[Code of Federal Regulations]
[Title 42, Volume 2]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR412.4]

[Page 373-374]
 
                         TITLE 42--PUBLIC HEALTH
 
                             HUMAN SERVICES
 
PART 412--PROSPECTIVE PAYMENT SYSTEMS FOR INPATIENT HOSPITAL SERVICES--Table of Contents
 
                      Subpart A--General Provisions
 
Sec. 412.4  Discharges and transfers.

    (a) Discharges. Subject to the provisions of paragraphs (b) and (c) 
of this section, a hospital inpatient is considered discharged from a 
hospital paid under the prospective payment system when--
    (1) The patient is formally released from the hospital; or
    (2) The patient dies in the hospital.
    (b) Transfer--Basic rule. A discharge of a hospital inpatient is 
considered to be a transfer for purposes of payment under this part if 
the discharge is made under any of the following circumstances:
    (1) From a hospital to the care of another hospital that is--
    (i) Paid under the prospective payment system; or
    (ii) Excluded from being paid under the prospective payment system 
because of participation in an approved Statewide cost control program 
as described in subpart C of part 403 of this chapter.
    (2) From one inpatient area or unit of a hospital to another 
inpatient area or unit of the hospital that is paid under the 
prospective payment system.
    (c) Transfers--Special 10 DRG rule. For discharges occurring on or 
after October 1, 1998, a discharge of a hospital inpatient is considered 
to be a transfer for purposes of this part when the patient's discharge 
is assigned, as described in Sec. 412.60(c), to one of the qualifying 
diagnosis-related groups (DRGs) listed in paragraph (d) of this section 
and the discharge is made under any of the following circumstances--
    (1) To a hospital or distinct part hospital unit excluded from the 
prospective payment system under subpart B of this part.
    (2) To a skilled nursing facility.
    (3) To home under a written plan of care for the provision of home 
health services from a home health agency and those services begin 
within 3 days after the date of discharge.
    (d) Qualifying DRGs. The qualifying DRGs for purposes of paragraph 
(c) of this section are DRGs 14, 113, 209, 210, 211, 236, 263, 264, 429, 
and 483.
    (e) Payment for discharges. The hospital discharging an inpatient 
(under paragraph (a) of this section) is paid in full, in accordance 
with Sec. 412.2(b).
    (f) Payment for transfers. (1) General rule. Except as provided in 
paragraph (f)(2) or (f)(3) of this section, a hospital that transfers an 
inpatient under the circumstances described in paragraph (b)(1) or (c) 
of this section, is paid a graduated per diem rate for each day of the 
patient's stay in that hospital, not to exceed the amount that would 
have been paid under subparts D and M of this part if the patient had 
been discharged to another setting. The per diem rate is determined by 
dividing the appropriate prospective payment rate (as determined under 
subparts D and M of this part) by the geometric mean length of stay for 
the specific DRG to which the case is assigned. Payment is graduated by 
paying twice the per diem amount for the first day of the stay, and the 
per diem amount for each subsequent day, up to the full DRG payment.
    (2) Special rule for DRGs 209, 210, and 211. A hospital that 
transfers an inpatient under the circumstances described in paragraph 
(c) of this section and the transfer is assigned to DRGs 209, 210 or 211 
is paid as follows:
    (i) 50 percent of the appropriate prospective payment rate (as 
determined under subparts D and M of this part) for the first day of the 
stay; and
    (ii) 50 percent of the amount calculated under paragraph (f)(1) of 
this section for each day of the stay, up to the full DRG payment.

[[Page 374]]

    (3) Transfer assigned to DRG 385. If a transfer is classified into 
DRG 385 (Neonates, died or transferred) the transferring hospital is 
paid in accordance with Sec. 412.2(b).
    (4) Outliers. Effective with discharges occurring on or after 
October 1, 1984, a transferring hospital may qualify for an additional 
payment for extraordinarily high-cost cases that meet the criteria for 
cost outliers as described in subpart F of this part.

[63 FR 41003, July 31, 1998, as amended at 65 FR 47106, Aug. 1, 2000; 67 
FR 50111, Aug. 1, 2002]