Billing

Outpatient Services for Registered Inpatients

There are occasional circumstances in which a registered inpatient may require a service that is not available at the inpatient facility. These inpatient facilities include acute-care hospitals (POS 21), skilled nursing facilities (POS 31), psychiatric inpatient facilities (POS 51) and comprehensive inpatient rehabilitation facilities (POS 61) as well as other types of hospitals represented by place of service (POS) code 21 unless there is a more specific POS code. Such outpatient services are performed on a same-day basis; the patient is transported to another facility or physician’s office and returned to the original facility on the same date of service.

When such services occur, the following rules apply:

For Part A services (nonphysician outpatient services) performed outside of the facility at which the patient is a registered inpatient:

  • The facility which provides a Part A service must seek compensation from the original facility at which the patient is a registered inpatient. That original facility is responsible for the cost of the service(s) performed at the outside facility and will make payment from Medicare’s reimbursement for the inpatient stay.
  • The original facility includes the nonphysician outpatient services on its inpatient claim. This is commonly referred to as under arrangement billing.
  • Examples of services that may be performed under these circumstances (generally referred to as “under arrangement”) include outpatient dialysis, radiation therapy, and diagnostic procedures such as MRI.

For Part B services at a physician’s office, performed outside of the facility at which the patient is a registered inpatient:

  • The physician’s office service must be billed with the POS code that reflects the inpatient facility at which the patient is a registered inpatient (i.e., POS codes 21, 31, 51 or 61 as described above).
  • The physician’s office service must be coded using a CPT code correlative to the POS code used on the claim. For example, an office service for a new patient would be represented by an inpatient CPT code in the range of 99221‒99223, while an office service for an established patient would be represented by an inpatient CPT code in the range of 99231‒99233.
  • The important factor here is that the POS code must correlate to the CPT code. Claim editing is set to allow a subset of CPT codes per POS and claims will deny when this correlation is not established on the claims. Such denials, of course, are subject to appeal.

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Reviewed 8/28/2024