Inpatient Hospital Billing Guide

Description & Regulation Inpatient Hospital PPS
Implementation Date Social Security Administration (SSA) Amendment of 1983
Unique Identifying Provider Number Ranges 3rd digit = 001-0999
Bill Type
  • 111 - Admit to discharge
  • 112 - 1st sequential
  • 117 - Adjustment or Interim
  • 118 - Cancel
  • 110 - No payment
Special Revenue Codes NA
Payment Type 489 Diagnosis Relation Group (DRG) at time of discharge
Payment Calculators PC Pricer
Frequency of Billing Bill upon discharge or interim billing after 60 days from admission and every 60 days thereafter as adjustment claim. No need to split claims for provider/Medicare FYE or Calendar years

Diagnosis Related Grouper (DRG) Adjustments

CMS Internet Only Manual (IOM), Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 50

Changes or adjustments to inpatient hospital claims resulting in a higher-weighted DRG are required within 60 days of remittance date. Once 60 day time limit has expired, claim cannot be corrected either by an adjustment or cancellation and rebilling
Changes or adjustments to inpatient hospital claims resulting in a lower-weighted DRG are allowed to be submitted after 60 days of remittance date to repay Medicare overpayment

Billing Pre-Entitlement Days

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.1

Provider may only bill for days after entitlement if claim exceeds cost outlier if they were not entitled to Medicare upon admission date

Benefit Period

CMS IOM, Publication 100-02, Benefit Policy Manual, Chapter 3, Section 10

A period of consecutive days during which medical benefits for covered services, with certain specified maximum limitations, are available to beneficiary. 60 full days of hospitalization plus 30 coinsurance days represent maximum benefit period. When beneficiary has not been in a hospital or SNF for 60 days, period is renewed

Benefits Exhaust

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.2

Benefits do not exhaust until all 90 days are used in benefit period and lifetime reserve (LTR) days is at zero
Use A3 Occurrence code for last covered day on claim that exhausts benefits

Same Day Transfers

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.1

First hospital bills day in non-covered, charges in covered with 40 condition code. Receiving hospital bills claim as usual. Shared DRG would apply

Provider Liable Days

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.1

If provider liable days are for other than medical necessity or custodial care use 77 occurrence span code

Services Provided at Other Facilities During Inpatient Stay

Services provided at other facilities are billed by originating hospital on their claim, charges for any ambulance transports are rolled into cost for service provided since 0540 revenue code isn't allowed on 11x Type of Bill (TOB)

72-hour/24 hour preadmission bundling rule

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.3

All diagnostic services within 72 hours of inpatient admission always have to be bundled into 11x TOB for same provider numbers, Non-diagnostic services are bundled into inpatient admission if exact diagnosis match on admitting diagnosis as outpatient principle diagnosis

Same Day Discharge and Readmission

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.2.5

If original discharge and return readmission is related diagnosis then it must be billed on one continuous claim. If return readmission is unrelated diagnosis then both claims can be billed with B4 condition code on second claim

Leave of Absence (LOA) Days

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.2.6

Show days in non-covered, 74 occurrence span code and 180 revenue code

Interrupted Stays/LOA

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 150.9.1.2

NA - Follow LOA policy

Outpatient Charges During Interrupted Stay

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 150.9.1.2

NA - Follow LOA policy

Inpatient care no longer needed

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 40.2.2

Use 31 occurrence code for date beneficiary notified through limitation of liability along with 76 span code and 31 value code

Cost Outlier

CMS IOM, Publication 100-04, Medicare Claims Processing Manual Chapter 3, Sections 20.1.2, 20.7.4

Cost outlier day is shown on a claim with a 47 occurrence code.

  • If beneficiary runs out of full/co-insurance days in that benefit period, provider cannot use LTR days prior to cost outlier day
  • If beneficiary starts admission with no full or co-insurance days available, they can start day of admission using LTR days without waiting for cost outlier days
  • If beneficiary has some full or coinsurance days, but not enough to cover up to cost outlier day, provider would use a 70 occurrence span code to reflect free/inlier days

Lung Volume Reduction Surgery

CMS IOM, Publication 100-04, Medicare Claims Processing Manual, Chapter 3, Section 100.7

Only covered when provided at these approved facilities
Ancillary Part B Claims When beneficiary doesn't qualify under Part A due to entitlement or benefits exhaust, bill on 12x TOB

 

Last Updated Apr 09, 2018