Billing and Coding: Psychiatric Partial Hospitalization Programs

Language quoted from Centers for Medicare and Medicaid Services (CMS), National Coverage Determinations (NCDs) and coverage provisions in interpretive manuals is italicized throughout the policy. NCDs and coverage provisions in interpretive manuals are not subject to the Local Coverage Determination (LCD) Review Process (42 CFR 405.860[b] and 42 CFR 426 [Subpart D]). In addition, an administrative law judge may not review an NCD. See Section 1869(f)(1)(A)(i) of the Social Security Act.

Unless otherwise specified, italicized text represents quotation from one or more of the following CMS sources:

Title XVIII of the Social Security Act (SSA):

Section 1862(a)(1)(A) of Title XVIII of the Social Security Act excludes expenses incurred for items or services which are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.

Sections 1861 (ff) and 1832 (a)of Title XVIII of the Social Security Act define the partial hospitalization benefit and provide for coverage of partial hospitalization in a hospital or CMHC setting. Section 1861 (ff) also provides coverage of partial hospitalization in a Critical Access Hospital (CAH) outpatient setting.

Section 1861 (s)(2)(B) of Title XVIII of the Social Security Act references partial hospitalization in a hospital outpatient setting.

Section 1835(a) of Title XVIII of the Social Security Act references physician certification.

Section 1833(e) of Title XVIII of the Social Security Act requires services to be documented in order for payment to be made.

Code of Federal Regulations:

42 CFR Section 410.43 describes conditions and exclusions from partial hospitalization services.

42 CFR Section 424.24 lists requirements for certification of partial hospitalization services.

Federal Register:

Federal Register, Vol. 59, No. 29, February 11, 1994, pages. 6570-6579 is the Partial Hospitalization Services in Community Mental Health Centers Interim Final Rule.

CMS Publications:

CMS Publication 100-02, Medicare Benefit Policy Manual, Chapter 2:

30.2.2 Active Treatment in Psychiatric Hospitals

30.2.2.1 Principles for Evaluating a Period of Active Treatment

30.2.3 Services Supervised and Evaluated by a Physician

30.3.1 Individualized Treatment or Diagnostic Plan

30.3.2 Services Expected to Improve the Condition or for Purpose of Diagnosis

CMS Publication 100-02, Medicare Benefit Policy Manual, Chapter 6:

70 Outpatient Hospital Psychiatric Services

70.3 Partial Hospitalization Services

CMS Publication 100-03, Medicare National Coverage Determinations Manual (MNCDM), Chapter 1:

70.1 Consultations With a Beneficiary's Family and Associates

160.25 Multiple Electroconvulsive Therapy (MECT) (Transmittal 10, April 6, 2004)

170.1 Institutional and Home Care Patient Education Programs

CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4:

260 Outpatient Partial Hospitalization Services

260.1 Hospital Outpatient Partial Hospitalization Services Billing Requirements

260.1.1 Bill Review for Partial Hospitalization Services Provided in Community Mental Health Centers (CMHC)

260.2 Professional Services Related to Partial Hospitalization

260.3 Outpatient Mental Health Treatment Limitations for Partial Hospitalization Services

260.4 Reporting Service Units for Partial Hospitalization

260.5 Line Item Date of Service Reporting for Partial Hospitalization

260.6 Payment for Partial Hospitalization Services

CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 12:

150 Clinical Social Worker (CSW) Services

160 Independent Psychologist Services

160.1 Payment [for testing services performed by psychologists other than clinical psychologists]

CMS Publication 100-02, Medicare Benefit Policy Manual and CMS Publication 100-04, Medicare Claims Processing Manual, Change Request #6320, January 1, 2009, January 2009 Update of the Hospital Outpatient Prospective Payment System (OPPS).

CMS Publication 100-20, One-Time Notification Manual, Transmittal No. 98, Change Request #3343, July 23, 2004, revises Change Request #3194 by changing the effective date for the discontinuation of revenue code 0910 to dates of service on or after October 16, 2003.

CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1, Transmittal No. 167, Change Request #3194, April 30, 2004, provides instructions for discontinued use of revenue code 0910 effective 10/01/2004.

CMS [then HCFA] Ruling 97-1, February 1, 1997, defines Medicare policy for limitation of liability for PHP services for which Medicare payment is denied.

This article gives guidance for billing, coding, and other guidelines in relation to local coverage policy L34196-Psychiatric Partial Hospitalization Programs.

General Guidelines for Claims submitted to Part A or Part B MAC:

Procedure codes may be subject to National Correct Coding Initiative (NCCI) edits or OPPS packaging edits. Refer to NCCI and OPPS requirements prior to billing Medicare. For services requiring a referring/ordering physician, the name and NPI of the referring/ordering physician must be reported on the claim. A claim submitted without a valid ICD-10-CM diagnosis code will be returned to the provider as an incomplete claim under Section 1833(e) of the Social Security Act. The diagnosis code(s) must best describe the patient's condition for which the service was performed. For diagnostic tests, report the result of the test if known; otherwise the symptoms prompting the performance of the test should be reported.

Advance Beneficiary Notice of Non-coverage (ABN) Modifier Guidelines

An ABN may be used for services which are likely to be non-covered, whether for medical necessity or for other reasons. Refer to CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 30, for complete instructions.

Effective from April 1, 2010, non-covered services should be billed with modifier –GA, -GX, -GY, or –GZ, as appropriate.

The –GA modifier (“Waiver of Liability Statement Issued as Required by Payer Policy”) should be used when physicians, practitioners, or suppliers want to indicate that they anticipate that Medicare will deny a specific service as not reasonable and necessary and they do have an ABN signed by the beneficiary on file. Modifier GA applies only when services will be denied under reasonable and necessary provisions, sections 1862(a)(1), 1862(a)(9), 1879(e), or 1879(g) of the Social Security Act. Effective April 1, 2010, Part A MAC systems will automatically deny services billed with modifier GA. An ABN, Form CMS-R-131, should be signed by the beneficiary to indicate that ‎he/she accepts responsibility for payment.‎ The -GA modifier may also be used on assigned claims when a patient refuses to sign the ABN and the latter is properly witnessed. For claims submitted to the Part A MAC, occurrence code 32 and the date of the ABN is required.

Modifier GX (“Notice of Liability Issued, Voluntary Under Payer Policy”) should be used when the beneficiary has signed an ABN, and a denial is anticipated based on provisions other than medical necessity, such as statutory exclusions of coverage or technical issues. An ABN is not required for these denials, but if non-covered services are reported with modifier GX, will automatically be denied services.

The –GZ modifier should be used when physicians, practitioners, or suppliers want to indicate that they expect that Medicare will deny an item or service as not reasonable and necessary and they have not had an ABN signed by the beneficiary. ‎If the service is statutorily non-covered, or without a benefit category, submit the ‎appropriate CPT/HCPCS code with the -GY modifier. An ABN is not required for these denials, and the limitation of liability does not apply for beneficiaries. Services with modifier GY will automatically deny.

Documentation Requirements

The patient’s medical record should include but is not limited to:

• The assessment of the patient by the ordering provider as it relates to the complaint of the patient for that visit,
• Relevant medical history
• Results of pertinent tests/procedures
• Signed and dated office visit record/operative report (Please note that all services ordered or rendered to Medicare beneficiaries must be signed.)

The patient's medical record must contain documentation that fully supports the medical necessity for services included within this LCD. (See "Indications and Limitations of Coverage.") This documentation includes, but is not limited to, relevant medical history, physical examination, and results of pertinent diagnostic tests or procedures.

Upon admission, a certification by the physician (MD/DO) must be made that the patient admitted to the partial hospitalization program would require inpatient psychiatric hospitalization if the partial hospitalization services were not provided and must include an attestation that the services are furnished while the individual is under the care of a physician, and that the services are furnished under an individualized written plan of care.

Recertification must be signed by a physician who is treating the patient and has knowledge of the patient's response to treatment. The first recertification is required as of the 18 ^th day of partial hospitalization services. Subsequent recertifications are required at intervals established by the provider, but no less frequently than every 30 days [i.e., no less frequently than every 30 days following the first recertification which must be made as of the 18 ^th day of partial hospitalization services]. The recertification must specify that the patient would otherwise require inpatient psychiatric care in the absence of continued stay in the partial hospitalization program and describe the following:

• The patient's response to the therapeutic interventions provided by the partial hospitalization program.
• The patient's psychiatric symptoms that continue to place the patient at risk of hospitalization.
• Treatment goals for coordination of services to facilitate discharge from the partial hospitalization program.

(42 CFR 424.24)The initial psychiatric evaluation with medical history and physical examination must be performed and placed in the chart within 48 hours of admission in order to establish medical necessity for partial hospitalization services. If the patient is being discharged from an inpatient psychiatric admission to a partial hospitalization program, the psychiatric evaluation, medical history, and physical examination from that admission with appropriate update is acceptable.

In order to support the medical necessity of admission to the partial hospitalization program, the documentation in the initial psychiatric evaluation should include the following items:

• Patient's chief complaint;
• Description of acute illness or exacerbation of chronic illness requiring admission;
• Current medical history, including medications and evidence of failure at or inability to benefit from a less intensive outpatient program;
• Past psychiatric and medical history;
• History of substance abuse;
• Family, vocational and social history, including documentation of an adequate support system to sustain/maintain the patient outside the partial hospitalization program;
• Mental status examination, including general appearance and behavior, orientation, affect, motor activity, thought content, long and short term memory, estimate of intelligence, capacity for self harm and harm to others, insight, judgment, capacity for activities of daily living (ADLs);
• Physical examination (if not done within the past 30 days and available for inclusion in the medical record);
• Formulation of the patient's status, including an assessment of the reasonable expectation that the patient will make timely and significant practical improvement in the presenting acute symptoms as a result of the partial hospitalization program;
• ICD-10-CM/DSM-IV-TR™ diagnoses, including all five axes of the multiaxial assessment as described in the DSM-IV-TR;
• Treatment plan, including long and short term goals related to the active treatment of the reason for admission, and types, amount, duration, and frequency of therapy services, including activity therapy, required to address the goals.

A team approach may be used in developing the initial psychiatric evaluation, but the physician (MD/DO) must document the mental status examination, physical examination, formulation, diagnosis, treatment plan, and certification.

Partial hospitalization is active treatment that incorporates an individualized treatment plan, which describes a coordination of services wrapped around the particular needs of the patient, and includes a multidisciplinary team approach to patient care. The treatment plan is established by the physician, in consultation with appropriate staff members, and should be reviewed according to the changing needs of the patient's acute psychiatric illness, but never less than every 31 days. The treatment plan should be reviewed more frequently if the severity of the clinical condition or changes in the clinical condition of the patient (e.g., change of medication) make it reasonable to do so. The long and short-term treatment goals described in the treatment plan are the basis for evaluating the patient's response to treatment. Treatment goals should be designed to measure the response to treatment, for this relationship will be used in determining whether services are medically necessary. The treatment goals should be measurable, functional, time-framed, and directly related to the reason for admission. The treatment plan must include the specific treatments ordered, including reference to psychotropic medication management, the expected timeframes and outcomes for each treatment, and the discharge plan.

Section 1833(e) of the Social Security Act requires services to be documented in order for payment to be made. Therefore, a separate progress note is required for each service rendered (e.g., HCPCS or revenue code billed). The progress note should be written by the team member rendering the service and should include a description of the nature of the treatment service, the patient's status (behavior, verbalizations, mental status) during the course of the service, the patient's response to the therapeutic intervention and its relation to the long or short term goals in the treatment plan. Each progress note should be legible, dated and signed, and include the credentials of the rendering provider. Documentation of group therapy sessions must indicate the name of the group, group type, an indication of the material under discussion, and the patient's response to the treatment encounter.

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 (CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1[D]).

Claims submitted by either CMHCs or hospital outpatient departments for partial hospitalization services must include a mental health diagnosis, and at least three partial hospitalization HCPCS codes for each day of service, one of which must be a psychotherapy HCPCS code (other than brief). Claims that do not pass the [Outpatient Code Editor] OCE edits will undergo further prepayment review. (65 FR 18454, April 7, 2000)

Repetitive Part B services to a single individual from providers that bill FIs shall be billed monthly (or at the conclusion of treatment)...Examples of repetitive Part B services with applicable revenue codes include...Psychological Services, 0900... 0911-0919 (in a psychiatric facility) (CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 1, Section 50.2.2, Rev. 270, Issued 08/03/04, Effective 01/01/05).

Partial hospitalization services provided by community mental health centers (CMHCs):
All italicized text below is from CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1.1 unless otherwise specified.
The CMHCs bill for partial hospitalization services on Form CMS-1450 or electronic equivalent under bill type 76X. ...The acceptable revenue codes are as follows:

0914

Individual Therapy

The CMHCs are also required to report appropriate HCPCS codes as follows:

Section 4523 of the Balanced Budget Act (BBA)(P.L. 105-33), requires payment to be made under a prospective payment system for partial hospitalization services furnished by a CMHC. CMHCs must:

• Report HCPCS codes and modifiers
• Report line item dates of service; and
• Report in Form Locator (FL) 46, "Service Units," the number of times a particular service or procedure based on the HCPCS was performed (not the total number of visits for the billing period). (See CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1.1[E].)

When reporting service units for HCPCS codes where the definition of the procedure does not include any reference to time (either minutes, hours or days), CMHCs should not bill for sessions of less than 45 minutes. (See CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1.1[E].)

Partial hospitalization services provided by hospital outpatient departments:
All italicized text below is from CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1 unless otherwise specified.
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 HCPCS code for this benefit (CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1[A]).
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 [other than CAHs] are required to report HCPCS codes. Component billing assures that only those partial hospitalization services covered under Section 1861(ff) of the Act are paid by the Medicare program (CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 260.1[A]).
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:

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

Under component billing, Critical Access Hospitals (CAHs) are required to report an acceptable revenue code, in accordance with those listed above, and the charge for each individual covered service furnished under a partial hospitalization program.

Hospitals and Community Mental Health Centers (CMHCs) are required to report all OPPS services that are provided on the same day on the same claim with the exception of claims containing condition codes 20, 21, or G0 (zero) or containing repetitive Part B services. If an individual OPPS service is provided on the same day as an OPPS repetitive service, the individual OPPS service must be billed separately, with all related services, from the OPPS monthly repetitive claim. However, if some of the services are for partial hospitalization, the provider shall place condition code 41 on the claim. For claims containing condition code 41, all services billed on the same day are to be included on the monthly bill for repetitive services. Non-repetitive OPPS services, exclusive of partial hospitalization services, are to be put on a single claim along with any packaged services. Repetitive services are billed monthly on a separate claim (CMS Publication 100-04, Medicare Claims Processing Manual, Chapter 4, Section 170, Rev. 239, Issued 07/23/04, Effective 01/01/05).

Other Comments:

For claims submitted to the Part A MAC: this coverage determination also applies within states outside the primary geographic jurisdiction with facilities that have nominated CGS Administrators to process their claims.

Bill type codes only apply to providers who bill these services to the Part A MAC. Bill type codes do not apply to physicians, other professionals and suppliers who bill these services to the carrier or Part B MAC.

Limitation of liability and refund requirements apply when denials are likely, whether based on medical necessity or other coverage reasons. The provider/supplier must notify the beneficiary in writing, prior to rendering the service, if the provider/supplier is aware that the test, item or procedure may not be covered by Medicare. The limitation of liability and refund requirements do not apply when the test, item or procedure is statutorily excluded, has no Medicare benefit category or is rendered for screening purposes.

If the facility portion of partial hospitalization programs is denied as not medically necessary this does not mean that the physician service is also not medically necessary. The physician service to the patient may be medically necessary even though the level of service rendered in a partial hospitalization facility is not medically necessary.

For outpatient settings other than CORFs, references to "physicians" throughout this policy include non-physicians, such as nurse practitioners, clinical nurse specialists and physician assistants. Such non-physician practitioners, with certain exceptions, may certify, order and establish the plan of care as authorized by State law. (See Sections 1861(s)(2) and 1862(a)(14) of Title XVIII of the Social Security Act; 42 CFR, Sections 410.74, 410.75, 410.76 and 419.22; 58 FR 18543, April 7, 2000.)