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    v1.0.30
    OpenPayerPolicy UpdatesReimbursement/Payment PolicyPriority Health Medicare Billing Update | OpenPaye…
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    CurrentPriority Health MedicarePolicy 025

    Provider-Based Billing

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    Governs billing, coding, service-location reporting, and reimbursement for provider-based hospital outpatient department services, including off-campus facilities, across commercial, Medicare, and Medicaid claims.

    Policy Summary
    PayerPriority Health Medicare
    PolicyProvider-Based Billing
    Policy CodePolicy 025
    Change TypeRevisedexpanded Medicare and Medicaid guidance
    Effective DateJune 1, 2024
    Last ReviewSep 1, 2026
    Next Review DateN/A
    Key ActionReport all commercial provider-based visit services on the professional claim and do not separately bill a facility fee.
    SourceLink
    POLICY UPDATE CHANGES

    The policy expanded its operational guidance to address Medicare and Medicaid provider-based billing in addition to commercial billing.

    Routine supplies, commonly packaged drugs and biologicals, treatment rooms, and specialty services used during provider-based visits were clarified as inclusive of professional charges and generally not separately payable on a facility claim.

    Specific facility revenue-code groupings that may be denied when associated with provider-based clinic visits were added.

    Modifier CG guidance was added for qualifying on-campus or nearby provider-based departments.

    A disclaimer was added explaining that authorization does not override coding, documentation, billing, reimbursement, or medical-necessity requirements.

    3Lines of business addressed

    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.

    0
    Separate commercial facility-fee reimbursement
    19 and 22Professional place-of-service codes
    2Off-campus billing modifiers
    250 yardsModifier CG distance criterion
    013XCommercial facility claim type

    Provider-Based Billing Coverage Rules

    Commercial provider-based visit reimbursement

    For commercial plans, provider-based visit services are reimbursed through the professional claim, and associated facility fees are not separately payable.

    ALL of the following

    • ALL of the following

      • Covered provider-based visit service

        • Evaluation and management services are furnished during a provider-based visit.
        • Procedures or other professional services are furnished during a provider-based visit.
        • Routine medical or surgical supplies, commonly packaged drugs or biologicals, or radiopharmaceuticals are furnished during the visit.
        • Treatment-room or specialty services are furnished in association with the professional services reported for the provider-based visit.
    • Report all services furnished during the encounter on the professional claim; do not separately report or reimburse the associated commercial clinic, office-visit, or facility fee on a UB-04 facility claim.

      Provider-based reimbursement is all-inclusive for practice expenses, including overhead, facility, and related services and expenses.

    Medicare and Medicaid provider-based billing

    Medicare and Medicaid provider-based claims are governed by CMS and MDHHS requirements.

    ALL of the following

    • Applicable government-program requirement

      • A Medicare claim follows traditional Medicare provider-based billing and reimbursement guidance in the CMS Claims Processing Manual and applicable MLN Matters guidance.
      • A Medicaid hospital clinic service is rendered in a clinic setting that is part of a licensed, Medicaid-enrolled hospital and satisfies applicable Medicare provider-based requirements, consistent with MDHHS guidance.
    • Applicable PO, PN, or CG modifier requirements, service-location requirements, and professional place-of-service requirements are accurately reported.

      For off-campus provider-based departments, corresponding professional claims should use POS 19 when applicable; off-campus facility claims must report the required location information.

    Coding and Location Reporting

    Professional place-of-service reportingmixedCovered
    11Office; professional services reimbursed at PFS non-facility rates including practice expense
    19Off-campus outpatient hospital; professional services reimbursed at PFS facility rates
    22On-campus outpatient hospital; professional services reimbursed at PFS facility rates
    Provider-based billing modifiersModifierCovered
    POExcepted service provided at an off-campus outpatient provider-based department of a hospital
    PNNon-excepted service provided at an off-campus outpatient provider-based department of a hospital
    CGPolicy criteria applied; report when the provider-based department is on campus, within 250 yards, or at a qualifying remote location
    Commercial facility claim denial codesRevenueNot Covered
    013XType of bill identified among commercial denial conditions for provider-based facility billing
    0250-0254Revenue codes for facility items such as pharmacy or drugs identified among denial examples
    0256-0259Revenue codes identified among commercial denial examples
    0270-0274Revenue codes for supplies or related facility items identified among denial examples
    0279Revenue code identified among commercial denial examples
    0510-0519Clinic or treatment-room revenue codes identified among denial examples
    0760-0761Treatment-room or specialty-service revenue codes identified among denial examples
    0924-0929Revenue codes identified among commercial denial examples
    0940-0942Revenue codes identified among commercial denial examples
    0949Revenue code identified among commercial denial examples
    1–10 of 13
    1/2
    General compliant claim codingmixed
    CPTIndustry-standard procedure coding required when applicable
    HCPCSIndustry-standard healthcare procedure and item coding required when applicable
    Revenue codesIndustry-standard facility revenue coding required when applicable
    Modifier CG proximity criteria
    On-campus locationProvider-based department is on the hospital campus
    Nearby locationProvider-based department is within 250 yards of the hospital
    Qualifying remote locationRemote location of the hospital as defined under 42 CFR 413.65
    Non-excepted off-campus practice
    Effective dateOff-campus practice location effective on or after 11/2/15
    Required modifierReport modifier PN when applicable for a non-excepted off-campus practice location

    Billing and Documentation Actions

    Billing Rule

    Select the correct professional place of service

    Determine whether the practice setting meets applicable commercial practice-setting rules and report the appropriate place of service on the professional claim. POS 11 is reimbursed at the Physician Fee Schedule non-facility rate; POS 19 and POS 22 are reimbursed at facility rates.

    • POS 11 — Office
    • POS 19 — Off-Campus-Outpatient Hospital
    • POS 22 — On-Campus-Outpatient Hospital
    Billing Rule

    Do not separately bill commercial facility fees

    For commercial plans, report all services furnished during the provider-based encounter on the professional claim. Do not submit a separately payable clinic, office-visit, or facility fee on a UB-04 facility claim; facility charges associated with the visit may be denied.

    Key Provider-Based Billing Terms

    Provider-based billing
    Service settingBilling process for services rendered in an outpatient department of the hospital, including off-campus facilities
    ClaimsTypically uses separate professional and facility claims
    PurposeFacility claims report costs such as overhead, facility costs, staffing and technical resources, while professional claims report physician services
    Provider-based facility
    Qualifying settingHospital outpatient department or related setting that meets certain CMS criteria for provider-based designation
    Other namesMay be called an outpatient center, hospital outpatient department, doctor's office, or practice
    Policy Summary
    PayerPriority Health Medicare
    PolicyProvider-Based Billing
    Policy CodePolicy 025
    Change TypeRevisedexpanded Medicare and Medicaid guidance
    Effective DateJune 1, 2024
    Last ReviewSep 1, 2026
    Next Review DateN/A
    Key ActionReport all commercial provider-based visit services on the professional claim and do not separately bill a facility fee.
    SourceLink
    On This Page
    Provider-Based Billing Coverage RulesCoding and Location ReportingBilling and Documentation ActionsKey Provider-Based Billing Terms
    The claim is processed under the applicable government-program methodology; PO and PN may trigger payment reductions.

    MDHHS follows the CMS protocol for determining PO and PN, and those modifiers result in a payment reduction applied to the OPPS rate.

    Applicable claimOff-campus provider claim lines containing a HCPCS must include the applicable PO or PN modifier
    • Provider-based reimbursement is all-inclusive for practice expenses, including overhead, facility, and related services and expenses.
    • Routine supplies, commonly packaged drugs and biologicals, treatment rooms, and specialty services associated with the visit are generally not separately payable.
    Denial Risk

    Avoid nonpayable facility revenue codes

    Commercial claims may be denied when provider-based visit services are billed on facility claims with type of bill 013X or with listed revenue codes for drugs, clinic charges, treatment rooms, supplies, E/M services, procedures, or other services performed during the visit. The listed revenue-code examples are not all-inclusive.

    • Type of bill 013X
    • Revenue codes 0250–0254, 0256–0259, 0270–0274, 0279
    • Revenue codes 0510–0519, 0760–0761, 0924–0929, 0940–0942, 0949, 096X, 097X, and 098X
    Billing Rule

    Apply provider-based billing modifiers

    For off-campus outpatient provider-based departments, report PO for excepted services and PN for non-excepted services on applicable institutional claim lines containing HCPCS codes. Report CG when the department is on campus, within 250 yards of the hospital, or at a qualifying remote location, and use the appropriate off-campus service location and POS 19 on corresponding professional claims.

    • PO — Excepted service provided at an off-campus, outpatient provider-based department
    • PN — Non-excepted service provided at an off-campus, outpatient provider-based department
    • CG — Policy criteria applied for an on-campus, nearby, or qualifying remote location
    Denial Risk

    Report accurate off-campus location data

    Ensure the service facility address matches the provider practice file, report the off-campus address on the facility claim and in loop 2310E of the 837 when applicable, and include PO or PN on off-campus claim lines containing HCPCS codes. Missing or inaccurate information may cause claim denial.

    • A practice location effective on or after 11/2/15 requires PN when applicable.
    • Corresponding professional claims must report POS 19 for off-campus provider-based department services.
    Billing Rule

    Follow program-specific government billing rules

    Medicare claims must follow traditional Medicare provider-based billing guidance. Medicaid clinic services must satisfy applicable provider-based requirements, and MDHHS follows the CMS protocol for determining PO and PN; those modifiers result in a payment reduction applied to the OPPS rate.

    • Follow the CMS Claims Processing Manual and MLN Matters guidance for Medicare provider-based billing.
    • For Medicaid, services must be rendered in a qualifying clinic setting that is part of the licensed, Medicaid-enrolled hospital and satisfies Medicare provider-based requirements.
    Documentation Required

    Maintain documentation and coding support

    Submit industry-standard, compliant CPT, HCPCS, and revenue codes only for services actually performed and fully documented in the medical record to the highest level of specificity. Authorization does not guarantee payment and does not supersede coding, billing, reimbursement, or medical-necessity requirements; failure to document services or items supplied may result in denial.

    • Use compliant codes defined by CPT, HCPCS, and revenue-code standards.
    • Maintain documentation supporting the services rendered or items supplied.
    • Claims may be rejected, denied, or recouped when applicable billing requirements are not followed.
    Designation authorityCenters for Medicare and Medicaid Services (CMS)
    Non-facility rates
    DefinitionRates comprised of costs associated with physician practice expenses
    Included expensesOverhead, facility costs, staffing and supplies
    Place of service examplePOS 11 office services are reimbursed at Physician Fee Schedule non-facility rates
    Facility rates
    DefinitionRates that do not include physician practice expenses
    Off-campus outpatient hospitalPOS 19 services are reimbursed at Physician Fee Schedule facility rates
    On-campus outpatient hospitalPOS 22 services are reimbursed at Physician Fee Schedule facility rates