Upper Payment Limit FAQs
To date, CMS has not published a list of revenue codes that must be included or excluded from this service category. Medicaid outpatient hospital services are defined at 42 Code of Federal Regulations (CFR) 440.20 and include “preventive, diagnostic, therapeutic, rehabilitative, or palliative services”. In the state plan, states further define those services covered as outpatient hospital services.
No, CMS does not require any particular starting point within the fiscal year for the UPL demonstrations. This allows states the flexibility to develop UPL demonstrations that are tied to the provider payment periods described in the state plan payment methodologies for each service. For instance, if a state submits a state plan amendment to update provider payments as of October 1 of each year, the state would document that the SPA changes comply with the UPL for the period 10/1 - 9/30 of that payment year. The UPL must represent the entire payment year. Since UPL demonstrations usually rely on historic data that is projected into a payment year, this is consistent with past practices.