Nebraska Administrative Code
Topic - HEALTH AND HUMAN SERVICES SYSTEM
Title 471 - NEBRASKA MEDICAL ASSISTANCE PROGRAM SERVICES
Chapter 10 - HOSPITAL SERVICES
Section 471-10-007 - BILLING AND PAYMENT FOR HOSPITAL SERVICES

Universal Citation: 471 NE Admin Rules and Regs ch 10 ยง 007

Current through March 20, 2024

007.01 PAYMENT.

007.01(A) GENERAL PAYMENT REQUIREMENTS. The Department will reimburse the Provider for services rendered in accordance with the applicable payment regulations codified in 471 NAC 10. In the event that individual payment regulations in 471 NAC 3 conflict with payment regulations outlined in this 471 NAC 10, the individual payment regulations in 471 NAC 10 must govern.

007.01(B) SPECIFIC PAYMENT REQUIREMENTS.
007.01(B)(i) OUTPATIENT SERVICES. The Department provides reimbursement for hospital outpatient services provided to Nebraska Medicaid eligible clients on a prospective basis in accordance with the rate methodology for Outpatient Hospital and Emergency Room Services. Reimbursement for the following services is included in the prospective rate payment for hospital inpatient services:
(a) Technical Component of Hospital Outpatient Radiology Services;

(b) Non-Patient Radiology Services;

(c) Anesthesiology:
(i) Technical Component of Medical Direction of Four or Fewer Concurrent Procedures for hospital outpatient;

(ii) Technical component of outpatient anesthesiology services provided by anesthetists who are not employees of a physician; and

(d) Medical Transplants, hospital charges for ambulatory stays.

007.01(B)(i)(1) This list is not intended to be an exclusive list of services that are reimbursed as a part of the hospital prospective payment for outpatient services. Other services that are considered to be included within the scope of services that are reimbursed as a part of the prospective payment for outpatient services include, but are not limited to, the following:
(a) Services which are customarily reimbursed as a part of the prospective payment for outpatient services.

007.01(B)(ii) INPATIENT SERVICES. The Department provides reimbursement for hospital inpatient services provided to Nebraska Medicaid eligible clients on a prospective basis. Each facility, with the exception of critical access hospitals, must receive a prospective rate in accordance with the Department's outlined rate methodology for hospital inpatient services. Reimbursement for the following services is included in the prospective rate payment for hospital inpatient services:
(a) Hospital observation services when the client is thereafter admitted as an inpatient of the same hospital;

(b) Hospital outpatient or emergency room services when the client is thereafter admitted as an inpatient of the same hospital before midnight of the same day;

(c) Non-physician inpatient services and Items:
(i) Outpatient and emergency room services provided by the hospital before admission; and

(ii) Outpatient or inpatient services provided by another hospital or freestanding medical facility to an inpatient of the original admitting facility.

(iii) Payment for durable medical equipment, orthotics, and prosthetics, etc., for hospital inpatients is included in the hospital's payment for inpatient services.

(d) Labor and delivery: The Department utilizes the current Medicare methodology in accounting for labor and delivery charges on the Medicare cost report;

(e) Technical component of inpatient clinical laboratory services: The hospital may include these costs on its cost report to be considered in calculating the hospital's payment rate;

(f) Technical component of inpatient anatomical pathology services: The hospital may include these costs on its cost report to be considered in calculating the hospital's payment rate;

(g) Technical component of hospital inpatient radiology services: These costs may be included on the hospital's cost report to be considered in calculating the hospital's payment rate;

(h) Anesthesiology:
(i) Technical component of medical direction of four or fewer concurrent procedures for hospital;

(ii) Technical component of inpatient anesthesiology services provided by anesthetists who are not employees of a physician;

(i) Inpatient dialysis: The hospital may include the costs of inpatient dialysis services on it cost report to be considered in calculation the hospital payment rate.

(j) Pre-Admission Testing;

(k) Medical transplants:
(i) Hospital inpatient services, including procurement costs;

(ii) Technical component of inpatient laboratory and diagnostic and therapeutic radiology;

(l) Infant apnea monitoring services provided to an inpatient.

007.01(B)(ii)(1) This list is not intended to be an exclusive list of services that are reimbursed as a part of the hospital prospective payment for inpatient services. Other services that are considered to be included within the scope of services that are reimbursed as a part of the prospective payment for inpatient services include, but are not limited to, the following:
(a) Services which are included by a hospital in the Medicare cost report; or

(b) Services which are customarily reimbursed as a part of the prospective payment for inpatient services.

007.01(B)(iii) RECONCILIATION TO FACILITY UPPER PAYMENT LIMIT. Facilities will be subject to a preliminary and a final reconciliation of Nebraska Medicaid payments to allowable Nebraska Medicaid costs. Facilities will have 90 days to make refunds to the Department, when notified that an overpayment has occurred.

007.01(B)(iv) TRANSFERS. When a patient is transferred to or from another hospital, the Department will make a transfer payment to the transferring hospital if the initial admission is determined to be medically necessary.

007.01(B)(v) INPATIENT ADMISSION AFTER OUTPATIENT SERVICES. A patient may be admitted to the hospital as an inpatient after receiving hospital outpatient services. Inpatient services, for billing and payment purposes, includes the following:
(a) Non-physician outpatient services rendered on the day of admission or during the inpatient stay;

(b) Diagnostic services rendered up to three days before the day of admission; and

(c) Admission related non-diagnostic services rendered up to 3 days before the day of admission. The day of the admission as an inpatient is the first day of the inpatient hospitalization.

007.01(B)(v)(1) READMISSIONS. The Department adopts Medicare peer review organization (PRO) regulations to control increased admissions or reduced services. All Nebraska Medicaid patients readmitted as an inpatient within 31 days will be reviewed by the Department or its designee. Payment may be denied if either admissions or discharges are performed without medical justification as determined by medical review.

007.01(B)(vi) INTERIM PAYMENT FOR LONG-STAY PATIENTS. A hospital may request an interim payment if the patient has been hospitalized 60 days and is expected to remain hospitalized an additional 60 days. To request an interim payment, the hospital must send the appropriate claim form or electronic format to the Department indicating the hospital days for which the interim payment is being requested with an attestation by the attending physician that the patient has been hospitalized a minimum of 60 days and is expected to remain hospitalized a minimum of an additional 60 days.
007.01(B)(vi)(1) FINAL PAYMENT FOR LONG-STAY PATIENT. When an interim payment is made for long-stay patients, the hospital must submit a final billing for payment upon discharge of the patient. Upon discharge, payment for the entire hospitalization will be calculated at the same rate as all prospective discharge payments. The final payment will be reduced by the amount of the interim payment.

007.01(B)(vii) PAYMENT FOR NON-PHYSICIAN ANESTHETIST (CRNA) FEES. Hospitals which meet the Medicare exception for payment of certified registered nurse anesthetist (CRNA) fees as a pass-through by Medicare will be paid for certified registered nurse anesthetist (CRNA) fees in addition to their prospective per discharge payment.

007.01(B)(viii) NON-PAYMENT FOR HOSPITAL ACQUIRED CONDITIONS. The Department will not make payment for those claims which are identified as nonpayable by Medicare as a result of avoidable hospital complications and medical errors that are identifiable, preventable, and serious in their consequences to patients. This provision applies only to those claims in which the Department is a secondary payor to Medicare.

007.01(B)(ix) OUT-OF-PLAN SERVICES. When Managed Care enrollees are provided hospital inpatient services by Nebraska Medicaid enrolled facilities not under contract with the Department's managed care organizations (MCO), the managed care organizations (MCO) are authorized, but are not required, to pay for the care provided at rates the Department would otherwise reimburse providers.

007.01(B)(x) LOWER LEVELS OF CARE. When the Department determines that a client no longer requires inpatient services but requires skilled nursing care and there are no skilled nursing beds available when the determination is made, the Department will pay only for authorized medically necessary skilled nursing care provided in an acute care hospital at a rate equal to the average rate per patient day paid by the Department to skilled nursing facilities during the previous calendar year. Medically necessary skilled nursing care must be authorized within 15 days of admission.
007.01(B)(x)(1) When a Nebraska Medicaid patient no longer requires inpatient hospital services and has requested nursing home admission and is waiting for completion of the pre-admission screening process (PASP), the Department may pay for the pre-admission screening process (PASP) days the client remains in the hospital before the pre-admission screening process is completed at a rate equal to the average rate per patient day paid by the Department to skilled nursing facilities during the previous calendar year.

007.01(B)(x)(2) The hospital must request prior authorization from the Department before the pre-admission screening process (PASP) days are provided. The Department will send the authorization to the hospital. Pre-admission screening process (PASP) days will not be considered in computing the hospital's prospective rate.

007.01(C) PAYMENTS FOR PSYCHIATRIC SERVICES. Tiered rates will be used for all psychiatric services, regardless of the type of hospital providing the service. This includes services provided at a facility enrolled as a provider for psychiatric services which is not a licensed psychiatric hospital or a Medicare-certified distinct part unit. Payment for each discharge equals the applicable per diem rate times the number of approved patient days for each tier. Payment is made for the day of admission, but not the day of discharge. Mental health and substance abuse services provided to clients enrolled in managed care for the mental health and substance abuse benefits package will be reimbursed by the managed care organization (MCO).
007.01(C)(i) PAYMENT FOR HOSPITAL SPONSORED PSYCHIATRIC RESIDENTIAL TREATMENT FACILITIES (PRTF). The Department reimbursement is capped at the psychiatric residential treatment facilities (PRTF) usual and customary daily charges billed for eligible clients. Public psychiatric residential treatment facilities (PRTF) will be cost-settled annually. Payment rates do not include costs of providing educational, pharmacy and physician services.

007.01(C)(ii) PAYMENT FOR PSYCHIATRIC ADULT INPATIENT SUBACUTE HOSPITAL SERVICES. Payments for psychiatric adult inpatient subacute hospital services are made on a per diem basis. The subacute inpatient hospital per diem rate is not a tiered rate. Payment will be an all-inclusive per diem, with the exception of physician services.

007.01(C)(iii) RATES FOR STATE-OPERATED INSTITUTIONS FOR MENTAL DISEASE (IMD). Institutions for mental disease (IMD) operated by the State of Nebraska will be reimbursed for all reasonable and necessary costs of operation. State-operated institutions will receive an interim per diem payment rate, with an adjustment to actual costs following the cost reporting period.

007.01(C)(iv) FREE-STANDING PSYCHIATRIC HOSPITALS. When a free-standing psychiatric hospital (in Nebraska or out of state) does not have ancillary services onsite, such as pharmacy or laboratory, the provider of the ancillary service must bill the Department for the ancillary services provided to inpatients.

007.01(D) PAYMENT FOR SERVICES FURNISHED BY A CRITICAL ACCESS HOSPITAL (CAH). The Department reimburses the reasonable cost of providing the services, as determined under applicable Medicare principles of reimbursement, except that the following principles do not apply: the lesser of costs or charges (LCC) rule, ceilings on hospital operating costs, and the reasonable compensation equivalent (RCE) limits for physician services to providers. Subject to the 96-hour average on inpatient stays in critical access hospitals (CAH), items and services that a critical access hospitals (CAH), provides to its inpatients are covered if they are items and services of a type that would be covered if furnished by a hospital to hospital inpatients.

007.01(E) DISPROPORTIONATE SHARE HOSPITALS. A hospital qualifies as a disproportionate share hospital if the hospital meets the definition of a disproportionate share hospital and submits the required information completed, dated and signed as follows with their Medicare cost report:
(i) The names of at least two obstetricians who have staff privileges at the hospital and who have agreed to provide obstetric services to individuals who are eligible for Nebraska Medicaid. This requirement does not apply to a hospital:
(1) The inpatients of which are predominantly individuals under 18 years of age; or

(2) Which does not offer non-emergency obstetric services to the general population as of December 21, 1987.

(3) For a hospital located in a rural area, the term "obstetrician" includes any physician with staff privileges at the hospital to perform non-emergency obstetric procedures.

(ii) Only Nebraska hospitals which have a current enrollment with Nebraska Medicaid will be considered for eligibility as a Disproportionate Share Hospital.

007.01(F) DEPRECIATION. The Department recognizes depreciation as an allowable cost as reported on each facility's Medicare cost report and as determined allowable by the Medicare intermediary through application of Medicare principles of reimbursement.
007.01(F)(i) RECAPTURE OF DEPRECIATION. A hospital which is sold for a profit and has received Nebraska Medicaid payments for depreciation must refund to the Department the lower of:
(1) The amount of depreciation allowed and paid by the Department; or

(2) The product of:
(a) The ratio of Nebraska Medicaid allowed inpatient days to total inpatient days; and

(b) The amount of gain on the sale as determined by the Medicare.

007.01(F)(ii) The year(s) for which depreciation is to be recaptured is determined by the Medicare Intermediary according to Medicare principles of reimbursement.

007.01(G) ADJUSTMENT TO RATE. Changes to Nebraska Medicaid total allowable costs as a result of error, audit, or investigation may become the basis for adjusting current or prior prospective rates. The adjustment will be made back to the initial date of payment for the period affected based on the rate as determined by the Department. Hospitals will receive written notice of any adjustment stating the amount of the adjustment and the basis for the adjustment. If the rate adjustment results in decreasing a hospital's rate, the hospital must refund the overpayment amount as determined by the Department to the Department. If the rate adjustment results in increasing a hospital's rate, the Department will reimburse the underpayment amount as determined by the Department to the hospital.
007.01(G)(i) REQUEST FOR RATE ADJUSTMENTS. Hospitals may submit a request to the Department for an adjustment to their rates for the following:
(1) An error in the calculation of the rate;

(2) Extraordinary circumstances. Extraordinary circumstances are limited to:
(a) Changes in routine and ancillary costs, which are limited to:
(i) Intern and resident related medical education costs; and

(ii) Establishment of a subspecialty care unit;

(b) Extraordinary capital-related costs. Adjustment for capital-related costs will be limited to no more than a five percent increase; or

(3) Catastrophic circumstances. Hospitals may submit a request for adjustment to their rate if they incur allowable costs as a consequence of a natural or other catastrophe. The following circumstances must be met to be considered a catastrophic circumstance:
(a) One-time occurrence;

(b) Less than twelve-month duration;

(c) Could not have been reasonably predicted;

(d) Not of an insurable nature;

(e) Not covered by federal or state disaster relief; and

(f) Not a result of malpractice or negligence.

007.01(G)(ii) ADJUSTMENT CONDITIONS. In all circumstances, requests for adjustments to rates must be calculable and auditable. Requests must specify the nature of the adjustment sought and the amount of the adjustment sought. The burden of proof is that of the requesting hospital. If an adjustment is granted, the peer group rates will not be changed. In making a request for adjustment for circumstances other than a correction of an error, the requesting hospital must demonstrate the following:
(1) Changes in costs are the result of factors generally not shared by other hospitals in Nebraska, such as improvements imposed by licensing or accrediting standards, or extraordinary circumstances beyond the hospital's control.

(2) Every reasonable action has been taken by the hospital to mitigate or contain resulting cost increases. The Department may request that the hospital provide additional quantitative and qualitative data to assist in evaluation of the request. The Department may require an on-site operational review of the hospital be conducted by the Department or its designee.

(3) The rate the hospital receives is insufficient to provide care and service that conforms to applicable state and federal laws, regulations, and quality and safety standards.

007.07(H) ACCESS TO RECORDS. Hospitals must make all records relating to the care of Nebraska Medicaid patients and any and all other cost information available to the Department, its designated representatives or agents, or representatives of the federal Department of Health and Human Services, upon reasonable notice during regular business hours.
007.01(H)(i) ADDITIONAL CONDITIONS. Hospitals must allow authorized representatives of the Department, the federal Department of Health and Human Services, and state and federal fraud and abuse units to review and audit the hospital's data processing procedures and supportive software documentation involved in the production of computer-encoded claims submitted to the Department. The hospital must allow the authorized representatives access for the purpose of audit and review at any reasonable time during normal working hours upon written notice by the Department at least one working day before the review and audit.

007.01(J) COST REPORT AUDITS. The Department periodically performs or receives cost report audits to monitor the accuracy of data used to set rates. Audits may be performed by the hospital's Medicare intermediary, the Department, or an independent public accounting firm, licensed to do business in Nebraska and retained by the Department. Audits will be performed as determined appropriate by the Department.
007.02(J)(i) NON-PARTICIPATING HOSPITALS. A hospital that does not participate in the Medicare program will complete the Medicare cost report in compliance with Medicare principles and supporting rules, regulations, and statutes. The hospital will file the completed form with the Department within five months after the end of the hospital's reporting period. A 30-day extension of the filing period may be granted if requested in writing before the end of the five-month period. Completed Medicare Cost Reports are subject to audit by the Department or its designees. Note: If a nursing facility (NF) is affiliated with the hospital, the nursing facility (NF) cost report must be filed according to 471 NAC 12. Note specifically that the time guidelines for filing nursing facility (NF) cost reports differ from those for hospitals.

007.01(K) PROVIDER APPEALS. A hospital may submit additional evidence and request prompt administrative review of its prospective rate within 90 days of the rate notification date according to the procedures in 471 NAC 2. A hospital may also request an adjustment to its rate.

007.01(L) PAYMENT TO HOSPITAL-AFFILIATED AMBULATORY SURGICAL CENTERS (HAASC). The Department pays for services provided in a hospital-affiliated ambulatory surgical center (HAASC) according to 471 NAC 10 unless the hospital-affiliated ambulatory surgical center (HAASC) is a Medicare-participating ambulatory surgical center (ASC). If the hospital-affiliated ambulatory surgical center (HAASC) is a Medicare-participating ambulatory surgical center (ASC), payment is made according to 471 NAC 26.

007.01(M) PAYMENT FOR OUTPATIENT MENTAL HEALTH AND SUBSTANCE ABUSE SERVICES IN A HOSPITAL. The Department pays for covered outpatient mental health services, except for laboratory services, at the lower of:
(i) The provider's submitted charge; or

(ii) The allowable amount for that procedure code in the Nebraska Medicaid Practitioner Fee Schedule for that date of service.

007.01(N) APPROVAL OF PAYMENT FOR EMERGENCY ROOM SERVICES. At least one of the following conditions must be met before the Department approves payment for use of an emergency room:
(1) The patient is evaluated or treated for an emergency medical condition;

(2) The patient's evaluation or treatment in the emergency room results in an approved inpatient hospital admission. The emergency room charges must be displayed on the inpatient claim as ancillary charges and included in the inpatient per diem; or

(3) The patient is referred by his or her physician for treatment in an emergency room.

007.01(N)(i) When the facility or the Department determine services are non-emergent, the room fee for non-emergent services provided in an emergency room will be disallowed to 50 percent of what would otherwise be allowed. All other Nebraska Medicaid allowable charges incurred in this type of visit will be paid according to 471 NAC 10.

007.01(P) PAYMENT TO A NEW HOSPITAL FOR OUTPATIENT SERVICES. The Department must cost-settle claims for Nebraska Medicaid-covered services which are paid by the Department. The cost settlement will be the lower of costs or charges as reflected on the hospital's cost report. The Department's payment must not exceed the upper limit of the provider's charges for services. Upon the Department's receipt of the hospital's initial Medicare cost report, the Department must no longer consider the hospital to be a "new hospital" for payment of outpatient services.

007.01(Q) PAYMENT TO AN OUT-OF-STATE HOSPITAL FOR OUTPATIENT SERVICES. Payment to an out-of-state hospital for outpatient services will be made based on the statewide average ratio of cost to charges for all Nebraska hospitals.

007.01(R) ADMINISTRATIVE FINALITY. See 471 NAC 3.

007.01(S) LIMITATIONS ON PAYMENT FOR HOSPITAL SERVICES.
007.01(S)(i) PLACE OF SERVICE. The department may review, reduce, or deny payment for covered outpatient or emergency room drugs, supplies, or services which could have been provided in a less expensive setting.

007.01(S)(ii) ITEMS NOT UTILIZED IN THE FACILITY. Drugs, medical supplies, and services prescribed at discharge from the hospital must be obtained from and billed by the appropriate provider. The Department does not provide payment to a hospital for drugs, supplies, and services prescribed at discharge from the hospital for nursing home residents. Payment for these items is included in the nursing home per diem.

007.01(S)(iii) OUTPATIENT/EMERGENCY SERVICES ON THE SAME DAY AS INPATIENT SERVICES. When a client receives outpatient or emergency room hospital services and is thereafter admitted as an inpatient of the same hospital before midnight of the same day, the outpatient/emergency room hospital services are treated as inpatient services for billing purposes.

007.01(S)(iv) BILLED CHARGES. Inpatient hospital services are paid on a prospective rate basis, regardless of billed charges.

007.01(T) THE DEPARTMENT'S SURVEILLANCE AND UTILIZATION REVIEW OF HOSPITAL SERVICES. The Department, or its designee, reviews hospital inpatient services for:
(1) Medical necessity, appropriateness of service, and level of care;

(2) Validation of hospital diagnosis and procedure coding information;

(3) Completeness, adequacy and quality of care;

(4) Appropriateness of admission, continued hospitalization, discharge, and transfer; or

(5) Appropriateness of prospective payment outlier cases.

007.01(T)(i) REVIEW ACTIVITIES FOR HOSPITAL INPATIENT SERVICES REIMBURSED ON A PROSPECTIVE PER DISCHARGE BASIS. All hospital inpatient services reimbursed on a prospective per discharge basis are subject to random retrospective review by the Department or its designee. Admissions within three calendar days of a hospital outpatient service may be included in the sample. In addition to the random sample, focused reviews of inpatient stays for transplant(s) or neonatal intensive care unit (NICU) stays provided in a subspecialty care facility or cost outliers may be done by the Department or its designee.
007.01(T)(i)(1) REVIEW FOR ALL SELECTED CASES. Validation will include:
(a) Validation of diagnostic and procedural information and ICD-9-CM coding;

(b) Medical necessity for inpatient admission and procedure(s);

(c) Stability at discharge; and

(d) Quality of care.

007.01(T)(i)(2) PAYMENT REDUCTION. If the Department, or its designee, determines that either admissions or discharges are performed without medical justification, payment for inpatient services may be denied. Payment can be reduced if coding inaccuracies are identified by the Department or its designee. Any cost outlier which is not determined to be medically necessary for hospital inpatient care by the Department or its designee may qualify for payment as a lower level of care payment.

007.01(T)(ii) REVIEW ACTIVITIES FOR HOSPITAL INPATIENT SERVICES REIMBURSED ON A PROSPECTIVE PER DIEM BASIS. Hospital inpatient care must be reasonable, medically necessary, and appropriate for the class of care being billed. All hospital inpatient admissions must be certified by the Department or its designee prior to payment. Review will include medical necessity, appropriateness of service, and level of care. Payment for services will be denied if the Department or its designee determines the service was not medically necessary. The Department or its designee will conduct these activities through pre-admission, concurrent, and retrospective reviews. If the class of care is not appropriate, the claim may be reduced to the appropriate level of care according to 471 NAC 10 or denied.

007.01(T)(iii) SURVEILLANCE AND UTILIZATION REVIEW OF HOSPITAL OUTPATIENT SERVICES. Claims for payment for hospital outpatient services are subject to review by the Department or its designee. Hospital outpatient care must be reasonable and medically necessary, and must be provided in the most appropriate place of service.

007.02 BILLING.

007.02(A) GENERAL BILLING REQUIREMENTS. Providers must comply with all applicable billing requirements codified in 471 NAC 3. In the event that individual billing requirements in 471 NAC 3 conflict with billing requirements outlined in this 471 NAC 10, the individual billing requirements in 471 NAC 10 must govern.

007.02(B) SPECIFIC BILLING REQUIREMENTS. Providers of hospital services must submit claims to the Department on Form CMS-1450.
007.02(B)(i) MEDICARE COVERAGE. For a Medicare/Medicaid client, the provider must bill Medicare for appropriate benefits before submitting a claim to the Department except Medicare non-covered services covered by the Department.
007.02(B)(i)(1) MEDICARE PART B. If the Medicare/Medicaid client has exhausted their Medicare Part A benefits, the hospital must bill these services or items to Medicare Part B if the client is covered by Part B before billing the Department. The hospital must enter the amount approved by Medicare as a prior payment on Form CMS-1450 or by electronic format.

007.02(B)(ii) DOCUMENTATION. The Department requires that documentation, when required, be submitted with each claim for hospital services. Documentation must be complete and legible. All Nebraska Medicaid clients sign a release of information statement when they apply for Nebraska Medicaid. If the hospital requires another release, the hospital must obtain that release based on the provider agreement with the Department.

007.02(B)(iii) HOSPITAL-ACQUIRED CONDITIONS (HAC). Effective for inpatient and inpatient crossover claims with a 'From' date of service on or after the effective date of this regulation, hospitals are required to report whether each diagnosis on a Nebraska Medicaid claim was present at the time of patient admission, or present on admission (POA). Claims submitted without the required present on admission (POA) indicators will be denied.
007.02(B)(iii)(1) For claims containing diagnoses that are identified by Medicare as hospital-acquired conditions, other than deep vein thrombosis (DVT)/pulmonary embolism (PE) following total knee replacement or hip replacement surgery in pediatric and obstetric patients and for which the condition was not present on admission (POA), these diagnoses will not be used for All Patient Diagnostic Related Group grouping. The claim will be paid as though any diagnoses included in the list of hospital-acquired conditions (HAC) were not present on the claim. The Department denies payment for any hospital-acquired conditions (HAC) that results in death or serious disability. The Department does not make additional payments for services on inpatient hospital claims that are attributable to hospital-acquired conditions (HAC) and are coded with present on admission (POA) indicator codes "N" or "U". Specifically, for hospitals paid under the:
(i) Diagnostic related group (DRG) payment method, the Department does not make additional payments for complications and comorbidities (CC) and major complications and comorbidities (MCC).

(ii) Cost to Charges (CCR) payment method, the Department does not pay for charges attributable to the hospital-acquired conditions (HAC).

(iii) Per Diem payment method, the Department will limit provider payment reductions to the extent that the identified PPC would otherwise result in an increase in payment, or if the Department can reasonably isolate for nonpayment the portion of the payment directly related to the PPC.

007.02(B)(iv) OTHER PROVIDER PREVENTABLE CONDITION (OPPC). Effective for inpatient, inpatient crossover, outpatient, and outpatient hospital claims, payment will be denied for the following other provider preventable conditions:
(1) Incorrect surgical or other invasive procedure performed on a patient;

(2) Incorrect surgical or other invasive procedure performed on the wrong body part;

(3) Incorrect surgical or other invasive procedure performed on the wrong patient.

007.02(B)(v) NURSERY CARE. Hospitals reimbursed by per diem must bill nursery care unless the newborn:
(1) Is transferred from nursery bassinet care to acute care or intensive care; or

(2) Remains in the hospital after the mother's discharge, if the child is being discharged to the mother's care.

007.02(B)(vi) HOSPITAL UTILIZATION REVIEW (UR). Each hospital must have in effect a utilization review plan that provides for review of services provided by the hospital and by members of the medical staff to Nebraska Medicaid patients.
007.02(B)(vi)(1) COMPOSITION OF THE UTILIZATION REVIEW COMMITTEE. A utilization review (UR) committee consisting of two or more practitioners must carry out the utilization review (UR) function. This commitee must be:
(i) A staff committee of the institution; or

(ii) A group outside the institution established by the local medical society and some or all of the hospitals in the locality or established in a manner approved by the Centers for Medicare and Medicaid Services.

007.02(B)(vi)(1)(a) SMALL INSTITUTION. If, because of the small size of the institution, it is impossible to have a properly functioning staff committee, the utilization review (UR) committee must be established under item two above. The committee's or group's reviews may not be conducted by any individual who has a direct financial interest in that hospital or was professionally involved in the care of the patient whose case is being reviewed. At least two members of the committee must be doctors of medicine or osteopathy. The other members may be:
(i) A doctor of medicine or osteopathy;

(ii) A doctor of dental surgery or dental medicine;

(iii) A doctor of podiatric medicine;

(iv) A doctor of optometry; or

(v) A chiropractor.

007.02(B)(vi)(2) SCOPE AND FREQUENCY OF REVIEWS. The utilization review (UR) plan must provide for review of Nebraska Medicaid patients with respect to the medical necessity of:
(i) Admissions to the hospital;

(ii) The duration of stays; and

(iii) Professional services provided, including drugs.

007.02(B)(vi)(2)(a) REVIEW OF ADMISSIONS. Review of admissions may be performed before, at, or after hospital admission. Except for extended stay reviews, reviews may be conducted on a sample basis.

007.02(B)(vii) DETERMINATIONS REGARDING DENIAL OF MEDICAL NECESSITY OF ADMISSIONS OR CONTINUED STAYS. The determination that an admission or continued stay is not medically necessary:
(a) May be made by one member of the utilization review (UR) committee if the practitioner(s) responsible for the patient's care concur with the determination or fail to present their view when given the opportunity; or

(b) In all other cases, must be made by at least two members of the utilization review (UR) committee.

007.02(B)(vii)(1) MEDICALLY NECESSARY. Before making a determination that an admission or continued stay is not medically necessary, the utilization review (UR) committee must consult the practitioner(s) responsible for the care of the patient, and afford the practitioner(s) the opportunity to present their views. If the committee decides that admission to or continued stay in the hospital is not medically necessary, written notification must be given no later than two days after the determination, to the hospital, the patient, and the practitioner(s) responsible for the care of the patient.

007.02(B)(vii)(2) BILLING THE CLIENT. The hospital may bill the client for services provided after the date the client receives notification if the following criteria are met:
(i) The hospital's utilization review (UR) committee has determined that an admission or an extended stay is or was not medically necessary;

(ii) The hospital has met the client notification requirements in 471 NAC 10; and

(iii) The Nebraska Medicaid client chooses to remain in the hospital or be admitted to the hospital.

007.02(B)(vii)(2)(a) PERMISSABLE BILLING. When an individual is admitted to a hospital as a non-Nebraska Medicaid patient and is later determined to be eligible for Nebraska Medicaid, the hospital must not bill the client for services that are covered by the Department. If the services are covered by the Department but have been denied based on medical necessity, the provider must not bill the client. The hospital may bill the client for those services that are specifically not covered by the Department, such as cosmetic surgery.

007.02(B)(vii)(3) EXTENDED STAY REVIEW. The utilization review (UR) committee must make a periodic review as specified in the utilization review (UR) plan of each current inpatient receiving hospital services during a continuous period of extended duration. The scheduling or the periodic reviews may be the same for all cases or different for different classes of cases.

007.02(B)(vii)(4) RECERTIFICATION OF CONTINUED STAY. Recertification must be made at least every 60 days after initial certification. Psychiatric inpatient care must be certified every 30 days.

007.02(B)(viii) REVIEW OF PROFESSIONAL SERVICES. The utilization review (UR) committee must review professional services provided, to determine medical necessity and to promote the most efficient use of available health facilities and services.

007.02(B)(ix) SWING BEDS. The Department covers swing beds only for skilled nursing care where a client requires 24-hour professional nursing care.
007.02(B)(ix)(1) PRIOR AUTHORIZATION. To obtain prior authorization for payment for a client admitted to a swing bed, within 15 days of the date of admission to the swing bed facility staff must:
(a) Complete an admission Form MC-9-NF or use the standard electronic Health Care Services Review - Request for Review and Response transaction (ASC X12N 278);

(b) Submit a copy of Form DM-5 or physician's history and physical;

(c) Complete Long Term Care Evaluation; and

(d) Submit all the information to the local office.

007.02(B)(x) ANCILLARY SERVICES. The hospital must bill for ancillary services for swing-bed patients who are eligible for Nebraska Medicaid only. If Medicare is covering the swing-bed services, the facility must not bill the Department for ancillary services.

007.02(B)(xi) THERAPIES. Laboratory, radiology, respiratory therapy, physical therapy, occupational therapy, and speech pathology and audiology services must be billed on the appropriate claim form or in electronic format as outpatient services. These payments must be reported on the Medicare cost report as outpatient revenues.

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