No. 28258 (Repeal and Reenact): R414-2A. Inpatient Hospital Services

DAR File No.: 28258
Filed: 09/26/2005, 04:59
Received by: NL

 

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rulemaking is necessary to clarify inpatient hospital services policy and to implement it in rule pursuant to recent legislation (H.B. 126 (2003)) found in Subsection 26-18-3(2)(a). (DAR NOTE: H.B. 126 (2003) is found at UT L 2003 Ch 324, and was effective 05/05/2003.)

 

Summary of the rule or change:

The new (reenacted) rule includes criteria for client eligibility not specified in the old rule. It also includes a section that specifies physician requirements for hospital admissions that are not contained in the old rule. Also, this rule specifically lists criteria for service coverage which states that the Department does not pay for physician services rendered by a non-Medicaid provider. In addition, the new rule includes language regarding Medicaid coverage under the Diagnosis Related Group (DRG), limitations for hyperbaric oxygen therapy, and specifies criteria for pain management, observation services, and diagnostic evaluation. Finally, this rule adds a reimbursement section that explains the reimbursement methodology for inpatient hospital services and the Department's reimbursement policy for inpatient admissions. The old rule lists the contractors that are assigned to provide inpatient psychiatric services to specified counties within the prepaid mental health plan, while the new rule does not specifically list this information. The old rule also contains language regarding limited service for cosmetic, reconstructive, or plastic surgery as well as language that limits inpatient hospital care for the treatment of alcoholism or drug dependency. The new rule does not list these services.

 

State statutory or constitutional authorization for this rule:

Sections 26-1-5 and 26-18-3, and 42 CFR 440.10

 

Anticipated cost or savings to:

the state budget:

There is no impact to the state budget associated with this rulemaking because the policy for inpatient hospital services is only clarified and implemented in rule pursuant to recent legislation found in Subsection 26-18-3(2)(a).

 

local governments:

There is no budget impact to local governments as a result of this rulemaking because the policy for inpatient hospital services is only clarified and implemented in rule pursuant to recent legislation found in Subsection 26-18-3(2)(a).

 

other persons:

There is no budget impact to other persons as a result of this rulemaking because the policy for inpatient hospital services is only clarified and implemented in rule pursuant to recent legislation found in Subsection 26-18-3(2)(a).

 

Compliance costs for affected persons:

There are no compliance costs because the policy for inpatient hospital services is only clarified and implemented in rule pursuant to recent legislation found in Subsection 26-18-3(2)(a).

 

Comments by the department head on the fiscal impact the rule may have on businesses:

This rule updates and simplifies the rules on inpatient hospital services. No changes to the program are reflected in the rule, therefore there should be no fiscal impact on regulated hospitals. David N. Sundwall, MD, Executive Director

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Health
Health Care Financing, Coverage and Reimbursement Policy
CANNON HEALTH BLDG
288 N 1460 W
SALT LAKE CITY UT 84116-3231

 

Direct questions regarding this rule to:

Craig Devashrayee at the above address, by phone at 801-538-6641, by FAX at 801-538-6099, or by Internet E-mail at [e-mail]

 

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/14/2005

 

This rule may become effective on:

11/15/2005

 

Authorized by:

David N. Sundwall, Executive Director

 

 

RULE TEXT

R414. Health, Health Care Financing, Coverage and Reimbursement Policy.

R414-2A. Inpatient Hospital Services.

[R414-2A-100. Authority and Purpose.

(1) This rule defines the scope of inpatient hospital benefits available for the care and treatment of Medicaid clients who meet the level of care criteria for admission to an acute-care general hospital for treatment of disorders other than mental disease.

(2) Inpatient hospital services are required under Section 1901 et seq. and Section 1905(a)(1) of the Social Security Act, and by 42 CFR 440.10 (October 1, 1991, edition).

(3) This rule is authorized by Sections 26-1-5, 26-1-15, and 26-18-6, and by Subsections 26-18-3(2) and 26-18-5(3) and (4) and by 42 CFR 447.15 and 447.50, Oct. 1, 2000 ed.

 

R414-2A-300. Program Access Requirements.

(1) Each hospital providing inpatient services must have a utilization review plan, as described in 42 CFR 482.30 (October 1, 1991, edition), which is incorporated by reference.

(2) The attending physician or other practitioner of the healing arts must sign a physician attestation statement that meets the requirements of 42 CFR 412.46 (October 1, 1991, edition), which is incorporated by reference.

(3) The attending physician must certify and recertify the need for inpatient care as described in 42 CFR 441.152 and 456.60 (October 1, 1991, edition), which are incorporated by reference.

(4) All hospital admissions are subject to review by the department for appropriateness and medical necessity as detailed in R414-2A.

(5) For purposes of reimbursement, the day of admission is counted as a full day; the day of discharge is not counted.

(6) When a patient receives SNF-level, ICF-level, or other sub-acute care in an acute-care hospital or in a hospital with swing-bed approval, payment shall be made at the SNF or ICF rate.

(7) Inpatient hospital psychiatric services are covered Medicaid services for clients who live in the counties identified in Table 1 only when such services are coordinated through the contractor identified for the specified county:

 

TABLE 1

I.    Counties:    Salt Lake County

                   Summit County

      Contractor:  Salt Lake Valley Mental Health,

                   Salt Lake City, Utah

II.   Counties:    Carbon County

                   Emery County

                   Grand County

      Contractor:  Four Corners Community Mental Health Center,

                   Price, Utah

III.  Counties:    Beaver County

                   Garfield County

                   Kane County

                   Iron County

                   Washington County

      Contractor:  Southwest Utah Mental Health Center,

                   St. George, Utah

 

R414-2A-400. Services.

(1) Inpatient hospital services encompass all medically necessary and therapeutic Medicaid services and supplies that are ordered by a physician or other practitioner of the healing arts and are appropriate for the adequate diagnosis and treatment of a patient's illness. These services include nursing, therapy services, use of hospital facilities, the technical portion of clinical laboratory and radiology services, and medical social services. These services shall be furnished by the hospital.

(2) Drugs and biologicals, approved by the federal Food and Drug Administration and appropriate for inpatient care, are covered Medicaid services based on individual need and a physician's written order.

(3) Supplies, appliances, and equipment required for the care and treatment of a client during an inpatient stay are covered Medicaid services based on individual need and a physician's written order.

(4) Inpatient hospital intensive physical rehabilitation services are covered Medicaid services, as specified in R414-2B.

(5) Organ transplantation services are covered Medicaid services, as specified in R414-10A.

(6) Inpatient hospital psychiatric services are covered Medicaid services only when the severity of a patient's illness and the intensity of service required are such that these services cannot be provided in an alternative setting.

(7) Cosmetic, reconstructive, or plastic surgery is limited to:

(a) correction of a congenital anomaly;

(b) restoration of body form following an accidental injury; or

(c) revision of severe disfiguring and extensive scars resulting from neoplastic surgery.

(8) Inpatient hospital care for treatment of alcoholism or drug dependency is limited to medical treatment of symptoms associated with drug or alcohol detoxification.

(9) Abortion procedures are limited to those certified as medically necessary, approved by division consultants, and determined to meet the requirements of Section 26-18-4 and 42 CFR 441.203 (October 1, 1991, edition), which is incorporated by reference.

(10) Sterilization and hysterectomy procedures are limited to those that meet the requirements of 42 CFR 441, Subpart F (October 1, 1991, edition), which is incorporated by reference.

 

R414-2A-500. Limitations.

(1) Treatment of syndromes or disorders for which no specific therapies have been identified except for therapies that border on behavior modification or experimental or unproven practices, or for which medical necessity, appropriate utilization, and cost effectiveness cannot be assured, are not covered Medicaid services. The treatments are:

(a) treatment of sleep apnea, or sleep studies, or both;

(b) pain clinic services;

(c) treatment of eating disorders.

(2) Miscellaneous supplies, dressings, durable medical equipment, and drugs are not covered take-home supplies.

(3) Cosmetic, reconstructive, and plastic surgery procedures other than those specified in R414-2A-400(7), including all related services, supplies, and any institutional costs, are not covered Medicaid services.

(4) An inpatient admission for 24 hours or more solely for observation or diagnostic evaluation is not a covered Medicaid service.

(5) Nonphysician psychosocial counseling services are not covered Medicaid services.

(6) An off-unit pass is limited to an inpatient rehabilitation or psychiatric admission pursuant to a written order by the attending physician, planned by the physician or interdisciplinary team through established goals and objectives, and adequately documented and evaluated in the progress notes of the patient's chart as supporting the patient's plan of care.

(7) A therapeutic leave of absence is limited to inpatient rehabilitation admissions pursuant to a written order by the attending physician, planned by the physician or interdisciplinary team through established goals and objectives, and adequately documented and evaluated in the progress notes of the patient's chart as supporting the patient's plan of care.

(8) Except as provided in subsections (c) through (e), a Medicaid client must pay a co-insurance payment for inpatient services.

(a) The Medicaid client out-of-pocket expense is limited to $220 per calendar year for inpatient hospital services.

(b) The Department shall deduct $220 from the reimbursement paid to the provider that provides the initial inpatient service.

(c) Medicaid clients in the following categories are exempt from co-insurance requirements

(1) children;

(2) pregnant women;

(3) institutionalized individuals; and

(4) individuals whose total gross income, before exclusions or deductions, is below the Temporary Assistance to Needy Families standard payment allowance.

(d) Emergency services are exempt from the co-insurance payment requirements.

(e) Inpatient services for family planning purposes are exempt from the co-insurance requirements.

 

R414-2A-600. Prior Authorization.

(3) All services related to organ transplantations require prior authorization.

(4) All inpatient psychiatric and rehabilitation services require prior authorization.]

R414-2A-1. Introduction and Authority.

This rule defines the scope of inpatient hospital services that are available to Medicaid clients for the treatment of disorders other than mental disease. This rule is authorized under Utah Code 26-18-3 and governs the services allowed under 42 CFR 440.10.

 

R414-2A-2. Definitions.

(1) "Admission" means the acceptance of a Medicaid client for inpatient hospital services.

(2) "Diagnosis Related Group (DRG)" is the CMS-coding that determines reimbursement for the resources that a hospital uses to treat a client with a specific diagnosis or medical need and is further described in R414-2A-9 of this rule.

(3) "Hyperbaric Oxygen Therapy" is therapy that places the patient in an enclosed pressure chamber for medical treatment.

(4) "Inpatient" is an individual whose severity of illness requires 24 hours or more of continuous care in a hospital.

(5) "Inpatient Hospital Services" are services that a hospital provides for the care and treatment of inpatients with disorders other than mental illness, under the direction of a physician or other practitioner of the healing arts.

(6) "Leave of Absence" from an inpatient facility is a patient's absence for therapeutic or rehabilitative purposes where the patient does not return by midnight of the same day.

(7) "Observation" means monitoring a patient to evaluate the patient's condition, symptoms, diagnosis, or appropriateness of inpatient admission.

(8) "Other Practitioner of the Healing Arts" means a doctor of osteopathy, a doctor of dental surgery, or a podiatrist.

(9) "Prepaid Mental Health Plan" means the prepaid, capitated program through which the Department pays contracted community mental health centers to provide all needed inpatient and outpatient mental health services to residents of the community mental health center's catchment area who are enrolled in the plan.

 

R414-2A-3. Client Eligibility Requirements.

Inpatient hospital services are available to categorically and medically needy individuals who are under the care of a physician or other practitioner of the healing arts.

 

R414-2A-4. Hospital Admission Requirements.

(1) Each hospital providing inpatient services must have a utilization review plan as described in 42 CFR 482.30.

(2) The attending physician or other practitioner of the healing arts must sign a physician acknowledgement statement that meets the requirements of 42 CFR 412.46.

(3) For psychiatric patients, the attending physician must certify and recertify the need for inpatient psychiatric services as described in 42 CFR 441.152.

 

R414-2A-5. Prepaid Mental Health Plan.

A Medicaid client residing in a county for which a prepaid mental health contractor provides mental health services must obtain authorization for inpatient psychiatric services from the prepaid mental health contractor for the client's county of residence.

 

R414-2A-6. Service Coverage.

(1) Inpatient hospital services encompass all medically necessary and therapeutic medical services and supplies that the physician or other practitioner of the healing arts orders that are appropriate for the diagnosis and treatment of a patient's illness.

(2) The Department does not pay for physician services rendered by a non-Medicaid provider.

(3) Diagnostic services performed by the admitting hospital or by an entity wholly owned or operated by the hospital within three days prior to the date of admission to the hospital, are inpatient services.

(4) Medical supplies, appliances, drugs, and equipment required for the care and treatment of a client during an inpatient stay are reimbursed as part of payment under the DRG .

(5) Services associated with pregnancy, labor, and vaginal or C-section delivery are reimbursed as inpatient service as part of payment under the DRG, even if the stay is less than 24 hours

(6) Services provided to an inpatient that could be provided on an outpatient basis are reimbursed as part of payment under the DRG.

(7) Inpatient hospital psychiatric services are available only to clients not residing in a county covered by a prepaid mental health plan.

 

R414-2A-7. Limitations.

(1) Inpatient admissions for 24 hours or more solely for observation or diagnostic evaluation do not qualify for reimbursement under the DRG system.

(2) Inpatient hospital care for treatment of alcoholism or drug dependency is limited to medical treatment of symptoms associated with drug or alcohol detoxification.

(3) Abortion procedures must first be reviewed and preauthorized by the Department as meeting the requirements of Utah Code 26-18-4 and 42 CFR 441.203.

(4) Sterilization and hysterectomy procedures must first be reviewed and preauthorized by the Department as meeting the requirements of 42 CFR 441, Subpart F.

(5) Organ transplant services are governed by R414-10A, Transplant Services Standards.

(6) Take home supplies, dressings, non-rental durable medical equipment, and drugs are reimbursed as part of payment under the DRG.

(7) Hyperbaric oxygen therapy is limited to service in a hospital facility in which the hyperbaric unit has been accredited by the Joint Commission on Healthcare Organizations or the Undersea Hyperbaric Medical Society.

(8) Inpatient services solely for pain management do not qualify for reimbursement under the DRG system. Pain management is adjunct to other Medicaid services.

(9) Medicaid does not cover inpatient admissions for the treatment of eating disorders.

(10) Physician services provided by a physician who is paid by a hospital are inpatient services reimbursed as part of payment under the DRG. Payment for physician services provided by providers who are not paid by the hospital is governed by R414-10, Physician Services.

(11) Inpatient rehabilitation services must first be reviewed and preauthorized.

(12) Inpatient psychiatric services not covered by mental health contractual agreements must first be reviewed and preauthorized by the Department to assure that the admission meets the requirements of 42 CFR 412.27 and Part 441, Subpart D.

 

R414-2A-8. Coinsurance.

Each Medicaid client is responsible for a coinsurance payment as established in the Utah State Medicaid Plan and incorporated by reference in R414-1.

 

R414-2A-9. Reimbursement Methodology.

(1) Payments for inpatient hospital services are paid on a prospectively determined amount for each qualifying patient discharge under a Diagnosis Related Group (DRG) system. DRG weights are established to recognize the relative amount of resources consumed to treat a particular type of patient. The DRG classification scheme assigns each hospital patient to one of over 500 categories or DRGs based on the patient's diagnosis, age and sex, surgical procedures performed, complicating conditions, and discharge status. Each DRG is assigned a weighting factor which reflects the quantity and type of hospital services generally needed to treat a patient with that condition. A preset reimbursement is assigned to each DRG.

(2) For purposes of reimbursement, the day of admission is counted as a full day and the day of discharge is not counted.

(3) When a patient receives SNF-level, ICF-level, or other sub-acute care in an acute-care hospital or in a hospital with swing-bed approval, payment is made at the swing-bed rate.

(4) Reimbursement for services in the emergency department is limited to codes and diagnoses that are medically necessary emergency services. The provider manual lists appropriate emergency codes. The provider must list the discharge diagnosis on the claim form as one of the first five diagnoses.

(5) If a patient is readmitted for the same or a similar diagnosis within 30 days of a discharge, the Department may review and evaluate both claims to determine if, based on severity of illness, intensity of service, and cost effectiveness, the claims should be combined into a single DRG payment or paid separately.

(6) Exceptions to the 30-day readmission policy must still meet the severity of illness requirements for the allowance of a second DRG payment and are limited to:

(a) pregnancy;

(b) chemotherapy; and

(c) hyperbilirubinemia appearing in newborn infants within the first week of life.

(7) The Department pays for physician interpretation of laboratory services separately from the DRG payment. Laboratory technical services are included within the DRG for the inpatient admission.

(8) If an observation stay meets the intensity and severity for inpatient hospitalization and exceeds 24 hours, the patient becomes an inpatient and the observation services are reimbursed as part of payment under the DRG.

 

KEY: [m]Medicaid

[February 1, 2002]2005

Notice of Continuation November 26, 2002

26-1-5

[26-1-15

]26-18-3[(2)

26-18-5(3)

26-18-5(4)

26-18-6]

26-18-3.5