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    v1.0.31
    OpenPayerPolicy UpdatesReimbursement/Payment PolicyNorth Dakota Medicaid Reimbursement Update | OpenP…
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    CurrentNorth Dakota Department of Health & Human ServicesPolicy 24-0018

    METHOD FOR REIMBURSING INPATIENT HOSPITAL SERVICES

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    Governs North Dakota Medicaid reimbursement for inpatient hospital services, including PPS, DRG, capital, outlier, and separate LARC device payments for eligible in-state hospitals and distinct part units.

    Policy Summary
    PayerNorth Dakota Department of Health & Human Services
    PolicyMETHOD FOR REIMBURSING INPATIENT HOSPITAL SERVICES
    Policy CodePolicy 24-0018
    Change TypeMaterial revision
    Effective DateOctober 1, 2024
    Next Review DateN/A
    Key ActionDo not include LARC devices in DRG reimbursement for discharges on or after October 1, 2024; bill them under Attachment 4.19-B, section 34.11.
    SourceLink
    POLICY UPDATE CHANGES

    PPS base rates and capital rates are increased by two percent effective July 1, 2024.

    The All Patient Refined Diagnosis Related Grouper version 39 is used for DRG classification and grouping effective July 1, 2022.

    Long-acting reversible contraceptive devices are excluded from DRG reimbursement for discharges on or after October 1, 2024.

    2%PPS base and capital rate increase
    2x or $60,000General cost outlier threshold
    60%General outlier payment rate

    OpenPayer is powered by Trek Health's payer performance platform. Trek continuously ingests, validates, and normalizes Transparency in Coverage data alongside payer policies and other commercial payer data to create a structured payer intelligence foundation. OpenPayer uses this foundation to deliver personalized search results, dynamically generated policy pages, and tailored policy monitoring based on each user's payers, specialties, billing codes, and areas of interest. The same intelligence powers broader payer performance workflows, including reimbursement benchmarking, contract evaluation, payer negotiations, and financial decision-making.

    1.5x or $57,000Neonatal outlier threshold
    80%Neonatal outlier payment rate
    APR-DRG v39DRG grouper

    PPS Applicability and Separate Device Reimbursement

    PPS Applicability

    In-state hospital services are reimbursed under the Prospective Payment System unless the hospital or distinct part unit is specifically identified in Section 2.

    PPS applicability

    • The service is provided by an in-state hospital or distinct part unit.
    • The hospital or distinct part unit is not specifically identified in Section 2.
    • Reimbursement is based on the Prospective Payment System (PPS), which generally follows Medicare PPS and uses diagnosis-related groups (DRGs) to pay for services upon discharge.
    • Medical education costs are excluded from PPS reimbursement.

    LARC Reimbursement

    For discharges on or after October 1, 2024, LARC devices are excluded from DRG reimbursement and are reimbursed separately.

    Separate LARC reimbursement

    • The discharge occurs on or after October 1, 2024.>= October 1, 2024
    • The item is a long-acting reversible contraceptive (LARC) device.
    • The LARC device is excluded from the DRG reimbursement for the discharge.
    • The LARC device is reimbursed separately as outlined in Attachment 4.19-B, §34.11, Prescribed Drugs, Physician Administered Drugs.

    DRG Classification and Outlier Payments

    DRG classification systemmixed
    APR-DRG v39All Patient Refined Diagnosis Related Grouper version 39 used for DRG classification and grouping
    Neonatal DRGsmixedCovered
    DRG 580-640Neonatal-related DRGs subject to the specialized cost outlier threshold
    Separately reimbursed devicesHCPCSNot Covered
    LARCLong-acting reversible contraceptive devices excluded from DRG reimbursement for applicable discharges
    General Cost Outlier Threshold
    Applies toInpatient hospital discharges paid under the Prospective Payment System (PPS)
    ThresholdThe greater of two times the DRG rate or $60,000
    Outlier basisA cost outlier payment is made when inpatient costs exceed the applicable threshold
    General Cost Outlier Payment Rate
    Payment triggerCosts above the general cost outlier threshold
    Payment rate60 percent of billed charges
    Applicable thresholdThe greater of two times the DRG rate or $60,000

    Billing and Payment Actions

    Billing Rule

    Bill inpatient discharges under PPS

    Submit inpatient hospital discharges for reimbursement under the applicable Prospective Payment System (PPS) diagnostic related group (DRG) methodology. Include the applicable capital payment and any eligible outlier payment.

    • Use the All Patient Refined Diagnosis Related Grouper version 39 for DRG classification and grouping.
    • Capital payment is included in the PPS payment for all discharges, except transferring hospitals may not receive capital payments.
    • General cost outlier payments apply when costs exceed the greater of two times the DRG rate or $60,000; costs above the threshold are paid at 60% of billed charges.
    Billing Rule

    Apply neonatal outlier rules

    Apply the neonatal cost outlier methodology to discharges assigned to DRGs 580 through 640. For these discharges, the outlier threshold is the greater of 1.5 times the DRG rate or $57,000, and costs above the threshold are paid at 80% of billed charges.

    Key Payment Terms

    Prospective Payment System (PPS)
    MethodologyA Prospective Payment System that generally follows the Medicare PPS
    Payment methodUses diagnostic related groups (DRG) to pay for services upon discharge
    Excluded costsMedical education costs are excluded from the PPS
    All Patient Refined Diagnosis Related Grouper Version 39
    SystemAll Patient Refined Diagnosis Related Grouper version 39
    PurposeUsed for DRG classification and grouping
    Effective dateJuly 1, 2022
    Policy Summary
    PayerNorth Dakota Department of Health & Human Services
    PolicyMETHOD FOR REIMBURSING INPATIENT HOSPITAL SERVICES
    Policy CodePolicy 24-0018
    Change TypeMaterial revision
    Effective DateOctober 1, 2024
    Next Review DateN/A
    Key ActionDo not include LARC devices in DRG reimbursement for discharges on or after October 1, 2024; bill them under Attachment 4.19-B, section 34.11.
    SourceLink
    On This Page
    PPS Applicability and Separate Device ReimbursementDRG Classification and Outlier PaymentsBilling and Payment ActionsKey Payment Terms
    Neonatal Cost Outlier Threshold
    Applicable DRGsDRGs 580-640 relating to neonates
    ThresholdThe greater of 1.5 times the DRG rate or $57,000
    Payment categoryNeonatal cost outlier threshold
    Neonatal Cost Outlier Payment Rate
    Applies toCosts above the neonatal cost outlier threshold for DRGs 580-640
    Payment rate80 percent of billed charges
    Applicable thresholdThe greater of 1.5 times the DRG rate or $57,000
    • Applicable DRGs: 580–640
    • Threshold: greater of 1.5 times the DRG rate or $57,000
    • Payment above the threshold: 80% of billed charges
    Billing Rule

    Bill LARC devices separately

    For discharges on or after October 1, 2024, exclude long-acting reversible contraceptive (LARC) devices from DRG reimbursement. Bill or seek reimbursement under Attachment 4.19-B, section 34.11, Prescribed Drugs, Physician Administered Drugs.

    • Effective date: October 1, 2024
    • Do not include LARC devices in the DRG reimbursement.
    • Separate reimbursement is outlined in Attachment 4.19-B #34.11.
    Cost Outlier Payment
    DefinitionAn additional payment made when inpatient costs exceed the applicable cost outlier threshold
    General excess costsPaid at 60 percent of billed charges
    Neonatal excess costsPaid at 80 percent of billed charges for DRGs 580-640