CMS issues new flexibilities and waivers, permits hospitals to bill for telehealth

May 1, 2020
Medicare Web

CMS released an interim final rule with comment period (IFC) on Thursday that grants organizations another round of flexibilities to meet the challenges of the COVID-19 public health emergency (PHE), including permitting hospitals to bill for telehealth services and loosening restrictions on COVID-19 testing.

The new waivers are based on stakeholders’ feedback and provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The changes are set to apply immediately, according to a CMS press release.

Temporary expansion sites and expanding telehealth

CMS’ previous IFC expanded telehealth billing for physicians and other practitioners as part of an effort to reduce nonemergency face-to-face contact. Although that allowed patients and practitioners to continue necessary services that would otherwise have been performed in clinics or hospital outpatient departments, it did not offer a mechanism for hospitals to obtain reimbursement. During open door forum calls, CMS acknowledged stakeholders’ feedback that this would have a negative effect on hospitals that are already struggling with staffing and bed shortages, as well as steep drops in revenue.

The new IFC addresses these concerns in several ways.

The IFC allows payment for outpatient hospital services, including physical and occupational therapy, wound care, drug administration, and behavioral health services, delivered in temporary expansion locations such as patients’ homes, parking lot tents, or converted hotels. These locations may be made provider-based departments (PBD) if they meet applicable non-waived Conditions of Participation. 

CMS delineates three types of services to be provided in these “relocated” PBDs: in-person services, services provided by telecommunications, and telehealth originating site services. CMS published a list of services able to be provided by telecommunication, including therapy, education and training codes.

For telehealth service, with the physician or NPP calling out from the hospital and the patient  located in one of the relocated PBDs, including their home if so designated, the hospital’s PBD (i.e. the patient’s home) would be the originating site and the hospital would bill and be paid an originating site fee.

According to the IFC, the patients in these PBDs should be registered as hospital outpatients, and  hospitals can bill for these services as normal along with any applicable billing requirements for relocating PBDs (i.e., appending modifier -PO for excepted items and services and modifier -PN for nonexcepted services).

Services provided in a temporary expansion location, including the patient’s home, still require a physician’s or nonphysician practitioner’s (NPP) order and existing supervision requirements still apply.

If the temporary expansion location is the patient’s home, it cannot be considered a “home” for the purposes of home health services. Therefore, a patient cannot receive hospital outpatient services and home health services in his or her home simultaneously.

All applicable requirements, including non-waived Conditions of Participation (CoPs), must be met for a temporary expansion location to be made a PBD. Hospitals should develop policies and procedures for assessing the appropriateness of a patient’s home for delivery of the intended outpatient services to meet the requirements of the Outpatient Services CoP (§482.54), says Kimberly A. Hoy, JD, CPC, director of Medicare and compliance with HCPro.  The Interpretive Guidelines  for this CoP require the hospital to ensure equipment, staff and facilities are adequate to provide the ouaptient services being offered at the location, says Hoy.

Organizations should compile a list of all non-waived CoPs, as well as the requirements of all applicable state and local pandemic plans, to ensure that new PBDs meet them.


PBD waivers

CMS is temporarily expanding its extraordinary circumstances relocation policy for excepted off-campus PBDs to include excepted on-campus PBDs. Effective March 1, excepted on-campus PBDs that relocate due to the public health emergency (PHE) may seek an extraordinary circumstances relocation exception and continue to bill at the Outpatient Prospective Payment System rate. The waiver will expire with the end of the PHE.

Ordering and payment for COVID-19 diagnostic tests

CMS is waiving the requirement that COVID-19 diagnostic tests must be ordered by a physician to be covered. Under the IFC and for the duration of the PHE, COVID-19 tests may be covered when ordered by any authorized healthcare professional. CMS is also extending this policy to cover diagnostic laboratory tests for influenza and respiratory syncytial virus when these tests are conducted in conjunction with a COVID-19 diagnostic test.

As widespread diagnostic testing ramps up, practitioners and organizations will likely be collecting and assessing specimens from patients that they do not have an existing relationship with. For the duration of the PHE, practitioners may bill CPT code 99211 for both new and established patients for COVID-19 assessment and specimen collection. Currently, 99211 pays a national unadjusted rate of $23.46.

Because hospital outpatient departments will also be conducting widespread testing, CMS created a new HCPCS code C9803 (hospital outpatient clinic visit specimen collection for severe acute respiratory syndrome coronavirus 2 [SARS-COV-2] [coronavirus disease (COVID-19)], any specimen source). The new code is assigned to APC 5731 (Level I Minor Procedures), which pays a national unadjusted rate of $22.98, and is assigned status indicator (SI) Q1. Separate payment for C9803 will be made only if it is billed without another primary covered hospital outpatient service or if it is billed with a clinical diagnostic laboratory test with SI A.

CMS expects to retire C9803 at the end of the PHE.

There is no beneficiary cost-sharing associated with CPT code 99211 or HCPCS code C9803.


The IFC contains numerous other provisions that are designed to support flexible care, expanded surge and testing capacity, and strengthen infection control. The changes are broad and may have complex impacts on organizations. Therefore, the IFC must be reviewed by stakeholders from all departments, including clinical, revenue cycle, compliance, and legal. CMS will be accepting comments on the IFC once it is published in the Federal Register. Organizations should continue to provide feedback to the agency as the PHE evolves.