CMS Pub. 100-04, ch. 26, § 10.6

for Place of Service (POS) Codes

(Rev. 3490, Issued: 04-01-16, Effective: 04-25-16, Implementation: 04-25-16)

For purposes of payment under the Medicare Physician Fee Schedule (MPFS), the POS

code is generally used to reflect the actual setting where the beneficiary receives the face-to-face service. For example, if the physician’s face-to-face encounter with a patient

occurs in the office, the correct POS code on the claim, in general, reflects the 2-digit

POS code 11 for office. In these instances, the 2-digit POS code (Item 24B on the claim

Form CMS-1500) will match the address and ZIP entered in the service location (Item 32

on the 1500 Form) – the physical/geographical location of the physician. However, there

are two exceptions to this general rule – these are for a service rendered to a patient who

is a registered inpatient or an outpatient of a hospital. In these cases, the correct POS

code -- regardless of where the face-to-face service occurs -- is that of the appropriate

inpatient POS code (at a minimum POS code 21) or that of the appropriate outpatient

hospital POS code (at a minimum POS code 19 or 22, for outpatient services performed

off campus or on campus) as discussed in section 10.5 of this chapter. So, if in the above

example, the patient seen in the physician’s office is actually an inpatient of the hospital,

POS code 21, for inpatient hospital, is correct. In this example, the POS code reflects a

different setting than the address and ZIP code of the practice location (the physician’s

office).

For MPFS payment purposes the determinant of payment is the locality where the

physician or supplier furnished the service. Medicare has both facility and non-facility

designations for services paid under the physician fee schedule. In accordance with

Chapter 1, Section 10.1.1 (Payment Jurisdiction Among Local Medicare Administrative

Contractors (MACs) for Services Paid Under the Physician Fee Schedule and Anesthesia

Services) of this manual, the jurisdiction for processing a request for payment for services

paid under the MPFS is governed by the payment locality where the physician or supplier

furnished the service and will be based on the ZIP code. CMS requires that the address

and ZIP code of the physician’s practice location be placed on the claim form in order to

determine the appropriate locality -- item 32 on the paper claim Form CMS 1500 or in the

corresponding loop on its electronic equivalent.

For specific POS instructions and determination of the applicable payment locality for the

PC (professional interpretation) and the TC of diagnostic tests see chapter 13, section 150

of this manual. For general policy on POS code assignment, see chapter 12, section

20.4.2 of this manual regarding the site of service payment differential under MPFS.

If the physician bills for lab services performed in his/her office, the POS code for

"Office" is shown. If the physician bills for a lab test furnished by another physician,

who maintains a lab in his/her office, the code for "Other" is shown. If the physician bills

for a lab service furnished by an independent lab, the code for "Independent Laboratory"

is used. Items 21 and 22 on the Form CMS-1500 must be completed for all laboratory

work performed outside a physician's office. If an independent lab bills, the place where

the sample was taken is shown. An independent laboratory taking a sample in its

laboratory shows "81" as place of service. If an independent laboratory bills for a test on

a sample drawn on an inpatient or outpatient of a hospital, it uses the code for the

inpatient (POS code 21), off campus-outpatient hospital (POS code 19), or on campus-outpatient hospital (POS code 22), respectively.

For hospital visits by physicians, presume, in the absence of evidence to the contrary, that

visits billed for were made. However, review a sample of physician's records when there

are questionable patterns of utilization. Confirm these visits where the medical facts do

not support the frequency of the physician's visits or in cases of beneficiary complaints.

If questioning whether the visit had been made, ascertain whether the physician's own

entry is in the patient's record at the provider. Accept an entry where the nurses' notes

indicate that the physician saw the patient on a given day. A statement by the beneficiary

is also acceptable documentation if it was made close to the alleged date of the visit.

Entries in the physician's records represent possible secondary evidence. However, these

are of less value since they are self-serving statements. Exercise judgment regarding

their authenticity. The policy requiring daily physician visits is not conclusive if, in the

individual case, the facts did not support a finding that daily visits were made.

If a claim lacks a valid place of service (POS) code in item 24b, or contains an invalid

POS in item 24b, return the claim as unprocessable to the provider or supplier, using

Group Code CO, Claim Adjustment Remark Code (CARC) 16, and Remittance Advice

Remark Code (RARC) M77. Effective for claims received on or after April 1, 2004, only

one POS may be submitted on the Form CMS-1500 for services paid under the MPFS

and anesthesia services. If the place of service is missing and the MAC cannot infer the

place of service from the procedure code billed (e.g., a procedure code for which the

definition is not site specific or which can be performed in more than one setting), then

return services as unprocessable.

If place of service is inconsistent with procedure code billed, then edit for consistency or

compatibility between the place of service and site-specific procedure codes. If the place

of service is valid but inconsistent or incompatible with the procedure billed (e.g., the

place of service is inpatient hospital and the procedure code billed is office visit), then

return services as unprocessable since the MAC typically will not know whether the

procedure code or the place of service is incorrect in such instances. If place of service is

invalid, then edit for the validity of the place of service coding. If the place of service

code is not valid (e.g., the number designation has not been assigned or defined by CMS),

then return services as unprocessable.