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Spell of Illness Limitation for COVID-19-related Admissions

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For inpatient hospital stays related to COVID-19 for which the client was admitted on or after March 13, 2020, Texas Health and Human Services Commission (HHSC) has received federal approval through a disaster 1115 authority to extend the 30-day spell of illness limitation that applies to certain adult Medicaid clients for an additional 30 COVID-19-related days to allow an individual to stay up to 60 days in a hospital.

HHSC is also waiving the $200,000 benefit limitation for COVID-19-related stays, which applies to adults in fee-for-service Medicaid, and for some members who remain in STAR Health after their twenty-first birthday.

For COVID-19-related hospital stays, the provider should include diagnosis code U07.1 on the claim to indicate that the stay is COVID-19-related. HHSC will review cases submitted to HHSC by managed care organizations (MCOs) or, in fee-for-service Medicaid, claims submitted by providers to TMHP and allow for up to 30 COVID-19-related inpatient days beyond the initial 30-day spell of illness limit, if appropriate. Providers should follow regular processes for billing the MCOs (for managed care members) or TMHP (for fee-for-service clients). Providers do not need to submit any information directly to HHSC.

30-day Limitation

  • The 30-day spell of illness limit on inpatient hospital stays applies to fee-for-service clients 21 years of age and older; it also applies to STAR+PLUS, and STAR Health members 21 years of age and older.
  • Payment for up to 30 additional days beyond the initial 30-day spell of illness limit will be allowed if the additional days are for a COVID-19-related stay.
  • Example:
    • A client previously hospitalized for 25 days for a non-COVID-19-related illness, is hospitalized 2 days later with a COVID-19 diagnosis, the non-COVID-19 25 days will remain in the count and the COVID-19 days will begin being counted at day 26. The client can receive an additional 34 COVID-19-related days within the spell.
    • If the client described above is discharged from the COVID-19-related stay on day 50, the client would still have 10 days left for COVID-19-related stays.
    • If the client is discharged from the COVID-related stay on day 50 and 2 days later the client is admitted for a non-COVID-19 illness, the spell of illness limitation would apply because the stay is not COVID-19-related; this means 60 days must pass after the discharge from the COVID-19-related stay before a non-COVID-19 hospital stay would be eligible for payment.

$200,000 Limitation

  • The $200,000 spell of illness limit on inpatient hospital stays normally applies to fee-for-service clients and STAR Health members who are 21 years of age and older.
  • HHSC is waiving the $200,000 limitation on an individual case basis for fee-for-service clients and STAR Health members for COVID-19 related admissions.

The spell of illness limit does not apply to certain approved transplants and children 20 years of age and younger. For STAR+PLUS, the spell of illness limit does not apply to people with serious and persistent mental illness (SPMI). Please refer to the following for further information on the spell of illness:

Texas Medicaid Provider Procedures Manual:

  • Section 3.1.2 of the Inpatient and Outpatient Hospital Services Handbook
  • Sections 3.2.1, 4.2.1, and 5.2.2 of the Medicaid Managed Care Handbook

Uniform Managed Care Manual(link is external):

  • Section 16.1.2.10.1

For more information, call the TMHP Contact Center at 800-925-9126.