What is Method II billing?

Method II (Optional Method) Overview Method II allows the CAH to receive cost-based payment for facility services, plus 115% of fee schedule payment for professional services. For facility services, payment will be the same as indicated under Method I. Professional services are billed to and reimbursed by the MAC.

Which reimbursement method is used by Medicare?

Prospective Payment System
A Prospective Payment System (PPS) is a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. The payment amount for a particular service is derived based on the classification system of that service (for example, diagnosis-related groups for inpatient hospital services).

How does Medicare reimburse CAH?

Medicare pays a CAH under the Standard Payment Method unless it elects payment under the Optional Payment Method (SSA Section 1834(g)(1)). Under the Standard Payment Method, the physician or practitioner bills for their outpatient professional services under the Medicare Physician Fee Schedule (PFS).

What is Bill Type 85X?

Bill type 85X is used for all outpatient services including services approved as ASC services. Non-patient laboratory specimens (those not meeting the criteria for reasonable cost payment in §250.6) will be billed on a 14X type of bill.

How do FQHCs bill Medicare?

When billing Medicare, FQHCs must report all services provided during the encounter/visit by listing the appropriate HCPCS code. The additional revenue lines with detailed HCPCS code(s) are for information and data gathering purposes.

What is Bill Type 11x?

Valid values are: 11x = Hospital Inpatient (Including Medicare Part A) 12x = Hospital Inpatient (Medicare Part B Only) 13x = Hospital Outpatient 14x = Hospital Other 18x = Hospital Swing Beds 21x = SNF Inpatient (Including Medicare Part A) 22x = SNF Inpatient (Medicare Part B Only) 23x = SNF Outpatient 28x = SNF Swing …

What is cost based reimbursement from Medicare?

Cost based reimbursement provides significant financial advantage to CAHs by allowing them to get paid at 101% of costs on all of their hospital Medicare business. The cost of treating Medicare patients is estimated using cost accounting data from Medicare cost reports.

What is the 96 hour rule?

The CAH 96-hour rule creates a condition of payment that requires a physician to certify that a patient can reasonably be expected to be discharged or transferred within 96 hours.

What is a critical access hospital and how is it reimbursed by Medicare?

The CAH designation is designed to reduce the financial vulnerability of rural hospitals and improve access to healthcare by keeping essential services in rural communities. To accomplish this goal, CAHs receive certain benefits, such as cost-based reimbursement for Medicare services.

What are Medicare revenue codes?

Revenue Codes

• 0020-0021 Reserved.
• 0022 – Skilled Nursing Facility (SNF)
• 0023 – Home Health.
• 0024 – Inpatient Rehabilitation Facility (IRF)
• 0025-0029 – Reserved.

What does Medicare method II mean for CAH?

Critical Access Hospital Method II Elections The Medicare Prescription Drugs, Improvement, and Modernization Act (MMA) of 2003 allows a CAH to elect the Method II payment option for outpatient professional services, which allows the CAH to be paid 115% of what would otherwise be paid under the fee schedule.

What is method II of Medicare professional fee schedule?

Method II Professional Fees – 115% of Medicare Physician Fee Schedule (MPFS) based on the practitioner rendering the service All services provided on the same day should be submitted on one claim or submitted monthly for repetitive services. See IOM for CMS defined – repetitive services.

How are professional fees billed to Medicare Part B?

Standard Option (Method 1) – Professional fees billed to Medicare Part B on a CMS-1500 Claim Form Optional Method (Method II) – Professional fees for CAH outpatients only included on UB-04 form on revenue codes 096x, 097x or 098x.

When did Medicare start billing two services lines?

According to MLN Matters Article SE1039, “Effective January 1, 2011, two services lines are submitted with a 052X revenue code and one line contains modifier 59.