Kaiser Permanente Clinical Review Payment Policy Update

Coverage, Bundling, and Reimbursement Rules

Coverage and payment rules

Itemized Bill Review (IBR) outlines categories of items/services not separately payable and examples.

Charges that are inclusive or integral to another procedure are not separately payable and will be paid as part of the related service.

Charges for use of capital equipment (rented or purchased) are not separately payable (examples include monitors, anesthesia machines, ventilators, pumps, scopes, specialty beds, cell savers, cameras, hemodynamic catheters).

Charges for IV flushes, diluents, IV start, access of indwelling catheters, flush at end of infusion, standard tubing/syringes/supplies, and preparation of chemotherapy agents are not separately payable.

Hydration charges are not separately payable unless documented as therapeutic in the medical record; Clinical Review will assess supporting records to determine payability.

Services integral to provision of care or room and board (eg venipuncture, medication administration IV/PO/IM, urinary catheterization, dressing changes, tube feeding, respiratory treatment or care including suctioning and incentive spirometry, specimen collection, point-of-care testing) are routine and not separately payable.

Under OPPS, HCPCS/line items bundled into APCs (Status indicator 'N') are included in overall payment and not separately payable; packaged services may also be non-payable outside OPPS when deemed packaged.

Personal care items that do not contribute to meaningful treatment (eg admission kits, oral swabs/mouthwash, slippers/footies) are not separately payable.

Respiratory therapy charges in Specialty Care Units (ICU, PICU, CCU, ED, intermediate intensive care units) are not separately payable, with limited allowances: one daily ventilator or BiPAP management charge in specialty care unit and CPAP allowed in NICU; routine CPAP (eg OSA) is not separately payable. Respiratory services in non-specialty inpatient units are limited to 1 unit/charge per date of service regardless of number of treatments.

Routine floor stock items and point-of-care (POC) tests performed at the site of care are not separately payable; POC testing requires a CLIA Certificate of Waiver for the site to allow testing.

Implants are reimbursable only if they meet FDA requirements, are reasonable and necessary, intended for one patient, and remain in patient at discharge; specific exclusions (eg certain absorbable materials) apply and Clinical Review will apply device eligibility criteria.

Intraoperative neurophysiologic monitoring (IONM) is reimbursable only when performed and interpreted by qualified personnel, with a monitoring physician overseeing no more than 3 simultaneous cases for reimbursement of professional services; professional IONM charges must be billed on HCFA 1500; UB billing for IONM professional services is not reimbursable.

Multiple-procedure and technical-component payment reductions apply per policy (highest-valued procedure at full rate; subsequent surgical procedures and certain imaging TC services receive reduced payment as specified).

Three-Day Lookback / Bundling

Medicare 3-day bundling rule for DRG hospitals:

Outpatient services furnished by the same facility in the 3 days preceding an inpatient admission must be bundled into the inpatient claim for hospitals reimbursed by DRG pricing.

This bundling includes the technical component of outpatient diagnostic services (including diagnostic laboratory tests) and related non-diagnostic services; outpatient non-diagnostic services are presumed related to the admission unless the provider attests they are unrelated.

30-Day Readmission Criteria

Readmission reimbursement policy and clinical review criteria:

Kaiser Permanente does not allow separate reimbursement for readmissions to the same DRG-priced hospital within 30 days for the same, similar, or related condition unless contractual or regulatory requirements indicate otherwise.

Clinical review (from day 2 through day 30) uses licensed clinical professionals to determine if the second admission is: the same/closely related condition or procedure; an infection or complication of care; a failed surgical intervention; an acute decompensation of a chronic disease; reasonably preventable by appropriate prior care; caused by premature discharge; or medically unnecessary.

Exclusions to the readmission policy include admissions for cancer treatment, primary psychiatric disease and rehabilitation, planned readmissions, inter-hospital transfers, and discharges against medical advice.

Additional exclusions (e.g., Critical Access Hospitals) include readmissions due to patient nonadherence, end-of-life/hospice care, obstetrical readmissions after antepartum admission, neonatal readmissions, and transplant readmissions within 180 days.

ED Facility E&M Coding Review

Emergency Department facility E&M review stance:

Facility ED claims with level 3, 4, or 5 E/M codes will be reviewed using EDC Analyzer™ to determine appropriate facility reimbursement for affected plans and facilities.

Excluded from review are claims with certain diagnosis codes (eg sexual assault, homicidal ideations, bipolar disorder, schizophrenia), claims for children under 2, patients who died in the ED or were discharged/transferred to another setting, and patients who received critical care services.

Review determination is based on presenting problems (ICD‑10 reason for visit), intensity of diagnostic workup (diagnostic CPT codes), and complicating conditions (ICD‑10 principal/secondary/external cause codes).

Clinical Review will instruct claims examiners not to reimburse any non-payable service lines or portions thereof identified during review.

Robotics Reimbursement Policy

Robotics and reimbursement:

Kaiser Permanente does not provide additional professional or technical reimbursement based on the use of robotic assistance, instruments, technique, or surgical approach; reimbursement is limited to the standard procedure payment.

PPC / DNBE Non-Reimbursement

Provider Preventable Conditions (PPC) and Do Not Bill Events (DNBE):

Clinical Review evaluates pended claims for Provider Preventable Conditions (PPC), Hospital Acquired Conditions (HAC), and Other Provider Preventable Conditions (OPPC) using CMS-defined lists and clinical guidelines; services meeting CMS criteria for PPCs/DNBEs/HACs will not be reimbursed.

Never events examples include wrong surgery or invasive procedure on patient, surgery on wrong patient, and surgery on wrong body part; charges related to DNBE/HAC will be disallowed following medical record confirmation and itemized statement review.

The Clinical Review department will instruct claims examiners not to reimburse non-payable service lines or portions of those lines when PPC/DNBE/HAC criteria are met.

NICU Level of Care

Neonatal Intensive Care (NICU) guidance:

Provides guidance for NICU and neonatal care levels 2 through 4; Level 1 (routine/mother‑baby) criteria are omitted.

Specific information regarding neonatal level of care may be requested through National Clinical Review.

Code Lists, Billing Limits, and Review Triggers

Bundled/packaged OPPS itemsHCPCSNot Covered

Status indicator 'N'

Identifies packaged services not separately payable

IONM billing formsmixed

HCFA 1500	Required form for reimbursable professional intraoperative monitoring charges
UB	Charges billed on UB form for intraoperative monitoring are not reimbursable

ED facility E&Mmixed

No codes listed

Respiratory therapy inpatient non-specialty — Limit

Policy limitRespiratory therapy charges in inpatient non-specialty settings are limited to 1 unit/charge per date of service regardless of number of treatments.

Examples coveredIncludes respiratory therapist CPT procedures, nebulizers, heated aerosol, oxygen, chest percussions, demonstration of MDI or respiratory equipment.

Specialty unit exceptionRespiratory therapy provided in Specialty Care Units (ICU, PICU, CCU, ED, intermediate intensive care) is not separately payable except limited allowances.

Allowed daily charge in specialty unitsOne daily ventilator management charge or BiPAP allowed while patient is in the specialty care unit.

ED claim levels subject to review

Requests, Documentation, and Authorization Expectations

Denial Risk

Clinical Review: Provider Preventable Conditions (PPC) / DNBE Instructions

The Clinical Review department reviews claims pended for Provider Preventable Conditions (PPC) and will instruct claims examiners not to reimburse any non-payable service lines or portions of those service lines when the services meet CMS-defined PPC/HAC/OPPC criteria. This review applies to Medicaid lines of business per CMS guidelines and includes evaluation against the defined list of Health Care Acquired Conditions and Other Provider Preventable Conditions. Clinical Review will determine whether the services meet the clinical guidelines set forth by CMS and will provide explicit instructions to Claims staff to deny or adjust payment for the affected line items.

Applies to Medicaid line of business per CMS guidance
Clinical Review evaluates pended claims against HAC/OPPC lists
Clinical Review instructs claims examiners to deny or not reimburse non-payable lines or portions thereof

Key Terms and Standards

NPI Clinical Review

DefinitionNPI Clinical Review is responsible for reviewing facility and professional claims to ensure billing/coding compliance, appropriateness, medical necessity, and payment per contract/provider manual.

Primary functionsDetermine payment for claims under review, validate medical necessity, and ensure providers comply with billing and coding standards.

Decision authorityClinical Review may deny or reduce coverage for services not medically necessary or not meeting applicable standards; physician approval required for denials.

Packaged services (OPPS/Status 'N')

DefinitionPackaged services (OPPS Status 'N') are line items/HCPCS codes bundled into APCs under OPPS and are not separately payable because their cost is included in the overall payment for the associated service.

Non-OPPS applicability

OpenPayer

Clinical Review Payment Determination Policy

Coverage, Bundling, and Reimbursement Rules

Code Lists, Billing Limits, and Review Triggers

Requests, Documentation, and Authorization Expectations

Key Terms and Standards