Medicare Like Rates Kris Locke American Indian Health Commission September 14, 2007

Overview  Legislation  Regulation  Partners  Implementation

Legislation Medicare Modernization Act of 2003 Section 506: Limitation on charges for inpatient hospital contract health services provided to Indians by Medicare participating hospitals DHHS Secretary “shall promulgate regulations to carry out” Section 506

Regulation  42 CFR Part 136 and Part 489 published on June 4, 2007 Adds new Subpart D as sections – (IHS) Payment to Medicare Participating Hospitals for Contract Health Services  Hospitals “must accept no more than (Medicare) rates…as payment in full for all items and services authorized by” I/T/U.

Regulation (cont’d)  I/T/U “payer of last resort”  I/T/U pay “the lesser of” negotiated amount or Medicare rate  No reconciliation of payments unless hospital submitted inaccurate information  Recovery of overpayment from cost based providers permitted if “actual costs fall significantly below the computed rate”

Regulation (cont’d) Also adds new section to Chapter IV Subpart B (CMS) Provider Agreements and Supplier Approval  Special requirements concerning beneficiaries served by the Indian Health Service, Tribal health programs and urban Indian organization health programs Medicare inpatient hospitals “must accept…no more than” Medicare rates Hospitals “may not refuse service”

Partners  Federal DHHS – issue regulation  CMS – sets Medicare payment provisions Region X, CMS and Native American Contact  IHS – works with CMS to implement policy Portland Area Office  Area State Hospital Associations – can help member hospitals with implementation AIHC, NPAIHB – can help Tribes by coordinating information

Implementation  Each 638/Self-Governance Tribe decides which option to use for pricing hospital claims using Medicare rates In house – using software and Medicare fee scheduled Tribe re-prices claims Contract – have another entity re-price claims  Tribal consortium  IHS Fiscal Intermediary (BCBSNM)  Other contractor (e.g. Noridian, Other claims processing entity)

What is a Fiscal Intermediary?  Term used in slightly different ways Medicare (CMS) contracts with FI to review, price and pay Part A claims  NW Medicare FI is Noridian IHS contracts with Blue Cross Blue Shield of New Mexico as FI to review, price and pay all “direct service” CHS claims  A FI/contractor has the advantage of Medicare claims processing experience

Facilities & Services “Applies to all levels of care…inpatient, outpatient, skilled nursing facility care, other services of a department, subunit, distinct part, or other component of a hospital (including services furnished directly by the hospital or under arrangements)” and authorized through CHS (sec (b))

Facilities & Services (cont’d) Inpatient AcuteDRG Inpatient LTCLTC-DRG Inpatient RehabilitationCMG Inpatient PsychiatricPer Diem Inpatient Critical AccessPer Diem (?CCR+1%?) Inpatient TEFRAPer Diem (?CCR?) Skilled Nursing FacilityPer Diem Swing BedsPer Diem Outpatient AcuteOPPS APC Outpatient Critical AccessCost to Charges Ratio + 1% Outpatient TEFRACost to Charges Ratio Hospital LabFee Schedule Outpatient Rehabilitation, PT, OT, mammography, DME Fee Schedule

Contact  American Indian Health Commission for Washington State  Northwest Portland Area Indian Health Board