CMS Pub. 100-04, ch. 4, § 260.1

Hospitals, Community Mental Health Centers, and Critical Access

Hospitals

(Rev. 12423; Issued: 12-20-23; Effective: 01-01-24; Implementation: 01-02-24)

Medicare Part B coverage is available for hospital outpatient partial hospitalization

services.

A. Billing Requirement

Section 1861 (http://www.socialsecurity.gov/OP_Home/ssact/title18/1800.htm) of the

Act defines the services under the partial hospitalization benefit in a hospital.

Section 1866(e)(2) of the Act

(http://www.socialsecurity.gov/OP_Home/ssact/title18/1800.htm)recognizes

CMHCs as “providers of services” but only for furnishing partial hospitalization

or intensive outpatient services. See §261.1.1 of this chapter for CMHC partial

hospitalization bill review directions.

Hospitals and CAHs report condition code 41 in FLs 18-28 (or electronic equivalent)

to indicate the claim is for partial hospitalization services. They must also report a

revenue code and the charge for each individual covered service furnished. In

addition, hospital outpatient departments are required to report HCPCS codes. CAHs

are not required to report HCPCS code for this benefit.

Under component billing, hospitals are required to report a revenue code and the

charge for each individual covered service furnished under a partial hospitalization

program. In addition, hospital outpatient departments are required to report HCPCS

codes. Component billing assures that only those partial hospitalization services

covered under §1861(ff) of the Act are paid by the Medicare program.

Effective January 1, 2017, non-excepted off-campus provider-based departments of a

hospital are required to report a “PN” modifier on each claim line for non-excepted

items and services. The use of modifier “PN” will trigger a payment rate under the

Medicare Physician Fee Schedule. We expect the PN modifier to be reported with

each nonexcepted item and service including those for which payment will not be

adjusted, such as separately payable drugs, clinical laboratory tests, and therapy

services.

Excepted off-campus provider-based departments of a hospital must continue to report

existing modifier “PO” (Services, procedures and/or surgeries provided at off-campus

provider-based outpatient departments) for all excepted items and services furnished.

Use of the off-campus PBD modifier became mandatory beginning January 1, 2016.

All hospitals are required to report condition code 41 in FLs 18-28 to indicate the claim

is for partial hospitalization services. Hospitals use bill type 13X and CAHs use bill

type 85X. The following special procedures apply.

Bills must contain an acceptable revenue code. They are as follows:

Revenue Code Description

0250 Drugs and Biologicals

043X Occupational Therapy

0900 Behavioral Health Treatment/Services

0904 Activity Therapy

0910 Psychiatric/Psychological Services (Dates of Service

prior to October 16, 2003)

0914 Individual Therapy

0915 Group Therapy

0916 Family Therapy

0918 Behavioral Health/Testing

0942 Education/Training

Hospitals other than CAHs are also required to report appropriate HCPCS codes as

follows:

Revenue Code Description HCPCS Code

043X Occupational Therapy

*G0129 (PHP/IOP)

0900 Behavioral Health

Treatment/Services

****90791 or ***** 90792,

97153, 97154, 97155, 97156,

97157, 97158

0904 Activity Therapy

**G0176 (PHP/IOP)

0914 Individual Psychotherapy 90785, 90832, 90833, 90834,

90836, 90837, 90838, 90839,

90840, 90845, 90880, 90899

0915 Group Therapy G0410, G0411, 90853

0916 Family Psychotherapy 90846, 90847, 90849

0918 Behavioral Health/Testing 96112, 96116, 96130, 96131,

96132, 96133, 96136, 96137,

96138,

96139, 96146, 96156, 96158,

96161, 96164, 96167, 97151,

97152

0942 Education/Training

G0023, G0024, G0140,

G0146, ***G0177, G0451,

96202, 96203, 97550, 97551,

97552

The A/B MAC (A) will edit to assure that HCPCS are present when the above revenue

codes are billed and that they are valid HCPCS codes. The A/B MAC (A) will not

edit for matching the revenue code to HCPCS.

*The definition of code G0129 is as follows:

Occupational therapy services requiring skills of a qualified occupational therapist,

furnished as a component of a partial hospitalization or intensive outpatient treatment

program, per session (45 minutes or more).

**The definition of code G0176 is as follows:

Activity therapy, such as music, dance, art or play therapies not for recreation, related

to the care and treatment of patient’s disabling mental problems, per session (45

minutes or more).

***The definition of code G0177 is as follows:

Training and educational services related to the care and treatment of patient’s

disabling mental health problems, per session (45 minutes or more).

****The definition of code 90791 is as follows:

Psychiatric diagnostic evaluation (no medical services) completed by a non-physician.

*****The definition of code 90792 is as follows:

Psychiatric diagnostic evaluation (with medical services) completed by a physician.

Codes G0129 and G0176 are used only for intensive outpatient programs or partial

hospitalization programs.

Code G0177 may be used in intensive outpatient programs, partial hospitalization

programs, and outpatient mental health settings.

Revenue code 0250 does not require HCPCS coding. However, Medicare does not

cover drugs that can be self-administered.

Edit to assure that HCPCS are present when the above revenue codes are billed and

that they are valid HCPCS codes. Do not edit for the matching of revenue code to

HCPCS.

B. Professional Services

The professional services listed below when provided in all hospital outpatient

departments are separately covered and paid as the professional services of physicians

and other practitioners. These professional services are unbundled and these

practitioners (other than physician assistants (PA) bill the Medicare A/B MAC (B)

directly for the professional services furnished to hospital outpatient partial

hospitalization patients. The hospital can also serve as a billing agent for these

professionals by billing the A/B MAC (B) on their behalf under their billing number

for their professional services. The professional services of a PA can be billed to the

A/B MAC (B) only by the PA's employer. The employer of a PA may be such entities

or individuals as a physician, medical group, professional corporation, hospital, SNF,

or nursing facility. For example, if a physician is the employer of the PA and the PA

renders services in the hospital, the physician and not the hospital would be

responsible for billing the A/B MAC (B) on Form CMS-1500 for the services of the

PA. The following direct professional services are unbundled and not paid as partial

hospitalization services.

• Physician services that meet the criteria of 42 CFR 415.102, for

payment on a fee schedule basis;

• Physician assistant (PA) services as defined in §1861(s)(2)(K)(i)

of the Act;

• Nurse practitioner and clinical nurse specialist services, as defined

in

§1861(s)(2)(K)(ii) of the Act; and

• Clinical psychologist services as defined in §1861(ii) of the Act.

The services of other practitioners (including clinical social workers, marriage and

family therapists, mental health counselors, and occupational therapists), are bundled

when furnished to hospital patients, including partial hospitalization patients. The

hospital must bill the contractor for such nonphysician practitioner services as partial

hospitalization services. Make payment for the services to the hospital.

C. Outpatient Mental Health Treatment Limitation

The outpatient mental health treatment limitation may apply to services to treat

mental, psychoneurotic, and personality disorders when furnished by physicians,

clinical psychologists, NPs, CNSs, and PAs to partial hospitalization patients.

However, the outpatient mental health treatment limitation does not apply to such

mental health treatment services billed to the A/B MAC (A) by a CMHC or hospital

outpatient department as partial hospitalization services.

D. Reporting of Service Units

Hospitals report the number of times the service or procedure, as defined by the

HCPCS code, was performed. CAHs report the number of times the revenue code visit

was performed.

NOTE: Service units are not required to be reported for drugs and biologicals

(Revenue Code 0250).

E. Line Item Date of Service Reporting

Hospitals other than CAHs are required to report line item dates of service per revenue

code line for partial hospitalization claims. This means each service (revenue code)

provided must be repeated on a separate line item along with the specific date the

service was provided for every occurrence. Line item dates of service are reported in

FL 45 “Service Date” (MMDDYY). See §260.5 for a detailed explanation.

F. Payment

Starting in CY 2024 and subsequent years, the payment structure for partial

hospitalization services provided in hospital outpatient departments and CMHCs has

been set to four (4) separate APCs: Community Mental Health Center PHP APCs 5853

(Level 1 Partial Hospitalization Program (up to 3 services)) and 5854 (Level 2 Partial

Hospitalization Program (4 or more services)) and Hospital-based PHP APCs 5863

(Level 1 Partial Hospitalization Program (up to 3 services)) and 5864 (Level 2 Partial

Hospitalization Program (4 or more services)). The following chart displays the

CMHC and hospital-based PHP APCs:

Hospital-Based and Community Mental Health Center PHP APCs

CY 2024

APC

Group Title

5853 Partial Hospitalization (3 or fewer services per day) for CMHCs

5854 Partial Hospitalization (4 or more services per day) for CMHCs

5863 Partial Hospitalization (3 or fewer services per day) for hospital-based PHPs

5864 Partial Hospitalization (4 or more services per day) for hospital-based PHPs

Apply Part B deductible, if any, and coinsurance.

G. Data for CWF and PS&R

Include revenue codes, HCPCS/CPT codes, units, and covered charges in the financial

data section (fields 65a - 65j), as appropriate. Report the billed charges in field 65h,

"Charges," of the CWF record.

Include in the financial data portion of the PS&R UNIBILL, revenue codes,

HCPCS/CPT codes, units, and charges, as appropriate.

Future updates will be issued in a Recurring Update Notification.