AAPC-CIC Certified Inpatient Coder - Set 4 - Part 1

Correct Answer: Outpatient prospective payment by date of service

The regulation describes Part A as helping pay for inpatient hospital or CAH services, posthospital SNF care, home health services and hospice care. Outpatient PPS payment by date of service is a payment method, not a listed Part A benefit. Option b is incorrect because inpatient hospital or inpatient CAH services are the first benefit the regulation lists for hospital insurance, so they are covered under Part A. Option c is incorrect because the regulation names posthospital skilled nursing facility care as a Part A benefit alongside inpatient hospital services, so it belongs in the covered set. Option d is incorrect because the regulation states that Part A also pays for hospice care, so this service is a Part A benefit rather than the exception.

Correct Answer: Posthospital SNF care

The Medicare manual states that inpatient hospital services do not include posthospital SNF care furnished by a hospital or critical access hospital that has a swing-bed approval. Such care is therefore not an inpatient hospital service. Option a is incorrect because the definition names this among the covered inpatient hospital services rather than among the services excluded from that definition. Option b is incorrect because it is listed in the Medicare manual among the services that make up inpatient hospital or inpatient CAH services. Option c is incorrect because the regulation counts these as inpatient hospital services furnished to an inpatient, so they are not part of the swing-bed exclusion.

Correct Answer: Estimated or actual time the beneficiary requires or required in the hospital

Medicare guidance lists three content elements of the physician certification: the reason for inpatient services, the estimated or actual time the beneficiary requires or required in the hospital, and plans for posthospital care, if appropriate. Option a is incorrect because the guidance lists no itemized drug or treatment list among certification content; the elements are reason, time in hospital and posthospital care plans. Option b is incorrect because entitlement dates are not a certification content element; the content covers reason for services, estimated or actual stay and posthospital plans. Option d is incorrect because the admission order is a separate requirement found at 42 CFR 412.3, not one of the listed content elements of the certification.

Correct Answer: Final notice with comment period, prospective effective date

Under the rule on interim changes to correct omissions and inequities, CMS publishes the change in the Federal Register as a final notice with comment period, with a prospective effective date. It is later repeated in the annual notice. Option b is incorrect because the annual notice republishes the interim change for public information afterward, and the regulation gives these changes a prospective date, not a retroactive one. Option c is incorrect because this is the route for interim coverage changes that add newly covered items and services, not for correcting omissions or inequities. Option d is incorrect because the regulation calls for a final notice with comment period published in the Federal Register, not a proposed rule tied to a fiscal-year start.

Correct Answer: Ongoing supply furnished to the patient for use outside the hospital after discharge

Drugs and biologicals furnished to an inpatient for use outside the hospital are, in general, not covered as inpatient hospital services. Only a limited, medically necessary supply that facilitates the patient's departure is covered. Option a is incorrect because guidance makes this exception explicit: a medically necessary limited supply that permits or facilitates departure is covered as an inpatient hospital service. Option c is incorrect because guidance allows coverage of non-formulary drugs when a hospital policy permits them at a physician's special request, provided a designated compendium includes or approves them. Option d is incorrect because coverage is not limited to routinely stocked items, so a drug the hospital obtains from an outside source such as a community pharmacy can be covered.

Correct Answer: FL 63 - Treatment Authorization Code

FL 63, Treatment Authorization Code, is situational. It is required when the payer assigned an authorization or referral number and the services on the claim were preauthorized or a referral is involved. Option a is incorrect because it is required when the indicated payer has already paid an amount toward this bill, so it reports payments rather than authorizations. Option b is incorrect because it reports the national health plan identifier when one is established, or otherwise the number Medicare assigned, which identifies the plan rather than an approval. Option c is incorrect because it holds the control number the health plan or its fiscal agent assigned to the original bill for internal control, not an authorization.

Correct Answer: Establish, update, and make public a list of standard charges for items and services

Section 2718(e) of the PHS Act requires each hospital, for each year, to establish, update, and make public a list of its standard charges for items and services, including DRGs. Option a is incorrect because that describes a claim-form entry in the billing process, a separate task from the public list of standard charges the statute requires. Option b is incorrect because the hospital's duty is to make the list public; CMS is given authority to promulgate regulations for enforcement, not an approval step. Option d is incorrect because the requirement covers items and services provided by the hospital and includes DRGs within that list, so DRGs are not the sole subject.

Correct Answer: Assignment to a qualifying DRG

Under the postacute care transfer provision, a discharge is considered a transfer when it is assigned to one of the qualifying diagnosis-related groups (DRGs) and is made under one of the listed circumstances. Both parts are required. Option b is incorrect because preadmission outpatient services fall under the billing rule that places them on the inpatient claim, which is a separate matter from transfer status. Option c is incorrect because death in the hospital is one of the two events that define a discharge under paragraph (a); it does not create a postacute transfer. Option d is incorrect because same-day readmission to another hospital is the test for an acute care transfer under paragraph (b), not an added condition of the postacute care provision.

Correct Answer: Temporary or disposable item

Medicare guidance covers a temporary or disposable item as an inpatient hospital service when it is medically necessary to permit or facilitate departure and is required until the patient can obtain a continuing supply. Option a is incorrect because prosthetic devices appear in the list of therapeutic items, a separate category, and the departure exception names temporary or disposable items instead. Option b is incorrect because admission packs hold toilet articles and are covered only when routinely furnished to all inpatients; they are not tied to departure from the hospital. Option c is incorrect because braces are listed as therapeutic items covered when ordinarily furnished, while the departure exception applies to temporary or disposable items awaiting a continuing supply.

Correct Answer: A licensed practitioner with admitting privileges who knows the patient's hospital course

Under 42 CFR 412.3(b), the order must come from a qualified, licensed practitioner who has admitting privileges at the hospital as permitted by State law and who is knowledgeable about the patient's hospital course. Option b is incorrect because the ordering practitioner must be granted privileges by the hospital to admit inpatients to that specific facility, so knowledge of the patient alone is not enough. Option c is incorrect because the regulation requires the practitioner to be knowledgeable about the patient's hospital course, plan of care and current condition at the time of admission. Option d is incorrect because the admission decision may not be delegated to someone who lacks state authorization to admit patients or admitting privileges granted by the medical staff.

Correct Answer: medical necessity

The UR condition of participation sets the scope of review: the UR plan must cover Medicare and Medicaid patients' admissions, duration of stays, and professional services, judged by their medical necessity. Option a is incorrect because checking diagnostic and procedural information is a QIO review function under the medical review requirements, not the scope the UR plan assigns to admissions, stays and services. Option b is incorrect because discharge planning has its own separate condition of participation, which deals with identifying at-risk patients and the plan for post-discharge care, rather than the UR plan's review scope. Option d is incorrect because this phrase comes from the QIO's review of services furnished in the hospital, so it describes a different reviewer's task and not the UR plan standard.

Correct Answer: Payment of predetermined amounts

Both regulations describe prospective payment: inpatient hospitals are paid a predetermined amount per discharge, and outpatient hospitals are paid predetermined amounts for designated services. The shared feature is the predetermined amount, not the unit of payment. Option b is incorrect because MS-DRGs group inpatient discharges by illness severity and resource use, and they play no part in how outpatient services are paid. Option c is incorrect because the discharge is the inpatient unit of payment; outpatient payment is made for designated services, not per discharge. Option d is incorrect because HCPCS-identified services are the outpatient unit of payment, whereas inpatient hospitals are paid for the whole discharge.

Correct Answer: I, II, and IV

Under OPPS, predetermined amounts are paid for designated services identified by HCPCS codes. IPPS pays per inpatient case or discharge, with discharges assigned to MS-DRGs reflecting severity, service complexity, and resource use. Option a is incorrect because leaves out statement IV, which is also accurate, because IPPS assigns inpatient discharges to MS-DRGs reflecting illness severity, service complexity, and hospital resource use. Option c is incorrect because includes statement III, which is false, since OPPS services are identified by HCPCS codes and MS-DRGs belong to inpatient classification, and it omits statement I. Option d is incorrect because relies on statement III, which wrongly gives MS-DRGs to outpatient services, and it drops statement II, although IPPS does pay per inpatient case or discharge.

Correct Answer: Inpatient by discharge date; outpatient by date of service

The Medicare manual states that inpatient acute and rehabilitation PPS payment is based on the discharge date, whereas Outpatient PPS payments are based on Ambulatory Patient Classification payment for the date of service. Option a is incorrect because inpatient acute and rehabilitation PPS payment is tied to the discharge date, so the admission date is not the timing basis for the inpatient stay. Option b is incorrect because the Medicare manual ties OPPS payment to Ambulatory Patient Classification payment for the date of service, not to when the claim is submitted. Option d is incorrect because this reverses the pairing; OPPS payment follows the date of service, while the discharge date drives the inpatient payment.

Correct Answer: An extra payment for the case

Under the inpatient operating and capital-related prospective payment systems, the regulation provides an additional payment, in accordance with subpart F, for cases that are extraordinarily costly to treat, on top of the predetermined per discharge amount. Option a is incorrect because MS-DRG weights reflect average case cost within a group and are adjusted annually without changing overall IPPS payments, so they do not address one costly case. Option c is incorrect because base MS-DRGs are simply those not subdivided into severity levels, so this is a classification label and does not add payment for costly cases. Option d is incorrect because acute care hospitals can't separately bill Medicare Part B for qualifying services in the 3 days before admission; those services go on the inpatient claim.

Correct Answer: Medicare-participating hospitals not specifically excluded

The regulation on hospitals subject to the system makes it applicable to any hospital participating in the Medicare program, except those specified in the exclusions paragraph, such as Maryland waiver hospitals and critical access hospitals. Option a is incorrect because the regulation names critical access hospitals (CAHs) among the hospitals excluded from the outpatient prospective payment system, so they fall outside its scope. Option b is incorrect because services furnished by Maryland hospitals paid under a cost containment waiver are listed in the exclusions, so this group is carved out rather than covered. Option c is incorrect because applicability depends on participation in the Medicare program, so a hospital outside Medicare has no basis for coverage under this payment system.

Correct Answer: Subpart B

The scope statement in Part 419 says Subpart B sets forth the categories of hospitals and services that are subject to the outpatient hospital prospective payment system and those that are excluded from it. Option a is incorrect because it deals with Medicare payment amounts, beneficiary copayment amounts, and methods of payment to hospitals, which come after coverage under the system is settled. Option b is incorrect because it covers how the hospital outpatient prospective payment system may be updated, so it addresses changes over time rather than scope. Option d is incorrect because it sets forth the basic methodology for determining prospective payment rates for hospital outpatient services, not the categories of included or excluded hospitals and services.

Correct Answer: Clinical comparability and resource use

CMS classifies outpatient services and procedures that are comparable clinically and in terms of resource use into APC groups. Items in a group are not comparable if the highest geometric mean cost exceeds the lowest by more than 2 times. Option a is incorrect because APC groups rest on geometric mean costs from claims and cost reports, and the guidance gives no role to length of stay in grouping. Option c is incorrect because severity levels and patient characteristics determine MS-DRG assignment for inpatient discharges, not the grouping of outpatient services into APC groups. Option d is incorrect because the labor-related portion is used later to standardize geometric mean costs; it is a payment adjustment step rather than a basis for grouping services.

Correct Answer: Hospital labor costs across geographic areas

Under the regulation on standardizing amounts and payment weights, CMS standardizes the geometric mean costs by adjusting for variations in hospital labor costs across geographic areas, after identifying the labor-related portion of costs. Option a is incorrect because severity levels (MCC, CC, non-CC) belong to MS-DRG classification of inpatient discharges, not to the APC standardizing step for outpatient costs. Option b is incorrect because claim volume is not what CMS adjusts for; the regulation names geographic differences in labor costs as the basis for standardizing geometric mean costs. Option d is incorrect because the standardizing provision addresses labor cost variation by area; drugs and biologicals appear only in the exception rule for low volume items and services.

Correct Answer: Relative geometric mean costs

Under the APC weighting factor rule, CMS assigns each APC group a weighting factor reflecting the relative geometric mean costs of its services compared with the geometric mean costs of services in all APC groups. Option a is incorrect because the highest geometric mean cost is used only to test whether items in a group are comparable, using a two-times limit against the lowest. Option c is incorrect because the labor-related portion is the share of hospital outpatient costs tied to labor, determined as part of standardizing amounts, not the basis of the weighting factor. Option d is incorrect because copayment amounts are determined for an APC group under a separate subpart, after the group is set, and do not define its weighting factor.