Pain Points Hospice Overlap Claims

on Tuesday, 22 March 2011. All News Items

Address Outpatient Services Overlapping Hospice Election to Prevent Extra Effort, Payment Delays

Hospital Departments Challenged with Managing the Process:

  • Registration
  • Business Office (Billers)


Medicare provides a Hospice benefit to Medicare beneficiaries who have terminal illnesses and a life expectancy of six months or less. When a patient elects hospice, he/she waives all rights to Medicare payments for services that are related to the treatment and management of his/her terminal illness during any period the hospice benefit election is in force (except for the professional services of an attending physician). Other entities, such as hospitals, that provide services to the patient related to the terminal illness must seek compensation for these services from the patient’s hospice provider.

As part of the MMP, Inc. Outpatient UB Review reports, MMP provides information on the number of claims denied related to hospice overlap. Almost all hospitals in the MMP client base have at least some hospice overlap claims, while some hospitals have a large number of denials for hospice overlaps. When Medicare denies a claim for hospice overlap, most hospitals have procedures in place to pursue payment of the services from the patient’s hospice provider. However, inappropriately submitting a claim to Medicare, working denials, and resubmitting a second payment request costs the hospital time and effort in being appropriately compensated for services provided.

Challenge: What actions do hospitals need to consider to address hospice overlap claims?

MMP, Inc. recommends that hospitals, especially those with large numbers of hospice overlap denials, evaluate their processes to ensure appropriate registration and billing of claims initially.

First, evaluate your denials due to hospice overlaps to determine the problem areas within your hospital. For example, are all of your hospice overlap denials on ER patients, or for laboratory services? Some hospitals may be able to use their internal systems to determine this information. If not, MMP, Inc. can provide you a breakdown of your hospice overlap denials by area if requested. If multiple registration areas are involved, you would need to address the issue with your registration department as a whole. If the denials are coming from a specific area or department, you can concentrate your education efforts on that registration area.

Upon registration of a Medicare beneficiary, the registrar should verify Medicare benefits utilizing the ELGA system. This system will include information as to whether the Medicare beneficiary is under hospice election. If the patient has elected hospice benefits, the registrar should contact the patient’s hospice provider to determine if:

  • The services being requested are related to the patient’s illness for which hospice was elected, and if so
  • If the Hospice agrees to be financially responsible for the services.

If the services are unrelated to the illness for which hospice was elected, registration should enter a code or comment to notify billing staff of such. Condition code “07” must be entered on the claim into one of the UB-04 fields 18-28 to indicate to Medicare that the patient is a hospice enrollee but the provider is not treating the terminal condition and is requesting regular Medicare reimbursement for the services. If the services are related to the terminal illness, the Hospice should be entered as the guarantor for the account. Note that the Hospice may request to speak to the patient or patient family member / representative concerning their need for the services.

There are some registration areas with special considerations. For example, if a hospice patient presents to your emergency department, EMTALA obligations apply and the patient must be provided a medical screening examination and stabilized prior to considering his/her insurance status. Also consider claims with laboratory services only – does your hospital have a reference laboratory where hospice nurses may be bringing specimens they collected in the patient’s home? The Hospice should always be the guarantor for these types of registrations.

Hospitals may also want to consider if there is a particular hospice provider with whom you have the most problems related to overlap claims. This could indicate that this hospice provider is not adequately educating their patients regarding the hospice benefit requirements. Perhaps someone at the hospital, such as the hospital’s business office or case management department, could initiate a discussion with this Hospice concerning patient education.

Addressing services upfront provided to patients who have elected hospice will reduce your hospitals time and effort in being appropriately compensated and can improve your relationships with hospice providers and their patients. Medicare regulations concerning hospice services can be found at Medicare Benefits Policy Manual, Chapter 9 and Medicare Claims Processing Manual, Chapter 11 .

Information on Checking Beneficiary Eligibility is available on the Cahaba GBA website.

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