CMS Pub. 100-04, ch. 4, § 30.1

The transition to the standard Medicare coinsurance rate (20 percent of the APC

payment rate) will be gradual. For those APC groups for which coinsurance is

currently a relatively high proportion of the total payment, the process will be

correspondingly lengthy. The law offers hospitals the option of electing to reduce

coinsurance amounts and advertise their reduced rates for all OPPS services. They

may elect to receive a coinsurance payment from Medicare beneficiaries that is less

than the wage adjusted coinsurance amount per APC. That amount will apply to all

services within that APC. This coinsurance reduction must be offered to all Medicare

beneficiaries.

Hospitals should review the list of APCs and their respective coinsurance amounts that

is published in the Federal Register for the applicable year as a final rule. After

adjusting those coinsurance amounts for the wage index applicable to their MSA,

hospitals must notify their A/B MACs (A) if they wish to charge their Medicare

beneficiaries a lesser amount. The election remains in effect until the following

calendar year. The first election must be filed by July 1, 2000, for the period August

1, 2000, through December 31, 2000. Future calendar year elections must be made by

December 1st of the year preceding the calendar year for which the election is being

made.

Because the final rule on OPPS payment rates for 2002 was not published until March

1, 2002, providers were unable to make election decisions for 2002 by December 1

preceding the year the payment rates became effective, the typical deadline for making

such elections. The deadline for providers to make elections to reduce beneficiary

copayments for 2002 was extended until April 1, 2002. The elections are effective for

services furnished on or after April 1, 2002.

The lesser amount elected:

• May not be less than 20 percent of the wage adjusted APC

payment amount;

• May not be greater than the inpatient hospital deductible for that

calendar year ($812 for 2002); and

• Will not be wage adjusted by the A/B MAC (A) or CMS.

Once an election to reduce coinsurance is made, it cannot be rescinded or changed

until the next calendar year. National unadjusted and minimum unadjusted

coinsurance amounts will be posted each year in the addenda of the OPPS final rule

(enter CMS1005FC) on CMS’ Web site (http://cms.hhs.gov/).

This coinsurance election does not apply to partial hospitalization or intensive

outpatient services furnished by CMHCs, vaccines provided by a CORF, vaccines,

splints, casts, and antigens provided by HHAs, or splints, casts, and antigens provided

to a hospice patient for the treatment of a non-terminal illness. It also does not apply

to screening colonoscopies, screening sigmoidoscopies, or screening barium enemas,

or to services not paid under OPPS.

Hospitals must utilize the following format for notification to the A/B MAC (A):

Provider number 1122334455

Provider name XYZ Hospital Effective from 8/1/2000 -

12/31/2000

Provider contact Joe Smith Phone # 123-456-7890

Contact e-mail Jsmith@XYZ.ORG Fax # 123-456-7891

XYZ Hospital elects to reduce coinsurance to the amount shown for the following

APCs:

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

APC____ Coinsurance___.__ APC____ Coinsurance___.__

Return to:

Provider Audit & Reimbursement Dept.

Attn: John Doe

A/B MAC (A) Address

The A/B MAC (A) must validate that the reduced coinsurance amount elected by the

hospital is not less than 20 percent of the wage adjusted APC amount nor more than

the inpatient deductible for the year of the election, and must send an acknowledgment

to the hospital that the election has been received, within 15 calendar days of receipt.