Original Medicare Coverage and Payment Related to COVID-19

Diagnostic Tests

Medicare Part B, which includes a variety of outpatient services, covers medically necessary clinical diagnostic laboratory tests when a doctor or other practitioner orders them. Medically necessary clinical diagnostic laboratory tests are generally not subject to coinsurance or deductible. Medicare Part B also covers medically necessary imaging tests, such as computed tomography (CT) scans, as needed for treatment purposes for lung infections (not for screening asymptomatic patients). For those imaging tests paid by Part B, beneficiary coinsurance and deductible would apply. If the Part B deductible ($198 in 2020) applies to the Part B services, beneficiaries must pay all costs (up to the Medicare-approved amount) until the beneficiary meets the yearly Part B deductible. After the beneficiary’s deductible is met, Medicare coverage pays its share and beneficiaries typically pay 20% of the Medicare-approved amount of the service (except laboratory tests), if the doctor or other health care provider accepts the assignment. There’s no yearly limit for what a beneficiary pays out-of-pocket.

CMS issued a public health news alert on February 13, 2020, which has additional information about the new Healthcare Common Procedure Coding System (HCPCS) code (U0001) for health care providers and laboratories to bill for laboratory testing patients for SARS-CoV-2. HCPCS is a standardized coding system that Medicare and other health insurers use to submit claims for services provided to patients. This code will allow those laboratories conducting the tests to bill for the specific test instead of using an unspecified code, which means better tracking of the public health response for this particular strain of the coronavirus to help protect people from the spread of this infectious disease.

There are two new HCPCS codes for healthcare providers who need to test patients for Coronavirus. Providers using the Centers for Disease Control and Prevention (CDC) 2019 Novel Coronavirus Real-Time RT-PCR Diagnostic Test Panel may bill for that test using the newly created HCPCS code (U0001). A second new HCPCS code (U0002) can be used by laboratories and healthcare facilities to bill Medicare as well as by other health insurers that choose to adopt this new code for such tests. HCPCS code (U0002) generally describes 2019-nCoV Coronavirus, SARS-CoV-2/2019-nCoV (COVID-19) using any technique, multiple types or subtypes (includes all targets). The Medicare claims processing system will be able to accept these codes on April 1, 2020, for dates of service on or after February 4, 2020.


Medicare Part B pays for certain preventive vaccines (influenza, pneumococcal, and Hepatitis B), and coinsurance and deductible do not apply to preventive vaccines. Medicare Part B also pays for other vaccines directly related to the medically necessary treatment of an injury or direct exposure to a disease or condition. For example, Medicare would cover a tetanus vaccine for a beneficiary who steps on a rusty nail. For these other medically necessary vaccines, beneficiary coinsurance and deductible would apply.

Inpatient Hospital Care Services

Medicare Part A covers medically necessary inpatient hospital care. This coverage includes semi-private rooms, meals, general nursing, imaging, drugs as well as other hospital services and supplies as part of inpatient hospital treatment. Inpatient hospital treatment includes care from acute care hospitals, critical access hospitals, inpatient rehabilitation facilities, long-term care hospitals, inpatient care as part of a qualifying clinical research study, and inpatient mental health care given in a psychiatric hospital or psychiatric unit within a hospital.

Medicare beneficiaries may pay a deductible for hospital services. Under Original Medicare, for hospital inpatient services, beneficiaries pay a deductible of $1,408 and no coinsurance for days 1– 60 of each benefit period. Beneficiaries pay a coinsurance amount of $352 per day for days 61– 90 of each benefit period. There is a coinsurance amount per “lifetime reserve day” after day 90 of each benefit period (up to 60 days over a beneficiary’s lifetime). Beneficiaries pay all costs for each day after all the lifetime reserve days are used. In addition, inpatient psychiatric care in a freestanding psychiatric hospital is limited to 190 days in a beneficiary’s lifetime.

Inpatient Hospital Quarantines

There may be times when beneficiaries with the virus need to be quarantined in a hospital private room to avoid infecting other individuals. These patients may not meet the need for acute inpatient care any longer but may remain in the hospital for public health reasons. Hospitals having both private and semiprivate accommodations may not charge the patient a differential for a private room if the private room is medically necessary. Patients who would have been otherwise discharged from the hospital after an inpatient stay but are instead remaining in the hospital under quarantine would not have to pay an additional deductible for quarantine in a hospital.

If a Medicare beneficiary is a hospital inpatient for medically necessary care, Medicare will pay hospitals the diagnosis-related group (DRG) rate and any cost outliers for the entire stay, including any the quarantine time when the patient does not meet the need for acute inpatient care, until the Medicare patient is discharged. The DRG rate (and cost outliers as applicable) includes the payments for when a patient needs to be isolated or quarantined in a private room.

Ambulatory Services in a Hospital or Other Location

Medicare Part B covers medically necessary ambulatory services, including doctors’ services, hospital outpatient department services, home health services, durable medical equipment, mental health services, and other medical services. Coinsurance and deductible would generally apply depending on the service. In the event a patient is quarantined in an ambulatory setting, the existing Medicare payments for medically necessary services apply.

Requests for Prescription Refills

For Part B drugs, when considering whether to pay for a greater-than-30-day-supply of drugs, in general, Medicare and its contractors, known as Medicare Administrative Contractors or MACs, will, on a case-by-case, basis, consider each request and make decisions locally. In general, local Medicare contractors will take into account the nature of the particular Part B drug (including Part B immunosuppressive drugs), the patient’s diagnosis, the extent and likely duration of disruptions to the drug supply chain during an emergency, and other relevant factors that would be applicable when making a determination as to whether, on the date of service, an extended supply of the drug was reasonable and necessary.

Emergency Ambulance Transportation

Medicare covers ground ambulance transportation when beneficiaries need to be transported to a hospital, critical access hospital, or skilled nursing facility for medically necessary services when transportation in any other vehicle could endanger the beneficiary’s health. A ground ambulance emergency transportation may temporarily stop at a doctor’s office without affecting the coverage status of the transport in certain circumstances, however, in general, the physician’s office is not a covered destination. Medicare may pay for emergency ambulance transportation in an airplane or helicopter to a hospital if the beneficiaries need immediate and rapid ambulance transportation that ground transportation can’t provide.

Should a facility that would normally be the nearest appropriate facility be unavailable during an emergency, Medicare may pay for transportation to another facility so long as that facility is the nearest facility that is available and equipped to provide the needed care for the illness or injury involved.

In some cases, Medicare may pay for limited, medically necessary, non-emergency ambulance transportation if the doctor writes an order stating that ambulance transportation is medically necessary. For example, beneficiaries may need a medically necessary non-emergency ambulance transport to a dialysis facility when they have End-Stage Renal Disease. There is a current Medicare model testing prior authorization for individuals receiving scheduled, non-emergency ambulance transportation for 3 or more round trips in a 10-day period or at least once a week for 3 weeks or more in certain states.

The Medicare coinsurance and deductible would apply to these Part B services. Medicare pays for ambulance transports under the Ambulance Fee Schedule. This payment amount includes a base rate payment (level of service provided) plus a separate payment for mileage to the nearest appropriate facility and also cover both the transport of the beneficiary to the nearest appropriate facility and all medically necessary covered items and services (such as oxygen, drugs, extra attendants, and electrocardiogram testing) associated with the transport. In case of any confusion related to original Medicare coverage and payment related to COVID-19, you can take the assistance of Medical Billers and Coders (MBC). To know more about our billing and coding services contact us at 888-357-3226/ info@medicalbillersandcoders.com