CMS Pub. 100-04, ch. 1, § 10.3

Services to Patients of a Provider

(Rev. 1, 10-01-03)

B3-3115

Section 1861(w)(1) of the Act permits a hospital, critical access hospital, skilled nursing

facility, home health agency, or hospice to obtain under arrangement, services for which

an individual is entitled to under Medicare. Doing so discharges the liability of such

individual or any other person to pay for the services. This is required in specified

situations where the provider is paid under a PPS system.

Examples of this include:

• While a patient is under a home health plan of care, the HHA must provide all

covered and medically reasonable home health services and certain supplies

(subject to consolidated billing) either directly or under arrangement.

• Where a patient is a SNF inpatient, the SNF must furnish all services within the

scope of the SNH benefit.

• Where a patient is a hospital inpatient, the hospital must furnish certain inpatient

services.

• Certain services are considered included in the rural health clinic or federally

funded health clinic visit.

In such cases, the supplier must look to the provider for payment and the provider will

bill the FI.

In some cases, the hospital, SNF, or HHA may also choose not to arrange for additional

services in this and bill for them. In some cases the provider may instead arrange for the

supplier to furnish the test and to bill the carrier. The provider may make different

arrangements with different suppliers. For example a provider may arrange with a lab

supplier for the lab to bill for all outpatient lab services and make arrangements with an

x-ray supplier for the provider to bill for all x ray services to inpatients and outpatients.

Similarly the supplier may make different arrangements for services to beneficiaries for

whom only Part B benefits are payable, from arrangements for beneficiaries for whom

Part A benefits are payable under a PPS system.

The FIs notify carriers of contracts that the hospital, critical access hospital, skilled

nursing facility, home health agency, or hospice have reported with their suppliers. The

carrier should confirm the supplier’s understanding of the arrangements to assure that the

supplier does not bill inappropriately.

A description of basic services for each benefit type is in the Medicare Benefit Policy

Manual and also in the Medicare Claims Processing Manual chapter specific to the

provider.