Hospice Billing

Avoiding Reason Code 7C625: Appropriate Use of Remarks on Final Hospice Claims

Once a hospice chooses to admit a Medicare beneficiary, it may not automatically or routinely discharge the beneficiary at its discretion, even if the care promises to be costly or inconvenient, or if State law allows for the discharge. The election of the hospice benefit is the beneficiary’s choice rather than the hospice’s choice, and the hospice cannot revoke the beneficiary’s election. Neither should the hospice request nor demand that the patient revoke his/her election.

Medicare regulations at CFR 418.26 outline three reasons for discharge from hospice care:

  1. The beneficiary moves out of the hospice’s service area or transfers to another hospice;
  2. The hospice determines that the beneficiary is no longer terminally ill; and
  3. The hospice determines the beneficiary meets their internal policy regarding discharge for cause.

When submitting a final claim to Medicare, hospice providers must use specific coding as well as remarks to verify that the hospice is following the discharge guidelines set forth by the CMS. When these remarks are absent or unclear, or if the appropriate coding is not used, the final claim will be RTP with reason code 7C625..

Avoiding this Reason Code

When submitting a final claim (TOB 8X1 or 8X4) to Medicare, providers must be aware of the reporting guidelines for discharges, revocations and transfers based on the date of service. Detailed instructions on reporting hospice discharges, revocations, and transfers can be found in the "Reporting Hospice Discharges, Revocations and Transfers" job aid available on our website.

In addition to the reporting requirements for discharges, revocations and transfers, when submitting a final claim (TOB 8X1 or 8X4) to Medicare, remarks are required to explain the reason for the final claim. If submitting TOBs 8X2 or 8X3, do not report remarks. You can use the chart below to determine the appropriate coding and remarks when submitting a final claim. And remember always initial and date your remarks to help identify your comments in the remarks field.

If... Respond with...
The reason for discharge is patient revocation “Beneficiary revoked hospice on <date of revocation.”>
The beneficiary is transferring to another certified hospice “Beneficiary transferred to another certified hospice (<facility name>) on <<date of transfer>.”
The beneficiary is going to a Veterans Administration (VA) hospital “Beneficiary revoked/discharged to a VA hospital on <<date of revocation/discharge>.”
The beneficiary is moving out of your service area* without a transfer to another certified hospice “Beneficiary moved out of our service area without a transfer on <date of discharge>.”
The beneficiary is discharged because he/she no longer has a prognosis of six months or less “Beneficiary is no longer terminally ill effective <date of discharge>.” or “Beneficiary was discharged due to stable condition effective <date of discharge>.”
The beneficiary is discharged under the hospice's documented "discharge for cause" policy “Beneficiary discharged for cause on <date of discharge>.”
The discharge is due to a late face-to-face encounter “Beneficiary discharged due to face-to-face not done timely on <date of discharge>.”
* As outlined in CR 7677, this includes discharges due to a hospice patient receiving treatment for a condition unrelated to the terminal illness, or related conditions, in a facility with which the hospice does not have a contract. Medicare’s expectation is that the hospice provider would consider the amount of time the patient is in that facility before making a determination that discharging the patient from the hospice is appropriate.
Note: Remarks indicating that the beneficiary was admitted to the hospital is not a valid reason for discharge. Please use the remarks above to avoid receiving reason code 7C625.


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