FI - Inpatient Ancillary Services - Medicare Part B - Payment Policy for Indian Health Services (Rev. 1511; 06-23-08)

by  Jared Staheli
June 25th, 2015

Certain inpatient hospital ancillary services are covered under Medicare Part B when coverage is no longer provided under Medicare Part A due to benefits exhausted, the beneficiary is determined to be receiving a non-covered level of care, or is not eligible for Medicare Part A benefits. Chapter 4, §240 of Pub. 100-04, Medicare Claims Processing Manual contains information on the physician services and the nonphysician medical and other health services covered under Medicare Part B when furnished by a participating IHS provider to an inpatient of the hospital, but only if payment for these services cannot be made under Medicare Part A.

The IHS providers are paid for covered inpatient Medicare Part B ancillary services based upon an all inclusive inpatient ancillary per diem rate (AIR). The AIR is established by CMS and IHS based upon a review of yearly cost reports prepared by IHS’s contractor. Upon completion of the review, IHS submits the agreed upon rate to the Office of Management and Budget (OMB) for approval. Upon approval by OMB, IHS publishes the approved rate in the Federal Register. The AIR is established for each calendar year. The approved AIR is issued periodically in a Recurring Update Notification.

These rates are not facility specific and should not be confused with the all inclusive facility specific inpatient ancillary per diem rate paid to CAHs based on their cost reports. For more information on the CAHs all inclusive facility specific per diem rate, see §110.3 of this chapter.


FI - Inpatient Ancillary Services - Medicare Part B - Payment Policy for Indian Health Services (Rev. 1511; 06-23-08). (2015, June 25). Find-A-Code Articles. Retrieved from

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