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Information on CMS Ruling 1455-R

(Part B Billing Options for Denied Part A Hospital Claims)

On March 13, 2013, the Centers for Medicare & Medicaid Services (CMS) issued Ruling 1455-R.  The Ruling addresses a hospital’s Medicare Part B billing options when a Part A inpatient admission was denied as not reasonable and necessary, and remains in effect until the effective date of regulations that finalize the proposed rule entitled, “Medicare Program; Part B Inpatient Billing in Hospitals” (CMS-1455-P).  The Ruling expands the Part B services that may be billed by the hospital in such a situation, and establishes an interim process for hospitals to submit Part B claims.  In addition, the Ruling clarifies the adjudicators’ scope of review.

CMS Rulings are published under the authority of the CMS Administrator and are binding on all HHS components that adjudicate matters under the jurisdiction of CMS, including Qualified Independent Contractors, Administrative Law Judges, and the Medicare Appeals Council.  See 42 C.F.R. §§ 401.108, 405.1063(b).  This CMS Ruling supersedes any prior interpretations of Medicare payment policy.

The Ruling explains that adjudicators may only consider the originally billed Part A inpatient admission denial.  Adjudicators may not consider potential coverage under Part B because hospitals are solely responsible for determining whether to bill for services under Part A or Part B, and submitting the appropriate claims.  If no Part B claim was submitted by the hospital, there is no appealable initial determination on Part B services.  Therefore, adjudicators cannot consider Part B coverage for the services furnished.

Under the Ruling, Administrative Law Judges may only address the Part A claims that were submitted by the hospital.  However, the Ruling allows hospitals to bill for certain services under Part B when a Part A claim was denied because an inpatient admission was determined as not reasonable and necessary.  While the Ruling is in effect, the Ruling grants an exception to the one-year claim submission period for these Part B claims.  See the CMS Ruling for important details on documentation requirements, what services may be claimed, and how to submit the claims.

If a hospital wishes to submit claims for services under Part B, the CMS Ruling requires that the Part A appeal be withdrawn (if it is pending before an adjudicator) or an appeal to a higher level is not pursued and becomes binding or final (including if a decision or dismissal has been made and not yet appealed to the next level).  This is to avoid duplicate billing.

If an appeal is pending at OMHA, a request to withdraw the Part A appeal must be submitted to the assigned Administrative Law Judge or to the OMHA Central Operations Division if an Administrative Law Judge has not yet been assigned.  Please see the CMS Ruling 1455-R Hospital Request for Withdrawal Instructions (PDF - 105K) for comprehensive instructions on filing requests to withdraw and a recommended form to use so OMHA can process your request as quickly as possible.

CMS Ruling 1455-R can be found at page 16,632 of the March 18, 2013, Federal Register (78 Fed. Reg. 16632 (Mar. 18, 2013)), or on the CMS website at http://www.cms.gov/Regulations-and-Guidance/Guidance/Rulings/Downloads/CMS1455R.pdf