CMS Proposes Changes to Medicare Part B Billing for Hospitals

CMS has proposed two rules that would pay for more hospital inpatient services under Medicare Part B when a Medicare Part A claim is denied.

The first rule would allow CMS to pay hospitals additional Part B payments when a Part A claim is denied because the Medicare patient should have been treated as an outpatient rather than inpatient. More specifically, Medicare would pay for all "reasonable and necessary Part B hospital inpatient services" if the patient had been treated as an outpatient instead of the current limit list of covered Part B hospital inpatient services.

The second rule relates to the "significant" number of pending appeals of Part A hospital inpatient reasonable and necessary denials from Recovery Auditors, formerly known as recovery audit contractors, according to CMS. CMS proposed a standardized process to handle pending appeals and billing for the additional Part B inpatient services.

CMS estimates the proposed rules would result in a $4.8 billion decrease in Medicare program expenditures over five years due to lower RAC appeals and other factors. In addition, CMS expects short-stay inpatient admissions to rise under the proposed rule since hospitals could rebill Part B without the expense of an appeal. However, hospitals would have to rebill Medicare within 12 months to get the additional payment.

To view a fact sheet on the proposed rules, click here. Comments for the proposed rule are due by May 17.

More Articles on CMS Proposed Rules:

HHS Issues Final Rule on PPACA's Essential Health Benefits
CMS Releases Proposed 2014 Payment Plan for Medicare Part D, Advantage
CMS Proposes Medicare Reforms to Save Hospitals $676M Per Year

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