CurrentHealthfirstPolicy PO-RE-165v1

Outpatient Facility and Professional Claim Reimbursement - Lesser-of Methodology

Governs Healthfirst's reimbursement methodology for outpatient facility and professional claims, applying a line-level 'lesser-of' rule to determine payment for multiple lines of business listed in the policy.

Policy Summary

PayerHealthfirst

PolicyOutpatient Facility and Professional Claim Reimbursement - Lesser-of Methodology

Policy CodePolicy PO-RE-165v1

Change TypeNo material changes

Effective DateJan 1, 2026

Next Review DateN/A

Key ActionSubmit claims using CMS-1500 for professional services and UB-04 for facility outpatient services; ensure accurate coding and timely filing.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

line-level lesser-ofprimary reimbursement rule

9 LOBslines of business

behavioral healthexplicit exclusions

CMS-1500/UB-04claim formats

Reimbursement Rule and Applicability

Trek Health ingests and normalizes Transparency in Coverage data and payer policy updates to give provider organizations a clear view of how commercial reimbursement behaves across markets, payers, and services. Our platform transforms raw payer disclosures into structured intelligence that supports contract evaluation, payer negotiations, and service line strategy. By combining market benchmarks with ongoing policy visibility, Trek helps teams identify variability, risk, and opportunity in commercial reimbursement. The result is faster insight, stronger negotiating positions, and more informed financial decisions.

Applies to outpatient facility and professional claims for the listed lines of business (see policy)

Apply the lesser-of rule at the individual claim line: payment = min(provider billed charge, allowed amount)

Allowed amount is determined by the applicable provider contract, Healthfirst internal fee schedule, or an external benchmark (e.g., contracted fee schedule, bundled rate, per diem rate, global case rate, OPPS, or APG)

Methodology is applicable across multiple reimbursement models including line-item pricing, OPPS/APC, APG, bundled payments, per diem, and global case rates; reimbursement may be calculated at the line or encounter level but will not exceed billed charges

When a provider agreement includes specific lesser-of language, the contract language prevails; if the contract is silent, Healthfirst applies the default lesser-of logic

Exclusions (NONE of the following apply)

Behavioral health and addiction services are excluded and governed by separate regulations or contract terms
Inpatient services are excluded and follow separate reimbursement methodologies or contract language
Services with reimbursement rates mandated by federal or state law or regulatory authority are excluded and will be reimbursed per applicable mandates

Provider/claim requirements

Claims must include required claim elements (CPT/HCPCS for professional lines; revenue codes for facility lines, modifiers, units, and billed charges)
Claims must be submitted in the appropriate CMS format (CMS-1500 for professional services, UB-04 for facility outpatient services) and follow timely filing and Provider Manual requirements

Claim Coding Elements and Amount Calculation

Required claim code elementsmixed

CPT/HCPCS	Valid CPT/HCPCS codes required on each line
Revenue	Revenue codes required for facility lines

Reimbursed Amount Rule

Reimbursed AmountLesser of (Provider's billed charge, Allowed amount under methodology)

Calculation BasisDetermined by the applicable methodology (e.g., CPT/HCPCS fee schedule, CMS APC logic, state APG weights, contracted rates)

Application LevelApplied at the unit specified by model (per line, per bundle, per diem, or per case)

Claim Submission, Appeals, and Provider Responsibilities

Billing Rule

Claim submission, coding accuracy, timely filing, and appeals

Submit claims using the required CMS formats and include accurate coding and billed charges; follow timely filing and appeals instructions in the Provider Manual to avoid denials or rejections.

Use CMS-1500 for professional services and UB-04 for facility outpatient services.
Include valid CPT/HCPCS codes on each line; facility lines must include revenue codes, applicable modifiers, units of service, and billed charges.
For bundled or case-rate submissions, follow appropriate encounter-level billing rules.
Adhere to timely filing requirements and the Healthfirst Provider Manual Subsection 17.6 for claims inquiries, corrected claims, reconsideration, and appeals.
Claims not adhering to this policy may be denied or rejected; providers are responsible for coding accuracy.

Key Definitions

Allowed Amount Definition

Allowed amount — sourcesMay be determined by provider contract, internal fee schedule, or external benchmark (e.g., contracted fee schedule, bundled rate, per diem rate, global case rate, OPPS, or APG)

Model-specific basisCalculation basis varies by model: CPT/HCPCS fee schedule for line-item FFS; CMS APC logic for OPPS/APC; state APG weights/rates for APG; contracted rates for bundled, per diem, or global case models

Contract precedenceIf provider agreement specifies pricing application, that contract language governs; Healthfirst defaults to line-level lesser-of when contract is silent

Reimbursed Amount

DefinitionThe reimbursed amount is the lesser of the provider's billed charge or the allowed amount under the applicable methodology.

PurposePrevents payment in excess of submitted charges and aligns payments with contracts, internal schedules, or benchmarks.

ScopeApplies to outpatient facility and professional claims across listed lines of business unless excluded by contract or policy-specific exclusions.

Application Units

Per-line applicationLesser-of applied per individual claim line for line-item FFS, OPPS/APC, and APG models.

Per-bundle applicationFor bundled payments, lesser-of may be applied per bundle or per line depending on contract language.

Per-diem applicationFor per diem models, lesser-of may be applied per diem or per line as specified by the contract.

Per-case applicationFor global case rates, lesser-of may be applied per case or per line based on the reimbursement model and contract.