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(D) Services for which a beneficiary would be entitled to payment but for a reduction or denial in payment as a result of quality review; and

(E) Services rendered during a period in which the provider was not in compliance with one or more conditions of authorization;

(ii) Comply with the applicable provisions of this part and related CHAMPUS administrative policy;

(iii) Accept the CHAMPUS determined allowable payment combined with the cost-share, deductible, and other health insurance amounts payable by, or on behalf of, the beneficiary, as full payment for CHAMPUS allowed services;

(iv) Collect from the CHAMPUS beneficiary those amounts that the beneficiary has a liability to pay for the CHAMPUS deductible and cost-share;

(v) Permit access by the Director, OCHAMPUS, or designee, to the clinical record of any CHAMPUS beneficiary, to the financial and organizational records of the provider, and to reports of evaluations and inspections conducted by state, private agencies or organizations;

(vi) Provide the Director, OCHAMPUS, or designee, prompt written notification of the provider's employment of an individual who, at any time during the twelve months preceding such employment, was ployed in a managerial, accounting, auditing, or similar capacity by an agency or organization which is responsible, directly or indirectly for decisions regarding Department of Defense payments to the provider;

(vii) Cooperate fully with a designated utilization and clinical quality management organization which has a contract with the Department of Defense for the geographic area in which the provider renders services;

(viii) Obtain written authorization before rendering designated services or items for which CHAMPUS cost-share may be expected;

(ix) Maintain clinical and other records related to individuals for whom CHAMPUS payment was made for services rendered by the provider, or otherwise under arrangement, for a period of 60 months from the date of service;

(x) Maintain contemporaneous clinical records that substantiate the clinical rationale for each course of treatment, periodic evaluation of the efficacy of treatment, and the outcome at completion or discontinuation of treatment;

(xi) Refer CHAMPUS beneficiaries only to providers with which the referring provider does not have an economic interest, as defined in $199.2; and

(xii) Limit services furnished under arrangement to those for which receipt of payment by the CHAMPUS authorized provider discharges the payment liability of the beneficiary.

(14) Implementing instructions. The Director, OCHAMPUS, or a designee, shall issue CHAMPUS policies, instructions, procedures, and guidelines, as may be necesssary to implement the intent of this section.

(15) Exclusion. Regardless of any provision in this section, a provider who is suspended, excluded, or terminated under $ 199.9 of this part is specifically excluded as an authorized CHAMPUS provider.

(b) Institutional providers—(1) General. Institutional providers are those providers who bill for services in the name of an organizational entity (such as hospital and skilled nursing facility), rather than in the name of a person. The term “institutional provider” does not include professional corporations or associations qualifying as a domestic corporation under $ 301.7701–5 of the Internal Revenue Service Regulations nor does it include other corporations that provide principally professional services. Institutional providers may provide medical services and supplies on either an inpatient or outpatient basis.

(i) Preauthorization. Preauthorization may be required by the Director, OCHAMPUS for any health care service for which payment is sought under CHAMPUS. (See $$ 199.4 and 199.15 for further

information preauthorization requirements.)

(ii) Billing practices.

(A) Each institutional billing, including those institutions subject to the CHAMPUS DRG-based reimbursement method or a CHAMPUS-determined allinclusive rate reimbursement method, must be itemized fully and sufficiently



descriptive for the CHAMPUS to make a determination of benefits.

(B) Institutional claims subject to the CHAMPUS DRG-based reimbursement method or a CHAMPUS-determined all-inclusive rate reimbursement method, may be submitted only after the beneficiary has been discharged or transferred from the institutional provider's facility or program.

(C) Institutional claims for Residential Treatment Centers and all other institutional providers, except those listed in (B) above, should be submitted to the appropriate CHAMPUS fiscal intermediary at least every 30 days.

(2) Nondiscrimination policy. Except as provided below, payment may not be made for inpatient or outpatient care provided and billed by an institutional provider found by the Federal Government to practice discrimination in the admission of patients to its services on the basis of race, color, or national origin. Reimbursement may not be made to a beneficiary who pays for care provided by such a facility and submits a claim for reimbursement. In the following circumstances, the Secretary of Defense, or a designee, may authorize payment for care obtained in an ineligible facility:

(1) Emergency care. Emergency inpatient or outpatient care.

(ii) Care rendered before finding of a violation. Care initiated before a finding of a violation and which continues after such violation when it is determined that a change in the treatment facility would be detrimental to the health of the patient, and the attending physician so certifies.

(iii) Other facility not available. Care provided in an ineligible facility because an eligible facility is not available within a reasonable distance.

(3) Procedures for qualifying as CHAMPUS-approved institutional provider. General and special hospitals otherwise meeting the qualifications outlined in paragraphs (b)(4) (i), (ii), and (iii), of this section are not required to request CHAMPUS approval formally.

(1) JCAH accreditation status. Each CHAMPUS fiscal intermediary shall keep informed as to the current JCAH accreditation status of all hospitals and skilled nursing facilities in its

area; and the provider's status under Medicare, particularly with regard to compliance with title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d(1)). The Director, OCHAMPUS, or a designee, shall specifically approve all other authorized institutional providers providing services to CHAMPUS beneficiaries. At the discretion of the Director, OCHAMPUS, any facility that is certified and participating as a provider of services under title XVIII of the Social Security Act (Medicare), may be deemed to meet CHAMPUS requirements. The facility must be providing a type and level of service that is authorized by this part.

(ii) Required to comply with criteria. Facilities seeking CHAMPUS approval will be expected to comply with appropriate criteria set forth in paragraph (b)(4) of this section. They also are required to complete and submit CHAMPUS Form 200, "Required Information, Facility Determination Instructions,” and provide such additional information as may be requested by OCHAMPUS. An onsite evaluation, either scheduled or unscheduled, may be conducted at the discretion of the Director, OCHAMPUS, or a designee. The final determination regarding approval, reapproval, or disapproval of a facility will be provided in writing to the facility and the appropriate CHAMPUS fiscal intermediary.

(iii) Notice of peer review rights. All health care facilities subject to the DRG-based payment system shall provide CHAMPUS beneficiaries, upon admission, with information about peer review including their appeal rights. The notices shall be in a form specified by the Director, OCHAMPUS.

(iv) Surveying of facilities. The surveying of newly established institutional providers and the periodic resurveying of all authorized institutional providers is a continuing process conducted by OCHAMPUS.

(v) Institutions not in compliance with CHAMPUS standards. If a determination is made that an institution is not in compliance with one or more of the standards applicable to its specific category of institution, CHAMPUS shall take immediate steps to bring about compliance or terminate the approval



as an authorized institution in accordance with $199.9(1)(2).

(vi) Participation agreements required for some hospitals which are not Medicare-participating. Notwithstanding the provisions of this paragraph (B)(3), a hospital which is subject to the CHAMPUS DRG-based payment system but which is not Medicareparticpating hospital must request and sign an agreement with OCHAMPUS. By signing the agreement, the hospital agrees to participate on all CHAMPUS inpatient claims and accept the requirements for a participating provider as contained in paragraph (a)(8) of $199.6. Failure to sign such an agreement shall disqualify such hospital as a CHAMPUS-approved institutional provider.

(4) Categories of institutional providers. The following categories of institutional providers may be reimbursed by CHAMPUS for services provided CHAMPUS beneficiaries subject to any and all definitions, conditions, limitation, and exclusions specified or enumerated in this part.

(i) Hospitals, acute care, general and special. An institution that provides inpatient services, that also may provide outpatient services (including clinical and ambulatory surgical services), and that:

(A) Is engaged primarily in providing to inpatients, by or under the supervision of physicians, diagnostic and therapeutic services for the medical or surgical diagnosis and treatment of illness, injury, or bodily malfunction (including maternity).

(B) Maintains clinical records on all inpatients (and outpatients if the facility operates an outpatient department or emergency room).

(C) Has bylaws in effect with respect to its operations and medical staff.

(D) Has a requirement that every patient be under the care of a physician.

(E) Provides 24-hour nursing service rendered or supervised by a registered professional nurse, and has a licensed practical nurse or registered professional nurse on duty at all times.

(F) Has in effect a hospital utilization review plan that is operational and functioning.

(G) In the case of an institution in a state in which state or applicable local

law provides for the licensing of hospitals, the hospital:

(1) Is licensed pursuant to such law, or

(2) Is approved by the agency of such state or locality responsible for licensing hospitals as meeting the standards established for such licensing.

(H) Has in effect an operating plan and budget.

(I) Is accredited by the JCAH or meets such other requirements as the Secretary of Health and Human Services, the Secretary of Transportation, or the Secretary of Defense finds necessary in the interest of the health and safety of patients who are admitted to and furnished services in the institution.

(ii) Liver transplantation centers. (A) CHAMPUS shall provide coverage for liver transplantation procedures performed only by experienced transplant surgeons at centers complying with the provisions outlined in paragraph (b)(4)(i) of this section and meeting the following criteria:

(1) The center is a tertiary care facility affiliated with an academic health center. The center must have accredited programs in graduate medical education related to the function of liver transplantation such as internal medicine, pediatrics, surgery, and anesthesiology;

(2) The center has an active solid organ transplantation program (involving liver transplants as well as other organs);

(3) The transplantation center must have at least a 50 percent one-year survival rate for ten cases. At the time CHAMPUS approval is requested, the transplant center must provide evidence that at least ten liver transplants have been performed at the center and that at least 50 percent of those transplanted patients have survived one year following surgery. A 50 percent one-year survival rate for all subsequent liver transplantations must be maintained for continued CHAMPUS approval;

(4) The center has allocated sufficient operating room, recovery room, laboratory, and blood bank support and a sufficient number of intensive care and general surgical beds and specialized staff for these areas;

(5) The center participates in a donor procurement program and network;

(6) The center systematically collects and shares data on its transplant program;

(7) The center has an interdisciplinary body to determine the suitability of candidates for transplantation on an equitable basis;

(8) The transplantation surgeon is specifically trained for liver grafting and must assemble and train a team to function whenever a donor liver is available;

(9) The transplantation center must have on staff board eligible or board certified physicians and other experts in the field of hepatology, pediatrics, infectious disease, nephrology with dialysis capability, pulmonary medicine with respiratory therapy support, pathology, immunology, and anesthesiology to complement a qualified transplantation team;

(10) The transplantation center has the assistance of appropriate microbiology, clinical chemistry, and radiology support;

(11) The transplantation center has blood bank support to accommodate normal demands and the transplant procedure; and

(12) The transplantation center includes the availability of psychiatric and social services support for patients and family.

(B) In order to receive approval as a CHAMPUS authorized liver transplant center, a center must submit a request to the Director, CHAMPUS, or a designee. The CHAMPUS authorized liver transplant center shall agree to the following:

(1) Bill for all services and supplies related to the liver transplantation performed by its staff and bill also for services rendered by the donor hospital following declaration of brain death and after all existing legal requirements for excision of the donor organ have been met; and

(2) The center shall agree to submit all charges on the basis of fully itemized bills. This means that each service and supply and the charge for each is individually identified.

(iii) Heart transplantation centers. (A) CHAMPUS shall provide coverage for heart transplantation procedures per

formed only by experienced transplant surgeons at centers complying with provisions outlined in paragraph (b)(4)(i) of this section and meeting the following criteria:

(1) The center has experts in the fields of cardiology, cardiovascular surgery, anesthesiology, immunology, infectious disease, nursing, social services and organ procurement to complement the transplant team;

(2) The center has an active cardiovascular medical and surgical program as evidenced by a minimum of 500 cardiac catheterizations and coronary arteriograms and 250 open heart procedures per year;

(3) The center has an anesthesia team that is available at all times;

(4) The center has infectious disease services with both the professional skills and the laboratory resources that are needed to discover, identify, and manage a whole range of organisms;

(5) The center has a nursing service team trained in the hemodynamic support of the patient and in managing immunosuppressed patients;

(6) The center has pathology resources that are available for studying and reporting the pathological responses of transplantation;

(7) The center has legal counsel familiar with transplantation laws and regulations;

(8) The commitment of the transplant center must be at all levels and broadly evident throughout the facility;

(9) Responsible team members must be board certified or board eligible in their respective disciplines;

(10) Component teams must be integrated into a comprehensive transplant team with clearly defined leadership and responsibility;

(11) The center has adequate social service resources;

(12) The transplant center must comply with applicable State transplant laws and regulations;

(13) The transplant center must safeguard the rights and privacy of patients;

(14) The transplant center must have adequate patient management plans and protocols;

(15) The center participates in a plant team to the Director, donor procurement program and net- OCHAMPUS. work;

(iv) Hospitals, psychiatric. A psy(16) The center systematically col chiatric hospital is an institution lects and shares data on its transplant which is engaged primarily in proprogram;

viding services to inpatients for the di(17) The center has an interdiscipli

agnosis and treatment of mental disnary body to determine the suitability

orders. of candidates for transplantation on an

(A) There are two major categories of equitable basis; (18) The center has extensive blood

psychiatric hospitals:

(1) The private psychiatric hospital bank support; (19) The center must have an estab

category includes both proprietary and lished heart transplantation program

the not-for-profit nongovernmental inwith documented evidence of 12 or

stitutions. more heart transplants in each of the

(2) The second category is those psytwo consecutive preceding 12-month pe

chiatric hospitals that are controlled, riods prior to application and 12 heart

financed, and operated by departments transplants prior to that, and

or agencies of the local, state, or Fed(20) The center must demonstrate ac- eral Government and always are opertuarial survival rates of 73 percent for ated on a not-for-profit basis. one year and 65 percent for two years (B) In order for the services of a psyfor patients who have had heart trans- chiatric hospital to be covered, the plants since January 1, 1982, at that fa hospital shall comply with the provicility.

sions outlined in paragraph (b)(4)(i) of (B) CHAMPUS approval will lapse if this section. All psychiatric hospitals either the number of heart transplants shall be accredited under the JCAHO falls below 8 in 12 months or if the one- Accreditation Manual for Hospitals year survival rate falls below 60 per- (AMH) standards in order for their cent for a consecutive 24-month period. services to be cost-shared under (C) CHAMPUS-approval may also be

CHAMPUS. In the case of those psyextended for a heart transplant center

chiatric hospitals that are not JCAHOthat meets other certification or ac

accredited because they have not been creditation standards provided the

in operation a sufficient period of time standards are equivalent to or exceed

to be eligible to request an accreditathe criteria listed above and have been

tion survey by the JCAHO, the Direcapproved by the Director, OCHAMPUS.

tor, OCHAMPUS, or a designee, may (D) In order to receive approval as a

grant temporary approval if the hosCHAMPUS heart transplant center, a

pital is certified and participating facility must submit a request to the

under Title XVIII of the Social SecuDirector, OCHAMPUS, or a designee.

rity Act (Medicare, Part A). This temThe CHAMPUS-authorized heart trans

porary approval expires 12 months from plant center shall agree to the fol

the date on which the psychiatric hoslowing: (1) Bill for all services and supplies

pital first becomes eligible to request related to the heart transplantation

an accreditation survey by the JCAHO. performed by its staff and bill also for

(C) Factors to be considered in deterservices rendered by the donor hospital mining whether CHAMPUS will costfollowing declaration of brain death;

share care provided in a psychiatric (2) Submit all charges on the basis of hospital include, but are not limited fully itemized bills. Each service and to, the following considerations: supply must be individually identified (1) Is the prognosis of the patient and the first claim submitted for the such that care provided will lead to heart transplantation must include a resolution or remission of the mental copy of the admission history and illness to the degree that the patient is physical examination; and

of no danger to others, can perform (3) Report any significant decrease in routine daily activities, and can be exthe experience level or survival rates pected to function reasonably outside and loss of key members of the trans- the inpatient setting?

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