Inpatient Services
Overview
Inpatient hospital services include medically necessary items and services ordinarily furnished by a Medicaid hospital provided under the direction of physician for the care and treatment of inpatient clients.
Inpatient Reimbursement
According to the Texas Administrative Code, §355.8052 related to Inpatient Hospital Reimbursement, hospitals may receive an annual SDA adjustment based upon their trauma designation.
Methodology / Rules
The Hospital Services program rules are located at Title 1 of the Texas Administrative Code, Part 15, Chapter 354, SubChapter A, Division 6, Rules 1071-1073, 1075, and 1077.
Reimbursement rules applicable to Hospitals are located at Title 1 of the Texas Administrative Code, Part 15, Chapter 355, SubChapter J, Division 4, Rules 8052, 8056, 8058, 8060, 8061, 8065, and 8066.
Prospective Payment Methodology
Inpatient hospital stays except in state-owned teaching hospitals and psychiatric facilities (CCP) are reimbursed according to a prospective payment methodology based on diagnosis-related groups (DRGs). The reimbursement method itself does not affect inpatient benefits and limitations. Inpatient admissions must be medically necessary and are subject to Texas Medicaid's UR requirements.
TEFRA Payment Methodology
Medicaid providers that are cost-reimbursed according to the TEFRA reimbursement principles on a reasonable cost basis are subject to cost reporting, cost reconciliation, and cost settlement processes. This includes state-owned teaching hospitals.
Additional information is available on the Texas Medicaid & Health Partnership (TMHP) website.
Payment Information
Hospital Inpatient Payments
FY 2022 Urban Hospital Prospective Standard Dollar Amount (SDA) with Add-on (.pdf)
FY 2022 Rural Hospital Prospective Standard Dollar Amount (SDA) (.pdf)
View the Delivery Related DRGs (.pdf)
HHSC is processing claims for Inpatient reimbursement with Grouper 38, Effective 10/01/2021. View TMHP Announcement here.
Texas APR-DRG Grouper current version (V38) (.pdf)
View Grouper 38 Implementation FAQ (.pdf)
View Grouper 38 MCO Notice (.pdf)
Current and previous versions of all SDA rates and APR DRG Grouper information are available on the TMHP website.
HHSC Reverts Inpatient Reimbursements to APR-DRG Grouper 36 Effective 11/1/2019 to 9/30/2021
- HHSC Reverts to Grouper 36 FAQ (.pdf)
- Recommendations for Updating 3M APR DRG and 3M EAPG Payment Methods (2020) (.pdf)
- Note: Texas Medicaid managed care organizations (MCOs) must provide all medically necessary, Medicaid-covered services to eligible clients. Administrative procedures such as prior authorization, pre-certification, referrals, and claims/encounter data filing may differ from traditional Medicaid (fee-for-service) and from MCO to MCO. Providers should contact the client's specific MCO for details.
Inpatient Ratio of Cost to Charges (RCC Rates) - effective 01/01/2022
Previous Inpatient Ratio of Cost to Charges (RCC Rates)
FY 2022 Psychiatric Hospital (Per Diem Rates) (.pdf)
Cost Report Requirements
Provider Cost and Reporting
The method of determining reasonable cost is similar to that used by Title XVIII (Medicare). Hospitals must include inpatient and outpatient costs in the cost reports submitted annually. The provider must prepare one copy of the applicable CMS Cost Report Form. Additional information is available on the Texas Medicaid & Health Partnership (TMHP) website.