Complete Critical Access Hospitals Manual

Critical Access Hospitals (CAH) Manual

To print this manual, right click your mouse and choose "print". Printing the manual material found at this website for long-term use is not advisable. Department Policy material is updated periodically and it is the responsibility of the users to check and make sure that the policy they are researching or applying has the correct effective date for their circumstances.

Update Log

Publication History

This publication supersedes all previous Critical Access Hospitals handbooks. Published by the Montana Department of Public Health & Human Services, January 2005.

Updated November 2005, January 2006, April 2014, April 2015, December 2015, October 2017, 2018, January 2020 and March 2020.

Update Log

03/18/2020
Billing Procedure Chapter: Added Billing for Laboratory Services, Outpatient Laboratory Billing, Billing Unlisted Services or Procedures, and Billing Electronically with Paper Attachments.

01/01/2020
Cost Sharing replaced with Co-Payment information in the Billing Procedures Chapter and Cost Sharing Indicators removed from the Submitting A Claim Chapter.

06/05/2018

Covered Services and the How Payment is Calculated chapters were revised.

10/03/2017
Critical Access Hospitals Manual converted to an HTML format and adapted to 508 Accessibility Standards.

12/31/2015
Critical Access and Exempt Hospitals, January 2016, HELP Plan-Related Updates and Others

04/27/2015
Critical Access and Exempt Hospitals, April 2015: Multiple Chapters

04/01/2014
Critical Access and Exempt Hospitals, March 2014: Key Contacts, MPQH Telephone and Fax

01/17/2006
Critical Access and Exempt Hospitals, January 2006: New Instructions on Completing Medicaid Hysterectomy Acknowledgement Form

11/02/2005
Critical Access and Exempt Hospitals, November 2005: Bundled Services

End of Update Log Chapter

Abortions (ARM 37.86.104)
Air Transport
Chemical Dependency Treatment
Detoxification
Diabetes Educations
Discharges
Donor Transplants
Elective Deliveries
Emergency Medical Services
Mental Health Services
Observation Bed
Outpatient Cardiac and Pulmonary Rehabilitation
Outpatient Clinic Services
Partial Hospitalization
Services Provided by Interns or Residents-in-Training (ARM 37.86.2902)
Sterilization (ARM 37.86.104)
Medically Necessary Sterilization
Therapy Services
Transfers
Transplants (ARM 37.86.4701-37.86.4706)
Non-Covered Services (ARM 37.85.207 and 37.86.2902)

Other Programs

Mental Health Services Plan (MHSP)
Healthy Montana Kids (HMK)

Passport to Health Program

Prior Authorization

What is Prior Authorization

Coordination of Benefits

When a Member Has Other Coverage

When a Member Has TPL (ARM 37.85.407)

Other Programs

Billing Procedures

Claim Forms

When to Bill Montana Healthcare Programs Members (ARM 37.85.406)

Hospital Services Beyond Medical Necessity

Member Cost Sharing (ARM 37.85.204 and 37.85.402)

Billing for Members with Other Insurance

Medicare Benefits Exhausted

Services Provided to Passport to Health Members

Services That Require Prior Authorization

Discharge and Transfer

Split/Interim Billing

Incurment

Submitting a Claim

Remittance Advices and Adjustments

How Payment Is Calculated

Overview

Charge Cap

Status Indicator Codes

Payment for Specified Services

Immunizations
Transfers
Observation Services (ARM 37.86.3020)
Outpatient Clinic Services
Pass-Through Payments
Procedures Considered Inpatient Only by Medicare

Calculating Payment

How Payment is Calculated on TPL Claims
How Payment is Calculated on Medicare Crossover Claims
Payment Examples for Dually Eligible Members

Other Programs

Appendix A: Forms

Definitions and Acronyms

Index

End of Table of Contents Chapter

Key Contacts and Websites

See the Contact Us link in the menu on the Provider Information website for a list of key contacts and websites.

End of Key Contacts and Websites Chapter

Introduction

Thank you for your willingness to serve members of the Montana Healthcare Programs program and other medical assistance programs administered by the Department of Public Health and Human Services.

Manual Organization

This manual provides information specifically for Critical Access Hospitals (CAHs). Most chapters have a section titled Other Programs that includes information about other Department programs such as the Mental Health Services Plan (MHSP) and Healthy Montana Kids (HMK). Additional information for providers is contained in the separate General Information for Providers manual. Providers are responsible for reviewing both manuals.

A table of contents and an index allows providers to quickly find answers to most questions. The margins contain important notes with extra space for writing notes. There is a list of contacts and websites on the Contact Us page on the Provider Information website. There is space on the inside of the front cover to record your NPI/API for quick reference when calling Provider Relations.

Manual Maintenance

Changes to manuals are provided through provider notices and replacement pages. When replacing a page in a paper manual, file the old page and notice in the back of the manual for use with claims that originated under the old policy.

Providers are responsible for knowing and following current Montana Healthcare Programs rules and regulations.

Rule References

Providers must be familiar with all current rules and regulations governing the Montana Healthcare Programs program. Provider manuals are to assist providers in billing Montana Healthcare Programs; they do not contain all Montana Healthcare Programs rules and regulations. Rule citations in the text are a reference tool; they are not a summary of the entire rule. In the event that a manual conflicts with a rule, the rule prevails. Links to rules are available on the Provider Information website. Paper copies of rules are available through the Secretary of State’s office. See the Contact Us link in the left menu on the Provider Information website.

In addition to the general Montana Healthcare Programs rules outlined in the General Information for Providers manual, the following rules and regulations are also applicable to the Hospital Inpatient and Outpatient programs:

Code of Federal Regulations (CFR)
- 42 CFR 440.10 Inpatient Hospital Services, Other than Services in an Institution for Mental Disease
- 42 CFR 440.20 Outpatient Hospital Services and Rural Health Clinic Services
Montana Codes Annotated (MCA)
- MCA 50-5-101 – MCA 50-5-1205 Hospitals and Related Facilities
Administrative Rules of Montana (ARM)
- ARM 37.86.2801 – ARM 37.86.3025 Hospital Services
- ARM 37.106.704 Standards for Critical Access Hospitals

Claims Review (MCA 53-6-111, ARM 37.85.406)

The Department is committed to paying Montana Healthcare Programs providers’ claims as quickly as possible. Montana Healthcare Programs claims are electronically processed and usually are not reviewed by medical experts prior to payment to determine if the services provided were appropriately billed. Although the computerized system can detect and deny some erroneous claims, there are many erroneous claims it cannot detect. For this reason, payment of a claim does not mean the service was correctly billed or the payment made to the provider was correct. Periodic retrospective reviews are performed that may lead to the discovery of incorrect billing or incorrect payment. If a claim is paid and the Department later discovers the service was incorrectly billed or paid or the claim was erroneous in some other way, the Department is required by federal regulation to recover any overpayment, regardless of whether the incorrect payment was the result of Department or provider error or other cause.

Getting Questions Answered

The provider manuals are designed to answer most questions; however, questions may arise that require a call to a specific group (such as a program officer, Provider Relations, or a prior authorization unit). See the Contact Us link on the Provider Information website for a list of contacts.

Montana Healthcare Programs manuals, provider notices, replacement pages, fee schedules, forms, and more are available on the Provider Information website.

End Introduction Chapter

Covered Services

General Coverage Principles

Montana Healthcare Programs covers hospital services when they are medically necessary. This chapter provides covered services information that applies specifically to inpatient and outpatient hospital services provided by CAHs. Like all healthcare services received by Montana Healthcare Programs members, these services must also meet the general requirements listed in the Provider Requirements chapter of the General Information for Providers manual.

Hospital Inpatient Services (ARM 37.86.2901–2947)
Inpatient hospital services are provided to Montana Healthcare Programs members who are formally admitted as an inpatient and whose expected hospital stay is greater than 24 hours. Inpatient services must be ordered by a licensed physician, dentist, or other practitioner and provided in an institution maintained primarily for treatment and care of members with disorders other than tuberculosis or mental diseases. The institution must be currently licensed as an acute care hospital by the designated state licensing authority in the state where the institution is located, must meet the requirements for participation in Medicare as a hospital, and must have in effect a utilization review plan that meets the requirements of 42 CFR 482.30, or provide inpatient psychiatric hospital services for individuals under age 21 according to ARM 37.88.1101–1119.

Hospital Outpatient Services (ARM 37.86.3001–3025)
Outpatient hospital services are provided to members whose expected hospital stay is less than 24 hours. Outpatient hospital services include preventive, diagnostic, therapeutic, rehabilitative, or palliative services provided by or under the direction of a physician, dentist, or other practitioner as permitted by federal law. Hospitals must meet all of the following criteria:

Licensed or formally approved as a hospital by the officially designated authority in the state where the institution is located; and
Meet the requirements for participation in Medicare as a hospital.

Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Services (ARM 37.86.2201–2235)
The EPSDT Well-Child program covers all medically necessary services for children age 20 and under. Providers are encouraged to use a series of screening and diagnostic procedures designed to detect diseases, disabilities, and abnormalities in the early stages. Some services are covered for children that are not covered for adults, such as:

Nutritionist services
Private duty nursing
Respiratory therapy
Therapeutic family and group home care
Substance dependency inpatient and day treatment services
School-based services

All prior authorization and Passport approval requirements must be followed. See the Prior Authorization chapter in the General Information for Providers manual, the Prior Authorization Information page on the Provider Information website, and the Passport to Health manual.

For more information about the recommended well-child screen and other components of EPSDT, refer to the EPSDT Well-Child chapter in the General Information for Providers manual.

Importance of Fee Schedules
The easiest way to verify coverage for a specific service is to check the Department’s fee schedule for your provider type. In addition to being listed on the fee schedule, all services provided must also meet the coverage criteria listed in the Provider Requirements chapter of the General Information for Providers manual and in this chapter. Use the fee schedule in conjunction with the more detailed coding descriptions listed in the CPT, ICD, and HCPCS coding books that pertain to the date of service. Fee schedules are available on the Provider Information website. CAHs should refer to the hospital inpatient and outpatient fee schedules for coverage information. Fee schedules for CAHs provide coverage information only; they do not provide reimbursement information.

Physician Attestation and Acknowledgment (ARM 37.86.2904)

At the time a claim is submitted, the hospital must have a signed and dated acknowledgment on file from the attending physician that the physician has received the following notice:

Notice to physicians: Montana Healthcare Programs payment to hospitals is based on all of each member’s diagnoses and the procedures performed on the member, as attested to by the member’s attending physician by virtue of his or her signature in the medical record. Anyone who misrepresents, falsifies or conceals essential information required for payment of federal funds, may be subject to fine, imprisonment or civil penalty under applicable federal laws.

The acknowledgment must be completed by the physician at the time that the physician is granted admitting privileges at the hospital; or before or at the time the physician admits his/her first member to the hospital. Existing acknowledgments signed by physicians already on staff remain in effect as long as the physician has admitting privileges at the hospital. The provider may, at his/her discretion, add to the language of this statement the word Medicare so that two separate forms will not be required by the provider to comply with both state and federal requirements.

Utilization Reviews (42 CFR 456)

The Department or its contractor may at any time review paid claims, provider documentation for medical necessity, appropriate billing, etc. Providers must maintain documentation of medical necessity for services such as initial hospitalization, transfers, and readmissions. For more information on provider requirements for maintaining documentation, see the Record Keeping section in the Provider Requirements chapter of the General Information for Providers manual. Also see the Claims Review section in the Introduction chapter of this manual.

Nursing Facility Placement (ARM 37.40.202)

Hospitalized Montana Healthcare Programs members and Montana Healthcare Programs applicants being considered for nursing facility placement from the hospital shall be referred in a timely manner to the preadmission screening team.

The preadmission screening (Form DPHHS-SLTC-61) must be completed before placement and payment is made on their behalf.

For information on requesting a Level I and/or Level of Care screen, see the Mountain-Pacific Quality Health entry on the Contact Us page on the Provider Information the Provider Information website.

Coverage of Specific Services (ARM 37.86.2902)

The following are coverage rules for specific inpatient and outpatient hospital services. Services are for both inpatient and outpatient hospitals unless designated an inpatient-only or outpatient-only service. Except as otherwise permitted by federal law, inpatient hospital services must be ordered by a physician or dentist licensed under state law. For inpatient hospital services, the following routine services are included in the stay; they cannot be billed separately:

Bed and board;
Nursing services and other related services;
Use of hospital facilities;
Medical social services;
Drugs, biologicals, supplies, appliances, and equipment;
Other diagnostic or therapeutic items, or services provided in the hospital and not specifically excluded in ARM 37.85.207 (See the Non-Covered Services section in this chapter.); and
Medical or surgical services provided by interns or residents-in-training in hospitals with teaching programs approved by the Council on Medical Education of the American Medical Association, the Bureau of Professional Education of the American Osteopathic Association, the Council on Dental Education of the American Dental Association, or the Council on Podiatry Education of the American Podiatry Association.

Abortions (ARM 37.86.104)
Coverage of physician services for abortions is limited as follows:

The life of the mother will be endangered if the fetus is carried to term.
The pregnancy is the result of an act of rape or incest.
The abortion is determined by the attending physician to be medically necessary, even if the member’s life is not endangered if the fetus is carried to term.

Physician services for abortions in a case of endangerment of the mother’s life must meet the following requirements to receive Montana Healthcare Programs reimbursement:

The physician must find, and certify in writing, that in the physician’s professional judgment, the life of the mother will be endangered if the fetus is carried to term. The certification must contain the name and address of the member and must be on or attached to the Montana Healthcare Programs claim.

Physician services for abortions in cases of pregnancy resulting from an act of rape or incest must meet the following requirements to receive Montana Healthcare Programs reimbursement:

The member certifies in writing that the pregnancy resulted from an act of rape or incest; and
The physician certifies in writing either that:
- The recipient has stated to the physician that she reported the rape or incest to a law enforcement or protective services agency having jurisdiction over the matter, or if the recipient is a child enrolled in a school, to a school counselor; or
- In the physician’s professional opinion, the recipient was and is unable for physical or psychological reasons to report the act of rape or incest.

A completed Physician Certification for Abortion Services (MA-37) form must be submitted with every abortion claim or payment will be denied. This form is the only form Montana Healthcare Programs accepts for abortion services. Complete only one section. See the Provider Information website for instructions.

When using mifepristone (Mifeprex or RU 486) to terminate a pregnancy, it must be administered within 49 days from the beginning of the last menstrual period by or under the supervision of a physician who:

Can assess the duration of a pregnancy.
Can diagnose ectopic pregnancies.
Can provide surgical intervention in cases of incomplete abortion or severe bleeding, or can provide such care through other qualified physicians.
Can assure access to medical facilities equipped to provide blood transfusion and resuscitation.
Has read, understood and explained to the member the prescribing information for mifepristone.

Air Transports
Air transport providers must be registered with Montana Healthcare Programs as an ambulance provider. Claims for these services are billed on a CMS-1500 claim form. See the Ambulance Services manual available on the Provider Information website.

Chemical Dependency Treatment
Chemical dependency services are limited. Providers must be approved by the Department before providing this service. Contact the Chemical Dependency Bureau for more information.

Detoxification
Services may be covered if the authorization contractor determines that the member has a concomitant condition that must be treated in an inpatient hospital setting, and the detoxification treatment is a necessary adjunct to the treatment of the concomitant condition.

Diabetes Education
Montana Healthcare Programs covers diabetes education services for members who have been newly diagnosed with diabetes and/or members with unstable diabetes (e.g., members with long-term diabetes now experiencing management problems). The diabetes education protocol must meet the following Medicare Part A requirements:

The program must train and motivate the member to self-manage their diabetes through proper diet and exercise, blood glucose self-monitoring, and insulin treatment.
The plan of treatment must include goals for the member and how they will be achieved, and the program duration must be sufficient to meet these goals.
The physician must refer only his/her members to the program.
The program must be provided under the physician’s order by the provider’s personnel and under medical staff supervision.
The education plan must be designed specifically for the member to meet his/her individual needs. Structured education may be included in the plan, but not substituted for individual training.

Discharges
A hospital’s utilization review (UR) committee must comply with the Code of Federal Regulations (42 CFR 456.131–137) prior to notifying a Montana Healthcare Programs member that he/she no longer needs medical care. The hospital is not required to obtain approval from Montana Healthcare Programs at the member’s discharge; however, a hospital’s UR plan must provide written notice to Montana Healthcare Programs if a member decides to stay in the hospital when it is not medically necessary. See the section titled Hospital Services Beyond Medical Necessity in the Billing Procedures chapter of this manual.

Donor Transplants
Montana Healthcare Programs covers harvesting from organ donors and transplants, but does not cover expenses associated with the donor search process.

Elective Deliveries
Effective July 1, 2014, all facilities must have a “hard-stop” policy in place regarding non-medically necessary inductions prior to 39 weeks and non-medically necessary Cesarean sections at any gestational age. The policy must contain the following:

No non-medically necessary inductions and Cesarean sections prior to 39 weeks and 0/7 days gestation, and no non-medically necessary Cesarean sections at any gestational age.
Confirmation of weeks gestation by ACOG guidelines (at least one of the following guidelines must be met to show gestational age):
- Fetal heart tones have been documented for 20 weeks by non-electronic fetoscope or 30 weeks by Doppler;
- 36 weeks since a positive serum or urine pregnancy test that was performed by a reliable laboratory; or
- An ultrasound prior to 20 weeks that confirms the gestational age of at least 39 weeks.
If pregnancy care was not initiated prior to 20 weeks gestation, the gestational age may be documented from first day of the last menstrual period (LMP).
Policy must have a multistep review process prior to all inductions and Cesarean sections including final decision being made by the Perinatology Chair/Obstetrical Chair, OB Director, or Medical Director.

As of October 1, 2014, Montana Healthcare Programs reduced reimbursement rates for non-medically necessary inductions prior to 39 weeks, and non-medically necessary Cesarean sections at any gestational ages. All hospital claims with an admit date on or after October 1, 2014, require coding changes to delivery claims.

Hospital inpatient claims and birthing center claims will require the use of condition codes for all induction and Cesarean section deliveries. These claims will be reviewed for medical necessity based on an approved list of diagnosis codes. The condition codes are:

81 – Cesarean section or induction performed at less than 39 weeks gestation for medical necessity.
82 – Cesarean section or induction performed at less than 39 weeks gestation electively.
83 – Cesarean section or induction performed at 39 weeks gestation or greater.

Emergency Medical Services
Emergency services are services required to treat and stabilize an emergency medical condition.

Mental Health Services
Montana Healthcare Programs covers inpatient mental health services for Montana Healthcare Programs-enrolled members when prior authorized. Inpatient hospital services are not covered for adults enrolled in the Mental Health Service Plan (MHSP) or children enrolled in the Children’s Mental Health Service Plan (CMHSP). Some mental health services may not be billed separately. These services include:

Services provided by a psychologist who is employed or under a contract with a hospital.
Services provided for purposes of discharge planning as required by 42 CFR 482.21.
Services that are required as a part of licensure or certification, including but not limited to group therapy.

Mental health services provided by physicians and psychiatrists in an inpatient setting are the only services that can be billed separately. Providers should refer to the mental health manual available on the Provider Information website.

Observation Bed
Members in observation beds (admission of 24 hours or less) are considered outpatients, and claims should be filed accordingly.

Outpatient Cardiac and Pulmonary Rehabilitation
Effective July 1, 2014, services for procedure codes G0423, and G0424 must be prior authorized by Mountain-Pacific Quality Health.

Coverage for outpatient cardiac and pulmonary rehabilitation services must be medically necessary.

Members with one or more contraindications are not eligible for cardiac and pulmonary rehabilitation. The following conditions are contraindications to cardiac pulmonary rehabilitation.

Severe psychiatric disturbance including, but not limited to, dementia and organic brain syndrome; or
Significant or unstable medical conditions including, but not limited to, substance abuse, liver dysfunction, kidney dysfunction, and metastatic cancer.

Cardiac Rehabilitation
Services are limited to the following:

Cardiac rehabilitation services are limited to a maximum of two 1-hour sessions per day and limited to the following cardiac events and diagnoses:
- Myocardial infarction within the preceding 12 months;
- Coronary artery bypass surgery;
- Heart-lung transplant;
- Current stable angina pectoris;
- Percutaneous transluminal coronary angioplasty (PTCA) or coronary stenting;
- Heart valve repair or replacement; and
- Chronic stable heart failure.

Pulmonary Rehabilitation

A maximum of two 1-hour sessions per day for members with moderate to severe COPD (defined as GOLD classification II, III, and IV).
If applicable, the member must have ceased smoking or be in a smoking cessation class.

The following pulmonary rehabilitation services are not covered:

Education, treatment, and therapies that are no individualized to a specific member need or are not an integral part of the treatment session;
Routine psychological screening and treatment where intervention is not indicated;
Films/videos;
Duplicate services;
Maintenance care when there is no expectation of further improvement;
Treatment that is not medically necessary because the member requires a general strengthening and endurance program only; and
Treatment that is not medically necessary because the member is at an early state of pulmonary disease as demonstrated by a lack of significant findings in diagnostic testing.

Outpatient Clinic Services

The Department will pay for service provided in an outpatient clinic. Outpatient clinics that are within or outside the hospital walls are considered independent clinics by Montana Healthcare Programs.

Clinic services provided by an individual physician or mid-level practitioner in the outpatient clinic must be billed on a CMS-1500 with place of service (POS) 11.

Partial Hospitalization
The partial hospitalization program is an active treatment program that offers therapeutically intensive, coordinated, structured clinical services. These services are provided only to members who are determined to have a serious emotional disturbance (SED) or a severe disabling mental illness (SDMI). Definitions for SED and SDMI are on the Provider Information website on the Definitions and Acronyms webpage. Partial hospitalization services are time-limited and provided within either an acute level program or a sub-acute level program. Partial hospitalization services include day, evening, night and weekend treatment programs that employ an integrated, comprehensive and complementary schedule of recognized treatment or therapeutic activities. These services require prior authorization. For more information, see the mental health manual, available on the Provider Information website.

Services Provided by Interns or Residents-in-Training (ARM 37.86.2902)
Montana Healthcare Programs covers medical or surgical services provided by interns or residents-in-training only when they are provided in hospitals with teaching programs approved by one of the following:

Council on Medical Education of the American Medical Association
Bureau of Professional Education of the American Osteopathic Association
Council on Dental Education of the American Dental Association
Council on Podiatry Education of the American Podiatry Association

Sterilization (ARM 37.86.104)
Elective Sterilization
Elective sterilizations are sterilizations done for the purpose of becoming sterile. Montana Healthcare Programs covers elective sterilization for men and women when all of the following requirements are met:

Member must complete and sign the Informed Consent to Sterilization (MA-38) form at least 30 days, but not more than 180 days, prior to the sterilization procedure. This form is the only form Montana Healthcare Programs accepts for elective sterilizations. If this form is not properly completed, payment will be denied. See the Forms page on the Provider Information website for the form and instructions for completing.
Member must be at least 21 years of age when signing the form.
Member must not have been declared mentally incompetent by a federal, state, or local court, unless the member has been declared competent to specifically consent to sterilization.
Member must not be confined under civil or criminal status in a correctional or rehabilitative facility, including a psychiatric hospital or other correctional facility for the treatment of the mentally ill.

The 30-day waiting period may be waived for either of the following reasons:

Premature Delivery. The Informed Consent to Sterilization must be completed and signed by the member at least 30 days prior to the estimated delivery date and at least 72 hours prior to the sterilization.
Emergency Abdominal Surgery. The Informed Consent to Sterilization form must be completed and signed by the member at least 72 hours prior to the sterilization procedure.

All forms required for sterilizations can be downloaded from the Provider Information website,

Before performing a sterilization, the following requirements must be met:

The member must have the opportunity to have questions regarding the sterilization procedure answered to his/her satisfaction.
The member must be informed of his/her right to withdraw or withhold consent anytime before the sterilization without being subject to retribution or loss of benefits.
The member must be made aware of available alternatives of birth control and family planning.
The member must understand the sterilization procedure being considered is irreversible.
The member must be made aware of the discomforts and risks which may accompany the sterilization procedure being considered.
The member must be informed of the benefits and advantages of the sterilization procedure.
The member must know that he/she must have at least 30 days to reconsider his/her decision to be sterilized.
An interpreter must be present and sign for those members who are blind, deaf, or do not understand the language to assure the person has been informed.

Informed consent for sterilization may not be obtained under the following circumstances:

If the member is in labor or childbirth.
If the member is seeking or obtaining an abortion.
If the member is under the influence of alcohol or other substance which affects his/her awareness.

Medically Necessary Sterilization
When sterilization results from a procedure performed to address another medical problem, it is considered a medically necessary sterilization. These procedures include hysterectomies, oophorectomies, salpingectomies and orchiectomies.

Every claim submitted to Montana Healthcare Programs for a medically necessary sterilization must be accompanied by one of the following:

A completed Montana Healthcare Programs Hysterectomy Acknowledgement form (MA-39) for each provider submitting a claim. It is the provider’s responsibility to obtain a copy of the form from the primary or attending physician. Complete only one section (A, B, or C) of this form. When no prior sterility (Section B) or life-threatening emergency (Section C) exists, the member (or representative, if any) and physician must sign and date Section A of this form prior to the procedure (see 42 CFR 441.250 for the federal policy on hysterectomies and sterilizations). Also, for Section A, signatures dated after the surgery date require manual review of medical records by the Department. The Department must verify that the member (and representative, if any) was informed orally and in writing, prior to the surgery, that the procedure would render the member permanently incapable of reproducing. The member does not need to sign this form when Sections B or C are used. See the Forms page on the Provider Information website for detailed instructions on completing the form.
For members who have become retroactively eligible for Montana Healthcare Programs, the physician must certify in writing that the surgery was performed for medical reasons and must document one of the following:
- The member was informed prior to the hysterectomy that the operation would render the member permanently incapable of reproducing.
- The reason for the hysterectomy was a life-threatening emergency.
- The member was already sterile at the time of the hysterectomy and the reason for prior sterility. When submitting claims for retroactively eligible members for which the date of service is more than 12 months earlier than the date the claim is submitted, contact the member’s local Office of Public Assistance and request a Notice of Retroactive Eligibility (160-M). Attach the form to the claim. Claims without the 160-M will not be paid.

Therapy Services
Physical, occupational, and speech/language therapy services are available to Montana Healthcare Programs members. See the Therapy Services manual for more information.

Transfers
All transfers are subject to review for medical necessity. The initial hospitalization, all subsequent hospitalizations, and the medical necessity for the transfer itself may be reviewed. For information on billing and payment for transfers, see the Billing Procedures and How Payment Is Calculated chapters in this manual.

Transplants (ARM 37.86.4701–37.86.4706)
Prior authorization is required for all transplant services. See the Prior Authorization Information page on the Provider Information website. Montana Healthcare Programs covers only the following organ and tissue transplantation services:

Organ transplantation includes the transplant surgery and those activities directly related to the transplantation. These activities must be performed at a Medicare approved transplant facility and may include:

Evaluation of the member as a potential transplant candidate.
Pre-transplant preparation including histocompatibility testing procedures.
Post-surgical hospitalization.
Outpatient care, including Federal Drug Administration (FDA) approved medications deemed necessary for maintenance or because of resulting complications.

Tissue transplantation includes only corneal, bone marrow, and peripheral stem cell transplants. Providers should refer to ARM 37.86.4705 for more information on the coverage of transplant services.

Non-Covered Services (ARM 37.85.207 and 37.86.2902)
The following is a list of services not covered by Montana Healthcare Programs. Some of these services may be covered under the EPSDT program for children age 20 and younger based on medical necessity or for individuals covered under the Qualified Medicare Beneficiary (QMB) program. See the Member Eligibility and Responsibilities chapter in the General Information for Providers manual.

Other Programs

This is how the information in this chapter applies to Department programs other than Montana Healthcare Programs.

Mental Health Services Plan (MHSP)
This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

Healthy Montana Kids (HMK)
The information in this chapter does not apply to HMK members. Hospital services for children with HMK coverage are covered by Blue Cross and Blue Shield of Montana (BCBSMT). For more information, contact BCBSMT at 1-800-447-7828. Information about HMK is available on the HMK website.

End of Covered Services Chapter

Passport to Health Program

See the Passport to Health manual for information on the Passport program. The manual is found on the Passport to Health page on the Provider Information website and on applicable provider type pages.

End of Passport to Health Program Chapter

Prior Authorization

What is Prior Authorization (ARM 37.86.2801)

In addition to the requirements in the General Information for Providers manual, the following is specific to CAHs.

Whether the member is enrolled in Passport or Team Care, the eligibility information denotes the member’s PCP. Services are only covered when they are provided or approved by the designated Passport provider or Team Care pharmacy shown in the eligibility information. Specific services may require both prior authorization and Passport referral. To be covered by Montana Healthcare Programs, all services must also be provided in accordance with the requirements listed in this manual.

When seeking prior authorization, keep in mind the following:

The referring provider should initiate all authorization requests.
Always refer to the Montana Healthcare Programs fee schedule that corresponds with the dates of service to verify whether prior authorization is required for the services.
When requesting prior authorization for members with partial eligibility, request prior authorization from the first date the member was Montana Healthcare Programs eligible, not the first date of the member’s hospital stay.
The Prior Authorization Criteria for Specific Services table on the Prior Authorization Information webpage lists services that require prior authorization, who to contact for authorization, and documentation requirements. See the Prior Authorization Information link in the left menu on the Provider Information website.
Have all required documentation included in the packet before submitting a prior authorization request. See the Prior Authorization Information link in the left menu on the Provider Information website.
When prior authorization is granted, providers will receive notification containing a prior authorization number. This prior authorization number must be included on the claim.
The hospital can document that at the time of admission it did not know, or have any basis to assume that the member was a Montana Montana Healthcare Programs member.

Prior Authorization for Specific Services

See the Prior Authorization Information link in the left menu on the Provider Information website. The webpage includes contact information and document requirements for prior authorization for specific services.

End of Prior Authorization Chapter

Coordination of Benefits

When a Member Has Other Coverage

See the General Information for Providers manual for additional information.

When a Member Has TPL (ARM 37.85.407)

See the General Information for Providers manual for additional information.

Other Programs

This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

The information in this chapter does not apply to members enrolled in Healthy Montana Kids (HMK). The HMK medical manual is available through Blue Cross and Blue Shield of Montana at 1-800-447-7828.

End of Coordination of Benefits Chapter

Billing Procedures

Using the Montana Healthcare Programs Fee Schedule

When billing Montana Healthcare Programs, it is important to use the Department’s fee schedule for your provider type in conjunction with the detailed coding descriptions listed in the current CPT and HCPCS coding books. In addition to covered services and payment rates, fee schedules often contain helpful information such as appropriate modifiers. Fee schedules are available on the Provider Information website.

Place of Service

Place of service must be entered correctly on each line. Montana Healthcare Programs typically reduces payment for services provided in hospitals and ambulatory surgical centers since these facilities typically bill Montana Healthcare Programs separately for facility charges.

For a list of place of service codes for professional claims, see the link under Coding/Place of Service Codes at http://www.cms.gov/Medicare/Medicare.html.

Date of Service

The date of service for custom molded or fitted items is the date upon which the provider completes the mold or fitting and either orders the equipment from another party or makes an irrevocable commitment to the production of the item.

Rental

Payment includes the entire initial month of rental even if actual days of use are less than the full month. Payment for second or subsequent months is allowed only if the item is used at least 15 days in such months.

Reference Laboratory Services - Outpatient Hospital and Critical Access Hospital (CAH) Billing for Laboratory Services

Montana Healthcare Programs allows Outpatient Hospitals and Critical Access Hospitals (CAH) to bill for reference laboratory services. If the Outpatient Hospital or CAH refers laboratory services to any outside laboratory and outpatient hospital or CAH bills Montana Healthcare Programs for those laboratory services, the outpatient hospital or CAH must use modifier 90 to indicate reference laboratory services. It is the responsibility of the hospital or CAH to ensure the reference laboratory meets the Clinical Laboratory Improvement (CLIA) certification criteria for the type and laboratory services performed. In addition, be sure that the CLIA certificate is in effect for the date of service laboratory tests are performed. If not, Montana Health Programs is entitled to recover reimbursement made for the reference laboratory services.

Labs provided to members residing in a Psychiatric Residential Treatment Facility (PRTF).

There are instances when laboratory work related to treating the psychiatric condition is included in the bundled per diem rate for in-state PRTFs (ARM 37.87.1223(3)(d). In those instances, the laboratory services provided by the hospital is not able to be separately billed. The hospital would need to work with the PRTF and/or Children’s Mental Health Bureau.

State Laboratory billing

In order for the State Laboratory to appropriately bill Montana Healthcare Programs, providers must indicate Montana Healthcare Program eligibility and include the members ID on the Public Health Laboratory Request Form.

Outpatient Laboratory Billing

Effective January 1, 2017, modifier L1 associated with the reporting of conditionally packaged laboratory procedures will be deactivated. The modifier will no longer override the packaging of laboratory codes that are billed with other payable Outpatient Prospective Payment System (OPPS) procedures. Laboratory procedures are only payable under OPPS when the lab codes are the only payable codes on the claim, or when the Type of Bill (TOB) is 141 (Hospital, Other, Admit through Discharge) for non-patient laboratory tests.

Note: Some lab codes (e.g., molecular pathology codes) are not subject to the conditional packaging logic.

Billing Unlisted Services or Procedures

Providers should use the most specific HCPCS code when billing a service or procedure to enable proper reimbursement. In the event an unlisted service or procedure code must be used, Montana Healthcare Programs urges providers to send medical records with the claim. Reviewing the medical records with the claim allows the claims processing personnel to understand the situation and apply appropriate reimbursement, as well as decreases claims processing time. Medical records can be sent with electronic claims through the use of the paperwork attachment.

Billing Electronically with Paper Attachments

When submitting claims that require additional supporting documentation, the Attachment Control Number field must be populated with an identifier. Identifier formats can be designed by software vendors or clearinghouses, but the preferred method is the provider's Montana Healthcare Programs ID number followed by the member's ID number and the date of service, each separated by a dash.

The supporting documentation must be submitted with a Paperwork Attachment Cover Sheet. The number in the paper Attachment Control Number field must match the number on the cover sheet.
CMS provides the following guidance regarding reimbursement for unlisted services or procedures:

Under the OPPS, CMS generally assigns the unlisted service or procedure codes to the lowest level APC within the most appropriate clinically related series of APCs. Payment for items reported with unlisted codes is often packaged.

End of Billing Procedures Chapter

Submitting a Claim

The services described in this manual are billed on UB-04 claim forms. Use this chapter with the UB-04 claim instructions on the Provider Information website.

Claims submitted with all of the necessary information are referred to as clean and are usually paid in a timely manner. (See the Billing Procedures chapter in the General Information for Providers manual.)

End of Submitting a Claim Chapter

Remittance Advices and Adjustments

See the General Information for Providers manual for information on remittance advices and adjustments.

End of Remittance Advice and Adjustments Chapter

How Payment Is Calculated

Overview

Although providers do not need the information in this chapter to submit claims to Montana Healthcare Programs, the information allows providers to understand how payment is calculated and to predict approximate payment for particular claims.

CAHs are reimbursed for their costs of providing care, as determined through the annual cost settlement process. In the interim, these hospitals are paid a hospital-specific percentage of their charges. The percentage equals the hospital’s estimated cost-to-charge ratio as determined from time-to-time by the Department. The percentage includes payments for medical education and capital expenses.

Charge Cap

For services covered in the hospital setting, Montana Healthcare Programs pays a cost to charge ratio, not the lower of the Montana Healthcare Programs fee or the provider’s charge. The charge cap is not applied.

Status Indicator Codes

The code set used by DPHHS is based on the code set used by Medicare but with several additions. See the following table of status indicator codes.

Status Indicator Codes Used by DPHHS

Code - Description - Origin

W - Excluded service - DPHHS
G - Drug/biological under trans. pass-through - Medicare
H - Device under trans. pass-through - Medicare
J - New drug/biological under trans. pass-through - Medicare
N - Incidental services (bundled) - Medicare
T - Surgical services - Medicare
C - Inpatient services - Medicare
K - Non-pass-through drugs and biologicals - Medicare
S - Significant procedures - Medicare
X - Ancillary service - Medicare
V - Medical visit
B - Services not paid under OPPS - Medicare
P - Partial hospitalization - Medicare
Q - Clinical lab - DPHHS
Y - Therapy - DPHHS
M - Misc. codes - DPHHS

Payment for Specific Services

Immunizations
If the member is under 19 years old and the vaccine is available to providers for free under the Vaccines for Children program, then the payment to the hospital is zero. Immunization administration is considered an incidental service. The claims processing system bundles immunization administration with other services on the claim and pays it at zero.

Transfers
When a member is transferred between two hospitals, the transferring and/or discharging hospitals are paid a hospital-specific cost to charge ratio for their services if they are CAHs.

Occasionally, a member is transferred from one hospital to another and then back to the original hospital when the condition causing the transfer is alleviated. Thus a hospital can be a transferring and discharging hospital. The discharging hospital should submit separate claims, one for the original admission and transfer and a second for the final discharge.

Observation Services (ARM 37.86.3020)
DPHHS follows the Medicare program, with the exception of obstetric complications, in making separate payment for observation care procedure codes if the following criteria are met.

Observation time must be documented in the medical record.
The number of units reported must equal or exceed eight hours.

In addition, the claim for observation must include one of the following services to the reported observation:

High level emergency department visit; or
High level clinic visit; or
High level critical care; or
Direct admit for observation care after being seen by a healthcare provider on the same date of service as the date reported for observation services.

The Department will also pay for observation care in a case with the potential obstetric complications if the following criteria are met:

Must have a qualifying diagnosis; and
Must be at least one hour in length of service.

If an observation service does not meet the criteria according to the above, then payment for observation care is considered bundled into the payment for other services.

Outpatient Clinic Services

Clinic services provided by an individual physician or mid-level practitioner in the outpatient clinic must be billed on a CMS-1500 with place of service (POS) 11.

Pass-Through Payments
Payments for certain drugs, devices and supplies are designated as pass-through and paid a hospital-specific cost-to-charge ratio.

Procedures Considered Inpatient Only by Medicare
Medicare has designated some procedures as inpatient-only. Montana Healthcare Programs has also adopted that designation. When these procedures are performed in the outpatient hospital setting, the claim is denied. Hospitals may appeal the denial to the Department. If the service is approved, the claim will be paid.

Calculating Payment

The sections below explain how to calculate payment for claims involving Medicare or third party liability.

How Payment Is Calculated on TPL Claims
When a member has coverage from both Montana Healthcare Programs and another insurance company, the other insurance company is often referred to as third party liability (TPL). In these cases, the other insurance is the primary payer, and Montana Healthcare Programs makes a payment as the secondary payer. Montana Healthcare Programs will make a payment only when the TPL payment is less than the Montana Healthcare Programs allowed amount. See the When a Member Has TPL section in the General Information for Providers manual.

How Payment Is Calculated on Medicare Crossover Claims
When a member has coverage from both Medicare and Montana Healthcare Programs, Medicare is the primary payer. Montana Healthcare Programs will pay the coinsurance and deductible, less any TPL or incurment, on hospital claims for these dually eligible individuals.

Payment Examples for Dually Eligible Members
Member has Medicare and Montana Healthcare Programs coverage. A provider submits an inpatient hospital claim for a member with Medicare and Montana Healthcare Programs. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. Montana Healthcare Programs will pay this amount ($250.00) as long as no TPL or incurment amounts are applicable.

Member has Medicare, Montana Healthcare Programs, and TPL. A provider submits an inpatient hospital claim for a member with Medicare, Montana Healthcare Programs, and TPL. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. The other insurance company paid $225.00. This amount is subtracted from the Montana Healthcare Programs allowed amount leaving $25.00. Montana Healthcare Programs pays $25.00 for this claim. If the TPL payment had been $250.00 or more, this claim would have paid at $0.00.

Member has Medicare, Montana Healthcare Programs, and Montana Healthcare Programs Incurment. A provider submits an inpatient hospital claim for a member with Medicare, Montana Healthcare Programs, and a Montana Healthcare Programs incurment. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. The member owes $150 for his Montana Healthcare Programs incurment, so this amount is subtracted from the $250.00. Montana Healthcare Programs will pay the provider $100.00 for this claim.

Other Programs

This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

The information in this chapter does not apply to members enrolled in Healthy Montana Kids (HMK). The HMK medical manual is available through Blue Cross and Blue Shield of Montana (BCBSMT) at 1-800-447-7828. Additional information about HMK is available on the HMK website.

End of How Payment Is Calculated Chapter

Appendix A: Forms

These forms and others are available on the Forms page on the Provider Information website.

Individual Adjustment Request
Physician Certification for Abortion Services (MA-37)
Informed Consent to Sterilization (MA-38)
Medicaid Hysterectomy Acknowledgment (MA-39)
Paperwork Attachment Cover Sheet

End of Appendix A: Forms Chapter

Definitions and Acronyms

See the Definitions and Acronyms page on the Provider Information website.

End of Definitions and Acronyms Chapter

Index

Previous editions of this manual contained an index.

This edition has three search options.

1.Search the whole manual. Open the Complete Manual pane. From your keyboard press the Ctrl and F keys at the same time. A search box will appear. Type in a descriptive or key word (for example "Denials". The search box will show all locations where denials discussed in the manual.

2.Search by Chapter. Open any Chapter tab (for example the "Billing Procedures" tab). From your keyboard press the Ctrl and F keys at the same time. A search box will appear. Type in a descriptive or key word (for example "Denials". The search box will show where denials discussed in just that chapter.

3.Site Search. Search the manual as well as other documents related to a particular search term on the Montana Healthcare Programs Site Specific Search page.

End of Index Chapter

End of Critical Access Hospital Manual

Update Log

Publication History

This publication supersedes all previous Critical Access Hospitals handbooks. Published by the Montana Department of Public Health & Human Services, January 2005.

Updated November 2005, January 2006, April 2014, April 2015, December 2015, October 2017, 2018, January 2020 and March 2020.

Update Log

03/18/2020
Billing Procedure Chapter: Added Billing for Laboratory Services, Outpatient Laboratory Billing, Billing Unlisted Services or Procedures, and Billing Electronically with Paper Attachments.

01/01/2020
Cost Sharing replaced with Co-Payment information in the Billing Procedures Chapter and Cost Sharing Indicators removed from the Submitting A Claim Chapter.

06/05/2018

Covered Services and the How Payment is Calculated chapters were revised.

10/03/2017
Critical Access Hospitals Manual converted to an HTML format and adapted to 508 Accessibility Standards.

12/31/2015
Critical Access and Exempt Hospitals, January 2016, HELP Plan-Related Updates and Others

04/27/2015
Critical Access and Exempt Hospitals, April 2015: Multiple Chapters

04/01/2014
Critical Access and Exempt Hospitals, March 2014: Key Contacts, MPQH Telephone and Fax

01/17/2006
Critical Access and Exempt Hospitals, January 2006: New Instructions on Completing Medicaid Hysterectomy Acknowledgement Form

11/02/2005
Critical Access and Exempt Hospitals, November 2005: Bundled Services

End of Update Log Chapter

Table of Contents

Abortions (ARM 37.86.104)
Air Transport
Chemical Dependency Treatment
Detoxification
Diabetes Educations
Discharges
Donor Transplants
Elective Deliveries
Emergency Medical Services
Mental Health Services
Observation Bed
Outpatient Cardiac and Pulmonary Rehabilitation
Outpatient Clinic Services
Partial Hospitalization
Services Provided by Interns or Residents-in-Training (ARM 37.86.2902)
Sterilization (ARM 37.86.104)
Medically Necessary Sterilization
Therapy Services
Transfers
Transplants (ARM 37.86.4701-37.86.4706)
Non-Covered Services (ARM 37.85.207 and 37.86.2902)

Other Programs

Mental Health Services Plan (MHSP)
Healthy Montana Kids (HMK)

Passport to Health Program

Prior Authorization

What is Prior Authorization

Coordination of Benefits

When a Member Has Other Coverage

When a Member Has TPL (ARM 37.85.407)

Other Programs

Billing Procedures

Claim Forms

When to Bill Montana Healthcare Programs Members (ARM 37.85.406)

Hospital Services Beyond Medical Necessity

Member Cost Sharing (ARM 37.85.204 and 37.85.402)

Billing for Members with Other Insurance

Medicare Benefits Exhausted

Services Provided to Passport to Health Members

Services That Require Prior Authorization

Discharge and Transfer

Split/Interim Billing

Incurment

Submitting a Claim

Remittance Advices and Adjustments

How Payment Is Calculated

Overview

Charge Cap

Status Indicator Codes

Payment for Specified Services

Immunizations
Transfers
Observation Services (ARM 37.86.3020)
Outpatient Clinic Services
Pass-Through Payments
Procedures Considered Inpatient Only by Medicare

Calculating Payment

How Payment is Calculated on TPL Claims
How Payment is Calculated on Medicare Crossover Claims
Payment Examples for Dually Eligible Members

Other Programs

Appendix A: Forms

Definitions and Acronyms

Index

End of Table of Contents Chapter

Key Contacts and Key Websites

Key Contacts and Websites

See the Contact Us link in the menu on the Provider Information website for a list of key contacts and websites.

End of Key Contacts and Websites Chapter

Introduction

Thank you for your willingness to serve members of the Montana Healthcare Programs program and other medical assistance programs administered by the Department of Public Health and Human Services.

Manual Organization

This manual provides information specifically for Critical Access Hospitals (CAHs). Most chapters have a section titled Other Programs that includes information about other Department programs such as the Mental Health Services Plan (MHSP) and Healthy Montana Kids (HMK). Additional information for providers is contained in the separate General Information for Providers manual. Providers are responsible for reviewing both manuals.

A table of contents and an index allows providers to quickly find answers to most questions. The margins contain important notes with extra space for writing notes. There is a list of contacts and websites on the Contact Us page on the Provider Information website. There is space on the inside of the front cover to record your NPI/API for quick reference when calling Provider Relations.

Manual Maintenance

Changes to manuals are provided through provider notices and replacement pages. When replacing a page in a paper manual, file the old page and notice in the back of the manual for use with claims that originated under the old policy.

Providers are responsible for knowing and following current Montana Healthcare Programs rules and regulations.

Rule References

Providers must be familiar with all current rules and regulations governing the Montana Healthcare Programs program. Provider manuals are to assist providers in billing Montana Healthcare Programs; they do not contain all Montana Healthcare Programs rules and regulations. Rule citations in the text are a reference tool; they are not a summary of the entire rule. In the event that a manual conflicts with a rule, the rule prevails. Links to rules are available on the Provider Information website. Paper copies of rules are available through the Secretary of State’s office. See the Contact Us link in the left menu on the Provider Information website.

In addition to the general Montana Healthcare Programs rules outlined in the General Information for Providers manual, the following rules and regulations are also applicable to the Hospital Inpatient and Outpatient programs:

Code of Federal Regulations (CFR)
- 42 CFR 440.10 Inpatient Hospital Services, Other than Services in an Institution for Mental Disease
- 42 CFR 440.20 Outpatient Hospital Services and Rural Health Clinic Services
Montana Codes Annotated (MCA)
- MCA 50-5-101 – MCA 50-5-1205 Hospitals and Related Facilities
Administrative Rules of Montana (ARM)
- ARM 37.86.2801 – ARM 37.86.3025 Hospital Services
- ARM 37.106.704 Standards for Critical Access Hospitals

Claims Review (MCA 53-6-111, ARM 37.85.406)

The Department is committed to paying Montana Healthcare Programs providers’ claims as quickly as possible. Montana Healthcare Programs claims are electronically processed and usually are not reviewed by medical experts prior to payment to determine if the services provided were appropriately billed. Although the computerized system can detect and deny some erroneous claims, there are many erroneous claims it cannot detect. For this reason, payment of a claim does not mean the service was correctly billed or the payment made to the provider was correct. Periodic retrospective reviews are performed that may lead to the discovery of incorrect billing or incorrect payment. If a claim is paid and the Department later discovers the service was incorrectly billed or paid or the claim was erroneous in some other way, the Department is required by federal regulation to recover any overpayment, regardless of whether the incorrect payment was the result of Department or provider error or other cause.

Getting Questions Answered

The provider manuals are designed to answer most questions; however, questions may arise that require a call to a specific group (such as a program officer, Provider Relations, or a prior authorization unit). See the Contact Us link on the Provider Information website for a list of contacts.

Montana Healthcare Programs manuals, provider notices, replacement pages, fee schedules, forms, and more are available on the Provider Information website.

End Introduction Chapter

Covered Services

General Coverage Principles

Montana Healthcare Programs covers hospital services when they are medically necessary. This chapter provides covered services information that applies specifically to inpatient and outpatient hospital services provided by CAHs. Like all healthcare services received by Montana Healthcare Programs members, these services must also meet the general requirements listed in the Provider Requirements chapter of the General Information for Providers manual.

Hospital Inpatient Services (ARM 37.86.2901–2947)
Inpatient hospital services are provided to Montana Healthcare Programs members who are formally admitted as an inpatient and whose expected hospital stay is greater than 24 hours. Inpatient services must be ordered by a licensed physician, dentist, or other practitioner and provided in an institution maintained primarily for treatment and care of members with disorders other than tuberculosis or mental diseases. The institution must be currently licensed as an acute care hospital by the designated state licensing authority in the state where the institution is located, must meet the requirements for participation in Medicare as a hospital, and must have in effect a utilization review plan that meets the requirements of 42 CFR 482.30, or provide inpatient psychiatric hospital services for individuals under age 21 according to ARM 37.88.1101–1119.

Hospital Outpatient Services (ARM 37.86.3001–3025)
Outpatient hospital services are provided to members whose expected hospital stay is less than 24 hours. Outpatient hospital services include preventive, diagnostic, therapeutic, rehabilitative, or palliative services provided by or under the direction of a physician, dentist, or other practitioner as permitted by federal law. Hospitals must meet all of the following criteria:

Licensed or formally approved as a hospital by the officially designated authority in the state where the institution is located; and
Meet the requirements for participation in Medicare as a hospital.

Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Services (ARM 37.86.2201–2235)
The EPSDT Well-Child program covers all medically necessary services for children age 20 and under. Providers are encouraged to use a series of screening and diagnostic procedures designed to detect diseases, disabilities, and abnormalities in the early stages. Some services are covered for children that are not covered for adults, such as:

Nutritionist services
Private duty nursing
Respiratory therapy
Therapeutic family and group home care
Substance dependency inpatient and day treatment services
School-based services

All prior authorization and Passport approval requirements must be followed. See the Prior Authorization chapter in the General Information for Providers manual, the Prior Authorization Information page on the Provider Information website, and the Passport to Health manual.

For more information about the recommended well-child screen and other components of EPSDT, refer to the EPSDT Well-Child chapter in the General Information for Providers manual.

Importance of Fee Schedules
The easiest way to verify coverage for a specific service is to check the Department’s fee schedule for your provider type. In addition to being listed on the fee schedule, all services provided must also meet the coverage criteria listed in the Provider Requirements chapter of the General Information for Providers manual and in this chapter. Use the fee schedule in conjunction with the more detailed coding descriptions listed in the CPT, ICD, and HCPCS coding books that pertain to the date of service. Fee schedules are available on the Provider Information website. CAHs should refer to the hospital inpatient and outpatient fee schedules for coverage information. Fee schedules for CAHs provide coverage information only; they do not provide reimbursement information.

Physician Attestation and Acknowledgment (ARM 37.86.2904)

At the time a claim is submitted, the hospital must have a signed and dated acknowledgment on file from the attending physician that the physician has received the following notice:

Notice to physicians: Montana Healthcare Programs payment to hospitals is based on all of each member’s diagnoses and the procedures performed on the member, as attested to by the member’s attending physician by virtue of his or her signature in the medical record. Anyone who misrepresents, falsifies or conceals essential information required for payment of federal funds, may be subject to fine, imprisonment or civil penalty under applicable federal laws.

The acknowledgment must be completed by the physician at the time that the physician is granted admitting privileges at the hospital; or before or at the time the physician admits his/her first member to the hospital. Existing acknowledgments signed by physicians already on staff remain in effect as long as the physician has admitting privileges at the hospital. The provider may, at his/her discretion, add to the language of this statement the word Medicare so that two separate forms will not be required by the provider to comply with both state and federal requirements.

Utilization Reviews (42 CFR 456)

The Department or its contractor may at any time review paid claims, provider documentation for medical necessity, appropriate billing, etc. Providers must maintain documentation of medical necessity for services such as initial hospitalization, transfers, and readmissions. For more information on provider requirements for maintaining documentation, see the Record Keeping section in the Provider Requirements chapter of the General Information for Providers manual. Also see the Claims Review section in the Introduction chapter of this manual.

Nursing Facility Placement (ARM 37.40.202)

Hospitalized Montana Healthcare Programs members and Montana Healthcare Programs applicants being considered for nursing facility placement from the hospital shall be referred in a timely manner to the preadmission screening team.

The preadmission screening (Form DPHHS-SLTC-61) must be completed before placement and payment is made on their behalf.

For information on requesting a Level I and/or Level of Care screen, see the Mountain-Pacific Quality Health entry on the Contact Us page on the Provider Information the Provider Information website.

Coverage of Specific Services (ARM 37.86.2902)

The following are coverage rules for specific inpatient and outpatient hospital services. Services are for both inpatient and outpatient hospitals unless designated an inpatient-only or outpatient-only service. Except as otherwise permitted by federal law, inpatient hospital services must be ordered by a physician or dentist licensed under state law. For inpatient hospital services, the following routine services are included in the stay; they cannot be billed separately:

Bed and board;
Nursing services and other related services;
Use of hospital facilities;
Medical social services;
Drugs, biologicals, supplies, appliances, and equipment;
Other diagnostic or therapeutic items, or services provided in the hospital and not specifically excluded in ARM 37.85.207 (See the Non-Covered Services section in this chapter.); and
Medical or surgical services provided by interns or residents-in-training in hospitals with teaching programs approved by the Council on Medical Education of the American Medical Association, the Bureau of Professional Education of the American Osteopathic Association, the Council on Dental Education of the American Dental Association, or the Council on Podiatry Education of the American Podiatry Association.

Abortions (ARM 37.86.104)
Coverage of physician services for abortions is limited as follows:

The life of the mother will be endangered if the fetus is carried to term.
The pregnancy is the result of an act of rape or incest.
The abortion is determined by the attending physician to be medically necessary, even if the member’s life is not endangered if the fetus is carried to term.

Physician services for abortions in a case of endangerment of the mother’s life must meet the following requirements to receive Montana Healthcare Programs reimbursement:

The physician must find, and certify in writing, that in the physician’s professional judgment, the life of the mother will be endangered if the fetus is carried to term. The certification must contain the name and address of the member and must be on or attached to the Montana Healthcare Programs claim.

Physician services for abortions in cases of pregnancy resulting from an act of rape or incest must meet the following requirements to receive Montana Healthcare Programs reimbursement:

The member certifies in writing that the pregnancy resulted from an act of rape or incest; and
The physician certifies in writing either that:
- The recipient has stated to the physician that she reported the rape or incest to a law enforcement or protective services agency having jurisdiction over the matter, or if the recipient is a child enrolled in a school, to a school counselor; or
- In the physician’s professional opinion, the recipient was and is unable for physical or psychological reasons to report the act of rape or incest.

A completed Physician Certification for Abortion Services (MA-37) form must be submitted with every abortion claim or payment will be denied. This form is the only form Montana Healthcare Programs accepts for abortion services. Complete only one section. See the Provider Information website for instructions.

When using mifepristone (Mifeprex or RU 486) to terminate a pregnancy, it must be administered within 49 days from the beginning of the last menstrual period by or under the supervision of a physician who:

Can assess the duration of a pregnancy.
Can diagnose ectopic pregnancies.
Can provide surgical intervention in cases of incomplete abortion or severe bleeding, or can provide such care through other qualified physicians.
Can assure access to medical facilities equipped to provide blood transfusion and resuscitation.
Has read, understood and explained to the member the prescribing information for mifepristone.

Air Transports
Air transport providers must be registered with Montana Healthcare Programs as an ambulance provider. Claims for these services are billed on a CMS-1500 claim form. See the Ambulance Services manual available on the Provider Information website.

Chemical Dependency Treatment
Chemical dependency services are limited. Providers must be approved by the Department before providing this service. Contact the Chemical Dependency Bureau for more information.

Detoxification
Services may be covered if the authorization contractor determines that the member has a concomitant condition that must be treated in an inpatient hospital setting, and the detoxification treatment is a necessary adjunct to the treatment of the concomitant condition.

Diabetes Education
Montana Healthcare Programs covers diabetes education services for members who have been newly diagnosed with diabetes and/or members with unstable diabetes (e.g., members with long-term diabetes now experiencing management problems). The diabetes education protocol must meet the following Medicare Part A requirements:

The program must train and motivate the member to self-manage their diabetes through proper diet and exercise, blood glucose self-monitoring, and insulin treatment.
The plan of treatment must include goals for the member and how they will be achieved, and the program duration must be sufficient to meet these goals.
The physician must refer only his/her members to the program.
The program must be provided under the physician’s order by the provider’s personnel and under medical staff supervision.
The education plan must be designed specifically for the member to meet his/her individual needs. Structured education may be included in the plan, but not substituted for individual training.

Discharges
A hospital’s utilization review (UR) committee must comply with the Code of Federal Regulations (42 CFR 456.131–137) prior to notifying a Montana Healthcare Programs member that he/she no longer needs medical care. The hospital is not required to obtain approval from Montana Healthcare Programs at the member’s discharge; however, a hospital’s UR plan must provide written notice to Montana Healthcare Programs if a member decides to stay in the hospital when it is not medically necessary. See the section titled Hospital Services Beyond Medical Necessity in the Billing Procedures chapter of this manual.

Donor Transplants
Montana Healthcare Programs covers harvesting from organ donors and transplants, but does not cover expenses associated with the donor search process.

Elective Deliveries
Effective July 1, 2014, all facilities must have a “hard-stop” policy in place regarding non-medically necessary inductions prior to 39 weeks and non-medically necessary Cesarean sections at any gestational age. The policy must contain the following:

No non-medically necessary inductions and Cesarean sections prior to 39 weeks and 0/7 days gestation, and no non-medically necessary Cesarean sections at any gestational age.
Confirmation of weeks gestation by ACOG guidelines (at least one of the following guidelines must be met to show gestational age):
- Fetal heart tones have been documented for 20 weeks by non-electronic fetoscope or 30 weeks by Doppler;
- 36 weeks since a positive serum or urine pregnancy test that was performed by a reliable laboratory; or
- An ultrasound prior to 20 weeks that confirms the gestational age of at least 39 weeks.
If pregnancy care was not initiated prior to 20 weeks gestation, the gestational age may be documented from first day of the last menstrual period (LMP).
Policy must have a multistep review process prior to all inductions and Cesarean sections including final decision being made by the Perinatology Chair/Obstetrical Chair, OB Director, or Medical Director.

As of October 1, 2014, Montana Healthcare Programs reduced reimbursement rates for non-medically necessary inductions prior to 39 weeks, and non-medically necessary Cesarean sections at any gestational ages. All hospital claims with an admit date on or after October 1, 2014, require coding changes to delivery claims.

Hospital inpatient claims and birthing center claims will require the use of condition codes for all induction and Cesarean section deliveries. These claims will be reviewed for medical necessity based on an approved list of diagnosis codes. The condition codes are:

81 – Cesarean section or induction performed at less than 39 weeks gestation for medical necessity.
82 – Cesarean section or induction performed at less than 39 weeks gestation electively.
83 – Cesarean section or induction performed at 39 weeks gestation or greater.

Emergency Medical Services
Emergency services are services required to treat and stabilize an emergency medical condition.

Mental Health Services
Montana Healthcare Programs covers inpatient mental health services for Montana Healthcare Programs-enrolled members when prior authorized. Inpatient hospital services are not covered for adults enrolled in the Mental Health Service Plan (MHSP) or children enrolled in the Children’s Mental Health Service Plan (CMHSP). Some mental health services may not be billed separately. These services include:

Services provided by a psychologist who is employed or under a contract with a hospital.
Services provided for purposes of discharge planning as required by 42 CFR 482.21.
Services that are required as a part of licensure or certification, including but not limited to group therapy.

Mental health services provided by physicians and psychiatrists in an inpatient setting are the only services that can be billed separately. Providers should refer to the mental health manual available on the Provider Information website.

Observation Bed
Members in observation beds (admission of 24 hours or less) are considered outpatients, and claims should be filed accordingly.

Outpatient Cardiac and Pulmonary Rehabilitation
Effective July 1, 2014, services for procedure codes G0423, and G0424 must be prior authorized by Mountain-Pacific Quality Health.

Coverage for outpatient cardiac and pulmonary rehabilitation services must be medically necessary.

Members with one or more contraindications are not eligible for cardiac and pulmonary rehabilitation. The following conditions are contraindications to cardiac pulmonary rehabilitation.

Severe psychiatric disturbance including, but not limited to, dementia and organic brain syndrome; or
Significant or unstable medical conditions including, but not limited to, substance abuse, liver dysfunction, kidney dysfunction, and metastatic cancer.

Cardiac Rehabilitation
Services are limited to the following:

Cardiac rehabilitation services are limited to a maximum of two 1-hour sessions per day and limited to the following cardiac events and diagnoses:
- Myocardial infarction within the preceding 12 months;
- Coronary artery bypass surgery;
- Heart-lung transplant;
- Current stable angina pectoris;
- Percutaneous transluminal coronary angioplasty (PTCA) or coronary stenting;
- Heart valve repair or replacement; and
- Chronic stable heart failure.

Pulmonary Rehabilitation

A maximum of two 1-hour sessions per day for members with moderate to severe COPD (defined as GOLD classification II, III, and IV).
If applicable, the member must have ceased smoking or be in a smoking cessation class.

The following pulmonary rehabilitation services are not covered:

Education, treatment, and therapies that are no individualized to a specific member need or are not an integral part of the treatment session;
Routine psychological screening and treatment where intervention is not indicated;
Films/videos;
Duplicate services;
Maintenance care when there is no expectation of further improvement;
Treatment that is not medically necessary because the member requires a general strengthening and endurance program only; and
Treatment that is not medically necessary because the member is at an early state of pulmonary disease as demonstrated by a lack of significant findings in diagnostic testing.

Outpatient Clinic Services

The Department will pay for service provided in an outpatient clinic. Outpatient clinics that are within or outside the hospital walls are considered independent clinics by Montana Healthcare Programs.

Clinic services provided by an individual physician or mid-level practitioner in the outpatient clinic must be billed on a CMS-1500 with place of service (POS) 11.

Partial Hospitalization
The partial hospitalization program is an active treatment program that offers therapeutically intensive, coordinated, structured clinical services. These services are provided only to members who are determined to have a serious emotional disturbance (SED) or a severe disabling mental illness (SDMI). Definitions for SED and SDMI are on the Provider Information website on the Definitions and Acronyms webpage. Partial hospitalization services are time-limited and provided within either an acute level program or a sub-acute level program. Partial hospitalization services include day, evening, night and weekend treatment programs that employ an integrated, comprehensive and complementary schedule of recognized treatment or therapeutic activities. These services require prior authorization. For more information, see the mental health manual, available on the Provider Information website.

Services Provided by Interns or Residents-in-Training (ARM 37.86.2902)
Montana Healthcare Programs covers medical or surgical services provided by interns or residents-in-training only when they are provided in hospitals with teaching programs approved by one of the following:

Council on Medical Education of the American Medical Association
Bureau of Professional Education of the American Osteopathic Association
Council on Dental Education of the American Dental Association
Council on Podiatry Education of the American Podiatry Association

Sterilization (ARM 37.86.104)
Elective Sterilization
Elective sterilizations are sterilizations done for the purpose of becoming sterile. Montana Healthcare Programs covers elective sterilization for men and women when all of the following requirements are met:

Member must complete and sign the Informed Consent to Sterilization (MA-38) form at least 30 days, but not more than 180 days, prior to the sterilization procedure. This form is the only form Montana Healthcare Programs accepts for elective sterilizations. If this form is not properly completed, payment will be denied. See the Forms page on the Provider Information website for the form and instructions for completing.
Member must be at least 21 years of age when signing the form.
Member must not have been declared mentally incompetent by a federal, state, or local court, unless the member has been declared competent to specifically consent to sterilization.
Member must not be confined under civil or criminal status in a correctional or rehabilitative facility, including a psychiatric hospital or other correctional facility for the treatment of the mentally ill.

The 30-day waiting period may be waived for either of the following reasons:

Premature Delivery. The Informed Consent to Sterilization must be completed and signed by the member at least 30 days prior to the estimated delivery date and at least 72 hours prior to the sterilization.
Emergency Abdominal Surgery. The Informed Consent to Sterilization form must be completed and signed by the member at least 72 hours prior to the sterilization procedure.

All forms required for sterilizations can be downloaded from the Provider Information website,

Before performing a sterilization, the following requirements must be met:

The member must have the opportunity to have questions regarding the sterilization procedure answered to his/her satisfaction.
The member must be informed of his/her right to withdraw or withhold consent anytime before the sterilization without being subject to retribution or loss of benefits.
The member must be made aware of available alternatives of birth control and family planning.
The member must understand the sterilization procedure being considered is irreversible.
The member must be made aware of the discomforts and risks which may accompany the sterilization procedure being considered.
The member must be informed of the benefits and advantages of the sterilization procedure.
The member must know that he/she must have at least 30 days to reconsider his/her decision to be sterilized.
An interpreter must be present and sign for those members who are blind, deaf, or do not understand the language to assure the person has been informed.

Informed consent for sterilization may not be obtained under the following circumstances:

If the member is in labor or childbirth.
If the member is seeking or obtaining an abortion.
If the member is under the influence of alcohol or other substance which affects his/her awareness.

Medically Necessary Sterilization
When sterilization results from a procedure performed to address another medical problem, it is considered a medically necessary sterilization. These procedures include hysterectomies, oophorectomies, salpingectomies and orchiectomies.

Every claim submitted to Montana Healthcare Programs for a medically necessary sterilization must be accompanied by one of the following:

A completed Montana Healthcare Programs Hysterectomy Acknowledgement form (MA-39) for each provider submitting a claim. It is the provider’s responsibility to obtain a copy of the form from the primary or attending physician. Complete only one section (A, B, or C) of this form. When no prior sterility (Section B) or life-threatening emergency (Section C) exists, the member (or representative, if any) and physician must sign and date Section A of this form prior to the procedure (see 42 CFR 441.250 for the federal policy on hysterectomies and sterilizations). Also, for Section A, signatures dated after the surgery date require manual review of medical records by the Department. The Department must verify that the member (and representative, if any) was informed orally and in writing, prior to the surgery, that the procedure would render the member permanently incapable of reproducing. The member does not need to sign this form when Sections B or C are used. See the Forms page on the Provider Information website for detailed instructions on completing the form.
For members who have become retroactively eligible for Montana Healthcare Programs, the physician must certify in writing that the surgery was performed for medical reasons and must document one of the following:
- The member was informed prior to the hysterectomy that the operation would render the member permanently incapable of reproducing.
- The reason for the hysterectomy was a life-threatening emergency.
- The member was already sterile at the time of the hysterectomy and the reason for prior sterility. When submitting claims for retroactively eligible members for which the date of service is more than 12 months earlier than the date the claim is submitted, contact the member’s local Office of Public Assistance and request a Notice of Retroactive Eligibility (160-M). Attach the form to the claim. Claims without the 160-M will not be paid.

Therapy Services
Physical, occupational, and speech/language therapy services are available to Montana Healthcare Programs members. See the Therapy Services manual for more information.

Transfers
All transfers are subject to review for medical necessity. The initial hospitalization, all subsequent hospitalizations, and the medical necessity for the transfer itself may be reviewed. For information on billing and payment for transfers, see the Billing Procedures and How Payment Is Calculated chapters in this manual.

Transplants (ARM 37.86.4701–37.86.4706)
Prior authorization is required for all transplant services. See the Prior Authorization Information page on the Provider Information website. Montana Healthcare Programs covers only the following organ and tissue transplantation services:

Organ transplantation includes the transplant surgery and those activities directly related to the transplantation. These activities must be performed at a Medicare approved transplant facility and may include:

Evaluation of the member as a potential transplant candidate.
Pre-transplant preparation including histocompatibility testing procedures.
Post-surgical hospitalization.
Outpatient care, including Federal Drug Administration (FDA) approved medications deemed necessary for maintenance or because of resulting complications.

Tissue transplantation includes only corneal, bone marrow, and peripheral stem cell transplants. Providers should refer to ARM 37.86.4705 for more information on the coverage of transplant services.

Non-Covered Services (ARM 37.85.207 and 37.86.2902)
The following is a list of services not covered by Montana Healthcare Programs. Some of these services may be covered under the EPSDT program for children age 20 and younger based on medical necessity or for individuals covered under the Qualified Medicare Beneficiary (QMB) program. See the Member Eligibility and Responsibilities chapter in the General Information for Providers manual.

Other Programs

This is how the information in this chapter applies to Department programs other than Montana Healthcare Programs.

Mental Health Services Plan (MHSP)
This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

Healthy Montana Kids (HMK)
The information in this chapter does not apply to HMK members. Hospital services for children with HMK coverage are covered by Blue Cross and Blue Shield of Montana (BCBSMT). For more information, contact BCBSMT at 1-800-447-7828. Information about HMK is available on the HMK website.

End of Covered Services Chapter

Passport to Health Program

See the Passport to Health manual for information on the Passport program. The manual is found on the Passport to Health page on the Provider Information website and on applicable provider type pages.

End of Passport to Health Program Chapter

Prior Authorization

What is Prior Authorization (ARM 37.86.2801)

In addition to the requirements in the General Information for Providers manual, the following is specific to CAHs.

Whether the member is enrolled in Passport or Team Care, the eligibility information denotes the member’s PCP. Services are only covered when they are provided or approved by the designated Passport provider or Team Care pharmacy shown in the eligibility information. Specific services may require both prior authorization and Passport referral. To be covered by Montana Healthcare Programs, all services must also be provided in accordance with the requirements listed in this manual.

When seeking prior authorization, keep in mind the following:

The referring provider should initiate all authorization requests.
Always refer to the Montana Healthcare Programs fee schedule that corresponds with the dates of service to verify whether prior authorization is required for the services.
When requesting prior authorization for members with partial eligibility, request prior authorization from the first date the member was Montana Healthcare Programs eligible, not the first date of the member’s hospital stay.
The Prior Authorization Criteria for Specific Services table on the Prior Authorization Information webpage lists services that require prior authorization, who to contact for authorization, and documentation requirements. See the Prior Authorization Information link in the left menu on the Provider Information website.
Have all required documentation included in the packet before submitting a prior authorization request. See the Prior Authorization Information link in the left menu on the Provider Information website.
When prior authorization is granted, providers will receive notification containing a prior authorization number. This prior authorization number must be included on the claim.
The hospital can document that at the time of admission it did not know, or have any basis to assume that the member was a Montana Montana Healthcare Programs member.

Prior Authorization for Specific Services

See the Prior Authorization Information link in the left menu on the Provider Information website. The webpage includes contact information and document requirements for prior authorization for specific services.

End of Prior Authorization Chapter

Coordination of Benefits

When a Member Has Other Coverage

See the General Information for Providers manual for additional information.

When a Member Has TPL (ARM 37.85.407)

See the General Information for Providers manual for additional information.

Other Programs

This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

The information in this chapter does not apply to members enrolled in Healthy Montana Kids (HMK). The HMK medical manual is available through Blue Cross and Blue Shield of Montana at 1-800-447-7828.

End of Coordination of Benefits Chapter

Billing Procedures

Using the Montana Healthcare Programs Fee Schedule

When billing Montana Healthcare Programs, it is important to use the Department’s fee schedule for your provider type in conjunction with the detailed coding descriptions listed in the current CPT and HCPCS coding books. In addition to covered services and payment rates, fee schedules often contain helpful information such as appropriate modifiers. Fee schedules are available on the Provider Information website.

Place of Service

Place of service must be entered correctly on each line. Montana Healthcare Programs typically reduces payment for services provided in hospitals and ambulatory surgical centers since these facilities typically bill Montana Healthcare Programs separately for facility charges.

For a list of place of service codes for professional claims, see the link under Coding/Place of Service Codes at http://www.cms.gov/Medicare/Medicare.html.

Date of Service

The date of service for custom molded or fitted items is the date upon which the provider completes the mold or fitting and either orders the equipment from another party or makes an irrevocable commitment to the production of the item.

Rental

Payment includes the entire initial month of rental even if actual days of use are less than the full month. Payment for second or subsequent months is allowed only if the item is used at least 15 days in such months.

Reference Laboratory Services - Outpatient Hospital and Critical Access Hospital (CAH) Billing for Laboratory Services

Montana Healthcare Programs allows Outpatient Hospitals and Critical Access Hospitals (CAH) to bill for reference laboratory services. If the Outpatient Hospital or CAH refers laboratory services to any outside laboratory and outpatient hospital or CAH bills Montana Healthcare Programs for those laboratory services, the outpatient hospital or CAH must use modifier 90 to indicate reference laboratory services. It is the responsibility of the hospital or CAH to ensure the reference laboratory meets the Clinical Laboratory Improvement (CLIA) certification criteria for the type and laboratory services performed. In addition, be sure that the CLIA certificate is in effect for the date of service laboratory tests are performed. If not, Montana Health Programs is entitled to recover reimbursement made for the reference laboratory services.

Labs provided to members residing in a Psychiatric Residential Treatment Facility (PRTF).

There are instances when laboratory work related to treating the psychiatric condition is included in the bundled per diem rate for in-state PRTFs (ARM 37.87.1223(3)(d). In those instances, the laboratory services provided by the hospital is not able to be separately billed. The hospital would need to work with the PRTF and/or Children’s Mental Health Bureau.

State Laboratory billing

In order for the State Laboratory to appropriately bill Montana Healthcare Programs, providers must indicate Montana Healthcare Program eligibility and include the members ID on the Public Health Laboratory Request Form.

Outpatient Laboratory Billing

Effective January 1, 2017, modifier L1 associated with the reporting of conditionally packaged laboratory procedures will be deactivated. The modifier will no longer override the packaging of laboratory codes that are billed with other payable Outpatient Prospective Payment System (OPPS) procedures. Laboratory procedures are only payable under OPPS when the lab codes are the only payable codes on the claim, or when the Type of Bill (TOB) is 141 (Hospital, Other, Admit through Discharge) for non-patient laboratory tests.

Note: Some lab codes (e.g., molecular pathology codes) are not subject to the conditional packaging logic.

Billing Unlisted Services or Procedures

Providers should use the most specific HCPCS code when billing a service or procedure to enable proper reimbursement. In the event an unlisted service or procedure code must be used, Montana Healthcare Programs urges providers to send medical records with the claim. Reviewing the medical records with the claim allows the claims processing personnel to understand the situation and apply appropriate reimbursement, as well as decreases claims processing time. Medical records can be sent with electronic claims through the use of the paperwork attachment.

Billing Electronically with Paper Attachments

When submitting claims that require additional supporting documentation, the Attachment Control Number field must be populated with an identifier. Identifier formats can be designed by software vendors or clearinghouses, but the preferred method is the provider's Montana Healthcare Programs ID number followed by the member's ID number and the date of service, each separated by a dash.

The supporting documentation must be submitted with a Paperwork Attachment Cover Sheet. The number in the paper Attachment Control Number field must match the number on the cover sheet.
CMS provides the following guidance regarding reimbursement for unlisted services or procedures:

Under the OPPS, CMS generally assigns the unlisted service or procedure codes to the lowest level APC within the most appropriate clinically related series of APCs. Payment for items reported with unlisted codes is often packaged.

End of Billing Procedures Chapter

Submitting a Claim

The services described in this manual are billed on UB-04 claim forms. Use this chapter with the UB-04 claim instructions on the Provider Information website.

Claims submitted with all of the necessary information are referred to as clean and are usually paid in a timely manner. (See the Billing Procedures chapter in the General Information for Providers manual.)

End of Submitting a Claim Chapter

Remittance Advices and Adjustments

See the General Information for Providers manual for information on remittance advices and adjustments.

End of Remittance Advice and Adjustments Chapter

How Payment Is Calculated

Overview

Although providers do not need the information in this chapter to submit claims to Montana Healthcare Programs, the information allows providers to understand how payment is calculated and to predict approximate payment for particular claims.

CAHs are reimbursed for their costs of providing care, as determined through the annual cost settlement process. In the interim, these hospitals are paid a hospital-specific percentage of their charges. The percentage equals the hospital’s estimated cost-to-charge ratio as determined from time-to-time by the Department. The percentage includes payments for medical education and capital expenses.

Charge Cap

For services covered in the hospital setting, Montana Healthcare Programs pays a cost to charge ratio, not the lower of the Montana Healthcare Programs fee or the provider’s charge. The charge cap is not applied.

Status Indicator Codes

The code set used by DPHHS is based on the code set used by Medicare but with several additions. See the following table of status indicator codes.

Status Indicator Codes Used by DPHHS

Code - Description - Origin

W - Excluded service - DPHHS
G - Drug/biological under trans. pass-through - Medicare
H - Device under trans. pass-through - Medicare
J - New drug/biological under trans. pass-through - Medicare
N - Incidental services (bundled) - Medicare
T - Surgical services - Medicare
C - Inpatient services - Medicare
K - Non-pass-through drugs and biologicals - Medicare
S - Significant procedures - Medicare
X - Ancillary service - Medicare
V - Medical visit
B - Services not paid under OPPS - Medicare
P - Partial hospitalization - Medicare
Q - Clinical lab - DPHHS
Y - Therapy - DPHHS
M - Misc. codes - DPHHS

Payment for Specific Services

Immunizations
If the member is under 19 years old and the vaccine is available to providers for free under the Vaccines for Children program, then the payment to the hospital is zero. Immunization administration is considered an incidental service. The claims processing system bundles immunization administration with other services on the claim and pays it at zero.

Transfers
When a member is transferred between two hospitals, the transferring and/or discharging hospitals are paid a hospital-specific cost to charge ratio for their services if they are CAHs.

Occasionally, a member is transferred from one hospital to another and then back to the original hospital when the condition causing the transfer is alleviated. Thus a hospital can be a transferring and discharging hospital. The discharging hospital should submit separate claims, one for the original admission and transfer and a second for the final discharge.

Observation Services (ARM 37.86.3020)
DPHHS follows the Medicare program, with the exception of obstetric complications, in making separate payment for observation care procedure codes if the following criteria are met.

Observation time must be documented in the medical record.
The number of units reported must equal or exceed eight hours.

In addition, the claim for observation must include one of the following services to the reported observation:

High level emergency department visit; or
High level clinic visit; or
High level critical care; or
Direct admit for observation care after being seen by a healthcare provider on the same date of service as the date reported for observation services.

The Department will also pay for observation care in a case with the potential obstetric complications if the following criteria are met:

Must have a qualifying diagnosis; and
Must be at least one hour in length of service.

If an observation service does not meet the criteria according to the above, then payment for observation care is considered bundled into the payment for other services.

Outpatient Clinic Services

Clinic services provided by an individual physician or mid-level practitioner in the outpatient clinic must be billed on a CMS-1500 with place of service (POS) 11.

Pass-Through Payments
Payments for certain drugs, devices and supplies are designated as pass-through and paid a hospital-specific cost-to-charge ratio.

Procedures Considered Inpatient Only by Medicare
Medicare has designated some procedures as inpatient-only. Montana Healthcare Programs has also adopted that designation. When these procedures are performed in the outpatient hospital setting, the claim is denied. Hospitals may appeal the denial to the Department. If the service is approved, the claim will be paid.

Calculating Payment

The sections below explain how to calculate payment for claims involving Medicare or third party liability.

How Payment Is Calculated on TPL Claims
When a member has coverage from both Montana Healthcare Programs and another insurance company, the other insurance company is often referred to as third party liability (TPL). In these cases, the other insurance is the primary payer, and Montana Healthcare Programs makes a payment as the secondary payer. Montana Healthcare Programs will make a payment only when the TPL payment is less than the Montana Healthcare Programs allowed amount. See the When a Member Has TPL section in the General Information for Providers manual.

How Payment Is Calculated on Medicare Crossover Claims
When a member has coverage from both Medicare and Montana Healthcare Programs, Medicare is the primary payer. Montana Healthcare Programs will pay the coinsurance and deductible, less any TPL or incurment, on hospital claims for these dually eligible individuals.

Payment Examples for Dually Eligible Members
Member has Medicare and Montana Healthcare Programs coverage. A provider submits an inpatient hospital claim for a member with Medicare and Montana Healthcare Programs. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. Montana Healthcare Programs will pay this amount ($250.00) as long as no TPL or incurment amounts are applicable.

Member has Medicare, Montana Healthcare Programs, and TPL. A provider submits an inpatient hospital claim for a member with Medicare, Montana Healthcare Programs, and TPL. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. The other insurance company paid $225.00. This amount is subtracted from the Montana Healthcare Programs allowed amount leaving $25.00. Montana Healthcare Programs pays $25.00 for this claim. If the TPL payment had been $250.00 or more, this claim would have paid at $0.00.

Member has Medicare, Montana Healthcare Programs, and Montana Healthcare Programs Incurment. A provider submits an inpatient hospital claim for a member with Medicare, Montana Healthcare Programs, and a Montana Healthcare Programs incurment. The Medicare coinsurance and deductible are $65.00 and $185.00. This total ($250.00) becomes the Montana Healthcare Programs allowed amount. The member owes $150 for his Montana Healthcare Programs incurment, so this amount is subtracted from the $250.00. Montana Healthcare Programs will pay the provider $100.00 for this claim.

Other Programs

This chapter does not apply to members who are enrolled in the Mental Health Services Plan (MHSP). Providers will find more information on mental health services in the mental health manual available on the Provider Information website.

The information in this chapter does not apply to members enrolled in Healthy Montana Kids (HMK). The HMK medical manual is available through Blue Cross and Blue Shield of Montana (BCBSMT) at 1-800-447-7828. Additional information about HMK is available on the HMK website.

End of How Payment Is Calculated Chapter

Appendix A: Forms

These forms and others are available on the Forms page on the Provider Information website.

Individual Adjustment Request
Physician Certification for Abortion Services (MA-37)
Informed Consent to Sterilization (MA-38)
Medicaid Hysterectomy Acknowledgment (MA-39)
Paperwork Attachment Cover Sheet

End of Appendix A: Forms Chapter

Definitions and Acronyms

See the Definitions and Acronyms page on the Provider Information website.

End of Definitions and Acronyms Chapter

Index

Previous editions of this manual contained an index.

This edition has three search options.

1.Search the whole manual. Open the Complete Manual pane. From your keyboard press the Ctrl and F keys at the same time. A search box will appear. Type in a descriptive or key word (for example "Denials". The search box will show all locations where denials discussed in the manual.

2.Search by Chapter. Open any Chapter tab (for example the "Billing Procedures" tab). From your keyboard press the Ctrl and F keys at the same time. A search box will appear. Type in a descriptive or key word (for example "Denials". The search box will show where denials discussed in just that chapter.

3.Site Search. Search the manual as well as other documents related to a particular search term on the Montana Healthcare Programs Site Specific Search page.

End of Index Chapter

End of Critical Access Hospital Manual

Critical Access Hospitals Manual

If you experience any difficulty opening a section or link from this page, please email the webmaster.

How to Search this manual:

Critical Access Hospitals (CAH) Manual

Update Log

Publication History

Update Log

Table of Contents

Key Contacts and Websites

Introduction

Covered Services

Passport to Health Program

Prior Authorization

Coordination of Benefits

Billing Procedures

Submitting a Claim

Remittance Advices and Adjustments

How Payment Is Calculated

Appendix A: Forms

Definitions and Acronyms

Index

Key Contacts and Websites

Introduction

Manual Organization

Manual Maintenance

Rule References

Claims Review (MCA 53-6-111, ARM 37.85.406)

Getting Questions Answered

Covered Services

General Coverage Principles

Physician Attestation and Acknowledgment (ARM 37.86.2904)

Utilization Reviews (42 CFR 456)

Nursing Facility Placement (ARM 37.40.202)

Coverage of Specific Services (ARM 37.86.2902)

Other Programs

Passport to Health Program

Prior Authorization

What is Prior Authorization (ARM 37.86.2801)

Prior Authorization for Specific Services

Coordination of Benefits

When a Member Has Other Coverage

When a Member Has TPL (ARM 37.85.407)

Other Programs

Billing Procedures

Using the Montana Healthcare Programs Fee Schedule

Place of Service

Date of Service

Rental

Reference Laboratory Services - Outpatient Hospital and Critical Access Hospital (CAH) Billing for Laboratory Services

Outpatient Laboratory Billing

Billing Unlisted Services or Procedures

Billing Electronically with Paper Attachments

Submitting a Claim

Passport Indicators

Passport to Health Indicators

Remittance Advices and Adjustments

How Payment Is Calculated

Overview

Charge Cap

Status Indicator Codes

Status Indicator Codes Used by DPHHS

Payment for Specific Services

Calculating Payment

Other Programs

Appendix A: Forms

Definitions and Acronyms

Index

Update Log

Publication History

Update Log

Table of Contents

Key Contacts and Websites

Introduction

Covered Services

Passport to Health Program

Prior Authorization

Coordination of Benefits

Billing Procedures

Submitting a Claim

Remittance Advices and Adjustments