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CO HCPF Inpatient/Outpatient (IP/OP) Billing Manual — Outpatient and Community Clinics (CC)/Free-Standing Emergency Departments (FSED)

OutpatientandCommunityClinics(CC)/Free-StandingEmergencyDepartments(FSED)

activein force · 2026-07-26 – presentas-observed

OutpatientHospitalServicesmeansservicesthatarefurnishedtoOutpatientsandarefurnishedbyorunderthedirectionofaphysicianordentist.

OutpatientmeansapersonwhoisreceivingprofessionalservicesataHospitaloranoff-campuslocationofaHospitalbutisnotadmittedasanInpatient.

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VisittheColoradoMedicaidStatePlanwebpageformoreinformation.

Routineandannualphysicalexaminationsarenotprovidedunlessdeterminedtobemedicallynecessarybaseduponamedicaldiagnosis,complaintorsymptom.

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TheDepartmentreimburseshospitalsforinstitutionaloutpatientclaimswithallservicedatesonorafterOctober31,2016,usingtheEnhancedAmbulatoryPatientGrouping(EAPG)methodology.Assuch,periodicupdatestocost-to-chargeratiosarenolongerrequired.Paymentcalculationisperformedontheclaimdetailasthelowerofredistributedchargesorhospital-specificbaseratemultipliedbythedetail'sassignedEAPG'sAdjustedRelativeWeight.

TheColoradointerChangeclaimsprocessingsystemreliesonthe3MEAPGGroupermoduletopriceoutpatienthospitalclaims.Initspricingcalculations,billedamountsaredeterminedasreimbursableornon-reimbursablebasedonwhethertherevenuecodeiscovered.RefertoAppendixQlocatedontheBillingManualswebpageundertheAppendicesdrop-down.Reimbursablebilledamountsareaggregatedbyvisitandthendistributedtoeachlinebasedontheproportionofthatline'sEAPGAdjustedRelativeWeighttothesumofthatline'svisit'sEAPGAdjustedRelativeWeights.Theredistributedbilledamountsareutilizedforthepurposeofperforminga"lowerof"calculation,whichwillcomparethatline'sredistributedbilledamounttoitsEAPGPaymentamount.

OutpatienthospitalclaimsshouldbebilledusingTypeofBill013X(HospitalOutpatient).TheEAPGmethodologyreliesonbothrevenueandCurrentProceduralTerminology(CPT)/HealthcareCommonProcedureCodingSystem(HCPCS)codestopriceclaimdetails.Assuch,CPT/HCPCSshouldbebilledwheneverpossibleasappropriatefortheservicesdelivered.Pleasenotethatthisisanupdatefromtherequirementsoftheprecedingoutpatienthospitalpaymentmethodologywhichrequiredclaimdetailsbilledwithcertainrevenuecodes(036X[OperatingRoomServices],045X[EmergencyRoom],etc.)tohavetheirchargesaggregatedintoasinglelinewithoutaCPT/HCPCScode.

EffectiveDateRange

EAPGVersion

October30,2016,andprior

N/A

October31,2016,toDecember31,2021

EAPGversion3.10

January1,2022toJune30,2025

EAPGversion3.16

July1,2025tocurrent

EAPGversion3.18

VisittheOutpatientHospitalPaymentwebpageforfurtherinformationontheDepartment'simplementationoftheEAPGmethodology,includinginformationonColorado'sEAPGRelativeWeightsandhowtoobtaintheEAPGDefinitionsManualfrom3M.

PriortoOctober31,2016,reimbursementforOutpatientHospitalServiceswascalculatedbymultiplyingthesubmittedchargesbytheMedicarePartBcost-to-chargeratioofthesubmittinghospitalandthenbytheHealthFirstColoradocostratio(subjecttochange).Outpatientlaboratory,occupationaltherapy,physicaltherapyandhospital-basedtransportationclaimswerereimbursedbasedonthelowerofsubmittedchargesorHealthFirstColoradofeeschedule.

In-StateBillingProviders:

ReimbursementAmount=LineItemSubmittedCharges*HospitalCost-to-ChargeRatio*HealthFirstColoradoCostRatio

Out-of-StateBillingProviders:

ReimbursementAmount=LineItemSubmittedCharges*HospitalCost-to-ChargeRatio*HealthFirstColoradoCostRatio

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"Bundling"describesasinglereimbursementpackageforrelatedservices.HealthFirstColoradoreimbursementforinpatienthospitalcareincludesassociatedoutpatient,laboratoryandsupplyservicesprovidedimmediatelypriortothehospitaladmissionandduringthehospitalstaywhenbilledbythesameprovider.Refertothe48-hourReadmissionPolicyaboveforcircumstanceswhenamemberisreadmittedtothesamehospitalwithin48hoursafterapreviousinpatientstay.

Prenatalservicessuchasobservationstaysandsamelocationemergencydepartmentvisitsprovidedimmediatelypriortoaninpatientadmissionarerelatedandareincludedinthereimbursementfortheinpatientclaim.

Example:

AmemberisseenintheemergencydepartmentonFebruary11,2018.ThememberisadmittedasaninpatientonFebruary12,2018.ThememberisdischargedonFebruary20,2018.

FromDate:February11,2018

AdmitDate:February12,2018

Covered(Inpatient)Days:8days(February12,2018-February20,2018)

Revenuelineitemsandsurgicalprocedureperformedonanoutpatientdayshouldbereported(FromDate)butshouldnotbereportedfortheaccommodationunitsandinpatientcovereddays.

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EmergencyDepartmentvisitsshouldnotbeincludedonoutpatientclaimsdescribingrecurringvisits(e.g.,regularlyscheduledvisitsforongoingtreatment,suchasphysicaltherapyoroncologytreatment).EmergencyDepartmentvisitsshouldbebilledseparatelyfortheEnhancedAmbulatoryPatientGroup(EAPG)groupertocalculatepaymentappropriatelyperclaimandvisit.ThesetypesofvisitsareidentifiedbyoutpatientclaimswhicharebilledwithRevenueCodes045X(EmergencyServices)or076X(SpecialtyServices).

RecurringvisitswhichmayincludeObservationServicesshouldhaveeachvisitbilledonseparateclaimstoavoidunintendedbundlingduringpaymentcalculation.

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TheEAPGreimbursementmethodologyisutilizedtogrouppaymentforsimilarsignificantprocedureswhenbilledonanoutpatienthospitalclaim,suchthatonlythemostresource-intensivesignificantprocedurewillbepayablepervisitasdeterminedbytheEAPGalgorithm.Forpaymenttobecalculatedappropriatelyforseparateanddistinctsignificantproceduresoccurringduringthesamevisit,claimdetailsmaybebilledwithmodifier59toindicatethattheyaredistinctproceduralservices.EffectiveforinstitutionaloutpatientclaimswithafirstdateofserviceonorafterJanuary1,2018,modifiersXE,XP,XSandXUmayalsobeusedtoindicatedistinctproceduralservices.

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Modifier27maybereportedformultipleoutpatienthospitalevaluationandmanagementencountersonthesamedateforaninstitutionaloutpatientclaim.LineitemsbilledinthiswaymaybeassignedancillaryEAPG449(AdditionalUndifferentiatedMedicalVisits/Services)andareonlypayableduringvisitswherenosignificantprocedurehastakenplace.

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Modifier50maybereportedoninstitutionaloutpatienthospitalclaimdetailsforbilateralproceduresperformedduringthesameoperativesession.Suchproceduresmustbebilledonasingleclaimdetailforreimbursementtobecalculatedappropriately.

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Drugspurchasedthroughthe340BDrugDiscountProgrammustbebilledwiththeUDmodifier,whichwillallowthedrugtobepricedappropriatelybytheEAPGsoftware.Drugspurchasedinthiswaymustbebilledatacquisitioncost.

OUTPATIENTCLAIMFIRSTDATEOFSERVICE

340BDISCOUNT

October31,2016toMarch10,2018

50%

March11,2018toJune30,2025

80%

July1,2025tocurrent

65%

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DiscardedportionsofdrugsprovidedduringanoutpatienthospitalstaymustbebilledonaseparatelinewiththeJWmodifier.Thesedetailsarenotconsideredpayableonanoutpatienthospitalclaim.

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ModifiersfornevereventsPA(surgery,wrongbodypart),PB(surgery,wrongpatient)andPC(wrongsurgeryonpatient)mustbereportedwhenappropriate.Theseservicesarenotconsideredpayableonanoutpatienthospitalclaim.

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Terminatedproceduresmustbereportedwithmodifiers52(reducedservices)or73(discontinuedservicespriortoanesthesiaadministration).ReportingwiththepropermodifierwillallowtheproceduretobepricedappropriatelybytheEAPGsoftware.

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BilledunitsshouldbesummedintoasinglelineforeachCPT/HCPCscodeanddateofservice.Theonlyexceptionsareforrequiredmodifiers(e.g.,billingtwo(2)linesforadrugwherethediscardedportionofthedrugmustbebilledonaseparatelinewiththeJWmodifier)orwhenbillingdrugswithdifferentNationalDrugCodes(NDCs)butthesameHCPCS.OnthelineswiththerepeateddrugHCPCScode,adifferentNDCmustbebilledforcorrectprocessing.

ObservationstaysthatspanmultipleDOSmusthaveallunitssummedandbilledonasingleline.

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EffectiveJuly8,2022,take-homeNaloxonewillbereimbursedatthefeescheduleratewhenbilledonanoutpatienthospitalclaimwithHCPCSG1028and/orG2215.TheoutpatientclaimmustcontaintheNDCofthedrugdispensed.IfG2215isbilledontheoutpatientclaim,itmustalsoincludetheinvoiceofthedrugdispensed.

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SincetheimplementationofEAPGs,theDepartmenthascarvedoutthepaymentforunbundledDMEfromitsoutpatientclaimsandrequeststhatsuchlineitemsarebilledontheCMS-1500professionalclaim.SuchlineitemsaresubjecttothebillingrulesandpaymentmethodologyinplaceforDMESuppliers.RefertoAppendixGlocatedontheBillingManualwebpageundertheAppendicesdrop-downforalistingoftheCPT/HCPCScodeswhichareunbundledfromtheEAPGmethodology.

ACMS1500shouldbeusedtobillDMEonlywhentheprocedurecodeislistedontheDepartment'sAppendixG:OutpatientHospitalUnbundledDurableMedicalEquipmentCodes.Otherwise,paymentforDMEisassumedtobeapartofEAPG,andtheprocedurecodeshouldgoonaUB-04.

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TheDepartmentusesbothCentersforMedicare&MedicaidServices(CMS)andSolventumEnhancedAmbulatoryPatientGroup(EAPG)Inpatient-Onlylists.

CMSInpatient-OnlylistreferstoservicesrestrictedtoinpatientsettingswithinMedicaidNCCImethodologies.

FortheSolventumEAPGInpatient-OnlylistrefertoAppendixOlocatedontheBillingManualswebpageundertheAppendicesdrop-down.TheDepartmentusestheSolventumEAPGInpatient-OnlylistcorrespondingtotheEAPGversioninuseonthefirstdateofserviceoftheclaim.TheeffectivedatesforeachversioncanbefoundundertheEAPGsectionofthisbillingmanual.

Inpatient-onlyproceduresperformedintheoutpatientsettingaredenied.

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EffectiveforclaimswithdatesofserviceonorafterOctober30,2023

ObservationstaysareacoveredHealthFirstColoradobenefitwhenprovidedbyorunderthedirectionofaphysicianforasmanydaysasdeterminedMedicallyNecessary.Thebilledlineforobservationmusthaveanobservationtimeofeight(8)ormorehours.Withappropriatedocumentation,membersmaystayinobservationformorethan24hoursandonlyrarelyshallthestayexceed48hoursinlengthper10CCR2505-108.300.3.B.1.

ObservationStaysendwhenaphysicianorderseitherInpatientadmissionordischargefromthehospital.AnInpatientadmissioncannotbeconvertedtoanOutpatientObservationStayafterthememberisdischargedunlessforpurposesofrebillingafteranauditfindingasspecifiedin10CCR2505-108.043.

TheassignmentofseparateancillaryObservationEAPGisdependentuponspecificcriteria.ThislogicisdisplayedwithintheAncillaryObservationProcessingLogicwithinthe3MDefinitionsManualfor3MEnhancedAPG(EAPG)System.

Example1:HCPCSG0378isbilledwitheightplus(8+)billedunitsonaclaimalongwithaType2SignificantProcedureEAPG.Regardlessofservicesbilledontheclaim,G0378willbeassignedEAPGcode450andwillpackage.

Example2:HCPCSG0378isbilledwitheightplus(8+)billedunitsonaclaimalongwithamedicalvisitandType21-25SignificantProcedureEAPG.G0378willbeassignedEAPGcode450andnotbepackaged.

Example3:HCPCSG0378isbilledandnoType2SignificantProcedureandnomedicalvisitarepresent.G0378willbeassignedEAPG999.

Example4:HCPCSG0378isbilledandnoSignificantProcedureandnomedicalvisitarepresent,butaType21-25SignificantProcedureispresent.G0378willbeassignedEAPG450andwillpackage.

Example5:HCPCSG0378isbilledwitheightplus(8+)billedunitsonaclaimalongwithamedicalvisitandnoSignificantProcedureEAPGofanytype.G0378willbeassignedEAPGcode450andnotbepackaged.

ForclaimswithdatesofservicepriortoOctober30,2023

Observationstaysareacoveredbenefitasfollows.MembersmaybeadmittedasOutpatientstoObservationStaystatus.Thebilledlineforobservationmusthaveanobservationtimebetweeneight(8)and48hours.Withappropriatedocumentation,membersmaystayinObservationformorethan24hours,butanObservationStayshallnotexceed48hoursinlengthper10CCR2505-108.300.3.B.1.AphysicianorderseitherInpatientadmissionordischargefromobservation.AnInpatientadmissioncannotbeconvertedtoanOutpatientObservationStayafterthememberisdischarged.

Example1:HCPCSG0378isbilledwitheight(8)-48billedunitsonaclaimalongwithaType2SignificantProcedureEAPG.Regardlessofservicesbilledontheclaim,G0378willbeassignedEAPGcode450andwillpackage.

Example2:HCPCSG0378isbilledwitheight(8)-48billedunitsonaclaimalongwithamedicalvisitandType21-25SignificantProcedureEAPG.G0378willbeassignedEAPGcode450andnotbepackaged.

Example3:HCPCSG0378isbilledandnoType2SignificantProcedureandnomedicalvisitarepresent.G0378willbeassignedEAPG999.

Example4:HCPCSG0378isbilledandnoSignificantProcedureandnomedicalvisitarepresent,butaType21-25SignificantProcedureispresent.G0378willbeassignedEAPG450andwillpackage.

Example5:HCPCSG0378isbilledwitheight(8)-48billedunitsonaclaimalongwithamedicalvisitandnoSignificantProcedureEAPGofanytype.G0378willbeassignedEAPGcode450andnotbepackaged.

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TheprimarydiagnosiscodeontheclaimdetermineswhenoutpatientinstitutionalclaimsaresubmittedFee-for-Service(FFS)ortotheRegionalAccountableEntity(RAE)thatthememberisattributedto.RefertotheStateBehavioralHealthServices(SBHS)BillingManualforalistofbehavioralhealthdiagnosiscodesthatarecoveredundertheMedicaidCapitatedBehavioralHealthBenefitandreimbursedbytheRAEs.

ForInstitutionalOutpatientClaims:

Iftheclaim’sprimarydiagnosiscodeisalistedRAE-covereddiagnosis,theclaimshouldbesubmittedtothemember’sRAE.

Iftheclaim’sprimarydiagnosiscodeisnotalistedRAE-covereddiagnosiscode,theclaimshouldbesubmittedFFS.

IfthememberisnotattributedtoaRAE,theclaimwillneedtobesubmittedFFS.

SplitbillingforbehavioralhealthservicesprovidedinaHospitalisnotpermitted.

ProvidersmayappealthedecisioniftheclaimhasbeendeniedbytheRAE.AppealinformationislistedonthedenialletterfromtheRAE.

ContactHCPF_BHCoding@state.co.usforbehavioralhealthbillingquestions.

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WhenPartialHospitalizationservicesaredeliveredbyaGeneralAcuteCareHospital,andtheprincipaldiagnosisisnotaRegionalAccountableEntity(RAE)-coveredmentalhealthdiagnosis,theservicesmaybebilledfee-for-serviceusingrevenuecodes912and/or913.ARAEdenialisnotnecessarytoprocesstheseclaims.TheserevenuecodeshavebeenpayablethroughEAPGsinceNovember20,2019,andthecodeswereretroactivelyopenedforbillingbacktoJuly1,2018.

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Provenance

Source: hcpf.colorado.gov
Retrieved: 2026-07-26
Edition: 2026-07-26
Content hash: 05ce4e68fbaf4670335e1a6de5700c7fb4cf95553c16311504a6867dc31bef65

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