On February 24, CMS sent a notice to providers about claims inappropriately overlapping when billed with a 12X and 13X type of bill with the same date of service. CMS announced that these claims would no longer overlap inappropriately, and providers can begin to resubmit claims that were rejected because of these edits. The claims would be identified with reason codes 38038, 38074, 38151, 38033, and 38154, overlapping dates of services and 12X and 13X type of bills. View a copy of the notice in the “Other issuances” section of the February 28 issue of Medicare Weekly Update.
This became an issue following the January 2012 OPPS Update (Claims Processing Manual Transmittal 2386), which clarified that providers could separately bill outpatient services prior to a non-covered inpatient admission. This is a logical extension of the fact that the three day payment window is a feature of the Part A payment system, and if no Part A payment is made, the payment window is inapplicable.
The new manual language and transmittal, effective January 1, do not distinguish between reasons for non-coverage. Presumably, the policy would apply whether the patient simply did not have Part A or the particular admission was not considered medically necessary either by internal review or external audit. These situations are all billed with a 12X type of bill.
Also the new manual language makes it clear that the dividing line for services billed on the inpatient and outpatient claims is the inpatient order. The services “prior to the point of admission (i.e. the admission order)” are to be billed as outpatient services with a type of bill 13X type of bill. This would include services in the outpatient and emergency departments (e.g. diagnostics, outpatient surgery, drug administration, and observation) prior to the non-covered inpatient admission.
Therefore, if a provider is billing an inpatient stay using 12X type of bill, in most cases the provider should also have a 13X type of bill for the outpatient services the patient received prior to the non-covered admission. The only exception would be if the patient was directly admitted to inpatient status without any prior outpatient services.
However, contractors put edits in place to deny outpatient services (billed on a 13X claim) provided on the same day as an inpatient admission. This was likely done to avoid overpayments following the June 2010 change to the three day payment window. However, apparently the contractors did not distinguish between covered and noncovered admits, and the edit inappropriately extended to noncovered inpatient cases (billed on a 12X claim).