Life’s Not Fair and the Medicare Inpatient Only List

on Monday, 04 February 2013. All News Items | Billing

Almost everyone is aware of the Medicare Inpatient Only List – in fact, we included a link to the 2013 list in a recent Wed@One. But do you understand all of the specifics of the rules associated with an inpatient only procedure, especially those that just don’t seem fair? This week we take a look at one of the regulations related to inpatient only procedures and its seemingly unfair limitations.

The Basic Rule – Medicare has determined that there are certain procedures that should only be provided in a hospital inpatient setting; these “inpatient only” services are not appropriate to be furnished in a hospital outpatient department. Medicare does not pay for an inpatient only service or any other services provided on the same day for a hospital outpatient (claim submitted on a 13x Type of Bill).

Two Exceptions to the Rule

  • Medicare will pay for other services provided on the same day as an inpatient only procedure if the inpatient only procedure is defined by CPT as a “separate procedure” and another covered outpatient service with status indicator “T” was also performed for that date of service. Providers can determine “separate procedures” by the CPT manual description.
    • Not Fair note: Even if another payable OPPS service was provided on the same date of service with an inpatient only procedure, it will not be paid if the inpatient only procedure is not designated as a “separate procedure” by CPT definition.
  • Medicare will pay for an inpatient only procedure if the patient dies prior to being admitted and the hospital reports the inpatient only procedure with the CA modifier.
    • Not Fair note: Although the Medicare manual states that this applies to patients who expire or are transferred to another hospital, the modifier CA is defined as “Procedure payable only in the inpatient setting when performed emergently on an outpatient who expires prior to admission.” There is not an appropriate modifier to use to receive payment for patients that are transferred to another hospital.

But providers beware - as unfair as this may seem, it is not appropriate for the hospital to simply remove the inpatient only CPT code in order to receive payment on an outpatient claim.

More information on rules for Inpatient Only Procedures can be found at Medicare Claims Processing Manual, Chapter 4, Section 180.7.

Article by Debbie Rubio

Debbie Rubio, BS, MT (ASCP), is the Manager of Regulatory Affairs and Compliance at Medical Management Plus, Inc. Debbie has over twenty-seven years of experience in healthcare including nine years as the Clinical Compliance Coordinator at a large multi-facility health system. In her current position, Debbie monitors, interprets and communicates current and upcoming regulatory and compliance issues as they relate to specific entities concerning Medicare and other payers. You may contact Debbie at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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