Section 418.101016. Reimbursement; payment ratio methodology.

(1) A hospital licensed in Michigan billing facility services shall be reimbursed using the  maximum payment  ratio   methodology for  the following services:

(a)   Inpatient or observation care.

(b)   Emergency department services.

(c)   Occupational, physical, and speech therapy services.

(d)  Outpatient surgeries.

(e)   Laboratory services and outpatient services. If a carrier pays a properly submitted bill or unadjusted portion of the bill within 30 days of receipt, then the payment is calculated by multiplying the charges times the hospital's maximum payment ratio times a multiplier of 107%. If a carrier pays the bill after 30 days, then the multiplier shall be 110% allowing for a 3% late fee.

(2)   When a hospital outside the state of Michigan submits a bill for facility services, the carrier may initially process payment  by  using the  method described in subrule (1) of this rule, applying the average maximum payment ratio, as published in the health care services manual. If the facility located outside of  Michigan  does  not   accept reimbursement according to Michigan health care services rules, then the carrier shall negotiate  the charges with the out-of-state facility  or reimburse the facility according to the laws of the state where the facility is located.

(3)    If applying the ratio methodology results in an amount greater than the hospital's charge, the carrier shall reimburse the hospital's charge. The only time a carrier shall pay in excess  of   the  charge  is   if   a properly submitted bill was not paid within 30 days and,  in that instance, the carrier shall reimburse the charge plus a 3% late fee.

(4)   Observation care shall not be for more than 24 hours. If the patient does not meet admission criteria according to the length of stay guidelines, then the patient shall be discharged from observation care.

History: 1998-2000 AACS; 2005 AACS; 2007 AACS; 2009 AACS.