Covered - Allowable - Billable TOP

Slide 1: Covered - Allowable - Billable September 20, 2006 Presented by Linda Dartt 207-589-3208 ldartt@fairpoint.net

Covered - Allowable - Billable TOP

Slide 2: Goals for this Session To understand: What is an RHC Covered Service Medicare Medicaid What is an RHC Allowable Service Medicare Medicaid What is an RHC Billable Service RHC Services Part B Services

Covered - Allowable - Billable TOP

Slide 3: Medicare Covered Services Medicare Covered Services Vary by Institutional Provider Type RHC IRHC PBRHC with Parent Hospital > 50 Beds and/or Not Rural Rural Hospital < 50 Beds CAH CHC/FQHC Hospital, CAH Home Health Agency Outpatient Department ASC Doctor's Office

Covered - Allowable - Billable TOP

Slide 4: Medicare Covered Services Medicare Covered Services Vary by (cont'd.) Individual Provider Type MD, PA, NP, HHN, HH Aide, CNM, CP, LCSW, EMT, Paramedic, etc. etc. Diagnosis Service Location Home Office Hospital SNF

Covered - Allowable - Billable TOP

Slide 5: Covered RHC Services Medicare RHC Core Services Medicaid Medicare RHC Core Services Other services & providers as the State wishes (i.e. LSACs, LPCs)

Covered - Allowable - Billable TOP

Slide 6: Core RHC Services Medicare RHC Core Services Definition Arose from Historical Goals of the RHC Program Deliver Primary & Preventive care in rural areas that were perpetually short of doctors To encourage PAs & NPs to practice in rural shortage areas by paying them the same amounts as if a Physician had delivered the service (There were few CNMs at the time.). PAs &NPs were allowed to provide services & bill Medicare for covered services only when a Physician was on-site. Payment for PAs & NPs was less than 100% of the amount a Physician would have received for providing that same service. NPs were providing services through visiting nurse programs, especially in the Southeast. Mostly, States & non-profits paid for their services.

Covered - Allowable - Billable TOP

Slide 7: Core RHC Services Medicare RHC Core Services Definition (cont'd) Became Law Through the RHC Act Allowed RHCs (rural primary care practices in areas with little or no physician coverage) to bill Medicare & Medicaid Allowed RHCs to receive interim payments at the average price for the practice to deliver a visit to a patient of any type with any or no insurance coverage, without regard to whether the Physician was present Assured that quality care would be provided to Medicare & Medicaid patients through a set of rules to govern RHCs (Interpretive Guidelines, "annual" survey, surveyor forms, Policy Manual, etc., etc., etc.

Covered - Allowable - Billable TOP

Slide 8: Core RHC Services Medicare-covered RHC = "Core" services 1977 Rural Health Clinics Act (PL 95-210) defined Core services Services of Primary care Physicians FP, General IM, GP, OB/GYN, Peds Services of PAs, NPs Services incident to* those primary care services * Incident To describes those "Incidental services & supplies" that are commonly part of a physician visit & not chargeable. Incidentals are not Billable. AIRR (All Inclusive Reimbursement Rate) -- average visit payment -- calculation includes the cost of incidentals through inclusion of non-chargeable office, dressings, bandages, overhead, nursing time, etc.

Covered - Allowable - Billable TOP

Slide 9: Core RHC Services Medicare-covered RHC = Core Services (cont'd) Early RHC was "Easy" Practice "primarily engaged in the delivery of primary care" Bill by Encounter/Visit Face-to-face visit between a Medicare beneficiary & an RHC provider for A medically necessary reason (documented) One patient, one date = Visit (exception for a new diagnosis)

Covered - Allowable - Billable TOP

Slide 10: Core RHC Services Medicare-covered RHC = "Core" services Amendments Added CNMs, CPs, LCSWs Services & supplies incident to* new RHC providers Endless "clarifying" Current definition of Core Services Physician services Deliver Primary Care (Present 1 day in each 2 weeks) Serve as Medical Director Provide State-required supervision of PAs, NPs & CNMs Services & supplies incident to physicians' services

Covered - Allowable - Billable TOP

Slide 11: Core RHC Services Current Definition of Core Services (cont'd) Services of PAs, NPs, CNMs Services & supplies furnished as incident to services provided by PAs, NPs, CNMs Visiting nurse services - limited to Home Health Shortage Areas Good Luck! CP & LCSW Services - Part B coverage limitations apply Services & supplies incident to services of CPs & LCSWs. RHC Core services can be provided at the practice, the patient's home, a boarding or nursing home, SNF, or at another health institution that is not a hospital.

Covered - Allowable - Billable TOP

Slide 12: Medicaid Covered Services Federally Required "Core" RHC Services Optional Medicaid-Covered Services, as defined by State law Medicaid Allowable Costs are Different in Each State Medicaid Billing Policy is Different in Each State

Covered - Allowable - Billable TOP

Slide 13: Allowable Costs Allowable is Cost Reporting Terminology Result from providing covered services Are reasonable in amount Necessary to efficiently deliver covered services Include direct costs (salaries, supplies ++) to provide covered services Include allocated portion of overhead (administration, facility ++)

Covered - Allowable - Billable TOP

Slide 14: Allowable RHC Costs Medicare Allowable Cost rules follow Medicare Benefit Policy Manual #100-02 http://www.cms.hhs.gov/Manuals/IOM/list.asp Medicare Allowable varies by Institutional provider type Individual provider type Medicare RHC Allowable Cost rules are in the RHC/FQHC Manual

Covered - Allowable - Billable TOP

Slide 15: Allowable RHC Costs (cont'd) Medicaid Allowable Policy follows State law & regulations Covered Services Billable Services Billing Methodology Co-payments Deductibles Minimum spending amounts

Covered - Allowable - Billable TOP

Slide 16: Non-Allowable Costs Include direct costs to deliver non-covered services Include allocated portion of non-direct costs, based on direct cost of non-covered services compared to direct cost of covered services Direct non-covered costs + Direct covered costs = Total Direct Costs Direct non-covered costs ÷ Total Direct costs = Percentage of Non-Direct costs to allocate to non-covered services Direct covered costs ÷ Total Direct costs = Percentage of Direct costs to allocate to covered services

Covered - Allowable - Billable TOP

Slide 17: Non-Allowable Costs Direct Costs & allocated non-direct costs of delivering non-covered services are excluded from allowable RHC cost used to calculate AIRR Ex: Patient transportation (not covered by Medicare, may be covered by Medicaid) Direct costs such as gas, maintenance, driver, ++ Indirect costs such as office space, telephone, ++

Covered - Allowable - Billable TOP

Slide 18: Billable RHC Services Encounters delivered by a Billable RHC Provider MD, DO, other State-recognized "physicians" PAs, NPs, CNMs CPs & LCSWs Visiting Nurses (in designated Home Health Shortage Areas) Clinical Psychologists (Medicare coverage limitations apply) Licensed Clinical Social Workers (Medicare Part B coverage limitations apply) For Covered Services ONLY

Covered - Allowable - Billable TOP

Slide 19: Billable RHC Services Billable Visits An RHC billable visit is "a face to face encounter between a patient and a… covered service provider…" All patient encounters will not be billable visits Exs: Lab or x-ray services, with no "face to face encounter" with a covered RHC provider, do not constitute an RHC visit & cannot, by themselves, generate a bill. All Lab services are billed to the Medicare Part B Carrier as Lab services are not considered RHC services, including the 6 mandatory laboratory services.

Covered - Allowable - Billable TOP

Slide 20: Non-Billable RHC Services Non-Billable "Visits" Billing an RHC encounter for refilling a prescription is specifically forbidden (RHC Manual, Part 4, Section 405.3) whether the patient sees a provider or not. Billing for refills is not covered. If the manual did not define this as non-covered & not billable, it wouldn't be because there is no medical necessity for the patient to see a billable RHC provider Theoretically, the direct & indirect costs of providing these services (reception, nurse, space, telephone ++) should be allocated to non-allowable costs because they belong to non-covered services. In reality, this is just part of the overhead of running a practice, which is why a percentage of overhead is allocated to covered & non-covered service costs when calculating the AIRR.

Covered - Allowable - Billable TOP

Slide 21: Non-Billable RHC Services Services delivered by telephone are not currently Billable, but stay tuned. Many telephone-delivered services are Covered & are therefore Allowable on the cost report Many telephone-delivered services are not Covered & are therefore Non-allowable Anything that does not involve A Face-to-Face Encounter with an RHC Billable Provider Medical Necessity for a Face-to-Face Encounter with the Patient Medical Judgment documented in the patient record

Covered - Allowable - Billable TOP

Slide 22: AIRR = Allowable Cost ÷ Billable Visits Cost-based reimbursement assumes Medicare & Medicaid will pay a fair share of total RHC costs to deliver covered services. Total reimbursement is based on the % of Medicare & Medicaid covered visits provided. Medicare sets & uses the AIRR to pay for each Billable visit Medicare pays 80% of the AIRR for Covered, Billable services because 80% is the patient benefit level for almost all Medicare-covered services AIRR is limited by cost-controlling factors such as productivity expectations & per visit payment caps (depending on parent provider type).

Covered - Allowable - Billable TOP

Slide 23: AIRR ⇒ Cost Settlement ⇒ AIRR At the end of each fiscal year, Medicare & the practice "settle" their bill Practice (or parent) submits a cost report on covered costs & visits. After applying limiting factors, Medicare (or the practice) pays the difference between total due total received through AIRR payments. The AIRR is reset, taking into account the current cap & the reported costs

Covered - Allowable - Billable TOP

Slide 24: Medicaid Currently, Medicaid uses the Medicare AIRR as a guide After including required & optional services, Medicaid decides how much to pay the RHC Must make interim payments (encounters) There are some limits Must pay a reasonable rate, based on cost, for Core services See www.medicare.gov Everything about Medicaid varies by State & it is evolving away from any consistency that existed at one time

Covered - Allowable - Billable TOP

Slide 25: Finally Make friends with the people who decide policies & oversee coverage & billing within your State government. Attend Hearings & Informational Meetings. Do NOT Be Afraid to Ask Questions. If you think you are too small to make a difference, try sleeping in a closed room with a mosquito. African Proverb

Covered - Allowable - Billable TOP

Slide 26: Acronyms Used in this Presentation + ASC = Ambulatory Surgical Center CAH = Critical Access Hospital CHC = Community Health Center (receives funding through HRSA - §330 of SSA) CNM = Certified Nurse Midwife CP = Clinical Psychologist EMT = Emergency Medical Technician FQHC = Federally Qualified Health Center Look Alike CHC HHA = Home Health Agency

Covered - Allowable - Billable TOP

Slide 27: Acronyms Used in this Presentation (cont'd.) HHN = Home Health Nurse HHA = Home Health Aide HMO = Health Maintenance Organization HRSA = Health Resources & Services Administration LCSW = Licensed Clinical Social Worker IM = Internal Medicine NP = Nurse Practitioner aka AP (Advanced Practice) RN, other Master's level, State-approved RN practitioners OPD = Hospital Outpatient Department (including CAH)

Covered - Allowable - Billable TOP

Slide 28: Acronyms Used in this Presentation (cont'd.) Paramedic = Someone trained, usually by military, to deliver high level, emergency & urgent care Currently mostly Ambulance Employees PA = Physician Assistant PPO = Preferred Provider Organization PoSP = Point of Service Plan RHC = Rural Health Clinic IRHC = Independent RHC PBRHC = Provider-Based RHC SNF = Skilled Nursing Facility SSA = Social Security Act