CHA News Article

DHCS Issues DRG Guidance for Billing Beneficiaries with CCS and Managed Care

The California Department of Health Care Services (DHCS) has released guidance on how hospitals should bill under the Diagnosis Related Payment (DRG) methodology for beneficiaries hospitalized with a California Children’s Services (CCS)-eligible condition, as well as a condition covered by a Medi-Cal managed care plan (MCP). Effective retroactively to July 1, a specific billing policy will apply for services provided to Medi-Cal beneficiaries with CCS-eligible conditions who are enrolled in an MCP that does not cover CCS-eligible conditions.

The policy is as follows:

  • If a beneficiary is admitted to a hospital for a CCS-eligible condition or receives services during the stay for a CCS-eligible condition, the entire stay should be billed through the fee for service (FFS) system, regardless of whether any services provided during that stay may be covered by a MCP. MCPs should not be billed for the stay. The hospital will receive one payment for the entire stay, based on the DRG for that stay.
  • When a beneficiary stay includes delivery and well-baby coverage under an MCP, the entire claim will be billed to the MCP. If, during the stay, the baby develops a CCS-eligible condition, the entire stay for the baby will require a service authorization request (SAR) from the date of admission and should be billed through the FFS system. MCPs should not be billed for the baby’s stay. In this case, the hospital will receive two payments, one for the delivery and well-baby stay from the MCP, and one for the baby under the DRG.