TMPPM 2009 > Provider Information > Texas Medicaid Reimbursement > Reimbursement Methodology

2.2.1.1 Physician Services in Outpatient Hospital Setting

Section 104 of the Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 requires that Medicare/Medicaid limit reimbursement for those physician services furnished in outpatient hospital settings (e.g., clinics and emergency situations) that are ordinarily furnished in physician offices. The limit is 60 percent of the Medicaid rate for the nonemergency service furnished in physician offices. The following table identifies the services applicable to the 60 percent limitation when furnished in outpatient hospital settings:

These procedures are designated with note code "1" in the current fee schedule, which is available on the TMHP website at www.tmhp.com. The following services are excluded from the 60 percent limitation:

•Services furnished in rural health clinics (RHCs)

•Surgical services that are covered ASC/hospital-based ambulatory surgical center (HASC) services

•Anesthesiology and radiology services

•Emergency services provided in a hospital emergency room after the sudden onset of a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain), such that the absence of immediate medical attention could reasonably be expected to result in one of the following:

•Serious jeopardy to the client's health

•Serious impairment to bodily functions

•Serious dysfunction of any bodily organ or part

Exception: Because of TEFRA, Medicaid reimbursement for a payable nonemergency office service performed in the outpatient department of a hospital is limited to 60 percent of the Medicaid rate for that service. If the condition qualifies as an emergency, the 60 percent professional service reimbursement limit does not apply.