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2 CHANGE M OCTOBER 23, 2017 REMOVE PAGE(S) INSERT PAGE(S) CHAPTER 5 Section 4, pages 1 and 2 Section 4, pages 1 and 2 CHAPTER 7 Section 2, pages 3 and 4 Section 2, pages 3 and 4 CHAPTER 13 Section 2, pages 7 and 8 Section 2, pages 7 and 8 2

3 CHANGE M OCTOBER 23, 2017 SUMMARY OF CHANGES CHAPTER 5 1. Section 4. This change adopts Medicare's reduced payments for the technical component (and the technical component of the global fee) of the Physician Fee Schedule service for X-ray imaging services provided using film. EFFECTIVE DATE: 01/07/2017. CHAPTER 7 2. Section 2. This change corrects a cross reference. EFFECTIVE DATE: 11/23/2017. CHAPTER Section 2. This change corrects APC codes. EFFECTIVE DATE: 01/01/

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5 Allowable Charges Chapter 5 Section 4 Payment For Professional/Technical Components Of Diagnostic Services Issue Date: August 26, 1985 Authority: 32 CFR 199.4(c)(2)(ix) and (c)(2)(x) and 10 USC 1079(h)(1) 1.0 APPLICABILITY This policy is mandatory for reimbursement of services provided by either network or nonnetwork providers. However, alternative network reimbursement methodologies are permitted when approved by the Defense Health Agency (DHA) and specifically included in the network provider agreement. 2.0 ISSUE How are professional and technical components of diagnostic services to be reimbursed? 3.0 POLICY 3.1 Frequently, charges for diagnostic services are split between the professional (physician) and the technical (equipment) components. Wherever possible, separate allowable charges are developed for each component. When a bill is received for the total service, the total allowable charge is to be used in the processing of the claim. 3.2 Under the national allowable charge system, the Maximum Allowable Charge file provides the contractor with a complete allowable charge or with separate allowable charges for professional and technical components. 3.3 For diagnostic procedures that are still priced using area prevailing allowable charges, the contractor shall establish professional and technical components from the billed charges for the service as identified on the claims. 3.4 Clinical diagnostic lab tests furnished by Critical Access Hospitals (CAHs), are reimbursed under the reasonable cost method, reference Chapter 15, Section Effective for services provided on or after January 1, 2017, as required by law, TRICARE adopts Medicare's reduced payments for the technical component (and the technical component of the global fee) of the Physician Fee Schedule service for CT services that do not meet the National Electrical Manufacturers Association (NEMA) Standard XR , as required by Section 218(8) of the Protecting Access to Medicare Act (PAMA) of 2014, titled, Quality Incentives to Promote Patient Safety and Public Health in Computed Tomography (CT) Diagnostic Imaging. 1 C-149, October 23, 2017

6 Chapter 5, Section 4 Payment For Professional/Technical Components Of Diagnostic Services This provision requires that information be provided and attested to by a supplier and a hospital outpatient department that indicates whether an applicable CT service was furnished that was not consistent with the NEMA CT equipment standard Claims for the following CT services identified by Current Procedural Terminology (CPT) 1 codes , , , , , , , , that are furnished using equipment that does not meet each of the attributes of the NEMA XR standard, must include modifier CT A list of CPT codes subject to the CT modifier will be maintained in Centers for Medicare and Medicaid Services (CMS ) web supporting files for the annual Physician Fee Schedule (PFS) rule Effective January 1, 2017, a payment reduction of 5% applies to the technical component (and the technical component of the global fee) for CT services furnished using equipment that is inconsistent with the CT equipment standard and for which payment is made under the PFS Effective January 1, 2018, and succeeding years, a payment reduction of 15% applies. 3.6 Effective for services provided on or after January 1, 2017, as required by law, TRICARE adopts Medicare's reduced payments for the technical component (and the technical component of the global fee) of the Physician Fee Schedule service for X-ray imaging services provided using film. Beginning January 1, 2017, claims for X-rays using film must include modifier FX. A payment reduction of 20% applies to the technical component (and the technical component of the global fee) for X-ray services furnished using film as included in Section 502(a)(1) of the Consolidated Appropriations Act of 2016 entitled Medicare Payment Incentive for Transition from Traditional X- Ray Imaging to Digital Radiography and Other Medicare Imaging Payment Provision. - END - 1 CPT only 2006 American Medical Association (or such other date of publication of CPT). All Rights Reserved. 2 C-149, October 23, 2017

7 Chapter 7, Section 2 Partial Hospitalization Program (PHP) And Intensive Outpatient (IOP) Reimbursement: Mental Health And Substance Use Disorder (SUD) Treatment Note: Group therapy is strictly included in the per diem and cannot be paid separately even if billed by an individual professional provider Primary/Attending Provider. When a patient is approved for admission to a PHP or IOP, the primary or attending provider (if not contracted or employed by the partial program) may provide psychotherapy only when the care is part of the treatment environment which is the therapeutic partial program. That is why the patient is there--because that level of care and that program have been determined as medically necessary. The therapy must be adapted toward the events and interactions outlined in the treatment plan and be part of the overall partial treatment plan. Involvement as the primary or attending is allowed and covered only if he is part of the coherent and specific plan of treatment arranged in the partial setting. The treatment program must be under the general direction of the psychiatrist employed by the program to ensure medication and physical needs of the patients are met and the therapist must be part of the treatment team and treatment plan. An attending provider must come to the treatment plan meetings and his/her care must be coordinated with the treatment team and as part of the treatment plan. Care given independent of this is not covered Non-mental health related medical services. Those services not normally included in the evaluation and assessment of a partial hospitalization patient and not related to care in the PHP or IOP. These medical services are those services medically necessary to treat a broken leg, appendicitis, heart attack, etc., which may necessitate emergency transport to a nearby hospital for medical attention. Ambulance services may be cost-shared when billed for by an authorized provider if determined medically necessary for emergency transport. 2.3 Per Diem Rate For any full-day PHP (minimum of six hours), the maximum per diem payment amount is 40% of the average inpatient per diem amount per case paid to both high and low volume psychiatric hospitals and units established under the mental health per diem reimbursement system. The rates shall be updated to the current year using the same factors as used under the TRICARE mental health per diem reimbursement system For dates of service prior to October 3, 2016, a PHP of less than six hours (with a minimum of three hours), termed half-day PHP, will be paid a per diem rate of 75% of the rate for full-day PHP For dates of service on or after October 3, 2016, IOP services, lasting less than six hours, with a minimum of two hours, shall be reimbursed a per diem rate of 75% of the rate for full-day PHP. Note: PHPs that provide services that are less than six hours, with a minimum of two hours, are reimbursed in accordance with the provisions of paragraph TRICARE will not fund the cost of educational services separately from the per diem rate. The hours devoted to education do not count toward the therapeutic half- or full-day program. See the DHA web site at 3 C-149, October 23, 2017

8 Chapter 7, Section 2 Partial Hospitalization Program (PHP) And Intensive Outpatient (IOP) Reimbursement: Mental Health And Substance Use Disorder (SUD) Treatment Reimbursement, for the current maximum rate limits which are to be used as is for PHP and IOP care. 2.4 Other Requirements No payment is due for leave days, for days in which treatment is not provided, for days in which the patient does not keep an appointment, or for days in which the duration of the program services was less than three hours. 2.5 CAHs Effective December 1, 2009, PHPs in CAHs shall be reimbursed under the reasonable cost method (see Chapter 15, Section 1). 2.6 IOPs Prior To October 3, 2016 For dates of service prior to October 3, 2016, IOPs and PHPs may provide services they call Intensive Outpatient Program, or IOP. PHPs may provide partial hospitalization services, also referred to as IOP, provided less than five days per week, but at least three hours per day but less than six hours per day. Freestanding PHPs providing IOP services may submit reimbursement for Healthcare Common Procedure Coding System (HCPCS) codes S9480 or H0015 to represent these services; the contractor shall reimburse the provider the half-day PHP rate (i.e., three to five hours), in accordance with this section. See the TRICARE Policy Manual (TPM), Chapter 7, Sections 3.4 and 3.5; and the TRICARE Reimbursement Manual (TRM), Chapter 13, Section 2, paragraph for reimbursement in hospital-based PHPs. 2.7 Cost-sharing. For dates of service prior to October 3, 2016, cost-sharing for PHP services is made on an inpatient basis. For dates of service on or after October 3, 2016, outpatient cost-sharing is applied to PHP and IOP services. See Chapter 2, Addendum A. - END - 4 C-144, June 13, 2017

9 Chapter 13, Section 2 Billing And Coding Of Services Under Ambulatory Payment Classifications (APC) Groups Beginning January 1, 2016, APC 0375 will be renumbered to APC 5881, and all services reported on the same claim as an inpatient only procedure with modifier -CA will be paid through a single prospective payment for the comprehensive service. 3.5 Medical Screening Examinations Appropriate ED codes will be used for medical screening examinations including ancillary services routinely available to the ED in determining whether or not an emergency condition exists If no treatment is furnished, medical screening examinations would be billed with a lowlevel ED code. 3.6 HCPCS/Revenue Coding Required Under OPPS Hospital Outpatient Departments (HOPDs) should use the CMS 1450 UB-04 Editor as a guide for reporting HCPCS and revenue codes under the OPPS. 3.7 Treatment of Partial Hospitalization Programs (PHPs) And Intensive Outpatient Programs (IOPs) Hospital-based PHPs and IOPs for mental health and Substance Use Disorder (SUD) treatment shall be reimbursed a per diem payment under the OPPS. Freestanding PHPs and IOPs are reimbursed under the PHP and IOP per diem payment. See Chapter 7. Separate TRICARE certification of hospital-based PHPs and IOPs is not required, making all hospital-based PHPs and IOPs eligible for payment under TRICARE s OPPS Services of physicians, clinical psychologists, Clinical Nurse Specialists (CNSs), Nurse Practitioners (NPs), and Physician Assistants (PAs) furnished to PHP and IOP beneficiaries are billed separately as professional services and are not considered to be PHP and IOP services Payment for PHP and IOP services represents the provider s overhead costs, support staff, and the services of Certified Clinical Social Workers (CCSWs) and Occupational Therapists (OTs), whose professional services are considered to be included in the PHP or IOP per diem rate. For PHP and IOP SUD treatment, the costs of alcohol and addiction counselor services would also be included in the per diem. Hospitals will not bill the contractor for the professional services furnished by CCSWs, OTs, and alcohol and addiction counselors. Rather, the hospital s costs associated with the services of CCSWs, OTs, and alcohol and addiction counselors will continue to be billed to the contractor and paid through the per diem rate PHP should be a highly structured and clinically-intensive program, usually lasting most of the day. IOP is a comprehensive and complementary schedule of recognized treatment approaches that may include day, evening, night, and weekend services consisting of individual and group counseling or therapy, and family counseling or therapy as clinically indicated for children and adolescents, or adults aged 18 and over, and may include case management to link patients and their families with community-based support systems. Since a day of care is the unit 7 C-144, June 13, 2017

10 Chapter 13, Section 2 Billing And Coding Of Services Under Ambulatory Payment Classifications (APC) Groups that defines the structure and scheduling of partial hospitalization services, a two-tiered payment approach has been retained to reflect the lower costs of a less intensive day. PHP programs offering Intensive Outpatient Therapy or IOP may be appropriate for patients who do not require the more intensive level of care, or for those who have completed a more intense inpatient or partial hospitalization stay For dates of service prior to October 3, 2016, it was never the intention of this two-tiered per diem system that only three units of service should represent the number of services provided in a typical day. The intention of the two-tiered system was to cover days that consisted of three units of service only in certain limited circumstances; e.g., three-service days may be appropriated when a patient is transitioning towards discharge or days when a patient who is transitioning at the beginning of his or her PHP stay Programs that provide four or more units of service should be paid an amount that recognizes that they have provided a more intensive day of care. A higher rate for more intensive days is consistent with the goal that hospitals provide a highly structured and clinically-intensive program For dates of service prior to October 3, 2016, the OCE logic will require that hospitalbased PHPs provide a minimum of three units of service per day in order to receive PHP payment. Payment will be denied for days when fewer than three units of therapeutic services are provided. The three units of service are a minimum threshold that permits unforeseen circumstances, such as medical appointments, while allowing payment, but still maintains the integrity of a comprehensive program. An exception to the requirement for three units for service is made for programs billing with HCPCS codes S9480 or H0015. Because these codes represent comprehensive programs, they must represent a program providing at a minimum three hours of service per day For dates of service on or after October 3, 2016, and before January 1, 2017: The TRICARE Final Rule, effective October 3, 2016, reduced the minimum hours of service for half-day PHP/IOP to two hours for the TRICARE program. Therefore, for dates of service on or after October 3, 2016, the OCE logic will require that hospital-based PHPs and IOPs provide a minimum of two units of service per day in order to receive payment. An exception to the requirement for two units for service is made for programs billing with HCPCS codes S9480 or H0015. Because these codes represent comprehensive programs, they must represent a program providing at a minimum two hours of service per day PHP programs providing either two or three hours of service per day, or those claims with HCPCS codes S9480 or H0015 shall be grouped to APC PHP programs providing four or more hours of service shall continue to group to APC For dates of service on or after January 1, 2017, in accordance with Medicare s Calendar Year (CY) 2017 OPPS Final Rule (81 FR 79562), APCs and are deleted. Although Medicare now only recognizes one level of PHP care (three units of service or more), TRICARE shall retain a two-tier system, with the lower tier consisting of: two hours of service which shall group to APC T5861; or one occurrence of an IOP code (S9480 or H0015) which shall group to T0175. Three or more units of services shall group to the newly created APC C-149, October 23, 2017

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