A discharge of a hospital inpatient is considered to be a transfer if the patient is admitted
the same day to another hospital. A transfer between acute inpatient hospitals occurs
when a patient is admitted to a hospital and is subsequently transferred from the hospital
where the patient was admitted to another hospital for additional treatment once the
patient's condition has stabilized or a diagnosis established. The following procedures
apply.
Note: CMS established Common Working File Edits (CWF) edits in January 2004 to
ensure accurate coding and payment for discharges and/or transfers.
Transfers Between IPPS Prospective Payment Acute Care Hospitals
For discharges occurring on or after October 1, 1983, when a hospital inpatient is
discharged to another acute care hospital, as described in 42 CFR 412.4(b), payment to the
transferring hospital is based upon a graduated per diem rate (i.e., the prospective payment
rate divided by the geometric mean length of stay for the specific MS-DRG into which the
case falls; hospitals receive twice the per diem rate for the first day of the stay and the per
diem rate for every following day up to the full MS-DRG amount). If the stay is less than l
day, l day is paid. A day is counted if the patient was admitted with the expectation of
staying overnight. However, this day does not count against the patient's Medicare days
(utilization days), since this Medicare day is applied at the receiving hospital. Deductible
or coinsurance, where applicable, is also charged against days at the receiving hospital
(see §40.1.D). If the patient is treated in the emergency room without being admitted and
then transferred, only Part B billing is appropriate. Payment is made to the final
discharging hospital at the full prospective payment rate.
