Effective Date of Rule: August 1, 2007.

     Purpose: The department is updating and clarifying sections in chapter 388-550 WAC relating to (1) hospital requirements for transplants and bariatric surgery; (2) inpatient chronic pain management and hospice services; (3) payment methods for Medicaid and SCHIP clients; (4) covered and noncovered outpatient services; (5) restrictions on hospital coverage; (6) revenue code categories and subcategories for outpatient and inpatient hospital services for dates of admission before August 1, 2007, and on and after August 1, 2007; (7) specific noncovered services; (8) authorization and utilization review of hospital services; (9) specialty services not requiring prior authorization; and (10) transplant coverage. In addition, the department is changing verbiage from "medical assistance administration (MAA)" to "the department," and "facility" to "hospital."

     Citation of Existing Rules Affected by this Order: Amending WAC 388-550-1200, 388-550-1300, 388-550-1350, 388-550-1400, 388-550-1500, 388-550-1600, 388-550-1700, 388-550-1800, 388-550-1900, 388-550-2100, 388-550-2200, 388-550-2301, 388-550-2500, and 388-550-2800.

     Statutory Authority for Adoption: RCW 74.08.090, 74.09.500.

      Adopted under notice filed as WSR 07-10-104, 07-10-105, 07-10-106 on May 1, 2007.

     Changes Other than Editing from Proposed to Adopted Version: WAC 388-550-2800(1) (Table) Third column in table under "Process to adjust for third-party liability insurance and any other client responsibility":

     Lesser of either the DRG billed amount minus the third-party payment amount and any client responsibility amount, or the allowable, allowed amount, minus the third-party payment amount and any client responsibility amount.

     The allowable minus the third-party payment amount and any client responsibility amount. (No change.)

     For the "hold harmless" settlement, the lesser of The the billed amount minus the third-party payment amount and any client responsibility amount, or the allowable allowed amount minus the third-party payment amount and any client responsibility amount. The payment made is the federal share only.

     Lesser of either the billed amount minus the third-party payment amount and any client responsibility amount, or the Ssingle case rate allowed amount minus the third-party payment amount and any client responsibility amount.

     Lesser of either the billed amount minus the third-party payment amount and any client responsibility amount, or the Pper diem allowed amount minus the third-party payment amount and any client responsibility amount.

     Per diem allowed amount, and for some services...

     The allowable allowed amount, subject to retrospective cost settlement...

     Paid according to applicable...(No change.)

     WAC 388-550-2900(1) (After table.) See WAC 388-550-4800 for payment methods used by the department for inpatient hospital services provided to clients eligible under state-administered programs. The department's policy for payment on state-administered program claims that involve third party liability (TPL) and/or client responsibility payments on claims is the same policy indicated in the table in subsection (1) in this section. However, to determine the department's payment on the claim, state-administered program rates, not medicaid or SCHIP rates, apply when comparing the lesser of either the billed amount minus the third-party payment and any client responsibility amount, or the allowed amount minus the third-party payment amount and any client responsibility amount.

     A final cost-benefit analysis is available by contacting Larry Linn, P.O. Box 45510, Olympia, WA 98504-5510, phone (360) 725-1856, fax (360) 753-9152, e-mail linnld@dshs.wa.gov.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 15, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 15, Repealed 0.

     Date Adopted: June 21, 2007.

Stephanie E. Schiller

Rules Coordinator

     (1) ((Medical care)) Clients enrolled with the department's ((healthy options carriers)) managed care organization (MCO) plans are subject to the respective ((carrier's)) plan's policies and procedures for coverage of hospital services;

     (2) ((Medical care)) Clients covered by primary care case management are subject to the clients' primary care physicians' approval for hospital services;

     (3) For emergency care exemptions for clients described in subsections (1) and (2) ((and (3))) of this section, see WAC 388-538-100.

     (4) Coverage for ((medically)) psychiatric indigent (((MI))) inpatient (PII) clients is limited to ((emergent)) voluntary inpatient psychiatric hospital services, subject to the conditions and limitations of WAC ((388-521-2140, 388-529-2950,)) 388-865-0217 and this chapter:

     (a) Out-of-state ((care,)) healthcare ((hospital or other medical,)) is not covered for clients under the ((MI)) PII program; and

     (b) Bordering city hospitals and critical border hospitals ((areas)) are not considered ((in-state)) instate hospitals for PII program claims.

     (5) ((Out-of-state medical care is)) Healthcare services provided by a hospital located out-of-state are:

     (a) Not covered for clients eligible under the medical care services (MCS) program. However, clients eligible for MCS are covered for that program's scope of care in bordering city and critical border hospitals.

     (b) Covered for:

     (i) Emergency care for eligible medicaid and SCHIP clients without prior authorization, based on the medical necessity and utilization review standards and limits established by the department.

     (ii) Nonemergency out-of-state care for medicaid and SCHIP clients when prior authorized by the department based on the medical necessity and utilization review standards and limits.

     (iii) Hospitals in bordering cities and critical border hospitals, based on the same client eligibility criteria and authorization policies as for instate hospitals. See WAC 388-501-0175 for a list of bordering cities.

     (c) Covered for out-of-state voluntary inpatient psychiatric hospital services for eligible medicaid and SCHIP clients based on authorization by a mental health division (MHD) designee.

     (6) See WAC 388-550-1100(((3))) for ((chemical-dependent pregnant clients)) hospital services for chemical-using pregnant (CUP) women.

     (7) ((Only Medicaid categorically needy and medically needy clients under twenty-one years of age, or sixty-five years of age or older may receive care in a state mental institution or approved psychiatric facility)) All psychiatric inpatient hospital admissions, length of stay extensions, and transfers must be prior authorized by a MHD designee. See WAC 388-550-2600.

     (8)(((a))) For clients eligible for both medicare and medicaid ((hospitalization)) (dual eligibles), ((MAA)) the department pays deductibles and coinsurance, unless the client has exhausted his or her medicare Part A benefits.

     (((i) MAA payment is limited in amount so that when added to the Medicare payment, the total amount is no more than what the department pays for the same service when provided to a Medicaid eligible, non-Medicare client.

     (ii) Providers must accept the total Medicare/Medicaid amount as payment in full.

     (iii) Beneficiaries are not liable for any additional charges billed by providers or by a managed care entity.

     (iv) Providers or managed care entities that charge beneficiaries excess amounts are subject to sanctions.

     (b))) If ((such)) medicare benefits are exhausted, the department pays for hospitalization for such clients subject to ((MAA)) department rules. See also chapter 388-502 WAC.

     (9) The department does not pay for covered inpatient hospital services for a medical assistance client:

     (a) Who is discharged from a hospital by a physician because the client no longer meets medical necessity for acute inpatient level of care; and

     (b) Who chooses to stay in the hospital beyond the period of medical necessity.

     (10) If the hospital's utilization review committee determines the client's stay is beyond the period of medical necessity, as described in subsection (9) of this section, the hospital must:

     (a) Inform the client in a written notice that the department is not responsible for payment (42 CFR 456);

     (b) Comply with the requirements in WAC 388-502-0160 in order to bill the client for the service(s); and

     (c) Send a copy of the written notice in (a) of this subsection to the department.

     (11) Other coverage restrictions, as determined by the department.

[Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, § 388-550-1200, filed 2/26/99, effective 3/29/99. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1200, filed 12/18/97, effective 1/18/98.]

     (2) The ((medical assistance administration (MAA))) department requires a hospital provider to report and bill all hospital services provided to medical assistance clients using the appropriate revenue codes published in the manual referenced in subsection (1) of this section.

[Statutory Authority: RCW 74.04.050, 74.04.057, 74.08.090, and Public Law 104-191. 03-19-044, § 388-550-1300, filed 9/10/03, effective 10/11/03. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1300, filed 12/18/97, effective 1/18/98.]

     (a) "IV therapy," only ((subcategory)) subcategories "general classification" and "infusion pump";

     (b) "Medical/surgical supplies and devices," only subcategory (("prosthetic/orthotic devices")) "other supplies/devices";

     (c) "Oncology";

     (d) "Laboratory";

     (((d))) (e) "Laboratory pathological";

     (((e))) (f) "Radiology - diagnostic";

     (((f))) (g) "Radiology - therapeutic and/or chemotherapy administration";

     (((g))) (h) "Nuclear medicine";

     (((h))) (i) "CT scan";

     (((i))) (j) "Operating room services," only subcategories "general classification" and "minor surgery";

     (((j))) (k) "Blood and blood components";

     (l) Administration, processing, and storage((,)) for blood components" ((only subcategory "administration (e.g., transfusions)"));

     (((k))) (m) "Other imaging services";

     (((l))) (n) "Respiratory services";

     (((m))) (o) "Physical therapy";

     (((n))) (p) "Occupational therapy";

     (((o))) (q) "Speech therapy - language pathology";

     (((p))) (r) "Emergency room," only subcategories "general classification" and "urgent care";

     (((q))) (s) "Pulmonary function";

     (((r))) (t) "Audiology";

     (((s))) (u) "Cardiology";

     (((t))) (v) "Ambulatory surgical care";

     (((u) "Outpatient services";

     (v))) (w) "Clinic," only subcategories "general classification((,))" (("dental clinic,")) and "other clinic";

     (((w))) (x) "Magnetic resonance technology (MRT)";

     (((x))) (y) "Medical/surgical supplies - extension," only subcategory "surgical dressings";

     (((y))) (z) "Pharmacy - extension" subcategories "Erythropoietin (EPO) less than ten thousand units," "Erythropoietin (EPO) ten thousand or more units," "drugs requiring detailed coding," and "self-administrable drugs";

     (((z))) (aa) "Labor room/delivery," only subcategories "general classification," "labor," "delivery," and "birthing center";

     (((aa))) (bb) "EKG/ECG (electrocardiogram)";

     (((bb))) (cc) "EEG (electroencephalogram)";

     (((cc))) (dd) "Gastro-intestinal services";

     (((dd))) (ee) "Specialty room - treatment/observation room," subcategory "treatment room and observation room";

     (((ee) "Lithotripsy";))

     (ff) "Telemedicine," only subcategory "other telemedicine";

     (gg) "Extra-corporeal shock wave therapy (formerly lithotripsy)";

     (hh) "Acquisition of body components," only subcategories "((living donor)) general classification" and "cadaver donor";

     (((gg))) (ii) "Hemodialysis - outpatient or home," only subcategory "general classification";

     (((hh))) (jj) "Peritoneal dialysis - outpatient or home," only subcategory "general classification";

     (((ii))) (kk) "Continuous ambulatory peritoneal dialysis (CAPD) - outpatient or home," only subcategory "general classification";

     (((jj))) (ll) "Continuous cycling peritoneal dialysis (CCPD) - outpatient or home," only subcategory "general classification";

     (((kk))) (mm) "Miscellaneous dialysis," only subcategories "general classification" and "ultrafiltration";

     (nn) "Behavioral health treatments/services," only subcategory "electroshock therapy";

     (((ll) "Psychiatric/psychological treatments," only subcategory "electroshock therapy";

     (mm))) (oo) "Other diagnostic services";

     (((nn))) (pp) "Other therapeutic services," only ((subcategory)) subcategories "general classification," "cardiac rehabilitation," and "other therapeutic service"; and

     (((oo))) (qq) Other revenue code categories and subcategories identified and published by the department.

     (2) For an outpatient claim line requiring a CPT or HCPCS code(s), the department denies payment if the required code is not reported on the line.

[Statutory Authority: RCW 74.04.050, 74.04.057, 74.08.090, and Public Law 104-191. 03-19-044, § 388-550-1350, filed 9/10/03, effective 10/11/03.]

     (1) The department ((covers)) pays for an inpatient hospital covered service in the following revenue code categories and subcategories ((for inpatient hospital services)) when the hospital provider accurately bills:

     (a) "Room & board - private (one bed)," only subcategories "general classification," "medical/surgical/gyn," "OB," "pediatric," and "oncology";

     (b) "Room & board - semi-private (two bed)," only subcategories "general classification," "medical/surgical/gyn," "OB," "pediatric," and "oncology";

     (c) "Room & board - semi-private - (three and four beds)," only subcategories "general classification," "medical/surgical/gyn," "OB," "pediatric," and "oncology";

     (d) "Room & board - deluxe private (((deluxe)))," only subcategories "general classification," "medical/surgical/gyn," "OB," "pediatric," and "oncology";

     (e) "Nursery," only subcategories "general classification," "newborn - level I," "newborn - level II," "newborn - level III," and "newborn - level IV";

     (f) "Intensive care unit," only subcategories "general classification," "surgical," "medical," "pediatric," "intermediate ICU," "burn care," and "trauma";

     (g) "Coronary care unit," only subcategories "general classification," "myocardial infarction," "pulmonary care," and "intermediate CCU";

     (h) "Pharmacy," only subcategories "general classification," "generic drugs," "nongeneric drugs," "drugs incident to other diagnostic services," "drugs incident to radiology," "nonprescription," and "IV solutions";

     (i) "IV therapy," only subcategories "general classification," "infusion pump," "IV therapy/pharmacy services," "IV therapy/drug/supply delivery" and "IV therapy/supplies";

     (j) "Medical/surgical supplies and devices," only subcategories "general classification," "nonsterile supply," "sterile supply," "pacemaker," "intraocular lens," and "other implant";

     (k) "Oncology," only subcategory "general classification";

     (l) "Laboratory," only subcategories "general classification," "chemistry," "immunology," "nonroutine dialysis," "hematology," "bacteriology & microbiology," and "urology";

     (m) "Laboratory ((pathological)) pathology," only subcategories "general classification," "cytology," "histology," and "biopsy";

     (n) "Radiology - diagnostic," only subcategories "general classification," "angiocardiography," "arthrography," "arteriography," and "chest X ray";

     (o) "Radiology - therapeutic and/or chemotherapy administration," only subcategories "general classification," "chemotherapy administration - injected," "chemotherapy administration - oral," "radiation therapy," and "chemotherapy administration - IV";

     (p) "Nuclear medicine," only subcategories "general classification," "diagnostic," ((and)) "therapeutic," "diagnostic radiopharmaceuticals," and "therapeutic radiopharmaceuticals";

     (q) "CT scan," only subcategories "general classification," "head scan," and "body scan";

     (r) "Operating room services," only subcategories "general classification" and "minor surgery";

     (s) "Anesthesia," only subcategories "general classification," "anesthesia incident to radiology," and "anesthesia incident to other diagnostic services";

     (t) "((Blood and blood component)) Administration, processing and storage for blood and blood component," only subcategories "general classification" and "administration (((e.g., transfusions)))";

     (u) "Other imaging services," only subcategories "general classification," "diagnostic mammography," "ultrasound," and "positron emission tomography";

     (v) "Respiratory services," only subcategories "general classification," "inhalation services" and "hyper baric oxygen therapy";

     (w) "Physical therapy," only subcategories "general classification," "visit charge," "hourly charge," "group rate," and "evaluation or reevaluation";

     (x) "Speech therapy-language pathology," only subcategories "general classification," "visit charge," "hourly charge," "group rate," and "evaluation or reevaluation";

     (y) "Emergency room," only subcategories "general, urgent care classification" and "urgent care";

     (z) "Pulmonary function," only subcategory "general classification";

     (aa) "Cardiology," only subcategories "general classification," "cardiac cath lab," "stress test," and "echocardiology";

     (bb) "Ambulatory surgical care," only subcategory "general classification";

     (cc) "Outpatient services," only subcategory "general classification";

     (dd) "Magnetic resonance technology (MRT)," only subcategories "general classification," "MRI - brain (including brainstem)," "MRI - spinal cord (including spine)," "MRI - other," "MRA - head and neck," ((and)) "MRA - lower extremities," and "MRA-other";

     (ee) "Medical/surgical supplies - extension," only subcategories "supplies incident to radiology," "supplies incident to other diagnostic services," and "surgical dressings";

     (ff) "Pharmacy-extension," only subcategories "single source drug," "multiple source drug," "restrictive prescription," "erythropoietin (EPO) less than ten thousand units," "erythropoietin (EPO) ten thousand or more units," "drugs requiring detailed coding," and "self-administrable drugs";

     (gg) "Cast room," only subcategory "general classification";

     (hh) "Recovery room," only subcategory "general classification";

     (ii) "Labor room/delivery," only subcategory "general

classification," "labor," "delivery," and "birthing center";

     (jj) "EKG/ECG (Electrocardiogram)," only subcategories "general classification," "holter monitor," and "telemetry";

     (kk) "EEG (Electroencephalogram)," only subcategory "general classification";

     (ll) "Gastro-intestinal services," only subcategory "general classification";

     (mm) "Treatment/observation room," only subcategories "general classification," "treatment room," and "observation room";

     (nn) (("Lithotripsy," only subcategory "general classification")) "Extra-corporeal shock wave therapy (formerly lithotripsy)," only subcategory "general classification";

     (oo) "Inpatient renal dialysis," only subcategories "general classification," "inpatient hemodialysis," "inpatient peritoneal (non-CAPD)," "inpatient continuous ambulatory peritoneal dialysis (CAPD)," and "inpatient continuous cycling peritoneal dialysis (CCPD)";

     (pp) "Acquisition of body components," only subcategories "general classification," "living donor," and "cadaver donor";

     (qq) "Miscellaneous dialysis," only subcategory "ultra filtration((,))" ((and));

     (rr) "Other diagnostic services," only subcategories "general classification," "peripheral vascularlab," "electromyelogram," and "pregnancy test((.))"; and

     (ss) "Other therapeutic services," only subcategory "general classification".

     (2) The department ((covers)) pays for an inpatient hospital covered service in the following revenue code subcategories ((for inpatient hospital services)) only when the hospital provider is approved by the department to provide the specific service(((s))):

     (a) "All inclusive rate," only subcategory "all-inclusive room & board plus ancillary";

     (b) "Room & board - private (one bed)," only subcategory "psychiatric";

     (c) "Room & board - semi-private (two beds)," only subcategories "psychiatric," "detoxification," "rehabilitation," and "other";

     (d) "Room & board - semi-private three and four beds," only subcategories "psychiatric" and "detoxification";

     (e) "Room & board - deluxe private (((deluxe)))," only subcategory "psychiatric";

     (f) "Room & board - ward," only subcategories "general classification" and "detoxification";

     (g) "Room & board - other," only subcategories "general classification" and "other";

     (h) "Intensive care unit," only subcategory "psychiatric";

     (i) "Coronary care unit," only subcategory "heart transplant";

     (j) "Operating room services," only subcategories "organ transplant-other than kidney" and "kidney transplant";

     (k) "Occupational therapy," only subcategories "general classification," "visit charge," "hourly charge," "group rate" and "evaluation or reevaluation";

     (l) "Clinic," only subcategory "chronic pain clinic";

     (m) "Ambulance," only subcategory "neonatal ambulance services";

     (n) "((Psychiatric/psychological treatments)) Behavioral health treatment/services," only subcategory "electroshock treatment"; and

     (o) "((Psychiatric/psychological)) Behavioral health treatment/services - extension," only subcategory "rehabilitation."

     (3) The department ((covers)) pays revenue code category "occupational therapy," subcategories "general classification, "visit charge, "hourly charge," "group rate," and "evaluation or reevaluation" when:

     (a) A client is in an acute PM&R facility;

     (b) A client is age twenty or younger; or

     (c) The diagnosis code is listed in the ((medical assistance administration's (MAA's))) department's published billing instructions.

     (4) The department does not ((cover)) pay for inpatient hospital services in the following revenue code categories and subcategories ((for inpatient hospital services)):

     (a) "All inclusive rate," subcategory "all-inclusive room and board";

     (b) "Room & board - private (one bed)" subcategories "hospice," "detoxification," "rehabilitation," and "other";

     (c) "Room & board - semi-private (two bed)," subcategory "hospice";

     (d) "Room & board - semi-private - (three and four beds)," subcategories "hospice," "rehabilitation," and "other";

     (e) "Room & board - deluxe private (((deluxe)))," subcategories "hospice," "detoxification," "rehabilitation," and "other";

     (f) "Room & board - ward," subcategories "medical/surgical/gyn," "OB," "pediatric," "psychiatric," "hospice," "oncology," "rehabilitation," and "other";

     (g) "Room & board - other," subcategories "sterile environment," and "self care";

     (h) "Nursery," subcategory "other nursery";

     (i) "Leave of absence";

     (j) "Subacute care";

     (k) "Intensive care unit," subcategory "other intensive care";

     (l) "Coronary care unit," subcategory "other coronary care";

     (m) "Special charges";

     (n) "Incremental nursing charge ((rate))";

     (o) "All inclusive ancillary";

     (p) "Pharmacy," subcategories "take home drugs," "experimental drugs," and "other pharmacy";

     (q) "IV therapy," subcategory "other IV therapy";

     (r) "Medical/surgical supplies and devices," subcategories "take home supplies," "prosthetic/orthotics devices," "oxygen - take home," and "other supplies/devices";

     (s) "Oncology," subcategory "other oncology";

     (t) "Durable medical equipment (other than renal)";

     (u) "Laboratory," subcategories "renal patient (home)," and "other laboratory";

     (v) "Laboratory ((pathological)) pathology," subcategory "other laboratory - pathological";

     (w) "Radiology - diagnostic," subcategory "other radiology - diagnostic";

     (x) "Radiology - therapeutic," subcategory "other radiology - therapeutic";

     (y) "Nuclear medicine," subcategory "other nuclear medicine";

     (z) "CT scan," subcategory "other CT scan";

     (aa) "Operating room services," subcategory "other operating room services";

     (bb) "Anesthesia," subcategories "acupuncture," and "other anesthesia";

     (cc) "Blood and blood components";

     (dd) "((Blood and blood component)) Administration, processing and storage for blood and blood components," subcategory "other processing and storage";

     (ee) "Other imaging services," subcategories "screening mammography," and "other imaging services";

     (ff) "Respiratory services," subcategory "other respiratory services";

     (gg) "Physical therapy," subcategory "other physical therapy";

     (hh) "Occupational therapy," subcategory "other occupational therapy";

     (ii) "Speech therapy-language pathology," subcategory "other speech-language pathology";

     (jj) "Emergency room," subcategories "EMTALA emergency medical screening services," "ER beyond EMTALA screening," and "other emergency room";

     (kk) "Pulmonary function," subcategory "other pulmonary function";

     (ll) "Audiology";

     (mm) "Cardiology," subcategory "other cardiology";

     (nn) "Ambulatory surgical care," subcategory "other ambulatory surgical care";

     (oo) "Outpatient services," subcategory "other outpatient service";

     (pp) "Clinic," subcategories "general classification," "dental clinic," "psychiatric clinic," "OB-gyn clinic," "pediatric clinic," "urgent care clinic," "family practice clinic," and "other clinic";

     (qq) "Free-standing clinic";

     (rr) "Osteopathic services";

     (ss) "Ambulance," subcategories "general classification," "supplies," "medical transport," "heart mobile," "oxygen," "air ambulance," "pharmacy," "telephone transmission EKG," and "other ambulance";

     (tt) "Home health (HH) skilled nursing";

     (uu) "Home health (HH) medical social services";

     (vv) "Home health (HH) - ((home health)) aide";

     (ww) "Home health (HH) - other visits";

     (xx) "Home health (HH) - units of service";

     (yy) "Home health (HH) - oxygen";

     (zz) "Magnetic resonance technology (MRT)," ((subcategories "MRA-other" and)) subcategory "other MRT";

     (aaa) "Medical" "medical/surgical supplies - extension," subcategory "FDA investigational devices";

     (bbb) "Home IV therapy services";

     (ccc) "Hospice services";

     (ddd) "Respite care";

     (eee) "Outpatient special residence charges";

     (fff) "Trauma response";

     (ggg) "Cast room," subcategory "other cast room";

     (hhh) "Recovery room," subcategory "other recovery room";

     (iii) "Labor room/delivery," subcategories "circumcision" and "other labor room/delivery";

     (jjj) "EKG/ECG (Electrocardiogram)," subcategory "other EKG/ECG";

     (kkk) "EEG (Electroencephalogram)," subcategory "other EEG";

     (lll) "Gastro-intestinal services," subcategory "other gastro-intestinal";

     (mmm) "Specialty room - treatment/observation room," subcategory "other ((treatment/observation room)) speciality rooms";

     (nnn) "Preventive care services";

     (ooo) "Telemedicine";

     (ppp) "((Lithotripsy," subcategory "other lithotripsy")) Extra-corporeal shock wave therapy (formerly lithotripsy)," subcategory "other ESWT";

     (qqq) "Inpatient renal dialysis," subcategory "other inpatient dialysis";

     (rrr) "Acquisition of body components," subcategories "unknown donor," "unsuccessful organ search - donor bank charges," and "other donor";

     (sss) "Hemodialysis - outpatient or home";

     (ttt) "Peritoneal dialysis - outpatient or home";

     (uuu) "Continuous ambulatory peritoneal dialysis (CAPD) - outpatient or home";

     (vvv) "Continuous cycling peritoneal dialysis (CCPD) - outpatient or home";

     (www) "Miscellaneous dialysis," subcategories "general

classification," "home dialysis aid visit," and "other miscellaneous dialysis";

     (xxx) (("Psychiatric/psychological treatments,")) Behavioral health treatments/services, subcategories "general classification," "milieu therapy," "play therapy," "activity therapy," ((and "other psychiatric/psychological treatment")) "intensive outpatient services - psychiatric," "intensive outpatient services - chemical dependency," "community behavioral health program (day treatment)";

     (yyy) (("Psychiatric/psychological services,")) Behavioral health treatment/services - (extension), subcategories "((general classification)) rehabilitation," "partial hospitalization - less intensive," "partial hospitalization - intensive," "individual therapy," "group therapy," "family therapy," "bio feedback," "testing," and "other ((psychiatric/psychological service)) behavioral health treatment/services";

     (zzz) "Other diagnostic services," subcategories "general classification," "pap smear," "allergy test," and "other diagnostic service";

     (aaaa) "Medical rehabilitation day program";

     (bbbb) "Other therapeutic services," subcategories "recreational therapy," "cardiac rehabilitation," "drug rehabilitation," "alcohol rehabilitation," "complex medical equipment - routine," "complex medical equipment - ancillary," and "other therapeutic services";

     (cccc) "Other therapeutic services - extension," subcategories "athletic training" and "kinesiotherapy";

     (dddd) "Professional fees";

     (((dddd))) (eeee) "Patient convenience items"; and

     (((eeee))) (ffff) Revenue code categories and subcategories that are not identified in this section.

[Statutory Authority: RCW 74.04.050, 74.04.057, 74.08.090, and Public Law 104-191. 03-19-045, § 388-550-1400, filed 9/10/03, effective 10/11/03. Statutory Authority: RCW 74.08.090. 01-02-075, § 388-550-1400, filed 12/29/00, effective 1/29/01. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1400, filed 12/18/97, effective 1/18/98.]

     Reviser's note: The typographical errors in the above section occurred in the copy filed by the agency and appear in the Register pursuant to the requirements of RCW 34.08.040.3850.2
AMENDATORY SECTION(Amending WSR 03-19-046, filed 9/10/03, effective 10/11/03)

WAC 388-550-1500   Covered and noncovered revenue code categories and subcategories for outpatient hospital services.   (1) The department ((covers)) pays for an outpatient hospital covered service in the following revenue code categories and subcategories ((for outpatient hospital services)) when the hospital provider accurately bills (((see subsection (2) of this section for revenue code subcategories covered only when the department approves the hospital provider to provide the specific service(s)))):

     (a) "Pharmacy," only subcategories "general classification," "generic drugs," "nongeneric drugs," "drugs incident to other diagnostic services," "drugs incident to radiology," "nonprescription," and "IV solutions";

     (b) "IV therapy," only subcategories "general classification," "infusion pump," "IV therapy/pharmacy services," "IV therapy/drug/supply delivery," and "IV therapy/supplies";

     (c) "Medical/surgical supplies and devices," only subcategories "general classification," "nonsterile supply," "sterile supply," "pacemaker," "intraocular lens," and "other implant," and "other supplies/devices";

     (d) "Oncology," only subcategory "general classification";

     (e) "Durable medical equipment (other than renal)," only subcategory "general classification";

     (f) "Laboratory," only subcategories "general classification," "chemistry," "immunology," "renal patient (home)," "nonroutine dialysis," "hematology," "bacteriology and microbiology," and "urology";

     (((f))) (g) "Laboratory ((pathological)) pathology," only subcategories "general classification," "cytology," "histology," and "biopsy";

     (((g))) (h) "Radiology - diagnostic," only subcategories "general classification," "angiocardiography," "arthrography," "arteriography," and "chest X ray";

     (((h))) (i) "Radiology - therapeutic and/or chemotherapy administration," only subcategories "general classification," "chemotherapy - injected," "chemotherapy - oral," "radiation therapy," and "chemotherapy - IV";

     (((i))) (j) "Nuclear medicine," only subcategories "general classification," "diagnostic," and "therapeutic," "diagnostic radiopharmaceuticals," and "therapeutic radiopharmaceuticals";

     (((j))) (k) "CT scan," only subcategories "general classification," "head scan," and "body scan";

     (((k))) (l) "Operating room services," only subcategories "general classification" and "minor surgery";

     (((l))) (m) "Anesthesia," only subcategories "general classification," "anesthesia incident to radiology," and "anesthesia incident to other diagnostic services";

     (((m))) (n) "((Blood and blood component)) Administration, processing and storage for blood and blood components," only subcategories "general classification" and "administration (((e.g., transfusions)))";

     (((n))) (o) "Other imaging," only subcategories "general classification," "diagnostic mammography," "ultrasound," "screening mammography," and "positron emission tomography";

     (((o))) (p) "Respiratory services," only subcategories "general classification," "inhalation services," and "hyper baric oxygen therapy";

     (((p))) (q) "Physical therapy," only subcategories "general classification," "visit charge," "hourly charge," "group rate," and "evaluation or reevaluation";

     (((q))) (r) "Occupational therapy," only subcategories "general classification," "visit charge," "hourly charge," "group rate," and "evaluation or reevaluation";

     (((r))) (s) "Speech therapy-language pathology," only subcategories "general classification," "visit charge," "hourly charge," "group rate," and "evaluation or reevaluation";

     (((s))) (t) "Emergency room," only subcategories "general classification" and "urgent care";

     (((t))) (u) "Pulmonary function," only subcategory "general classification";

     (((u))) (v) "Audiology," only subcategories "general classification," "diagnostic," and "treatment";

     (((v))) (w) "Cardiology," only subcategories "general classification," "cardiac cath lab," "stress test," and "echocardiology";

     (((w))) (x) "Ambulatory surgical care," only subcategory "general classification";

     (((x) "Outpatient services," only subcategory "general classification";))

     (y) "Magnetic resonance technology (MRT)," only subcategories "general classification," "MRI - brain (including brainstem)," "MRI - spinal cord (including spine)," "MRI - other," "MRA - head and neck," ((and)) "MRA - lower extremities" and "MRA-other";

     (z) "Medical/surgical supplies - extension," only subcategories "supplies incident to radiology," "supplies incident to other diagnostic services," and "surgical dressings";

     (aa) "Pharmacy - extension," only subcategories "single source drug," "multiple source drug," "restrictive prescription," "erythropoietin (EPO) less than ten thousand units," "erythropoietin (EPO) ten thousand or more units," "drugs requiring detailed coding," and "self-administrable drugs";

     (bb) "Cast room," only subcategory "general classification";

     (cc) "Recovery room," only subcategory "general classification";

     (dd) "Labor room/delivery," only subcategories "general classification," "labor," "delivery," and "birthing center";

     (ee) "EKG/ECG (Electrocardiogram)," only subcategories "general classification," "holter monitor," and "telemetry";

     (ff) "EEG (Electroencephalogram)," only subcategory "general classification";

     (gg) "Gastro-intestinal services," only subcategory "general classification";

     (hh) "Specialty room - treatment/observation room," only subcategories (("general classification,")) "treatment room," and "observation room";

     (ii) "((Lithotripsy," only subcategory "general classification")) Telemedicine," only subcategory "other telemedicine";

     (jj) "Extra-corporeal shock wave therapy (formerly lithotripsy)," subcategory "general classification";

     (((jj))) (kk) "Acquisition of body components," only subcategories "general classification," "living donor," and "cadaver donor";

     (((kk))) (ll) "Hemodialysis - outpatient or home," only subcategory "general classification";

     (((ll))) (mm) "Peritoneal dialysis - outpatient or home," only subcategory "general classification";

     (((mm))) (nn) "Continuous ambulatory peritoneal dialysis (CAPD - outpatient or home," only subcategory "general classification";

     (((nn))) (oo) "Continuous cycling peritoneal dialysis (CCPD) - outpatient or home," only subcategory "general classification";

     (((oo))) (pp) "Miscellaneous dialysis," only subcategories "general classification," and "ultra filtration";

     (((pp) "Psychiatric/psychological treatments)) (qq) "Behavioral health treatments/services," only subcategory "electroshock treatment"; and

     (((qq))) (rr) "Other diagnostic services," only subcategories "general classification," "peripheral vascular lab," "electromyelogram," "pap smear," (("allergy test,")) and "pregnancy test."

     (2) The department ((covers)) pays for an outpatient hospital covered service in the following revenue code subcategories only when the outpatient hospital provider is approved by the department to provide the specific service(s):

     (a) "Clinic," subcategories "general classification," "dental clinic," and "other clinic"; and

     (b) "Other therapeutic services(( - extension))," subcategories, "general classification," "education/training," "cardiac rehabilitation," and "other therapeutic service."

     (3) The department does not ((cover)) pay for outpatient hospital services in the following revenue code categories and subcategories ((for outpatient hospital services)):

     (a) "All inclusive rate";

     (b) "Room & board - private (one bed)";

     (c) "Room & board - semi-private (two beds)";

     (d) "Room & board - semi-private (three and four beds)";

     (e) "Room & board - deluxe private (((deluxe)))";

     (f) "Room & board - ward";

     (g) "Room & board - other";

     (h) "Nursery";

     (i) "Leave of absence";

     (j) "Subacute care";

     (k) "Intensive care unit";

     (l) "Coronary care unit";

     (m) "Special charges";

     (n) "Incremental nursing charge rate";

     (o) "All inclusive ancillary";

     (p) "Pharmacy," subcategories "take home drugs," "experimental drugs," and "other pharmacy";

     (q) "IV therapy," subcategory "other IV therapy";

     (r) "Medical/surgical supplies and devices," subcategories "take home supplies," "prosthetic/orthotic devices," and "oxygen - take home((,))" ((and "other supplies/devices"));

     (s) "Oncology," subcategory "other oncology";

     (t) "Durable medical equipment (other than renal)," subcategories "rental," "purchase of new DME," "purchase of used DME," "supplies/drugs for DME effectiveness (home health agency only)," and "other equipment";

     (u) "Laboratory," subcategory "other laboratory";

     (v) "Laboratory ((pathological)) pathology," subcategory "other laboratory pathological";

     (w) "Radiology - diagnostic," subcategory "other radiology - diagnostic";

     (x) "Radiology - therapeutic and/or chemotherapy administration," subcategory "other radiology - therapeutic";

     (y) "Nuclear medicine," subcategory "other nuclear medicine";

     (z) "CT scan," subcategory "other CT scan";

     (aa) "Operating room services," subcategories "organ transplant - other than kidney," "kidney transplant," and "other operating room services";

     (bb) "Anesthesia," subcategories "acupuncture" and "other anesthesia";

     (cc) "Blood and blood components";

     (dd) "((Blood and blood component)) Administration, processing and storage for blood and blood component," subcategory "other processing and storage";

     (ee) "Other imaging," subcategory "other imaging service";

     (ff) "Respiratory services," subcategory "other respiratory services";

     (gg) "Physical therapy services," subcategory "other physical therapy";

     (hh) "Occupational therapy services," subcategory "other occupational therapy";

     (ii) "Speech therapy-language pathology," subcategory "other speech-language pathology";

     (jj) "Emergency room," subcategories "EMTALA emergency medical screening services," "ER beyond EMTALA screening" and "other emergency room";

     (kk) "Pulmonary function," subcategory "other pulmonary function";

     (ll) "Audiology," subcategory "other audiology";

     (mm) "Cardiology," subcategory "other cardiology";

     (nn) "Ambulatory surgical care," subcategory "other ambulatory surgical care";

     (oo) "Outpatient Services((,))" ((subcategory "other outpatient service"));

     (pp) "Clinic," subcategories "chronic pain center," "psychiatric clinic," "OB-GYN clinic," "pediatric clinic," "urgent care clinic," and "family practice clinic";

     (qq) "Free-standing clinic";

     (rr) "Osteopathic services";

     (ss) "Ambulance";

     (tt) "Home health (HH) - skilled nursing";

     (uu) "Home health (HH) - medical social services";

     (vv) "Home health (HH) - ((home health)) aide";

     (ww) "Home health (HH) - other visits";

     (xx) "Home health (HH) - units of service";

     (yy) "Home health (HH) - oxygen";

     (zz) "Magnetic resonance technology (MRT)," ((subcategories "MRA - other" and)) subcategory "other MRT";

     (aaa) "Medical/surgical supplies - extension," only subcategory "FDA investigational devices";

     (bbb) "Home IV therapy services";

     (ccc) "Hospice services";

     (ddd) "Respite care";

     (eee) "Outpatient special residence charges";

     (fff) "Trauma response";

     (ggg) "Cast room," subcategory "other cast room";

     (hhh) "Recovery room," subcategory "other recovery room";

     (iii) "Labor room/delivery," subcategories "circumcision" and "other labor room/delivery";

     (jjj) "EKG/ECG (Electrocardiogram)," subcategory "other EKG/ECG";

     (kkk) "EEG (Electroencephalogram)," subcategory "other EEG";

     (lll) "Gastro-intestinal services," subcategory "other gastro-intestinal";

     (mmm) "Speciality room - treatment/observation room," ((subcategory)) subcategories "general classification" and "other ((treatment/observation room)) speciality rooms";

     (nnn) "Preventive care services";

     (ooo) "Telemedicine," subcategory "general classification;

     (ppp) "((Lithotripsy," subcategory "other lithotripsy")) Extra-corporal shock wave therapy (formerly lithotripsy)," subcategory "other ESWT";

     (qqq) "Inpatient renal dialysis";

     (rrr) "Acquisition of body components," subcategories "unknown donor," "unsuccessful organ search - donor bank charges," and "other donor";

     (sss) "Hemodialysis - outpatient or home," subcategories "hemodialysis/composite or other rate," "home supplies," "home equipment," "maintenance one hundred percent (home)," "support services (home)," and "other outpatient hemodialysis (home)";

     (ttt) "Peritoneal dialysis - outpatient or home," subcategories "peritoneal/composite or other rate," "home supplies," "home equipment," "maintenance one hundred percent (home)" "support services (home)," and "other outpatient peritoneal dialysis (home)";

     (uuu) "Continuous ambulatory peritoneal dialysis (CAPD) - outpatient or home," subcategories "CAPD/composite or other rate," "home supplies," "home equipment," "maintenance one hundred percent (home)" "support services (home)," and "other outpatient CAPD (home)";

     (vvv) "Continuous cycling peritoneal dialysis (CCPD) - outpatient or home," subcategories "CCPD/composite or other rate," "home supplies," "home equipment," "maintenance one hundred percent (home), "support services (home)," and "other outpatient CCPD (home)";

     (www) "Miscellaneous dialysis," subcategories "home dialysis aid visit" and "other miscellaneous dialysis";

     (xxx) "((Psychiatric/psychological)) Behavioral health treatments/services," subcategories "general classification," "milieu therapy," "play therapy," "activity therapy," ((and "other psychiatric/psychological treatment")) "intensive outpatient services - psychiatric," "intensive outpatient services - chemical dependency," and "community behavioral health program (day treatment)";

     (yyy) "((Psychiatric/psychological services)) Behavioral health treatment/services (extension)";

     (zzz) "Other diagnostic services," subcategories "((general classification)) allergy test" and "other diagnostic services";

     (aaaa) "Medical rehabilitation day program";

     (bbbb) "Other therapeutic services - extension," subcategories (("general classification,")) "recreational therapy," (("cardiac rehabilitation,")) "drug rehabilitation," "alcohol rehabilitation," "complex medical equipment - routine," "complex medical equipment - ancillary," "athletic training," and "kinesiotherapy";

     (cccc) "Professional fees";

     (dddd) "Patient convenience items"; and

     (eeee) Revenue code categories and subcategories that are not identified in this section.

[Statutory Authority: RCW 74.04.050, 74.04.057, 74.08.090, and Public Law 104-191. 03-19-046, § 388-550-1500, filed 9/10/03, effective 10/11/03. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1500, filed 12/18/97, effective 1/18/98.]

     Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.
AMENDATORY SECTION(Amending WSR 98-01-124, filed 12/18/97, effective 1/18/98)

WAC 388-550-1600   Specific items/services not covered.   The department ((shall)) does not ((cover certain hospital items/services for any hospital stay including,)) pay for an inpatient or outpatient hospital service, treatment, equipment, drug or supply that is not listed or referred to as a covered service in this chapter. The following list of noncovered items and services is not intended to be all inclusive. Noncovered items and services include, but are not limited to((, the following)):

     (1) Personal care items such as, but not limited to, slippers, toothbrush, comb, hair dryer, and make-up;

     (2) Telephone/telegraph services or television/radio rentals;

     (3) Medical photographic or audio/videotape records;

     (4) Crisis counseling;

     (5) Psychiatric day care;

     (6) Ancillary services, such as respiratory and physical therapy, performed by regular nursing staff assigned to the floor or unit;

     (7) Standby personnel and travel time;

     (8) Routine hospital medical supplies and equipment such as bed scales;

     (9) Handling fees and portable X-ray charges;

     (10) Room and equipment charges ("rental charges") for use periods concurrent with another room or similar equipment for the same client;

     (11) Cafeteria charges; and

     (12) Services and supplies provided to nonpatients, such as meals and "father packs"((; and

     (13) Standing orders. The department shall cover routine tests and procedures only if the department determines such services are medically necessary, according to the following criteria. The procedure or test:

     (a) Is specifically ordered by the admitting physician or, in the absence of the admitting physician, the hospital staff having responsibility for the client (e.g., physician, advanced registered nurse practitioner, or physician assistant);

     (b) Is for the diagnosis or treatment of the individual's condition; and

     (c) Does not unnecessarily duplicate a test available or made known to the hospital which is performed on an outpatient basis prior to admission; or

     (d) Is performed in connection with a recent admission)).

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1600, filed 12/18/97, effective 1/18/98.]

     (2) ((The medical assistance administration (MAA) may perform one or more types of utilization reviews described in subsection (3)(b) of this section.

     (3) MAA's utilization review)) All hospital services paid for by the department are subject to UR for medical necessity, appropriate level of care, and program compliance.

     (3) Authorization for inpatient and outpatient hospital services is valid only if a client is eligible for covered services on the date of service. Authorization does not guarantee payment.

     (4) The department will deny, recover, or adjust hospital payments if the department or its designee determines, as a result of UR, that a hospital service does not meet the requirements in federal regulations and WAC.

     (5) The department may perform one or more types of UR described in subsection (6) of this section.

     (6) The department's UR:

     (a) Is a concurrent, prospective, and/or retrospective (including postpay and prepay) formal evaluation of a client's documented medical care to assure that the services provided are proper and necessary and of good quality. The review considers the appropriateness of the place of care, level of care, and the duration, frequency or quantity of services provided in relation to the conditions(s) being treated; and

     (b) Includes one or more of the following:

     (i) "Concurrent utilization review" -- an evaluation performed by ((MAA)) the department or its designee during a client's course of care. A continued stay review performed during the client's hospitalization is a form of concurrent UR;

     (ii) "Prospective utilization review" -- an evaluation performed by ((MAA)) the department or its designee prior to the provision of healthcare services. Preadmission authorization is a form of prospective UR; and

     (iii) "Retrospective utilization review" -- an evaluation performed by ((MAA)) the department or its designee following the provision of healthcare services that includes both a post-payment retrospective ((utilization review)) UR (performed ((by MAA)) after healthcare services are provided and ((reimbursed)) paid), and a prepayment retrospective ((utilization review)) UR (performed ((by MAA)) after healthcare services are provided but prior to ((reimbursement)) payment). Retrospective UR is routinely performed as an audit function.

     (7) During the UR process, the department or its designee notifies the appropriate oversight entity if either of the following is identified:

     (a) A quality of care concern; or

     (b) Fraudulent conduct.

     (((4) Covered inpatient and outpatient hospital services must:

     (a) Be medically necessary as defined in WAC 388-500-0005;

     (b) Be provided at the appropriate level of care as defined in WAC 388-550-1050; and

     (c) Meet all authorization and program requirements in WAC and MAA published issuances.

     (5) Authorization for inpatient and outpatient hospital services is valid only if the client is eligible for covered services on the date of service. Authorization does not guarantee payment.))

[Statutory Authority: RCW 74.08.090 and 74.09.500. 04-20-058, § 388-550-1700, filed 10/1/04, effective 11/1/04. Statutory Authority: RCW 74.08.090. 01-02-075, § 388-550-1700, filed 12/29/00, effective 1/29/01. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1700, filed 12/18/97, effective 1/18/98.]

     Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.
AMENDATORY SECTION(Amending WSR 98-01-124, filed 12/18/97, effective 1/18/98)

WAC 388-550-1800   ((Services--Contract facilities)) Hospital specialty services not requiring prior authorization.   The department ((shall reimburse)) pays for certain specialty services without requiring prior authorization when such services are provided ((in medical assistance administration (MAA)-approved contract facilities)) consistent with department medical necessity and utilization review standards. These services include, but are not limited to, the following:

     (1) All transplant procedures specified in WAC 388-550-1900(2) under the conditions established in WAC 388-550-1900;

     (2) Chronic pain management services, including outpatient evaluation and inpatient treatment, as described under WAC 388-550-2400;

     (3) Polysomnograms and multiple sleep latency tests for clients one year of age and older (allowed only in outpatient hospital settings), as described under WAC 388-550-6350;

     (4) Diabetes education (allowed only in outpatient hospital setting), as described under WAC 388-550-6400; and

     (5) Weight loss program (allowed only in outpatient hospital setting), as described under WAC 388-550-6450.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1800, filed 12/18/97, effective 1/18/98.]

     (b))) are not otherwise subject to a managed care organization (MCO) plan. Clients eligible under the alien emergency medical (AEM) program are not eligible for transplant coverage.

     (2) The department ((shall)) covers the following transplant procedures when the transplant procedures are performed in a hospital designated by the department as a "center of excellence" for transplant procedures and meet that hospital's criteria for establishing appropriateness and the medical necessity of the procedures:

     (a) Solid organs involving the heart, kidney, liver, lung, heart-lung, pancreas, kidney-pancreas and small bowel;

     (b) Bone marrow and peripheral stem cell (PSC);

     (c) Skin grafts; and

     (d) Corneal transplants.

     (3) For procedures covered under subsections (2)(a) and (b) of this section, the department ((shall)) pays facility charges only to those ((medical centers)) hospitals that meet the standards and conditions:

     (a) Established by the department; and

     (b) Specified in WAC 388-550-2100 and 388-550-2200.

     (4) The department ((shall)) pays ((facility charges)) for skin grafts and corneal transplants to any qualified ((medical facility)) hospital, subject to the limitations in this chapter.

     (5) The department ((shall)) deems organ procurement fees as being included in the ((reimbursement)) payment to the transplant ((facility)) hospital. The department may make an exception to this policy and ((reimburse)) pay these fees separately to a transplant ((facility)) hospital when an eligible medical ((care)) medical client is covered by a third-party payer which will pay for the organ transplant procedure itself but not for the organ procurement.

     (6) The department ((shall)), without requiring prior authorization, pays for up to fifteen matched donor searches per client approved for a bone marrow transplant. The department ((shall)) requires prior authorization for matched donor searches in excess of fifteen per bone marrow transplant client.

     (7) The department ((shall)) does not pay for experimental transplant procedures. In addition, the department ((shall)) considers as experimental those services including, but not limited to, the following:

     (a) Transplants of three or more different organs during the same hospital stay;

     (b) Solid organ and bone marrow transplants from animals to humans; and

     (c) Transplant procedures used in treating certain medical conditions for which use of the procedure has not been generally accepted by the medical community or for which its efficacy has not been documented in peer-reviewed medical publications.

     (8) The department ((shall)) pays for a solid organ transplant procedure only once per client's lifetime, except in cases of organ rejection by the client's immune system during the original hospital stay.

     (9) The department ((shall cover)) pays for bone marrow, PSC, skin grafts and corneal transplants ((whenever)) when medically necessary.

     (((9) In reviewing coverage for transplant services, the department shall consider cost benefit analyses on a case-by-case basis)) (10) The department may conduct a post-payment retrospective utilization review as described in WAC 388-550-1700, and may adjust the payment if the department determines the criteria in this section are not met.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-1900, filed 12/18/97, effective 1/18/98.]

     (1) The department ((shall)) requires ((a)) instate transplant ((facility)) hospitals to meet the following requirements in order to be ((reimbursed)) paid for transplant services provided to medical ((care)) assistance clients. ((The facility shall)) A hospital must have:

     (a) An approved certificate of need (CON) from the state department of health (DOH) for the type(s) of transplant procedure(s) to be performed, except that ((MAA shall)) the department does not require CON approval for a hospital that provides peripheral stem cell (PSC), skin graft ((and)) or corneal transplant ((facilities)) services;

     (b) Approval from the United Network of Organ Sharing (UNOS) to perform transplants, except that ((MAA shall)) the department does not require UNOS approval for a hospital that provides PSC, skin graft ((and)) or corneal transplant ((facilities)) services; and

     (c) Been approved by the department as a center of excellence transplant center for the specific organ(s) or procedure(s) the ((facility)) hospital proposes to perform.

     (2) The department requires an out-of-state transplant center ((shall)), including bordering city and critical border hospitals, to be a Medicare-certified ((facility)) transplant center in a hospital participating in that state's Medicaid program. All out-of-state transplant services, excluding those provided in department approved centers of excellence (COE) in bordering city and critical border hospitals, must be prior authorized.

     (((2))) (3) The department ((shall)) considers a ((facility)) hospital for approval as a transplant center of excellence when the ((facility)) hospital submits to the department a copy of its DOH-approved CON for transplant services, or documentation that it has, at a minimum:

     (a) Organ-specific transplant physicians for each organ or transplant team. The transplant surgeon and other responsible team members ((shall)) must be experienced and board-certified or board-eligible practitioners in their respective disciplines, including, but not limited to, the fields of cardiology, cardiovascular surgery, anesthesiology, hemodynamics and pulmonary function, hepatology, hematology, immunology, oncology, and infectious diseases. The department ((shall)) considers this requirement met when the ((facility)) hospital submits to the department a copy of its DOH-approved CON for transplant services;

     (b) Component teams which are integrated into a comprehensive transplant team with clearly defined leadership and responsibility. Transplant teams ((shall)) must include, but not be limited to:

     (i) A team-specific transplant coordinator for each type of organ;

     (ii) An anesthesia team available at all times; and

     (iii) A nursing service team trained in the hemodynamic support of the patient and in managing immunosuppressed patients((;)).

     (((iv))) (c) Other resources that the transplant hospital must have include:

     (i) Pathology resources for studying and reporting the pathological responses of transplantation;

     (((v))) (ii) Infectious disease services with both the professional skills and the laboratory resources needed to ((discover,)) identify((,)) and manage a whole range of organisms; and

     (((vi))) (iii) Social services resources.

     (((c))) (d) An organ procurement coordinator;

     (((d))) (e) A method ensuring that transplant team members are familiar with transplantation laws and regulations;

     (((e))) (f) An interdisciplinary body and procedures in place to evaluate and select candidates for transplantation;

     (((f))) (g) An interdisciplinary body and procedures in place to ensure distribution of donated organs in a fair and equitable manner conducive to an optimal or successful patient outcome;

     (((g))) (h) Extensive blood bank support;

     (((h))) (i) Patient management plans and protocols; and

     (((i))) (j) Written policies safeguarding the rights and privacy of patients((; and

     (j) Satisfied)).

     (4) In addition to the requirements of subsection (3) of this section, the transplant hospital must:

     (a) Satisfy the annual volume and survival rates criteria for the particular transplant procedures performed at the ((facility)) hospital, as specified in WAC 388-550-2200(2).

     (((3) In addition to the requirements of subsection (2) of this section, a facility being considered for approval as a transplant center of excellence shall)) (b) Submit a copy of its approval from the United Network for Organ Sharing (UNOS), or documentation showing that the ((facility)) hospital:

     (((a))) (i) Participates in the national donor procurement program and network; and

     (((b))) (ii) Systematically collects and shares data on its transplant program(s) with the network.

     (((4))) (5) The department ((shall apply)) applies the following specific requirements to a PSC transplant ((facilities)) hospital:

     (a) A PSC transplant ((facility may receive approval from the department to do)) hospital must be a department approved COE to perform any of the following PSC services:

     (i) Harvesting, if it has its own apheresis equipment which meets federal or American Association of Blood Banks (AABB) requirements;

     (ii) Processing, if it meets AABB quality of care requirements for human tissue/tissue banking; ((and/or)) and

     (iii) Reinfusion, if it meets the criteria established by the Foundation for the Accreditation of Hematopoietic Cell Therapy.

     (b) A PCS transplant hospital may purchase PSC processing and harvesting services from other department-approved processing providers.

     (((c))) (6) The department ((shall)) does not ((reimburse)) pay a PSC transplant ((facility)) hospital for AABB inspection and certification fees related to PSC transplant services.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-2100, filed 12/18/97, effective 1/18/98.]

     (a) Meeting annual volume requirements for the specific transplant procedures for which approved;

     (b) Patient survival rates; and

     (c) Relative cost per case.

     (2) A transplant COE ((shall)) must meet or exceed annually the following applicable volume criteria for the particular transplant procedures performed at the facility, except for cornea transplants which do not have established minimum volume requirements. Annual volume requirements for transplant centers of excellence include:

     (a) Twelve or more heart transplants;

     (b) Ten or more lung transplants;

     (c) Ten or more heart-lung transplants;

     (d) Twelve or more liver transplants;

     (e) Twenty-five or more kidney transplants;

     (f) Eighteen or more pancreas transplants;

     (g) Eighteen or more kidney-pancreas transplants;

     (h) Ten or more bone marrow transplants; and

     (i) Ten or more peripheral stem cell (PSC) transplants.

     Dual-organ procedures may be counted once under each organ and the combined procedure.

     (3) A transplant ((facility)) hospital within the state that fails to meet the volume requirements in subsection (1) of this section may submit a written request to the department for conditional approval as a transplant ((center of excellence)) COE. The department ((shall)) considers the minimum volume requirement met when the requestor submits an approved certificate of need for transplant services from the ((state)) department of health (DOH).

     (4) An in-state ((facility)) hospital granted conditional approval by the department as a transplant ((center of excellence shall)) COE must meet the department's criteria, as established in this chapter, within one year of the conditional approval. The department ((shall)) must automatically revoke such conditional approval for any ((facility)) hospital which fails to meet the department's published criteria within the allotted one year period, unless:

     (a) The ((facility)) hospital submits a written request for extension of the conditional approval thirty calendar days prior to the expiration date; and

     (b) Such request is granted by the department.

     (5) A transplant center of excellence ((shall)) must meet Medicare's survival rate requirements for the transplant procedure(s) performed at the ((facility)) hospital.

     (6) A transplant ((center of excellence shall)) COE must submit to the department annually, at the same time the hospital submits a copy of its Medicare Cost Report (((HCFA)) Form 2552-96 ((report))) documentation showing:

     (a) The numbers of transplants performed at the ((facility)) hospital during its preceding fiscal year, by type of procedure; and

     (b) Survival rates data for procedures performed over the preceding three years as reported on the United Network of Organ Sharing report form.

     (7)(((a))) Transplant ((facilities shall)) hospitals must:

     (a) Submit to the department, within sixty days of the date of the ((facility's)) hospital's approval as a ((center of excellence)) COE, a complete set of the comprehensive patient selection criteria and treatment protocols used by the ((facility)) hospital for each transplant procedure it has been approved to perform.

     (b) ((The facility shall)) Submit to the department annual updates to ((said)) the documents ((annually thereafter)) listed in subsection (a) of this section, or whenever the ((facility)) hospital makes a change to the criteria and/or protocols.

     (c) Notify the department if no changes occurred during a reporting period ((the facility shall so notify the department to this effect)).

     (8) The department ((shall)) evaluates compliance with the provisions of WAC 388-550-2100 (2)(d) and (e) based on the protocols and criteria submitted to the department by a transplant ((centers of excellence)) COE in accordance with subsection (7) of this section. The department ((shall)) terminates a ((facility's)) hospital's designation as a transplant ((center of excellence)) COE if a review or audit finds that ((facility)) hospital in noncompliance with:

     (a) Its protocols and criteria in evaluating and selecting candidates for transplantation; and

     (b) Distributing donated organs in a fair and equitable manner that promotes an optimal or successful patient outcome.

     (9)(((a))) The department ((shall)):

     (a) Provides notification to a transplant ((centers of excellence)) COE it finds in noncompliance with subsection (8) of this section, and may allow from the date of notification sixty days within which such centers may submit a plan to correct a breach of compliance;

     (b) ((The department shall)) Does not allow the sixty-day option as stated in (a) of this subsection for a breach that constitutes a danger to the health and safety of clients as stated in WAC 388-502-0030;

     (c) Requires, within six months of submitting a plan to correct a breach of compliance, a center ((shall)) to report ((to the department showing)) that:

     (i) The breach of compliance has been corrected; or

     (ii) Measurable and significant improvement toward correcting such breach of compliance exists.

     (10) The department ((shall)) periodically reviews the list of approved transplant ((centers of excellence)) COEs. The department may limit the number of ((facilities)) hospitals it designates as a transplant ((centers of excellence)) COE or contracts with to provide services to medical ((care)) assistance clients if, in the department's opinion, doing so would promote better client outcomes and cost efficiencies.

     (11) The department ((shall reimburse)) pays a department-approved ((centers of excellence)) COE for covered transplant procedures using ((any of the)) methods identified in chapter 388-550 WAC.

[Statutory Authority: RCW 74.08.090. 01-02-075, § 388-550-2200, filed 12/29/00, effective 1/29/01. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-2200, filed 12/18/97, effective 1/18/98.]

     (a) The client qualifies for bariatric surgery by successfully completing all requirements under WAC 388-531-1600;

     (b) The client continues to meet the criteria to qualify for bariatric surgery under WAC 388-531-1600 up to the actual surgery date; ((and))

     (c) The hospital providing the bariatric surgery and bariatric surgery-related services meets the requirements in this section and other applicable WAC; and

     (d) The hospital receives prior authorization from the department prior to performing a bariatric surgery for a medical assistance client.

     (2) A hospital must meet the following requirements in order to be ((reimbursed)) paid for bariatric surgery and bariatric surgery-related services provided to an eligible medical assistance client. The hospital must:

     (a) Be approved by the department to provide bariatric surgery and bariatric surgery-related services and;

     (i) For dates of admission on or after July 1, 2007, be located in Washington state or approved bordering cities (see WAC 388-501-0175) ((and have a current core provider agreement with MAA)).

     (ii) For dates of admission on or after July 1, 2007, be located in Washington state, or be a department-designated critical border hospital.

     (b) Have an established bariatric surgery program in operation under which at least one hundred bariatric surgery procedures have been performed. The program must have been in operation for at least five years and be under the direction of an experienced board-certified surgeon. In addition, ((MAA)) department requires the bariatric surgery program to:

     (i) Have a mortality rate of two percent or less;

     (ii) Have a morbidity rate of fifteen percent or less;

     (iii) Document patient follow-up for at least five years postsurgery;

     (iv) Have an average loss of at least fifty percent of excess body weight achieved by patients at five years postsurgery; and

     (v) Have a reoperation or revision rate of five percent or less.

     (c) Submit documents to ((MAA's Division of Medical Management)) the department's division of healthcare services that verify the performance requirements listed in this section. ((The hospital must receive approval from MAA prior to performing a bariatric surgery for a medical assistance client.))

     (3) ((MAA)) The department waives the program requirements listed in subsection (2)(b) of this section if the hospital participates in a statewide bariatric surgery quality assurance program such as the surgical Clinical Outcomes Assessment Program (COAP).

     (4) See WAC 388-531-1600(13) for requirements for surgeons who perform bariatric surgery.

     (5) Authorization does not guarantee payment. Authorization for bariatric surgery and bariatric surgery-related services is valid only if:

     (a) The client is eligible on the date of admission and date of service; and

     (b) The hospital and professional providers meets the criteria in this section and other applicable WAC to perform bariatric surgery and/or to provide bariatric surgery-related services.

[Statutory Authority: RCW 74.08.090, 74.09.520. 05-12-022, § 388-550-2301, filed 5/20/05, effective 6/20/05.]

     (3) The department shall not reimburse a contract facility for unrelated services provided during the client's inpatient stay for chronic pain management, unless the facility requested and received prior approval from the department for those services)) The department pays a hospital that is specifically approved by the department to provide inpatient chronic pain management services, an all-inclusive per diem facility fee. The department pays professional fees for chronic pain management services to performing providers in accordance with the department's fee schedule.

     (2) A client qualifies for inpatient chronic pain management services when all of the following apply:

     (a) The client has had pain for at least three months and has not improved with conservative treatment, including tests and therapies;

     (b) At least six months have passed since a previous surgical procedure was done in relation to the pain problem; and

     (c) A client with active substance abuse must have completed a detoxification program, if appropriate, and must be free from drugs and/or alcohol for at least six months.

     (3) The department:

     (a) Covers inpatient chronic pain management training to assist eligible clients to manage chronic pain.

     (b) Pays for only one inpatient hospital stay, up to a maximum of twenty-one consecutive days, for chronic pain management training per a client's lifetime.

     (c) Does not require prior authorization for chronic pain management services.

     (d) Does not pay for services unrelated to the chronic pain management services that are provided during the client's inpatient stay, unless the hospital requests and receives prior authorization from the department

     (4) All applicable claim payment adjustments for client responsibility, third party liability, medicare crossover, etc., apply to the department.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-2400, filed 12/18/97, effective 1/18/98.]

     (a) The hospice agency coordinates the provision of such inpatient services; and

     (b) Such services are related to the medical condition for which the client sought hospice care.

     (2) Hospice agencies ((shall)) must bill the department for their services using revenue codes. The department ((shall reimburse)) pays hospice providers a set per diem fee according to the type of care provided to the client on a daily basis.

     (3) The department ((shall reimburse)) pays hospital providers directly pursuant to this chapter for inpatient care provided to clients in the hospice program for medical conditions not related to their terminal illness.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-2500, filed 12/18/97, effective 1/18/98.]

     (1) The department pays hospitals for medicaid and SCHIP inpatient hospital services using the rate setting methods identified in the department's approved state plan as follows:

Payment method used for Medicaid inpatient hospital claims	Applicable providers/services	Process to adjust for third-party liability insurance and any other client responsibility
Diagnosis related group (DRG) negotiated conversion factor	Hospitals participating in the medicaid hospital selective contracting program under waiver from the federal government	Lesser of either the DRG billed amount minus the third-party payment amount and any client responsibility amount, or the ((allowable)) allowed amount, minus the third-party payment amount and any client responsibility amount.
DRG cost-based conversion factor	Hospitals not participating in or exempt from the medicaid hospital selective contracting program	Lesser of either the DRG billed amount minus the third-party payment amount and any client responsibility amount, or the ((allowable)) allowed amount, minus the third-party payment amount and any client responsibility amount.
Ratio of costs-to-charges (RCC)	((Hospitals or)) Some services exempt from DRG payment methods	The allowable minus the third-party payment amount and any client responsibility amount.
Costs-to-charges rate with a "hold harmless" settlement provision	Hospitals eligible to be paid through the certified public expenditure (CPE) payment program	((The allowable)) For the "hold harmless" settlement, the lesser of the billed amount minus the third-party payment amount and any client responsibility amount, or the allowed amount minus the third-party payment amount and any client responsibility amount. The payment made is the federal share only.
Single case rate	Hospitals eligible to provide bariatric surgery to medical assistance clients	Lesser of either the billed amount minus the third-party payment amount and any client responsibility amount, or the single case rate allowed amount minus the third-party payment amount and any client responsibility amount.
Fixed per diem rate	Long-term acute care (LTAC) hospitals	Lesser of either the billed amount minus the third-party payment amount and any client responsibility amount, or the per diem allowed amount minus the third-party payment amount and any client responsibility amount.
Per diem rate	Some providers/services exempt from the DRG payment methods	Per diem allowed amount, and for some services a high outlier amount, minus the third-party payer amount and any client responsibility amount.
Cost settlement	DOH-approved critical access hospitals (CAHs)	The ((allowable times the approved CAH rate)) allowed amount, subject to retrospective cost settlement, minus the third-party payment amount and any client responsibility amount.
Medicaid base community psychiatric hospitalization rate	Nonstate-owned free-standing psychiatric hospitals located in Washington state	Paid according to applicable payment method in WAC 388-550-2650 for medicaid and SCHIP clients, minus the third-party payment amount and any client responsibility amount.

     See WAC 388-550-4800 for payment methods used by the department for inpatient hospital services provided to clients eligible under state-administered programs. The department's policy for payment on state-administered program claims that involve third-party liability (TPL) and/or client responsibility payments on claims is the same policy indicated in the table in subsection (1) in this section. However, to determine the department's payment on the claim, state-administered program rates, not medicaid or SCHIP rates, apply when comparing the lesser of either the billed amount minus the third-party payment and any client responsibility amount, or the allowed amount minus the third-party payment amount and any client responsibility amount.

     (2) The department's annual aggregate medicaid and SCHIP payments to each hospital for inpatient hospital services provided to medicaid and SCHIP clients will not exceed the hospital's usual and customary charges to the general public for the services (42 CFR Sec. 447.271). The department recoups annual aggregate medicaid and SCHIP payments that are in excess of the usual and customary charges.

     (3) The department's annual aggregate payments for inpatient hospital services, including state-operated hospitals, will not exceed the estimated amounts that the department would have paid using medicare payment principles.

     (4) When hospital ownership changes, the department's payment to the hospital will not exceed the amount allowed under 42 U.S.C. Section 1395x (v)(1)(O).

     (5) Hospitals participating in the department's medical assistance program must annually submit to the department:

     (a) A copy of the hospital's CMS medicare cost report (form 2552-96) that is the official "as ((submitted)) filed" cost report submitted to the medicare fiscal intermediary; and

     (b) A disproportionate share hospital (DSH) application if the hospital wants to be considered for DSH payments. See WAC 388-550-4900 for the requirement for a hospital to qualify for a DSH payment.

     (6) Reports referred to in subsection (5) of this section must be completed according to:

     (a) Medicare's cost reporting requirements;

     (b) The provisions of this chapter; and

     (c) Instructions issued by the department.

     (7) The department requires hospitals to follow generally accepted accounting principles.

     (8) Participating hospitals must permit the department to conduct periodic audits of their financial records, statistical records, and any other records as determined by the department.

     (9) The department limits payment for private room accommodations to the semiprivate room rate. Room charges must not exceed the hospital's usual and customary charges to the general public as required by 42 C.F.R. Sec. 447.271.

     (10) For a client's hospital stay that involves both regional support network (RSN)-approved voluntary inpatient and involuntary inpatient hospitalizations, the hospital must bill the department for payment, unless the hospital contracts directly with the RSN. In that case, the hospital must bill the RSN for payment.

     (11) ((The department pays hospitals to cover the cost of certain newborn screening tests that are required under chapter 70.83 RCW (see also chapter 246-650 WAC). The flat fees that are not included in the DRG rate but are related to performing the newborn screening tests are added to the DRG payment. Hospitals are responsible to bill for all newborn screening fees when submitting any claims for newborn services to the department.

     (12))) Refer to subsection (1) of this section for how the department adjusts inpatient hospital claims for third party payment amounts and any client responsibility amounts.

[Statutory Authority: RCW 74.08.090, 74.09.500, and 2005 c 518, § 204, Part II. 07-06-043, § 388-550-2800, filed 3/1/07, effective 4/1/07. Statutory Authority: RCW 74.08.090, 74.09.520. 05-12-022, § 388-550-2800, filed 5/20/05, effective 6/20/05. Statutory Authority: RCW 74.08.090 and 74.09.500. 04-19-113, § 388-550-2800, filed 9/21/04, effective 10/22/04. Statutory Authority: RCW 74.08.090, 74.09.500, 74.09.035(1), and 43.88.290. 02-21-019, § 388-550-2800, filed 10/8/02, effective 11/8/02. Statutory Authority: RCW 74.08.090 and 42 U.S.C. 1395x(v), 42 C.F.R. 447.271, .11303, and .2652. 01-16-142, § 388-550-2800, filed 7/31/01, effective 8/31/01. Statutory Authority: RCW 74.09.090, 42 U.S.C. 1395x(v) and 1396r-4, 42 C.F.R. 447.271, 11303 and 2652. 99-14-027, § 388-550-2800, filed 6/28/99, effective 7/1/99. Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, § 388-550-2800, filed 2/26/99, effective 3/29/99. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-2800, filed 12/18/97, effective 1/18/98.]

     Reviser's note: RCW 34.05.395 requires the use of underlining and deletion marks to indicate amendments to existing rules. The rule published above varies from its predecessor in certain respects not indicated by the use of these markings.

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