicaid DRG rate to calculate the
DRG allowed amount.
• HCA multiplies the high outlier payment by the hospital’s ratable.
The examples in the table below assume the following:
• DRG Allowed Amount = $10,000
• $10,000 = DRG SAP rate of $1,000 multiplied by a relative weight of 10
• Billed covered allowed charges = $250,000
• Hospital specific RCC = 0.40
• Hospital ratable = 0.5
DRG
SOI
Base
DRG
Allowed
Amount
Billed
Charges RCC Cost Threshold
Cost
Above
Threshold
Outlier
Percent Ratable Outlier
Total
Claim
Payment
A B C D F E G H I J
(1) C*D (2) $40,000+B F-E G*H B+I
1,2 $10,000 $250,000 0.40 $100,000 $50,000 $50,000 0.80 0.50 $20,000 $30,000
3,4 $10,000 $250.000 0.40 $100,000 $50,000 $50,000 0.95 0.50 $23,750 $33,750
41 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Transfer information for DRG payment method
Hospital transfers are when an eligible client transfers from an acute care hospital
or distinct unit to any of the following settings (noted on the claim with one of
the following discharge status codes: 02, 03, 04, 05, 06, 43, 50, 51, 61, 62, 63, 64,
65, 66, 70, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95):
• Another acute care hospital or distinct unit
• A skilled nursing facility (SNF)
• An intermediate care facility (ICF)
• Home care under HCA's home health program
• A long-term acute care facility (LTAC)
• Hospice (facility-based or in the client's home)
• A hospital-based, Medicare-approved swing bed or another distinct unit such
as a rehabilitation or psychiatric unit
• A nursing facility certified under Medicaid but not Medicare
HCA pays a transferring hospital a per diem rate when one of the transfer
discharge status codes listed above is used in the Discharge Status field of the
institutional electronic claim.
The transfer payment policy is applied to claims billed with patient status
indicated as transferred cases. The service provided to the client is paid based on
the DRG payment method. The payment allowed amount calculation is the lesser
of the:
• Per diem DRG allowed amount (hospital’s rate times relative weight for the
DRG code assigned to the claim by HCA) divided by the average length of
stay (for the DRG code assigned by HCA for the claim) multiplied by the
client’s length of stay plus 1 day.
• Total DRG payment allowed amount calculation for the claim.
Payment to the transferring hospital will not exceed the DRG allowed amount
that would have been paid for the claim, less any final adjustments, had the client
been discharged. The hospital that ultimately discharges the client receives a DRG
payment that equates to the allowed amount for the claim less any final
adjustments. If a transfer case qualifies as an outlier, HCA will apply the outlier
payment method to the payment.
Example: A client is admitted to Hospital A, transferred to
Hospital B, then transferred back to Hospital A and is discharged.
In this case, Hospital A, as a discharging hospital, is paid a full
DRG allowed amount for the claim minus any final adjustments.
Hospital B is paid a per diem amount.
42 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Per diem payment method
HCA bases the allowed amount for the per diem payment method on the
hospital's specific per diem rate assigned to the particular DRG classification,
unless otherwise specified.
HCA establishes the per diem allowed amount for payment by multiplying the
hospital's per diem rate for the particular claim by the number of covered days
for the claim based on HCA’s medical necessity review.
Note: [Per diem payment allowed amount] = [Hospital's per
diem rate for the claim] x [Number of HCA-determined covered
medically necessary days]
Services paid using the per diem payment method
HCA pays for the following services using the per diem payment method:
• Psychiatric, rehabilitation, withdrawal management, and Chemical-Using
Pregnant (CUP) Women program services provided in inpatient hospital
settings. The payment calculation is based on the per diem payment rate and
the client’s length of stay.
o No outlier adjustment is made for per diem services.
o Chemical-Using Pregnant (CUP) Women services are identified by
revenue code 129, not by APR-DRG classification. Refer to the Chemical-
Using Pregnant (CUP) Women Program Billing Guide for more
information.
o Psychiatric admissions and acute physical medicine and rehabilitation
(Acute PM&R) services require PA. See Authorization for information on
the authorization process.
Note: For psychiatric admission rules, refer to the Mental Health
Services Billing Guide. For information on the Acute PM&R
program, refer to the Acute Physical Medicine and
Rehabilitation (PM&R) Billing Guide.
Hospitals paid using the per diem payment method
HCA pays the following types of hospitals using the per diem payment method:
• Psychiatric hospitals
o Freestanding psychiatric hospitals
o State-designated, distinct pediatric psychiatric units
o Medicare-certified, distinct psychiatric units in acute care hospitals
43 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
The freestanding psychiatric hospitals referenced above do not include the
following:
o Eastern State Hospital
o Western State Hospital
o Psychiatric evaluation and treatment facilities
• Rehabilitation hospitals
o St. Luke’s Rehabilitation Institute
o Medicare-certified, distinct rehabilitation units in acute care hospitals
The hospitals referenced (rehabilitation hospitals) above do not include either of
the following:
o Long term acute care hospitals
o Freestanding withdrawal management facilities
Note: The payment methods for long term acute care (LTAC)
hospitals and freestanding withdrawal management facilities are
different from rehabilitation hospitals. For LTAC see “Fixed Per
Diem – LTAC” below, and for freestanding withdrawal
management facilities, see HCA’s Substance Use Disorder Billing
Guide.
Transfers (per diem)
See Transfers.
Note: No transfer payment policy is applied to services paid
using the per diem payment methods. Other policies to transfers
may apply (refer to the Mental Health Services Billing Guide).
Fixed per diem payment method – (LTAC)
HCA pays approved LTAC hospitals a per diem rate for HCA-approved days. For
other covered services listed on the claim (which are not already included in the
per diem rate) HCA uses the ratio of cost-to-charges (RCC) method
Transfers (per diem - LTAC)
All transfers to and from LTAC hospitals require PA by HCA. Refer to HCA’s Long
Term Acute Care (LTAC) Billing Guide. When the claim for the transferring
hospital is paid by the DRG payment method, charges on that claim must meet or
exceed the DRG allowed amount prior to the transfer. The DRG allowed amount
equals the hospital’s DRG rate times the relative weight for the DRG code
assigned by HCA.
44 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Ratio of costs-to-charges (RCC) payment method
HCA uses the RCC payment method to pay some hospitals and services that are
exempt from the DRG payment method. The RCC method is based on each
hospital's specific RCC. The RCC allowed amount for payment is calculated by
multiplying the hospital's allowed covered charges for the claim by the hospital’s
RCC. The RCC methodology is not based on conversion factors, per diem rates,
etc.
Note: If a client is not eligible for some of the days in the
hospital stay, all of the following are required when billing:
- Bill covered and noncovered charges on separate lines.
- Bill the entire stay from the admission date to the discharge
date, including the dates the client was not eligible.
- Bill all diagnosis and procedure codes for the entire stay.
Bill the entire stay from admittance to discharge. Show charges for dates of
service for which the client is not eligible as “noncovered.” Put noncovered
charges for each revenue code on its own line. Do not put noncovered charges
on the same revenue code line with covered charges.
[RCC payment allowed amount] = [Hospital's allowed covered
charges for the claim] x [Hospital’s RCC]
Hospitals paid using the RCC payment method
HCA uses the RCC payment method to pay the following types of hospitals:
• Military hospitals
• Hospitals participating in the certified public expenditure “full cost” payment
method
• Long term acute care (LTAC) hospitals for covered inpatient services not
covered in the per diem rate
Certified public expenditure (CPE)
HCA uses the RCC payment method to pay CPE hospitals billing Medicaid (Title
XIX) and state-administered program claims. The hospital receives only the
federal portion of the claim payment.
Payment for services provided to clients eligible for
Medicare and Medicaid
The ProviderOne system derived payment amount will be the true claim payment
amount using the appropriate OPPS, DRG, fee schedule, per diem, or RCC
reimbursement methodology that applies to the claim. Using that payment
45 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
amount, for Medicaid clients who are entitled to Medicare Part A and/or
Medicare Part B, HCA pays the difference between the Medicare paid amount
and the ProviderOne-derived payment amount or the deductible and/or
coinsurance amounts on the claim, whichever is less.
Recoupment of payments
HCA recoups any inappropriate payments made to hospitals for unauthorized
days or for authorized days that exceeded the actual date of discharge.
Noted Exceptions
For medical inpatient withdrawal management (previously detox). See Utilization
Review.
46 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Program Limitations
Medical necessity
HCA will pay only for covered services and items that are medically necessary and
the least costly, equally effective treatment for the client.
Unbundling
HCA does not pay separately for unbundled services billed on an inpatient claim
by a hospital. These services are accommodation costs and are considered part of
the “bundled services” under the diagnosis code billed on the claim, per WAC
182-550-1050. The following are general categories and examples of inpatient
facility charges that are not separately billable or reimbursable.
Routine supplies
Routine supplies that are not separately billable or reimbursable include, but are
not limited to:
• Supplies that are included in the cost of the room, such as linens, personal
protective equipment, reusable equipment, floor stock items
• Items commonly available to clients in a particular setting
• Items ordinarily used for or on most clients in that area or department
• Not reusable or representative of a cost for each preparation
• Kits that contain routine stock items, such as an IV start kit or urine catheter
kit
For an item to be separately billable and reimbursable, it must be both of the
following:
• Directly identifiable to the individual client with specific documentation or
easily inferred documentation
• Furnished at the direction of a physician because of specific medical needs
Components of room and board
Bedside nursing services (defined in WAC 182-550-1050) that are included in the
room and board services paid to regular and special care hospitals are not
separately billable or reimbursable. Examples include, but are not limited to:
• Blood and blood components, under the conditions described in WAC 182-
550-6500
• Dressing changes
• Hemodynamic monitoring
• Incremental nursing care (1:1 in ICU, CCU, etc.)
• IV insertion Medication administration and infusion of fluids
• Performance of point of care testing
47 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
• Respiratory treatments
• Tube feedings
• Urinary catheterization
Lab and pharmacy services
Lab and pharmacy services that are included in the bundled charge and are
therefore not separately billable or reimbursable include, but are not limited to:
• Blood draws from venous or arterial devices, regardless of the practitioner
doing the draw
• Capillary blood collection (heel sticks or finger sticks)
• Low osmolar contrast for radiology procedures
• Pharmacy consultations for medication management or education
Equipment
The following equipment is not separately billable or reimbursable:
• Equipment commonly available to clients in a particular setting or ordinarily
furnished to clients during the course of a procedure, whether hospital-owned
or rented, and supplies used in conjunction with this equipment
• Equipment that is used to provide services to multiple clients and has an
extended life
• Equipment that is required for the level of care being provided, such as
cardiac monitoring, oximetry, as well as leads, batteries, maintenance and
calibration of this equipment
Examples of equipment not separately billable or reimbursable include, but are
not limited to:
• Anesthesia machines
• Arterial/Swan Ganz monitors
• Automatic blood pressure machines and/or monitors
• Cameras
• Cardiac monitors
• Cautery machines
• Cell Saver equipment
• CO2 End Tidal monitors
• Fetal monitor
• Instruments
• IV pumps
• Lasers
48 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
• Microscopes
• Neurological Monitors
• Oximetry monitors
• Rental equipment
• Scopes
• Thermometers
• Ventilators
Respiratory therapy
The care of a client with respiratory needs and all related equipment, oxygen,
services, and supplies, as described in WAC 182-552-0005, are not separately
billable or reimbursable. Examples include, but are not limited to:
• Client’s own CPAP/BiPAP equipment
• Respiratory assessments and suctioning when done as part of a treatment or
when client is on a ventilator
• Ventilator setting changes, checks, weaning and extubation
Specific items/services not covered
HCA does not pay for an inpatient or outpatient hospital service, treatment,
equipment, drug, or supply that is not described as a covered service in Chapter
182-550 WAC. Noncovered items and services include, but are not limited to:
• Ancillary services, such as respiratory and physical therapy, performed by
regular nursing staff assigned to the floor or unit
• Cafeteria charges
• Crisis counseling
• Handling fees and portable X-ray charges
• Medical photographic or audio/videotape records
• Personal care items such as, but not limited to, slippers, toothbrush, comb,
hair dryer, and make-up
• Psychiatric day care
• Robotic assisted surgery (RAS)
• Room and equipment charges ("rental charges") for use periods concurrent
with another room or similar equipment for the same client
• Routine hospital medical supplies and equipment such as bed scales
• Services and supplies provided to nonclients, such as meals and "father packs”
• Standby personnel and travel time
• Telephone/telegraph services or television/radio rentals
49 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Note: Although RAS may be considered medically necessary,
HCA does not pay separately for HCPCS code S2900 and
reimburses only for the underlying procedure. HCA requires
billing providers to bill for RAS in order to track utilization and
outcome. HCA will monitor RAS through retrospective auditing
of applicable ICD 10 procedure codes, and review of operative
reports.
Administrative days
Administrative days are days of an inpatient hospital stay when an acute inpatient
or observational level of care is no longer medically necessary and one of the
following is true:
• Outpatient level of care is not applicable
• Appropriate non-hospital placement is not readily available
Administrative days are paid at the administrative day rate (refer to Payment for
Services). HCA may perform retrospective utilization reviews on inpatient hospital
admissions to determine appropriate use of administrative days.
Rate guideline for new hospitals
New hospitals are those entities that do not have base year costs on which to
calculate a rate. A change in ownership does not constitute the creation of a new
hospital. See WAC 182-550-4200 for information on change of ownership.
Major trauma services
Increased payments for major trauma care
The Washington State Legislature established the Trauma Care Fund (TCF) in
1997 to help offset the cost of operating and maintaining a statewide trauma
care system. The Department of Health (DOH) and HCA receive funding from the
TCF to help support provider groups involved in the state’s trauma care system.
HCA uses its TCF funding to draw federal matching funds. HCA makes
supplemental payments to designated trauma service centers for trauma cases
that meet specified criteria.
A hospital is eligible to receive trauma supplemental payments only for a patient
who is a Medicaid (Title XIX) client. The client must have an Injury Severity Score
(ISS) of:
a. 13 or greater for adults (age 15 or older)
b. 9 or greater for pediatric clients (age 14 or younger)
c. Less than (a) or (b) when received in transfer by a Level I, II, or III trauma
service center from a lower-level facility. (The receiving facility is eligible
50 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
for TCF payment regardless of the ISS; the transferring facility is eligible
only if the case met the ISS criteria above.)
Designated trauma service centers will receive supplemental payments for
services provided to Medicaid fee-for-service and managed care enrollees.
Note: HCA does not make supplemental payments to a hospital
for trauma care provided to a client who is not a Medicaid client.
How does a hospital qualify for TCF payments from HCA?
A hospital is eligible to receive TCF payments from HCA when the hospital meets
all of the following criteria. The hospital:
• Is designated by DOH as a trauma service center (or “recognized” by DOH if
the hospital is located in a designated bordering city).
• Is a Level I, Level II, or Level III trauma service center.
• Meets the provider requirements in WAC 182-550-5450 and other applicable
WAC.
• Meets the billing requirements in WAC 182-550-5450 and other applicable
WAC.
• Submits all information required by DOH for the Trauma Registry.
• Provides all information HCA requires to monitor, manage, and audit the
trauma program.
See DOH’s website for a list of the Washington State Designated Trauma Service
Centers.
TCF payments to hospitals for transferred trauma cases
When a trauma case is transferred from one hospital to another, HCA makes TCF
payments to hospitals according to the ISS, as follows:
• If the transferred case meets or exceeds the appropriate ISS threshold (ISS of
13 or greater for adults and 9 or greater for pediatric clients), both
transferring and receiving hospitals are eligible for TCF payments. The transfer
must have been to a higher-level designated trauma service center, and the
transferring hospital must be a Level II or Level III hospital. Transfers from a
higher-level to a lower-level designated trauma service center are not eligible
for TCF payments.
• If the transferred case is below the ISS threshold, only the receiving hospital is
eligible for TCF payments. The receiving hospital is eligible for TCF payments
regardless of the ISS for the transferred case. The receiving hospital must be a
Level III hospital or higher.
51 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
TCF payment calculation
HCA has an annual TCF appropriation. HCA distributes its TCF appropriation for
hospital services in five periodic supplemental payments. Hospitals receive a
percentage of a fixed periodic distribution amount. Each hospital’s percentage
share depends on the total qualified trauma care provided by the hospital during
the service year to date, measured against the total qualified trauma care
provided by designated Levels I-III trauma service centers during the same
period.
The payment an eligible hospital receives from the periodic TCF payment pool is
determined as follows:
• HCA’s payments to each designated hospital for qualifying trauma claims
from the beginning of the service year is summed.
• Using this amount as a percentage of total payments made by HCA to all
Level I, II, and III hospitals for qualifying trauma claims for the service year-to-
date, each eligible hospital’s payment percentage share for the service year-
to-date is multiplied by the trauma supplemental funds available for the
service year-to-date.
• HCA then subtracts previous periodic payments made to the individual
hospital for the service year-to-date to determine the amount (if any) that the
hospital will receive from the current periodic payment pool.
HCA includes in the TCF payment calculation only those eligible trauma claims
submitted with the appropriate condition code within the time frames specified
by HCA.
Note: See WAC 182-550-5450 for a complete description of the
payment methodology to designated trauma service centers and
other policies pertaining to HCA’s trauma program.
Cap on TCF payments
The total payments from the TCF for a state fiscal year cannot exceed the TCF
amount appropriated by the legislature for that fiscal year. HCA has the authority
to take whatever actions are needed to ensure its TCF appropriation is not
exceeded.
52 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Use appropriate condition codes when billing for qualified
trauma cases
A designated trauma service center must use an HCA-assigned condition code on
the institutional claim to indicate that a hospital claim is eligible for the TCF
payment. Select the appropriate condition code from the following table:
Condition Code Description
TP Indicates a pediatric client (through age 14 only) with an Injury
Severity Score (ISS) in the range of 9-12
TT Indicates a transferred client with an ISS that is less than 13 for
adults or less than 9 for pediatric clients
TV Indicates an ISS in the range of 13 to 15
TW Indicates an ISS in the range of 16 to 24
TX Indicates an ISS in the range of 25 to 34
TY Indicates an ISS in the range of 35 to 44
TZ Indicates an ISS of 45 or greater
Note: Remember that when you put a trauma condition code on
a hospital claim, you are certifying that the claim meets the
criteria published in WAC 182-550-5450.
The “TT” condition code should be used only by a Level I, Level II,
or Level III receiving hospital. A Level II or Level III transferring
hospital must use the appropriate condition code indicating the
Injury Severity Score of the qualifying trauma case. See WAC 182-
550-5450.
Trauma condition codes may be entered in form locators 18-28, but HCA prefers
that hospitals use form locator 18 for trauma cases.
Trauma claim adjustments
HCA considers a provider’s request for an adjustment to a trauma claim only if
HCA receives the adjustment request within one year from the date of service for
the initial traumatic injury.
HCA does not make any TCF payment for a trauma claim adjusted after 365 days
from the date of the qualifying service. The deadline for making adjustments to a
trauma claim is the same as the deadline for submission of the initial claim. WAC
182-502-0150 does not apply to TCF payments.
53 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
All claims and claim adjustments are subject to federal and state audit and review
requirements.
Injury severity score (ISS)
Note: The current qualifying ISS is 13 or greater for adults, and 9
or greater for pediatric clients (through age 14 only).
The ISS is a summary severity score for anatomic injuries.
It is based upon the Abbreviated Injury Scale (AIS) severity scores for six body
regions:
• Head and neck
• Face
• Chest
• Abdominal and pelvic contents
• Extremities and pelvic girdle
• External
The ISS values range from 1 to 75 and generally, a higher ISS indicates more
serious injuries.
Contacts
For information on designated trauma services, trauma service designation,
trauma registry, and/or injury severity scores (ISS), see:
Department of Health
Office of Community Health Systems
Trauma System Webpage
For information on payment, contact:
Office of Hospital Finance
Health Care Authority
360-725-9820
For clarification on any Medicaid trauma claim, email the Medical Assistance
Customer Service Center (MACSC) or call MACSC at 1-800-562-3022.
Note: See the Physician-Related Services/Health Care
Professionals Billing Guide for the list of Physicians/Clinical
Providers eligible to receive enhanced rates for trauma care
services.
54 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Authorization
General authorization
Certain authorization requirements are published in specific program or service
documents. Refer to the specific program or service document for more details.
HCA’ authorization process applies to medically necessary
covered health care services only and is subject to client
eligibility and program limitations. Not all categories of eligibility
receive all health care services.
For example: Therapies are not covered under the Family
Planning Only Program. All covered health care services are
subject to retrospective utilization review to determine if the
services provided were medically necessary and at the
appropriate level of care.
Authorization does not guarantee payment. Requests for
noncovered services may be reviewed under the exception to
rule policy. See WAC 182-501-0160.
To request a prior authorization (PA), concurrent authorization, or retroactive
authorization, providers may submit a request online through direct data
entry into ProviderOne (see HCA’s Prior authorization webpage for details).
Providers may also use the written or fax authorization process. Providers must
complete:
• A General Information for Authorization form 13-835. This request form must
be the initial page when you submit your request
• Evidence-based decision making
• Utilization review (UR)
• Any medical justification to support the request
Fax all documentation to 866-668-1214
Note: For psychiatric admission rules, refer to the Mental Health
Services Billing Guide. For information on the Acute PM&R
program, refer to the Acute Physical Medicine and
Rehabilitation (PM&R) Billing Guide.
See HCA’s ProviderOne Billing and Resource Guide for more
information on requesting authorization.
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Authorization requirements for selected surgical
procedures
HCA’s PA requirements include selected surgical procedures. Medical necessity
reviews for surgical procedures are conducted by HCA or Comagine Health.
For more information about the requirements for submitting medical necessity
reviews for authorization, refer to HCA’s Physician-Related Services/Health Care
Professional Services Billing Guide.
“Write or fax” PA
“Write or fax” PA is an authorization process available to providers when a
covered procedure requires PA. HCA does not retrospectively authorize any
health care services that require PA after they have been provided except when a
client has delayed certification of eligibility.
The following forms are available to providers requesting PA from HCA:
• Basic Information form, 13-756
• Bariatric Surgery Request form, 13-785
• Out-of-State Medical Services Request form, 13-787 (for elective, non-
emergency out- of-state medical services). Refer to Out-of-State Hospital
Admissions for more information
To access these forms, see Where can I download HCA forms?
Be sure to complete all information requested. Requests that are incomplete will
be returned to the provider.
Send one of the completed fax forms listed above to HCA to the fax number
listed on the form.
How does HCA approve or deny PA requests?
HCA reviews PA requests in accordance with WAC 182-501-0165 and uses
evidence-based medicine to evaluate each request. HCA evaluates and considers
all available clinical information and credible evidence relevant to the client’s
condition. At the time of the request, the provider responsible for the client’s
diagnosis and/or treatment must submit credible evidence specifically related to
the client’s condition. Within 15 days of receiving the request from the client’s
provider, HCA reviews all evidence submitted and does one of the following:
• Faxes an approval letter to the provider and mails a copy of the letter to the
client
• Denies the request if the requested service is not medically necessary, and
notifies the provider and client of the denial
• Requests the provider to submit additional justifying information within 30
days. When the additional information is received, HCA approves or denies
the request within 5 business days of the receipt of the additional information.
If the additional information is not received within 30 days, HCA denies the
requested service.
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When HCA denies all or part of a request for a covered service or equipment, it
sends the client and the provider written notice within 10 business days of the
date the complete requested information is received. The denial letter:
• Includes a statement of the action HCA intends to take.
• Includes the specific factual basis for the intended action.
• Includes references to the specific WAC provision upon which the denial is
based.
• Is in sufficient detail to enable the recipient to learn why HCA took the action.
• Is in sufficient detail to determine what additional or different information
might be provided to challenge HCA’s determination.
• Includes the client’s administrative hearing rights.
• Includes an explanation of the circumstances under which the denied service
is continued or reinstated if a hearing is requested.
• Includes example(s) of lesser cost alternatives that permit the affected party to
prepare an appropriate response.
Expedited prior authorization (EPA)
Expedited prior authorization (EPA) is designed to eliminate the need for written
authorization. HCA establishes authorization criteria and identifies the criteria
with specific codes, enabling providers to create an EPA number using those
codes. Enter the EPA number on the billing form in the authorization number
field, or in the “authorization” or “comments” section when billing electronically.
Surgical procedures that require a medical necessity
review by HCA
To implement the PA requirement for selected surgical procedures (including
hysterectomies and other surgeries of the uterus), HCA conducts medical
necessity reviews for selected surgical procedures. For details about the PA
requirements for these procedures, refer to both of the following:
• Physician-Related Services/Health Care Professional Services Billing Guide
• Physician-Related/Professional Health Care Services Fee Schedule. Select the
most current fee schedule link, then select a procedure code and refer to the
comments field for the accompanying submittal requirement.
Transgender health services
For details about these services and PA requirements, refer to the Physician-
Related Services/Health Care Professional Services Billing Guide.
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How do clients update their gender field?
• Clients who applied through the Healthplanfinder must call HCA’s Medical
Eligibility Determination Section toll free 1-855-623-9357.
• Clients who applied through the Community Service Office (CSO) must call
toll-free 1-877-501-2233 or report online at Washington Connection.
Any Washington Apple Health client can call and choose a gender. Clients should
be aware that other state agencies, such as the Department of Licensing, have
different requirements.
How do clients update or change their name?
Before making a name change in Washington Healthplanfinder, the client should
first obtain a name change with the Social Security Administration. If the client’s
name in Washington Healthplanfinder does not match the client’s name in Social
Security, the system will generate an error and this could affect the client’s
coverage.
• Clients who applied through the Healthplanfinder must call toll-free 1-855-
623-9357.
• Clients who applied through the Community Service Office (CSO) must call
toll-free 1-877-501-2233 or report online at Washington Connection.
Managed care clients
Covered by a managed care organization (MCO): If a client is enrolled in
managed care, the MCO is responsible for all medical care including hormone
and mental health services to treat gender dysphoria. Contact the MCO for
requirements for those services. The MCO is not responsible for surgical
procedures related to gender reassignment surgery, including electrolysis and
postoperative complications.
Covered through fee-for-service: HCA pays for surgical procedures related to
gender reassignment surgery, electrolysis, laser hair removal, and postoperative
complications through fee-for-service (FFS). PA is required from HCA for these
procedures.
Note: If the client is being seen for postoperative complications
from a gender reassignment surgery or procedure, the provider
must put “GRS complication surgery” in the Claim Note field.
These services are covered by HCA through fee-for-service for
managed care clients.
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Surgical procedures that require a medical necessity
review by Comagine Health
HCA contracts with Comagine Health to provide web-based access for reviewing
medical necessity of selected surgical procedures in the following categories:
• Spinal, including facet injections
• Major joints
• Upper and lower extremities
• Carpal tunnel release
• Thoracic outlet release
Comagine Health conducts the review of the request to establish medical
necessity for surgeries but does not issue authorizations. Comagine Health
forwards its recommendations to HCA for final determination.
For more information about the requirements for submitting medical necessity
reviews for authorization, refer to HCA’s Physician-Related Services/Health Care
Professional Services Billing Guide.
Breast Surgeries
Refer to HCA’s published Physician-Related Services/Health Care Professional
Services Billing Guide.
Inpatient admissions are billable only when the stay meets the definition of
inpatient admissions (see Definitions). Refer to the Physician-Related
Services/Health Care Professional Services Billing Guide for EPA criteria.
Newborn Deliveries
HCA does not pay for early elective deliveries. An early elective delivery is defined
in WAC 182-500-0030 as any non-medically necessary induction or cesarean
section before 39 weeks gestation.
An early elective delivery is considered medically necessary if the mother or fetus
has a diagnosis listed in the Joint Commission’s current table of Conditions
Possibly Justifying Elective Delivery Prior to 39 Weeks Gestation (WAC 182-533-
0400). If the client meets the medical necessity criteria, bill using EPA
#870001375. This EPA also needs to be used for clients who deliver naturally
prior to 39 weeks.
If the early elective delivery does not meet medical necessity criteria, HCA will pay
only for the antepartum and postpartum professional services. When billing,
these services must be unbundled. HCA will not pay for the delivery services.
For all deliveries for a client equal to or over 39 weeks gestation, bill using EPA
#870001378. This applies to both elective and natural deliveries for clients equal
to or over 39 weeks gestation.
59 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Approved bariatric hospitals and associated clinics
HCA covers medically necessary bariatric surgery for clients age 21-59 in a facility
that is accredited by the Metabolic and Bariatric Surgery Accreditation and
Quality Improvement Program (MBSAQIP), on the American College of
Surgeons website, in accordance with WAC 182-531-1600. HCA covers bariatric
surgery for clients age 18-20 for the laparoscopic gastric band procedure only
(ICD 0DV64CZ). All bariatric surgeries require PA, and are approved when the
client meets the criteria in WAC 182-531-1600. Inpatient bariatric surgery is paid
on a DRG basis, not on a per case rate basis.
Note: HCA does not cover bariatric surgery for clients age 17
and younger.
To begin the authorization process, providers must fax a completed Bariatric
Surgery Request form and the Basic Information form to HCA. (See Where can I
download HCA forms?)
Clients enrolled in an HCA-contracted managed care organization (MCO) may be
eligible for bariatric surgery. Clients enrolled in an HCA-contracted MCO must
contact their MCO for information regarding the bariatric surgery benefit.
Acute physical medicine and rehabilitation (PM&R)
HCA requires prior and concurrent authorization for admissions and continued
stays in an HCA-approved acute PM&R facilities. To facilitate ProviderOne billing,
provide room charges with one of the following revenue codes: 0128 or 0169.
Refer to HCA’s Acute Physical Medicine and Rehabilitation (PM&R) Billing
Guide for program specifics.
Inpatient psychiatric admissions
Each claim for inpatient psychiatric care must include an authorization number or,
for fee-for-service clients, an EPA number. Hospitals must bill a new claim and
use the appropriate EPA number depending on voluntary or involuntary status.
Refer to HCA’s Mental Health Services Billing Guide for program specifics.
Long-term acute care (LTAC)
HCA requires PA for all admissions to HCA-approved LTAC hospitals.
See HCA’s Long-Term Acute Care Program Billing Guide for more program
specifics. Approved long-term acute care hospitals are:
• Kindred Hospital for Respiratory and Complex Care - Seattle, WA
• Northern Idaho Advanced Care Hospital - Post Falls, ID
• Vibra Specialty Hospital - Portland, OR
60 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Claims must meet or exceed the DRG allowed amount prior to the transfer. HCA
no longer uses DRG high outlier payment status as a criterion for approving
transfers from acute care to LTAC for individuals who are otherwise eligible. To
facilitate ProviderOne billing, bill room charges with revenue code 0100.
Out-of-state hospital admissions (does not include
hospitals in designated bordering cities)
HCA pays for emergency care at an out-of-state hospital for Medicaid and CHIP
clients only.
Note: HCA considers hospitals in designated bordering cities
(listed in WAC 182-501-0175) as in-state hospitals for coverage
and as out-of-state hospitals for payment, except for critical
border hospitals. HCA considers critical border hospitals “in-
state” for both coverage and payment.
HCA requires PA for elective, non-emergency care. Providers should request PA
when:
• The client is on a medical program that pays for out-of-state coverage.
Example: Aged, Blind, Disabled (ABD) Assistance (formerly Disability Lifeline
clients) have no out-of-state benefit except in designated bordering cities.
• The service is for a covered medically necessary service that is unavailable in
the State of Washington (see WAC 182-501-0060).
Providers requesting elective, out-of-state care must send a completed Out-of-
State Medical Services Request form with the additional documentation required
on the form, to the address listed on the form. (See Where can I download HCA
forms?)
Refer to Mental Health Services Billing Guide for information on out-of-state
psychiatric care.
Out-of-country hospital admissions
HCA does not cover out-of-country hospital admissions or emergency room
visits. The exception to this is Medicaid clients who reside in Point Roberts or
Washington communities along the border with British Columbia, Canada. These
clients are covered for hospital admissions or emergency room visits in British
Columbia, Canada when:
• The Canadian provider is the closest source of care.
• Needed medical services are more readily available in Canada and the
aggregate cost of care is equal to or less than the aggregate cost of the same
care when provided within the state.
61 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Acute hospital withdrawal management
Withdrawal management (previously detox) services are provided to help people
safely withdraw from the physical effects of psychoactive substances. The need
for withdrawal management (WM) services is determined by using the American
Society of Addiction Medicine (ASAM) criteria.
Acute hospital withdrawal management is medically managed intensive inpatient
care, best described by ASAM Level 4.0. There is full access to medical acute care
including ICU if needed. Doctors, nurses, and counselors work as a part of an
interdisciplinary team to medically manage the patient’s care. These facilities are
regulated by DOH and hospital license. This level of care is considered hospital
care and not part of the behavioral health benefits provided through BH-
ASOs/MCOs.
See HCA’s Substance Use Disorder (SUD) Billing Guide for Level 3.2 and Level
3.7 services.
Hospitals approved for withdrawal management
services
Hospitals approved for withdrawal management services must submit billing
provider taxonomy 276400000X and revenue code 0126.
For more information about substance use treatment, visit the Health Care
Authority (HCA) Health care services and support webpage.
Chemical-using pregnant (CUP) women
Pregnant clients may be eligible to receive acute withdrawal management,
medical stabilization, and rehabilitation services through the Chemical-Using
Pregnant (CUP) Women Program.
See HCA’s Chemical-Using Pregnant (CUP) Women Program Billing Guide for
details. A list of the DBHR Certified Hospitals providing intensive inpatient care
for chemical using pregnant women is located on HCA’s website.
Acute hospital withdrawal management services
In order to bill HCA and get paid, hospitals that provide withdrawal management
to Washington Apple Health clients must meet the following criteria:
• Acute inpatient severity of illness criteria
• All of the medical inpatient withdrawal management criteria listed below
• Licensed as an acute care hospital by DOH under Chapter 246-320 WAC
62 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
What are the medical inpatient withdrawal management
criteria?
The medical inpatient withdrawal management (previously detox) criteria are
listed below. All of these criteria must be met:
1. The medical inpatient withdrawal management stay cannot be a
scheduled admission due to the acute nature of intoxication and the
need for immediate withdrawal management.
2. The stay meets criteria for severity and intensity of illness, and medical
necessity standards to qualify as an inpatient admission.
3. The principal diagnosis is related to the use or abuse of alcohol, hypnotic,
hallucinogen, stimulant, opioid, or other psychoactive substance.
4. The client is not participating in HCA’s Chemical-Using Pregnant (CUP)
Women Program.
5. The care is provided in a medical unit.
6. This is a medical stay and not a psychiatric stay. The client does not meet
medically necessary criteria for inpatient psychiatric care.
7. The hospital is not a DOH-approved withdrawal management (ASAM 3.2
or 3.7) facility.
8. Nonhospital-based withdrawal management is not medically
appropriate.
Do withdrawal management services need to be
authorized?
EPA is used for withdrawal management services.
Note: If the client is covered by an MCO, the claim must be
submitted to the client’s MCO. Do not send these claims to HCA.
All claims must meet the medical inpatient withdrawal management criteria and
be billed using one of the following EPA numbers:
Description EPA Number
For acute alcohol withdrawal management use 870000433**
For acute drug withdrawal management use 870000435**
**Claims submitted without one of the above EPA numbers will be denied.
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What is HCA’s allowed length of stay (LOS) for claims?
HCA limits payment for medical inpatient withdrawal management days to the
following:
• Three days for acute alcohol withdrawal management
• Five days for acute drug withdrawal management
How do I bill HCA for medical inpatient withdrawal
management services exceeding the 3 or 5-day LOS
limitation?
When a medical inpatient withdrawal management stay exceeds the 3- or 5-day
LOS limitation, bill all charges incurred during the stay (from admission through
discharge) on one claim.
The charges for the initial 3 or 5 days plus any other days for which you are
requesting an extension must be billed in the “total charges” column of the claim.
Bill the amount for any days that are not to be evaluated for an extension in the
noncovered charges column of a separate line of the claim.
Break out covered and noncovered charges on separate lines as in the following
examples:
Example 1
The client is withdrawing from alcohol, meets the medical inpatient withdrawal
management criteria, and is in the hospital for the allowed 3 days.
Room and
Board
Revenue
Code Unit
Total
Charges
Noncovered
Charges Notes
0111, 0121,
0131, 0141
3 days $xx.xx
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Example 2
The client is actively withdrawing from alcohol, meets medical inpatient
withdrawal management criteria, and is in the hospital for 5 days and does not
meet InterQual® Acute Level of Care criteria during the last 2 days of the stay.
Room and
Board
Revenue Code Unit
Total
Charges
Noncovered
Charges Notes
Depending on
the revenue
code billed by
the hospital:
• Ratio of
costs-to-
charges
(RCC)
• Military
subsistence
per diem
3 days $xx.xx Charges for total days
requested
0111, 0121,
0131, 0141
2 days $xx.xx $xx.xx Charges for days not to be
evaluated.
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Example 3
The client is actively withdrawing from cocaine, meets medical inpatient
withdrawal management criteria, and InterQual® Acute Level of Care criteria for
7 days. The hospital bills for the allowed 5 days as well as an extension approved
for the last 2 days.
Room and
Board
Revenue
Code Unit
Total
Charges
Noncovered
Charges Notes
0111, 0121,
0131, 0141
7 days $xx.xx Charges for total days requested.
Example 4
The client is actively withdrawing from alcohol, meets medical inpatient
withdrawal management criteria, and is in the hospital for 10 days. The stay
meets InterQual® Acute Level of Care criteria for the first 7 days. The hospital
bills for the allowed 3 days as well as an extension for 4 additional days. The
client does not meet InterQual® Acute Level of Care criteria during the last 3
days of the stay (last 3 days not to be evaluated for payment).
Room and
Board
Revenue Code Unit
Total
Charges
Noncovered
Charges Notes
Depending on
the revenue
code billed by
the hospital:
• Ratio of
costs-to-
charges
(RCC)
• Military
subsistence
per diem
7 $xx.xx Charges for total days
requested
0111, 0121,
0131, 0141
3 days $xx.xx $xx.xx Charges for days not to be
evaluated.
Extensions will automatically be reviewed for acute level of care when medical
records are submitted with the claim and when an EPA is on the claim for
medical inpatient withdrawal management services.
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Submit the following medical records demonstrating the medical necessity for
additional days with the claim:
• History and physical
• Pertinent physician notes
• Physician progress notes
• Discharge summary
For more information for submitting attachments, go to the ProviderOne Billing
and Resource Guide.
Payment methods
For medical inpatient withdrawal management claims paid
using the per diem payment method
HCA will adjudicate the claims, making payment for the approved days only.
For medical inpatient withdrawal management claims paid using the CPE
payment method
If HCA determines one or more of the requested extension days do not meet the
intensity of service criteria, the entire claim will be denied with adjustment code
152. If the claim is denied for this reason, resubmit the claim and insert the
charges for days that do not qualify for an extension, into the noncovered
column. Insert the covered 3 or 5 days and any authorized extension days into
the covered column. EPA MUST still appear on the claim and “prev rev” MUST
appear in the Claim Note field. Under these circumstances do not void or adjust a
denied claim.
HCA-approved centers of excellence (COE)
Transplant services must be performed in an HCA-approved COE. When
performed in an HCA-approved COE, these services do not require PA. See
the list of HCA-approved COEs on HCA’s Billers and Providers webpage.
HCA covers transplant procedures when:
• The transplant procedures are performed in a hospital approved by HCA as a
Center of Excellence for transplant procedures.
• The client meets the transplant hospital's criteria for appropriateness and
medical necessity of the procedure(s).
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Covered transplants
Solid Organs
Heart
Kidney
Liver
Lung
Heart-lung
Pancreas
Kidney-pancreas
Small bowel
Non-Solid Organs
Peripheral stem cell
Bone marrow – See Payment Limitations for PA information.
Note: HCA pays any qualified hospital for skin grafts and corneal
transplants when medically necessary.
Experimental transplant procedures
HCA does not pay for experimental transplant procedures. HCA considers
services as experimental, including, but not limited to, the following:
• Transplants of three or more different organs during the same hospital stay
• Solid organ and bone marrow transplants from animals to humans
• Transplant procedures used in treating certain medical conditions that use
procedures not generally accepted by the medical community, or that efficacy
has not been documented in peer-reviewed medical publications
Payment limitations
HCA considers organ procurement fees as part of the payment to the transplant
hospital. However, HCA may make an exception to this policy. If an eligible client
is covered by a third-party payer which will pay for the organ transplant
procedure, but not the organ procurement, then HCA will pay separately for the
organ procurement.
HCA pays for a solid organ transplant procedure only once per client's lifetime,
except in cases of organ rejection by the client's immune system during the
original hospital stay.
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Note: PA is required for transplants not performed in a COE.
When private insurance or Medicare has paid as primary
insurance and you are billing HCA as secondary insurance, HCA
does not require PA or that the transplant be done in a COE or
HCA-approved hospital. As required by federal law, organ
transplants and services related to an organ transplant procedure
are not covered under the AEM program.
For a list of HCA-approved organ transplant centers, see Organ
Transplants Centers of Excellence on HCA’s hospital finance
rates webpage.
Ventricular assist device (VAD) and percutaneous
ventricular assist device (PVAD) services
HCA will cover services for ventricular assist device (VAD) and percutaneous
ventricular assist device (PVAD under certain circumstances and in particular
facilities. For more information regarding these services, please refer to the
Physician-Related Services/Health Care Professional Services Billing Guide.
Transcatheter aortic valve replacement (TAVR)
TAVR is considered medically necessary only for the treatment of severe
symptomatic aortic valve stenosis when all of the following occur:
• PA has been obtained.
• The NPI for each team surgeon is provided for payment.
• The heart team and hospital are participating in a prospective, national,
audited registry approved by CMS.
• The conditions of the CMS Medicare National Coverage Determination are
met.
Note: HCA does not pay for TAVR for indications not approved
by the FDA, unless treatment is provided in the context of a
clinical trial and PA has been obtained.
69 | INPATIENT HOSPITAL SERVICES BILLING GUIDE
Utilization Review
What is utilization review (UR)?
UR is a prospective, concurrent, and/or retrospective (including post-pay and
pre-pay) formal evaluation of a client’s documented medical care to assure that
the health care services provided are proper, necessary, and of good quality. The
review considers the appropriateness of the place of service, level of care, and the
duration, frequency, or quantity of health care services provided in relation to the
condition(s) being treated.
• Prospective UR, also known as prior authorization (PA), is performed prior to
the provision of health care services.
• Concurrent UR is performed during a client’s course of care.
• Retrospective UR is primarily an audit function within HCA’s Section of
Program Integrity and is performed following the provision of health care
services. It includes both post-payment utilization review and pre-payment
utilization review. HCA uses McKesson InterQual® Level of Care criteria, in
effect on the client’s date of admission, as a guideline in the retrospective
utilization review process.
o Post-payment retrospective UR is performed after health care services
are provided and reimbursed.
o Pre-payment retrospective UR is performed after health care services are
provided but prior to reimbursement.
Note: For more information on prospective and concurrent UR,
refer to Authorization and the Mental Health Services Billing
Guide.
HCA program integrity retrospective UR
In accordance with 42 CFR Part 456, HCA performs retrospective UR to safeguard
against unnecessary utilization of care and services. Retrospective UR also
provides a method to assure appropriate disbursement of Washington Apple
Health funds. Payment to a hospital may be adjusted, denied or recouped, if HCA
determines that inpatient hospital services were not any of the following:
• Medically necessary for all or part of the client’s length of stay
• Provided at the appropriate level of care for all or part of the client’s length of
stay
• Coded accurately
• Medically necessary for a transfer from one acute care hospital to another
acute care hospital
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If HCA requests it, a hospital must provide HCA proof of compliance with 42 CFR
Part 456 to include, but not limited to, all of the following:
• A written UR Plan in effect that provides for review of each client’s need for
services the hospital provides to that client
• Details of the organization and composition of the hospital’s UR committee
• The written medical care criteria developed by the hospital’s UR committee to
assess the need for a client’s admission
• The hospital UR committee’s process for written notice of any adverse final
decision on the need for admission (see Hospital-issued notice of
noncoverage (HINN))
Changes in admission status
What is admission status?
Admission status is the level of care a client needs at the time of admission. Some
examples of typical types of admission status are: inpatient, outpatient
observation, medical observation, outpatient surgery or short-stay surgery, or
outpatient (e.g., emergency room).
Admission status is determined by the admitting physician or practitioner.
Continuous monitoring, such as telemetry, can be provided in an observation or
inpatient status. Consider overall severity of illness and intensity of service in
determining admission status rather than any single or specific intervention.
Specialty inpatient areas (including ICU or CCU) can be used to provide
observation services. Level of care, not physical location of the bed, dictates
admission status.
When is a change in admission status required?
A change in admission status is required when a client’s symptoms/condition
and/or treatment does not meet medical necessity criteria for the level of care
the client is initially admitted under. The documentation in the client’s medical
record must support the admission status and the services billed. HCA does not
pay for any of the following:
• Services that do not meet the medical necessity of the admission status
ordered
• Services that are not documented in the hospital medical record
• Services greater than what is ordered by the physician or practitioner
responsible for the client’s hospital care
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When can an admission status change from inpatient to
outpatient observation status?
The attending physician or practitioner may make an admission status change
from inpatient to outpatient observation when:
• The attending physician/practitioner and/or the hospital’s utilization review
staff determines that an inpatient client’s symptoms/condition and treatment
do not meet medical necessity criteria for an acute inpatient level of care and
do meet medical necessity criteria for an observation level of care.
• The admission status change is made prior to, or on the next business day
following, discharge.
• The admission status change is documented in the client’s medical record by
the attending physician or practitioner. If the admission status change is made
following discharge, the document must:
o Be dated with the date of the change.
o Contain the reason the change was not made prior to discharge (e.g., due
to the discharge occurring on the weekend or a holiday).
When can an admission status change from outpatient
observation to inpatient status?
The attending physician or practitioner may make an admission status change
from outpatient observation to inpatient when:
• The attending physician/practitioner and/or the hospital’s utilization review
staff determines that an outpatient observation client’s symptoms/condition
and treatment meet medical necessity criteria for an acute inpatient level of
care.
• The admission status change is made prior to, or on the next business day
following, discharge.
• The admission status change is documented in the client’s medical record by
the attending physician or practitioner. If the admission status change is made
following discharge, the documentation must:
o Be dated with the date of the change.
o Contain the reason the change was not made prior to discharge (e.g., due
to the discharge occurring on the weekend or a holiday).
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When can an admission status change from inpatient or
outpatient observation to outpatient status?
The attending physician or practitioner may make an admission status change
from inpatient or outpatient observation to outpatient when:
• The attending physician/practitioner and/or the hospital’s utilization review
staff determines that an outpatient observation or inpatient client’s
symptoms/condition and treatment do not meet medical necessity criteria for
observation or acute inpatient level of care.
• The admission status change is made prior to, or on the next business day
following, discharge.
• The admission status change is documented in the client’s medical record by
the attending physician or practitioner. If the admission status change is made
following discharge, the documentation must:
o Be dated with the date of the change.
o Contain the reason the change was not made prior to discharge (e.g., due
to the discharge occurring on the weekend or a holiday).
When can an admission status change from outpatient
surgery/procedure to outpatient observation or inpatient
admission status?
The attending physician or practitioner may make an admission status change
from outpatient surgery/procedure to outpatient observation or inpatient when:
• The attending physician/practitioner and/or the hospital’s utilization review
staff determines that the client’s symptoms/condition and/or treatment
require an extended recovery time beyond the normal recovery time for the
surgery/procedure and medical necessity for outpatient observation or
inpatient level of care is met.
• The admission status change is made prior to, or on the next business day
following, discharge.
• The admission status change is documented in the client’s medical record by
the attending physician or practitioner. If the admission status change is made
following discharge, the documentation must:
o Be dated with the date of the change.
o Contain the reason the change was not made prior to discharge (e.g., due
to the discharge occurring on the weekend or a holiday).
Note: During post-payment retrospective utilization review, HCA
may determine the admission status ordered is not supported by
documentation in the medical record. HCA may consider
payment made in this circumstance an overpayment and
payment may be recouped or adjusted.
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Acute care transfers
HCA may retrospectively review acute care transfers for appropriateness. If HCA
determines the acute care transfer was unnecessary, an adjustment in payment
may be taken.
Coding and DRG validations
HCA may retrospectively review inpatient hospital claims for appropriate coding
and DRG assignment. HCA follows national coding standards using the National
Uniform Billing Data Element Specifications, the Uniform Hospital Discharge Data
Set, and the ICD Committee Coding Guidelines.
DRG outliers
HCA may retrospectively review outliers to verify the following:
• Correct coding and DRG assignment
• Medical necessity for inpatient level of care
• Medical necessity for continued inpatient hospitalization
Length-of-stay (LOS) reviews
HCA may perform a retrospective utilization review of non-DRG paid claims that
exceed HCA’s DRG average LOS. Hospital medical records may be requested to
verify medical necessity and appropriate level of care for the client’s entire LOS.
Note: Admissions requiring authorization for LOS extensions are
psychiatric, acute physical medicine and rehabilitation (PM&R),
and long-term acute care (LTAC) admissions.
Refer to program-specific publications for more information.
Psychiatric admission, PA, and length of stay requirements are
located in the Mental Health Services Billing Guide.
The DRG average LOS review applies only to the following:
• Claims paid by the per diem payment method
• The critical access hospital (CAH) payment methods
• Certified Public Expenditure (CPE) payment method
• The ratio of costs-to-charges (RCC) payment method for organ transplants
HCA will continue to retrospectively post-pay review the LOS on claims of
hospitals paid using the Certified Public Expenditure (CPE) payment method.
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Hospital readmissions
HCA may perform a retrospective prepayment utilization review of hospital
readmissions for clients readmitted to the same or an affiliated hospital within 14
calendar days.
When this occurs, HCA may deny or recoup a claim and request medical records
to review both the admission and readmission(s) for consideration of payment.
HCA will determine if the admissions are appropriate for inpatient level of care
and whether the claims will be paid as individual payments.
Examples of cases in which individual payments are not allowed include:
• Continuation of same episode of care
• Complication(s) from the first admission
• A planned readmission following discharge (e.g., a therapeutic admission
following a diagnostic admission, readmission for patient or provider
convenience)
• A premature hospital discharge
Note: This utilization review does not apply to psychiatric admissions.
Provider preventable conditions (PPCs)
Hospitals must report to HCA within 45 calendar days of the confirmed PPC.
Notification must be in writing, addressed to HCA’s Section of Program Integrity
– Clinical Review, and include the PPC, date of service, client identifier, and the
claim number (TCN) if a claim is submitted to HCA. Hospitals and health care
professionals must complete their portion of the Provider Preventable Conditions
Notification form (HCA 12-200), and send it with the notification. See Where can I
download HCA forms?
HCA may request medical records to retrospectively review PPCs, reported or
non-reported, to determine if a claim requires denial, adjustment, or recoupment.
Medical record requests for retrospective UR
If HCA requests medical records during the retrospective utilization review
process, submit a complete copy of the medical records within the time period
stated in the request to:
Health Care Authority
Attn: Section of Program Integrity
PO Box 45503
Olympia WA 98504-5503
A complete copy of the medical record includes, but is not limited to, all of the
following:
• Face sheet
• Coding summary
• Admission record
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• Discharge summary
• History and physical
• Multidisciplinary progress notes
• Physician orders
• Radiology interpretations
• Laboratory test results
• Consultations/referrals
• Operative reports
• Medication administration records
• Itemized billing statement
• UB-04 claim form
Failure to submit a complete medical record and billing record may impede the
utilization review process and delay HCA’s determination. Failure to comply with
the record request timeline may result in claim denial or recovery. There are no
appeal rights for claims denied for untimely record request submission.
Hospital-issued notice of noncoverage (HINN)
When a Washington Apple Health client no longer requires medically necessary,
inpatient hospital medical care but chooses to remain in the hospital past the
period of medical necessity, HCA requires hospital providers to adhere to the
following guidelines for hospital issued notices of noncoverage:
• Notifying a Washington Apple Health client that medical care is no
longer needed
A hospital’s Utilization Review (UR) Committee must comply with the Code of
Federal Regulations 42 CFR 456.11 through 42 CFR 456.135 prior to notifying
a Washington Apple Health client that the client no longer needs inpatient
hospital medical care. The hospital is not required to obtain approval from
HCA or HCA’s contracted Quality Improvement Organization (QIO) at the
client’s discharge. Clients who have dual Medicare/Medicaid coverage are
governed by Medicare’s noncoverage rules.
According to 42 CFR 456.136, a hospital’s UR plan must provide written notice
to HCA if a Washington Apple Health client decides to stay in the hospital
when it is not medically necessary. A copy of this written notice must be sent
to:
Health Care Authority
Attn: Clinical Review Unit – HINN
PO Box 45503
Olympia, WA 98504-5503
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• Reimbursement for services that are not medically necessary
HCA does not reimburse for hospital services beyond the period of medical
necessity. A Washington Apple Health client who chooses to remain in the
hospital beyond the period of medical necessity may choose to pay for
continued inpatient care as an HCA noncovered service. The client must
accept financial responsibility. In order to bill the client for any noncovered
service, providers must comply with the requirements in WAC 182-502-0160.
These requirements are also published in HCA’s ProviderOne Billing and
Resource Guide.
If a client refuses to leave the hospital once the client no longer needs
inpatient hospital level of care, it is the responsibility of the hospital officials,
not HCA, to decide on a plan of action for the client.
Adverse determination appeal process
If a provider disagrees with an adverse determination made by HCA or HCA’s
contracted Quality Improvement Organization (QIO), the provider may appeal the
determination by submitting a detailed written description of the dispute.
A provider may appeal an adverse determination made: 1) prospectively
regarding the PA process; 2) concurrently during the continued stay authorization
process; or 3) retrospectively during the retrospective utilization review audit
process. Submit appeals to HCA’s Contact us –Medical provider webpage and
select the topic “claim inquiry.” Providers may be asked later to submit
supporting documentation.
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General Billing
All claims must be submitted electronically to HCA, except under
limited circumstances. For more information about this policy
change, see Paperless Billing at HCA. For providers approved to
bill paper claims, see HCA’s Paper Claim Billing Resource.
What are the general billing requirements?
Providers must follow HCA’s ProviderOne Billing and Resource Guide. These
billing requirements include the following:
• What time limits exist for submitting and resubmitting claims and adjustments
• When providers may bill a client
• How to bill for services provided to primary care case management (PCCM)
clients
• How to bill for clients eligible for both Medicare and Medicaid
• How to handle third-party liability claims
• What standards to use for record keeping
How do I bill for clients who are eligible for only a
part of the hospital stay?
HCA and the contracted managed care organizations can pay only for the days of
an inpatient admission that fall within the client’s eligibility period.
The billing process is the same when a client becomes eligible or ineligible during
a hospital stay. Enter all of the following on the claim:
• Covered and noncovered charges on separate lines
• The entire stay from the admission date to the discharge date, including the
dates the client was not eligible
• All diagnosis and procedure codes for the entire stay
Enter the” from” and “to” dates for the entire admission span including the dates
the clients were not eligible. Enter the admission date as the date the client was
admitted, even if the client was not eligible for Washington Apple Health. Bill
covered and noncovered accommodations charges on separate lines. Enter
charges for noncovered days in the Noncovered Line Charges field.
The “date of admission” on the claim is the criterion by which inpatient hospital
claims are paid and managed care payment responsibility is determined. For
inpatient hospital stays for a client covered under HCA “fee-for-service” at the
time of admission, HCA “fee-for-service” program covers the hospital stay if
medically necessary. This is the case even if the client becomes enrolled in an
HCA managed care plan during the inpatient stay.
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Note: When a client’s eligibility has changed from fee-for-service
to managed care during a continuous hospital stay, or if the
client becomes eligible for Medicaid and is enrolled with an
HCA-contracted managed care organization (MCO) on the first
day of the same month during an admission, but the admission
date was in a previous month, the claim must include a comment
in the following format:
“Continuous hospital stay MM/DD/YYYY- MM/DD/YYYY”
The first date is the date of the initial admission for the current
episode of care.
The second date is the date of the client’s discharge for the
current episode of care.
Example A: A client is admitted to Hospital A on 01/01/2001,
then is transferred to Hospital B on 01/15/2001, and is
discharged from Hospital B on 01/30/2001. The claim note
should say:
“Continuous hospital stay 01/01/2001- 01/30/2001”
Example B: A client is admitted to the hospital on 06/28/2016
and discharged on 07/15/2016, but the client’s eligibility for
Medicaid and managed care enrollment doesn’t begin until
07/01/2016. HCA covers this admission. The claim note would
say:
“Continuous hospital stay 06/28/2016 – 07/15/2016”
The payment is based on the client’s eligibility program on the date of admission.
How are outpatient hospital services prior to
admission paid?
Outpatient hospital services, including pre-admission, emergency room, and
observation services related to an inpatient hospital stay and provided within one
calendar day of a client hospital stay, must be billed on the inpatient hospital
claim. See WAC 182-550-6000. The “from” and “to” dates on the hospital claim
should cover the entire span of billed services. The admit date is the actual date
of admission.
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How are outpatient hospital services during an
inpatient admission paid?
HCA payment for an inpatient claim is what HCA pays for the client’s stay. HCA
will not pay outpatient claim(s) for services when an inpatient claim has been
billed for the same period.
Exception: HCA will pay for outpatient services for an eligible
inpatient client when the client is in a free-standing psychiatric
facility and is transported for acute outpatient care to a
completely separate facility.
Newborn practices to promote breastfeeding
(RCW 74.09.475)
Hospitals providing childbirth services must implement policies and procedures
to promote the following practices, which positively impact the initiation of
breastfeeding:
• Skin-to-skin placement of the newborn on the mother’s chest immediately
following birth.
• Rooming-in practices in which the newborn and the mother share the same
room for the duration of their post-delivery stay at the birth center.
HCA allows exceptions to these requirements when skin-to-skin placement or
rooming-in are contraindicated for the health and well-being of either mother or
newborn.
For more information, visit the Breastfeeding Friendly Washington website.
How do I bill for neonates/newborns?
Neonatal/newborn coding
• HCA considers children between birth and 28 days to be neonates or
newborns.
• Hospitals must bill neonatal claims in accordance with ICD coding guidelines.
• HCA pays neonatal inpatient hospital claims according to the payment
method associated with the DRG assigned on discharge or transfer.
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Birth weight coding
When billing, providers must:
• Include birth weight on the inpatient birth claim and on any claim for a
newborn that is younger than 29 days on admission.
• Submit birth weight on the claim using value code 54.
• Bill birth weight in grams using whole numbers.
Newborn eligibility and billing
The following crosswalk should be used to provide guidance in determining
which program the infant is eligible to participate in, as well as continuing
coverage based on the mother’s eligibility status and post-birth placement status.
If the newborn does not have a ProviderOne Client ID number, use the mother’s
ID number for the first 60 days of life. If the newborn has a ProviderOne Client ID,
bill using the newborn’s ID.
Eligibility status – Note: Family Medical as defined includes
Newborn Medical (N10)[RAC 1202]
Placed in Out of Home Placement?
Eligibility Status
*Note* Family Medical
as defined includes
Newborn Medical (N0)
[RAC 1202]
No (Newborn is not going into
foster care)
Yes (Newborn is going into
foster care)
Mother is Apple
Health eligible,
enrolled in MCO
Newborn is opened on Family
Medical for month of birth and
enrolled in the same Managed
Care Organization (MCO) as the
birth mother to cover the first 21
days of life.
If newborn is never deemed
eligible, newborn has no
continuing coverage after first 21
days of life.
Mother’s MCO is responsible to
cover newborn nursery services as
required for at least the first
twenty-one days of life.
Newborn is opened on Family
Medical and enrolled in mother’s
MCO for the month of birth.
Apple Health Foster Care (AHFC)
Medical enrollment is established
prospectively the first of the
month following the placement.
Nursery services provided after
birth are covered by mother’s
MCO. If the newborn remains in
the hospital after the month of
birth, the mother’s MCO covers
the hospital costs as a continuing
health event.
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Eligibility Status
*Note* Family Medical
as defined includes
Newborn Medical (N0)
[RAC 1202]
No (Newborn is not going into
foster care)
Yes (Newborn is going into
foster care)
Mother is Apple
Health eligible, not
enrolled in MCO
Newborn is opened on Family
Medical for the month of birth
and enrolled into an MCO
according to assignment rules.
If Newborn is deemed eligible,
Newborn will be retro-enrolled for
the current month based on
earlier enrollment rules. MCO may
request a retro-eligibility
determination up to 365 days
after birth upon completion of a
premium payment request report.
Nursery services provided after
birth are covered by assigned
MCO. If the newborn remains in
the hospital after the month of
birth, the assigned MCO covers
the hospital costs as a continuing
health event.
Newborn is opened family
medical and assigned to Apple
Health Managed Care as of
month of birth. Newborn is
opened prospectively on AHFC
beginning the 1st of the month
following placement and enrolled
in AHFC.
Nursery services provided after
birth are covered by assigned
MCO. If the newborn remains in
the hospital after the month of
birth, the assigned MCO covers
the hospital costs as a continuing
health event.
Mother is enrolled in
AHFC
Newborn is eligible for Family
Medical the month of birth. The
newborn will be enrolled with
Apple Health Managed Care
(AHMC) in same plan as the
mother if available.
Eligibility and enrollment will
begin from the newborns’ date of
birth or mother’s date of
enrollment, whichever is sooner.
Newborn is eligible for AHFC and
enrolled the month of birth.
Nursery services provided after
birth are covered by AHFC as a
continuing health event.
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Eligibility Status
*Note* Family Medical
as defined includes
Newborn Medical (N0)
[RAC 1202]
No (Newborn is not going into
foster care)
Yes (Newborn is going into
foster care)
Mother has NO Apple
Health coverage and
Does not have private
insurance
Family must apply for eligibility. If
deemed eligible, newborn is
enrolled in AHMC according to
assignment rules.
If newborn eligibility is received in
ProviderOne (P1) within the birth
month, Newborn will be retro-
enrolled to first of the month
newborn is reported to HCA
based on earlier enrollment rules.
If newborn eligibility is not
received in P1 birth month,
Newborn is enrolled first of month
deemed AHMC eligible. Eligibility
back to birth month must be
requested based on medical need
and is Fee for Service (FFS).
Newborn is opened on FC as of
month of placement. The
newborn will be enrolled with
AHFC MCO the first of the month
of placement.
When billing for a newborn claim using the mother’s ProviderOne Client ID, enter
the baby’s name, baby’s birthdate, and the baby’s gender in the subscriber/client
information fields instead of the mother’s information. In addition, you must use
“SCI=B” in the Billing Note section of the electronic institutional claim.
When billing for multiple births, enter the infant’s identifying information in the
comment or remarks area. For example, the first infant would be “SCI=BA,” the
second infant would be “SCI=BB,” and the third infant would be “SCI=BC.” Each
newborn must have services provided to that newborn billed on a separate claim.
When using special claims indicator (SCI) entries, everything following the “=”
symbol will be read as part of your indicator. Do not enter any additional data
after that or ProviderOne will not recognize your entry. Do not put any spaces in
the entry or the information will not be recognized when processed.
Bill any services provided to the mother on a separate claim.
Note: When a newborn no longer needs an acute inpatient level
of care and an appropriate placement outside the hospital is
available, HCA does not pay the all-inclusive administrative day
rate for any additional days of the hospital stay for the newborn.
(WAC 182-550-2900)
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Neonate revenue code descriptions
HCA has defined six levels of care for newborns and correlates each level to the
nursery accommodation revenue codes. The billed accommodation revenue code
must meet the associated level of care criteria and be supported by
documentation in the medical record.
REV CODE
REVENUE CODE
DESCRIPTION LEVEL OF CARE
0170 General Classification
Nursery
Normal Newborn Care – Normal healthy
newborns with low complexity needs are
physiologically stable and are rooming with
mom. InterQual Newborn Level I criteria.
Hospital must meet American Academy of
Pediatrics Level I facility guidelines
0171 Newborn – Level I Level I Nursery/General Nursery
Observation. Healthy newborns (birth
weight > 2000 gms. or gestational age > 35
wks.) with low complexity needs and who
are physiologically stable and require
routine evaluation and observation during
the immediate post-partum period.
Examples of care at this level are: routine
bilirubin and blood glucose monitoring;
initiation of phototherapy < 2 days, drug
withdrawal management new or continued
from higher level and NAS score 1-8;
isolette/warmer for thermoregulation of
neonates > 35 weeks gestation; diagnostic
work-up/surveillance on otherwise stable
neonate; services rendered to growing
premature infant without supplemental
oxygen or IV needs. InterQual Newborn
Level I criteria. Hospital must meet
American Academy of Pediatrics Level I
facility guidelines.
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REV CODE
REVENUE CODE
DESCRIPTION LEVEL OF CARE
0172 Newborn – Level II Level II Special Care Nursery/Neonatal
Intermediate Care. Newborns (birth weight
< 2000 gms. or gestational age < 35 wks.)
with moderately complex care needs or
with physiological immaturity (apnea of
prematurity, inability to maintain body
temperature, or inability to take oral
feedings) combined with medical
instabilities. Examples of care at this level
are: IV heplock meds; IV fluids;
supplemental oxygen via hood or nasal
cannula of less than 40%; or feeding via NG,
OG, NJ or gastrostomy tube; intensive
phototherapy; drug withdrawal therapy and
NAS score >8; non-invasive hemodynamic
monitoring; continuous monitoring of
apnea/bradycardia that requires tactile
stimulation or periodic oxygen; sepsis
evaluation and treatment. InterQual Special
Care Level II criteria. Hospital must meet
American Academy of Pediatrics Level IIA
facility guidelines.
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REV CODE
REVENUE CODE
DESCRIPTION LEVEL OF CARE
0173 Newborn – Level III Level III Neonatal Intensive Care. Newborns
(birth weight < 1500 gms., or gestational
age < 32 weeks, or hemodynamically
unstable) with complex medical conditions
that require invasive therapies. Examples of
care at this level are: supplemental oxygen
via hood or nasal cannula of greater than
40%; intubation with mechanical ventilation;
IV pharmacologic treatment for apnea
and/or bradycardic episodes; services for
apnea or other conditions requiring assisted
respiration; positive pressure ventilatory
assistance; exchange transfusion, partial or
complete; central or peripheral
hyperalimentation; chest tube; IV bolus or
continuous drip therapy for severe
physiologic or metabolic instability; or
maintenance of umbilical artery catheters
(UACs), peripheral artery catheters (PACs),
umbilical vein catheters (UVCs), and/or
central vein catheters (CVCs). InterQual
Neonatal Intensive Care Level III criteria.
Hospital must meet American Academy of
Pediatrics Level IIB/IIIA facility guidelines.
0174 Newborn – Level IV Level IV Neonatal Intensive Care. Newborns
with complex medical conditions that meet
Level III criteria and require extracorpreal
membrane oxygenation (ECMO); high
frequency ventilation; nitric oxide (NO) or
complex pre-surgical/surgical interventions
for severe congenital malformations or
acquired conditions that require use of
advanced technology and support.
InterQual Neonatal Intensive Care Level III
criteria. Hospital must meet American
Academy of Pediatrics Level IIIB/IIIC/IIID
facility guidelines.
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REV CODE
REVENUE CODE
DESCRIPTION LEVEL OF CARE
0179 Other Nursery Transitional Care. Newborns with low
complexity care needs who are awaiting
finalization of discharge plan to home or
transfer to a lesser care setting, and are:
hemodynamically stable, in an open crib,
and gaining weight, some examples of
appropriate treatments in this level of care
that are planned to be continued in the
home or lesser care setting are: IV anti-
infective administration; apnea or
bradycardia monitoring; drug withdrawal
therapy; oxygen therapy; tube feedings <
50% of daily caloric requirement; and
parent or caregiver discharge teaching.
InterQual Transitional Care Nursery criteria.
How do I bill for immediate postpartum long-acting
reversible contraception (LARC)?
For information on family planning services, including long-acting reversible
contraceptives (LARC), see the Family Planning Billing Guide.
Submitting adjustments to a paid inpatient hospital
claim
Each adjustment to a paid hospital claim (when not billed on the original paid
claim) should be billed as a complete replacement of the previous claim, as if the
claim was never billed. Each adjustment must provide complete documentation
for the entire date span between the client’s admission date and discharge date
and include all of the following:
• All inpatient hospital services provided
• All applicable diagnosis codes and procedure codes
Present on admission indicators
HCA requires present on admission (POA) indicators on all inpatient claims. All
inpatient claims will be reviewed for health care acquired conditions (HCAC) and
will not receive additional payment related to treatment of the HCAC. For more
information, see WAC 182-502-0022.
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How to indicate a POA on a direct data entry claim
When submitting a claim using Direct Data Entry (DDE), submit the POA indicator
in Diagnosis Information and/or Other Diagnosis Information sections.
For each diagnosis entered, there is a box to enter the POA indicator.
How to indicate a POA on an electronic claim
Using the 837i, submit the POA indicator as follows:
Principal diagnosis – Submit the POA indicator in Loop 2300
Segment HI data element HI01-9 External Cause of Injury – submit the
POA indicator in Loop 2300, Segment HI
Segment HI data element HI02-9
Segment HI data element HI03-9
Segment HI data element HI04-9
Segment HI data element HI05-9
Segment HI Data element HI06-9
Segment HI Data element HI07-9
Segment HI Data element HI08-9
Segment HI Data element HI09-9
Segment HI Data element HI10-9
Segment HI Data element HI11-9
Segment HI Data element HI12-9
Other diagnosis information – Submit the POA indicator in Loop 2300 segment
HI – Other Diagnosis Information repeats 2 times for up to 24 other diagnosis.
Report POA indicator for each Other Diagnosis submitted.
Segment HI data element HI01-9
Segment HI data element HI02-9
Segment HI data element HI03-9
Segment HI data element HI04-9
Segment HI data element HI05-9
Segment HI Data element HI06-9
Segment HI Data element HI07-9
Segment HI Data element HI08-9
Segment HI Data element HI09-9
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Segment HI Data element HI10-9
Segment HI Data element HI11-9
Segment HI Data element HI12-9
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Billing Specific to Hospital Services
Interim billing
HCA requires hospitals to bill interim claims, using the appropriate patient status
code for “still inpatient,” in 60-day intervals unless the client is discharged prior to
the next 60 days. Hospitals must bill each interim billed claim as an adjustment to
the previous interim billed claim and must include all of the following:
• The entire date span between the client’s admission date and the current date
of service billed
• All inpatient hospital services provided for the date span billed
• All applicable diagnosis codes and procedure codes for the date span billed
Billing for administrative days is an exception to the interim billed claim policy.
HCA may retrospectively review interim billed claims to verify medical necessity
of inpatient level of care and continued inpatient hospitalization.
Note: Effective on or after January 1, 2020, hospital and
ambulatory surgery center facility fees for eligible clients enrolled
in an HCA-contracted managed care organization must be billed
directly through the client’s MCO.
Inpatient hospital stays without room charges
HCA suspends or denies Inpatient Hospital claims if the room charges are not
listed on the claim.
How do I bill for administrative days?
To receive payment for medical administrative days, the hospital must bill
administrative days with revenue code 0191. Pharmaceuticals prescribed for the
client’s use during the administrative portion of the client’s stay must be billed on
a claim separate from that of the acute care stay. This does not require PA for FFS
clients.
For the acute care stay claim the provider must bill with inpatient status code 30
to indicate the provider will be submitting a separate claim for administrative
days and include a claim note that states “Admin. days claim to follow.”
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Payment
Methodology Revenue Code PA required? Notes
Prospective
Payment System
(PPS)
0191 NO Submit on a separate claim from
acute care stay
Certified Public
Expenditure
(CPE)
0191 NO Submit on a separate claim from
acute care stay
Critical Access
Hospitals (CAH)
0191 NO Submit on a separate claim from
acute care stay
To qualify for payment for administrative days related to per-diem-paid services
such as PM&R, LTAC, and inpatient psychiatric, the hospital must request PA and
bill approved administrative days with rev code 0169 on a separate claim.
Payment
Methodology Revenue Code PA required? Notes
PM&R 0169 YES Submit on a separate claim from
acute care stay
LTAC 0169 YES Submit on a separate claim from
acute care stay
Inpatient
Psychiatric
0169 YES Submit on a separate claim from
acute care stay
Note: For administrative days qualifying for payment under
revenue code 0169, refer to the Mental Health Services Billing
Guide. For information on the Acute PM&R program, refer to the
Acute Physical Medicine and Rehabilitation (PM&R) Billing
Guide.
How do hospitals bill for acute inpatient stay when a
client elects hospice?
When a client elects hospice during an inpatient stay, the hospital must use
discharge status code 51 according to the National Uniform Billing Code (NUBC)
excerpt below.
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Questions and Answers from NUBC Manual
Question Answer
If a client is discharged from acute hospital
care but remains at the same hospital under
hospice care, what discharge status code
should be used for preparing the UB 04 for the
acute stay?
Discharge status code 51 – Hospice – Medical
Facilities (Certified) Providing Hospice Level of
Care.
Are the codes 50 (hospice/home) and 51
(hospice/facility) used by the hospital when the
client is discharged from an inpatient bed or
are they only to be used on hospice or home
health type of bills?
Use 50 or 51 if the client is discharged from an
inpatient hospital to a hospice.
How do CPE hospitals bill for services provided to
blind and disabled clients enrolled in managed care?
For certified public expenditure (CPE) hospitals that provide medical services to
Categorically Needy Medicaid Blind/Disabled clients, bill those services fee-for-
service to HCA. (For more information on billing for services provided to these
clients, refer to the RAC eligibility codes.) In order to process those claims, the
CPE hospital must obtain prior authorization from the MCO and submit that
information to HCA in the Claim Note field on the claim in the manner shown
below:
PA from [MCO Name]: [Authorization number]
How do effective dates for procedure and/or
diagnosis codes affect processing of my claims?
HCA may suspend or deny claims with procedure codes and/or diagnosis codes
that are not valid as of the date of admission shown on the claim. To avoid delays
in processing, use codes that are effective on the admission date on the claim.
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How do I bill for clients covered by Medicare Part B
only (No Part A), or has exhausted Medicare Part A
benefits prior to the stay?
Description DRG Per Diem RCC CPE CAH
Bill Medicare Part B for
qualifying services delivered
during the hospital stay.
Yes Yes Yes Yes Yes
Bill HCA for hospital stay as
primary.
Yes Yes Yes Yes Yes
Show as noncovered on HCA’s
bill what was billed to Medicare
under Part B.
No No Yes Yes Yes
Expect HCA to reduce payment
for the hospital stay by what
Medicare paid on the Part B
bill.
Yes Yes No No No
Expect HCA to recoup payment
as secondary on Medicare Part
B bill*.
Yes Yes No* No* No*
Report the Part B payment on
the claim in the other payer
filed “Medicare Part B”
Yes Yes Yes Yes Yes
Include a claim note** Yes Yes Yes Yes Yes
* HCA pays line item by line item on some claims (RCC, CPE, and CAH). HCA does
not pay for line items that Medicare has already paid. HCA pays by the stay (DRG
claims) or the day (Per Diem) on other claims. HCA calculates the payment and
then subtracts what Medicare has already paid. HCA recoups what it paid as
secondary on the Medicare claim.
**The claim note should be one of the following:
• No Part A benefits
• Part A benefits exhausted prior to stay
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What HCA pays the hospital:
DRG Paid Claims:
DRG allowed amount minus what Medicare paid under Part B. When billing, put
the Part B payment amount in the TPL commercial insurance field and indicate
the primary payer as Medicare Part B.
Per Diem Paid Claims:
Per diem allowed amount minus what Medicare paid under Part B. When billing,
put the Part B payment amount in the TPL commercial insurance filed and
indicate the primary payer as Medicare Part B.
RCC, CPE and CAH claims:
Allowed amount for line items covered by HCA (line items usually covered by
Medicare under Part A, if client were eligible).
How do I bill for clients when Medicare coverage
begins during an inpatient stay or Medicare Part A has
been exhausted during the stay?
Providers bill for clients when Medicare coverage begins or Medicare Part A has
been exhausted during an inpatient stay using the steps below. These
instructions are also available in the ProviderOne Billing and Resource Guide.
• Bill Medicare
o Medicare PPS Payment Manual, Chapter 3, Section 40A, bullet 3 states:
o “The beneficiary becomes entitled after admission. The hospital may not
bill the beneficiary or other persons for days of care preceding
entitlement except for days in excess of the outlier payment.”
• HCA must have a paid/billed inpatient crossover claim in the system.
• After the inpatient crossover claim is paid, bill the primary claim for the entire
stay to HCA:
o If billing ratio of costs-to-charges (RCC), certified public expenditures
(CPE), or are a critical access hospital (CAH), list the Medicare covered
day’s charges as noncovered.
o If billing DRG or per diem, list all services (do not list noncovered
services).
• If Part A is exhausted during the stay, bill Medicare for the Part B charges.
• HCA may pay an amount using the following formula:
o HCA’s allowed amount for the entire stay minus Medicare’s payment
minus HCA’s crossover payments
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• Add the following claim note:
o “Part A Benefits exhausted during stay;” or
o “Medicare Part A coverage began during the stay;” or
o Enter the Part A start date or the date benefits are exhausted in the
“occurrence” fields using occurrence Code “A3”.
• Attach Part A and Part B Medicare explanation of benefits (EOMB)
• These claims can be very complex and are addressed on a case-by-case basis
and sometimes it is necessary for HCA to contact the biller for additional
information.
Required consent forms for hysterectomies
• HCA pays for hysterectomies only when performed for medical reasons
unrelated to sterilization.
• Federal regulations prohibit payment for hysterectomy procedures until a
properly completed consent form is received. To comply with this
requirement, surgeons, anesthesiologists, and assistant surgeons must obtain
a copy of a completed HCA-approved consent form to attach to their claim.
• ALL hysterectomy procedures require a properly completed HCA-approved
consent form, regardless of the client's age or the ICD diagnosis.
• Submit the claim and the completed HCA-approved consent form to HCA.
To download the Hysterectomy Consent and Patient Information form HCA
13-365, see Where can I download HCA forms?
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Completing the Claim
How do I bill claims electronically?
Instructions on how to bill Direct Data Entry (DDE) claims can be found on HCA’s
Billers, providers, and partners webpage, under Webinars.
For information about billing Health Insurance Portability and Accountability Act
(HIPAA) Electronic Data Interchange (EDI) claims, see the ProviderOne 5010
companion guides on the HIPAA Electronic Data Interchange (EDI) webpage.
What does HCA require from the provider-generated
explanation of Medicare benefit (EOMB) to process a
claim?
Header level information on the EOMB must include all the following:
• Medicare as the clearly identified payer
• The Medicare claim paid or process date
• The client’s name (if not in the column level)
• Text in font size 12 or greater
Column level labels on the EOMB must include all the following:
• Date of service
• Billed amount
• Allowed amount if applicable
• Deductible amount if applicable
• Co-insurance/co-pay amount if applicable
• Amount paid by Medicare (PROV PD) if Medicare paid
• Medicare Adjustment Reason codes and Remark codes
Specific instructions for Medicare crossover claims
How do I submit institutional services on a crossover
claim?
• Mark “Yes” for the question, “Is this a Medicare Crossover Claim?” in the
electronic claim. (If Medicare makes a payment or allows the services,
Medicaid considers it a crossover.)
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• See the ProviderOne Billing and Resource Guide and the Fact Sheets
webpage to get more information about submitting Medicare payment
information electronically and to find out when paper backup must be
attached.
• Enter the third-party (e.g. Blue Cross) supplement plan name in the Other
Insurance Information section of the electronic claim. See the Submit an
Institutional Claim with Primary Insurance other than Medicare webinar for
further assistance with submitting third-party insurance information.
How do I submit institutional services for inpatient clients
who are eligible for Medicare Part B Benefits but not
eligible for Medicare Part A Benefits or Medicare Part A
benefits are exhausted?
For all claims:
Include one of the following comments in the Billing Note section:
• “No Part A benefits”
• “Part A exhausted prior to stay”
• “Part A exhausted during stay”
If Medicare benefits are exhausted, report the last Medicare Part A coverage date
using Occurrence Code A3.
When including “No Part A benefits” or “Part A exhausted prior to stay,”
follow the process as indicated below:
• If your facility is reimbursed using PPS method (DRG and Per Diem):
o Enter the Part B payment as if it is insurance. See the ProviderOne Billing
and Resource Guide for instructions on how to bill other insurance
information.
o Attach the Explanation of Medicare Benefit (EOMB) Parts A and B to the
claim.
• If your facility is reimbursed using the RCC (Ratio of Cost to Charges)
method
o Bill using Type of Bill 111.
o Enter the amount covered by Medicare Part B for each service in the
Noncovered field at line level, as applicable.
o Attach the Explanation of Medicare Benefit (EOMB) Parts A and B to the
claim.
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Note: HCA will deny your claim if one of the following condition
codes is submitted:
- Condition Code 04 – Information Only Bill
- Condition Code 21 – Billing for Denial Notice
