Transmittal 454 Date: September 28, 2012 HEADER SECTION NUMBERS PAGES TO INSERT PAGES TO DELETE

Transcription

1 Medicare Prvider Reimbursement Manual Part 1, Chapter 21, Csts Related t Patient Care Department f Health & Human Services (DHHS) Centers fr Medicare & Medicaid Services (CMS) Transmittal 454 Date: September 28, 2012 HEADER SECTION NUMBERS PAGES TO INSERT PAGES TO DELETE Table f Cntents, Chapter (2 pp.) (2 pp.) (4 pp.) (2 pp.) CLARIFIED/UPDATED MATERIAL--EFFECTIVE DATE: Nt Applicable Sectin , Dnatins t a Prvider f Prduce, Supplies, Space, Etc., has been added t cntain the plicy previusly cntained in 608 and 610 f Chapter 6. DISCLAIMER: The revisin date and transmittal number apply t the red italicized material nly. All ther material was previusly published and remains unchanged. CMS-Pub

2 CHAPTER 21 COST RELATED TO PATIENT CARE Sectin General Principle Definitins Reasnable Csts Csts Related t Patient Care Csts Nt Related t Patient Care Dnatins t a Prvider f Prduce, Supplies, Space, Etc Prudent Buyer Csts Nt Allwable Unallwable Csts Related t Patient Care Ambulance Service Private-Duty Persnnel Luxury Items r Services Dental Services Vcatinal and Schlastic Training Expense Unallwable Csts Nt Related t Patient Care Nncmpetitin Agreement Csts Cst f Meals fr Other Than Prvider Persnnel Cst f Reserving Beds r Services Csts f Unsuccessful Beneficiary Appeals Csts f Management Emplyee Meals Csts f Emplyee Travel Csts f Gifts r Dnatins Csts f Entertainment Csts f Emplyees Persnal Use f Mtr Vehicles Csts f Fines r Penalties Csts f Spusal r Dependents Educatin Telephne, Televisin, and Radi Csts Csts f Telephne, Televisin, and Radi General Cmbinatin Purpse Systems Parking Lt Csts Parking Lt Csts General Treatment f Parking Revenue Prvider-Based Physician Services Reimbursement fr Services by Prvider-Based Physicians Prfessinal and Prvider Cmpnents Cmpensatin Arrangements Methds Used t Determine the Reasnable Charge f Prvider-Based Physicians Schedule f Charges Rev

3 COSTS RELATED TO PATIENT CARE Sectin Effect f Physician's Assumptin f Operating Csts (Lease r Cncessin Arrangement) Duties and Respnsibilities f Prvider and Intermediary in the Area f Prvider-Based Physician Reimbursement Retractive Adjustment f Certain Prvider-Based Physician Payments Reimbursement fr Prvider-Based Physicians' Administrative, Teaching, and Direct Medical Care Services Where the Physicians Have Changed Their Cmpensatin Arrangements With the Prvider Reimbursement fr the Services f Prvider-Based Physicians Cmpensated Thrugh the Prvider and the Prvider Bills the Prgram Under Cmbined Billing (n Frms SSA-l453 r l483) r n Frm SSA-l Treatment f Prvider Csts Related t the Prvisin f Physician Services t Nnprvider Patients Exhibits - Prvider-Based Physicians Emergency Department Services Reimbursement f Hspital Emergency Department Services When Physicians Receive Cmpensatin Fr Availability Services General Definitins Allwability f Emergency Department Physician Availability Services Csts Methdlgy fr Determining Allwable Emergency Physician Availability Service Csts Billing Csts Billing Csts Cntract Billing Services Treatment f Incme Derived Frm Interest, Finance Charges, and Penalties n Delinquent Accunts Receivable Treatment f Incme Derived Frm Billing Charges Impsed n Suppliers f Services Furnished Under Arrangements Physician Billing Csts Nnphysician Anesthetists' Services Nnphysician Anesthetists' Services as Hspital Services Hme Health Services Hme Health Crdinatin (r Hme Care Intake Crdinatin) Csts - General Hme Health Crdinatin Activities Patient Slicitatin Activities Discharge Planning-Type Activities Educatin and Liaisn Activities Hme Health Crdinatin in the Prvider-Based HHA Visiting Csts f HHAs Nnwners Cmpensatin Transprtatin Csts Treatment f Medical Supply Csts in HHAs Nn-Visiting Csts f HHAs Cntracted Services Purchased by HHA Rev. 454

4 09-12 COSTS RELATED TO PATIENT CARE PRINCIPLE All payments t prviders f services must be based n the reasnable cst f services cvered under title XVIII f the Act and related t the care f beneficiaries r, in the case f acute care hspitals, the prspective payment system (PPS). (See Chapter 28 n PPS.) Reasnable cst includes all necessary and prper csts incurred in rendering the services, subject t principles relating t specific items f revenue and cst DEFINITIONS Reasnable Csts.--Reasnable csts f any services are determined in accrdance with regulatins establishing the methd r methds t be used, and the items t be included. Reasnable cst takes int accunt bth direct and indirect csts f prviders f services, including nrmal standby csts. The bjective is that under the methds f determining csts, the csts fr individuals cvered by the prgram are nt brne by thers nt s cvered and the csts fr individuals nt s cvered are nt brne by the prgram. Csts may vary frm ne institutin t anther because f scpe f services, level f care, gegraphical lcatin, and utilizatin. It is the intent f the prgram that prviders are reimbursed the actual csts f prviding high quality care, regardless f hw widely they may vary frm prvider t prvider, except where a particular institutin's csts are fund t be substantially ut f line with ther institutins in the same area which are similar in size, scpe f services, utilizatin, and ther relevant factrs. Utilizatin, fr this purpse, refers nt t the prvider's ccupancy rate but rather t the manner in which the institutin is used as determined by the characteristics f the patients treated (i.e., its patient mix - age f patients, type f illness, etc.). Implicit in the intentin that actual csts be paid t the extent they are reasnable is the expectatin that the prvider seeks t minimize its csts and that its actual csts d nt exceed what a prudent and cst-cnscius buyer pays fr a given item r service. (See 2103.) If csts are determined t exceed the level that such buyers incur, in the absence f clear evidence that the higher csts were unavidable, the excess csts are nt reimbursable under the prgram. In the event that a prvider underges bankruptcy prceedings, the prgram makes payment t the prvider based n the reasnable r actual cst f services rendered t Medicare beneficiaries and nt n the basis f csts adjusted by bankruptcy arrangements Csts Related t Patient Care.--These include all necessary and prper csts which are apprpriate and helpful in develping and maintaining the peratin f patient care facilities and activities. Necessary and prper csts related t patient care are usually csts which are cmmn and accepted ccurrences in the field f the prvider's activity. They include persnnel csts, administrative csts, csts f emplyee pensin plans, nrmal standby csts, and thers. Allwability f csts is subject t the regulatins prescribing the treatment f specific items under the Medicare prgram Csts Nt Related t Patient Care.--Csts nt related t patient care are csts which are nt apprpriate r necessary and prper in develping and maintaining the peratin f patient care facilities and activities. Csts which are nt necessary include csts which usually are nt cmmn r accepted ccurrences in the field f the prvider's activity. Such csts are nt allwable in cmputing reimbursable csts and include, fr example: Cst f meals sld t visitrs; Cst f drugs sld t ther than patients; Cst f peratin f a gift shp; Rev

5 2103 COSTS RELATED TO PATIENT CARE Cst f alchlic beverages furnished t emplyees r t thers regardless f hw r where furnished, such as cst f alchlic beverages furnished at a prvider picnic r furnished as a fringe benefit; Cst f gifts r dnatins; Cst f entertainment, including tickets t sprting and ther entertainment events; Cst f persnal use f mtr vehicles; Cst f fines r penalties resulting frm vilatins f Federal, State, r lcal laws; Cst f educatinal expenses fr spuses r ther dependents f prviders f services, their emplyees r cntractrs, if they are nt active emplyees f the prvider r cntractr; Cst f meals served t executives that exceed the cst f meals served t rdinary emplyees due t the use f separate executive dining facilities (capital and capital-related csts), duplicative r additinal fd service staff (chef, waiters/waitresses, etc.), upgraded r gurmet menus, etc.; and Cst f travel incurred in cnnectin with nn-patient care related purpses Dnatins t a Prvider f Prduce, Supplies, Space, Etc.--If a prvider receives a dnatin f prduce, supplies, the use f space wned by anther rganizatin, etc., the prvider may nt prperly impute a cst fr the value f the dnatins and include the imputed cst in allwable csts. If an imputed cst has been included in the prvider's csts, that amunt is deleted in determining allwable csts. If the prvider and dnr rganizatin are bth part f a larger rganizatinal entity, such as units f a state r cunty gvernment, csts related t the dnatins are includable in the allwable csts f the prvider. Fr example, if a cunty hme health agency is given space t use in the cunty ffice building, csts related t that space may be included in the agency's csts, e.g., depreciatin, csts f janitrial services, maintenance and repairs Rev. 454

6 09-12 COSTS RELATED TO PATIENT CARE PRUDENT BUYER A. General.--The prudent and cst-cnscius buyer nt nly refuses t pay mre than the ging price fr an item r service, he/she als seeks t ecnmize by minimizing cst. This is especially s when the buyer is an institutin r rganizatin which makes bulk purchases and can, therefre, ften gain discunts because f the size f its purchases. In additin, bulk purchase f items r services ften gives the buyer leverage in bargaining with suppliers fr ther items r services. Anther way t minimize cst is t btain free replacements r reduced charges under warranties fr medical devices. Any alert and cst-cnscius buyer seeks such advantages, and it is expected that Medicare prviders f services will als seek them. B. Applicatin f Prudent Buyer Principle.--Intermediaries may emply varius means fr detecting and investigating situatins in which csts seem excessive. Included may be such techniques as cmparing the prices paid by prviders t the prices paid fr similar items r services by cmparable purchasers, spt-checking, and querying prviders abut indirect, as well as direct, discunts. In additin, where a grup f institutins has a jint purchasing arrangement which seems t result in participating members getting lwer prices because f the advantages gained frm bulk purchasing, any ptentially eligible prviders in the area which d nt participate in the grup may be called upn t justify any higher prices paid. Als, when mst f the csts f a service are reimbursed by Medicare (fr example, fr a hme health agency which treats nly Medicare beneficiaries), examine the csts with particular care. In thse cases where an intermediary ntes that a prvider pays mre than the ging price fr a supply r service r des nt try t realize savings available under warranties fr medical devices r ther items, in the absence f clear justificatin fr the premium, the intermediary excludes excess csts in determining allwable csts under Medicare. Rev

7 COSTS RELATED TO PATIENT CARE C. Examples f Applicatin f Prudent Buyer Principle Prvider A cnsistently purchases supplies frm supplier R and makes n effrt t btain the mst advantageus price fr its supplies Rev. 454