Payment Under Limitation on Liability

110.1 - Payment Under Limitation on Liability (Rev. 1, 10-01-03) When it is determined during the course of a beneficiary’s inpatient stay or during the patient’s course of home health visits, or during a patient’s course of treatment from a practitioner, physician or other supplier that the care is not covered but both the beneficiary and the provider of services are entitled to limitation on liability, the Medicare program may make payment for the noncovered services up to the date of notice and, if, for inpatient or home health services, the A/B MAC (A) or (HHH) determines that additional time is needed to arrange for post-discharge care, also for a “grace period” of l day after the date of notice to the provider or to the beneficiary, whichever is earlier. If it is determined that even more time is required in order to arrange post-discharge care, 1 additional “grace period” day may be paid for. (See §§30 and 40 for definition of notice.) When the provider is given notice as described in §40.1, it is required to advise the beneficiary in writing of the determination on the same date it received the A/B MAC (A) or (HHH) notice. Where the provider fails to give the beneficiary such timely notice, the beneficiary is protected from liability until the beneficiary receives the notice. For example, if a SNF received the A/B MAC (A)’s notice of noncoverage on February 15 but failed to advise the beneficiary until February 19, the beneficiary is protected from liability through February 19 - the date on which the beneficiary first received notice. However, the SNF is entitled to program payment only through the date - February 15 - on which it received notice, and for whatever “grace period” is allowed thereafter. In a case in which a SNF received the A/B MAC (A)'s notice on February 15 but failed to give the beneficiary notice until the next day - February 16 - the beneficiary and provider, if the A/B MAC (A) determines that additional time is needed to arrange post-discharge care, would be protected from liability under the “grace period” only for the additional day - February 16 - unless it is determined that even more time is required to arrange post-discharge care, in which case 1 additional “grace period” day may be paid for. NOTE: The “grace period” is applicable only where circumstances have permitted program payment under §1879 of the Act, i.e., limitation on liability was applicable both to the beneficiary and the provider of services. Where the A/B MAC (A) or (HHH) concurs with a URC’s decision that covered care has ended, any payments made during the “grace period” after the URC’s notice are made under the authority of that statutory provision (§1814 of the Act) rather than under §1879.