Knowledge Base Category -
MEDICARE TRANSMITTALS – RECURRING UPDATES
Quarterly Update to the National Correct Coding Initiative (NCCI) Procedure-to-Procedure (PTP) Edits, Version 26.0, Effective January 1, 2020
International Classification of Diseases, 10th Revision (ICD-10) and Other Coding Revisions to National Coverage Determination (NCDs)--April 2020 Update
A maintenance update of ICD-10 conversions and other coding updates specific to National Coverage Determinations (NCDs). These NCD coding changes are the result of newly available codes, coding revisions to NCDs released separately, or coding feedback received.
2020 Annual Update to the Therapy Code List
Updates the list of codes that sometimes or always describe therapy services.
2020 Annual Update of Per-Beneficiary Threshold Amounts
Updates the annual per-beneficiary incurred expenses amounts now called the KX modifier thresholds and related policy for CY 2020.
Claim Status Category and Claim Status Codes Update
https://www.cms.gov/files/document/mm11467
Remittance Advice Remark Code (RARC), Claims Adjustment Reason Code (CARC), Medicare Remit Easy Print (MREP) and PC Print Update
https://www.cms.gov/files/document/mm11489
Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2020
https://www.cms.gov/files/document/MM11542
OTHER MEDICARE TRANSMITTALS
Addition of Medical Severity Diagnosis Related Groups (MS-DRG) Subject to Inpatient Prospective Payment System (IPPS) Replaced Devices Offered Without Cost or With a Credit Policy
Medicare Severity Diagnosis-Related Groups (MS-DRGs) 319 and 320 (Other Endovascular Cardiac Valve Procedures with and without major complications and comorbidities (MCC), respectively) added to the list of MS-DRGs subject to the policy for replaced devices offered without cost or with a credit.
Medicare Physician Fee Schedule Database (MPFSDB) Update to Status Indicators
Status Indicator Q (therapy functional information code) is no longer effective with the 2020 MPFSDB beginning January 1, 2020. Medicare no longer requires functional therapy reporting.
Positron Emission Tomography (PET) Scan - Allow Tracer Codes Q9982 and Q9983 in the Fiscal Intermediary Shared System (FISS)
Currently, the system does not recognize HCPCS Q9982 and Q9983 as valid radiopharmaceutical tracer codes and claims are incorrectly returned to the provider as unprocessed or rejected.
Updating FISS Editing for Practice Locations to Bypass Mobile Facility and/or Portable Units and Services Rendered in the Patient's Home
Implements the newly approved National Uniform Billing Committee (NUBC) Condition Code “A7” and improved edit criteria in Medicare systems to bypass edits that match service facility location on certain hospital claims.
https://www.cms.gov/files/document/mm11470
Summary of Policies in the Calendar Year (CY) 2020 Medicare Physician Fee Schedule (MPFS) Final Rule, Telehealth Originating Site Facility Fee Payment Amount and Telehealth Services List, CT Modifier Reduction List, and Preventive Services List
A summary of the policies in the CY 2020 MPFS Final Rule, announces the Telehealth Originating Site Facility Fee payment amount and makes other policy changes related to Medicare Part B payment.
https://www.cms.gov/files/document/mm11560
Medicare Claims Processing Manual Chapter 23 - Fee Schedule Administration and Coding Requirements
Updates language pertaining to the National Correct Coding Initiative (NCCI).
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019Downloads/R4465CP.pdf
Update to Medicare Claims Processing Manual, Chapters 1, 23 and 35
New Global Billing and Separate TC/PC billing instructions. For both paper and electronic claims, when a global diagnostic service code is billed (for example, no modifier TC and no modifier -26), the address where the TC was performed must be reported on the claim.
https://www.cms.gov/files/document/mm10882
REVISED MEDICARE TRANSMITTALS
April 2019 Update of the Hospital Outpatient Prospective Payment System (OPPS)
Revision - Reference added to a related article SE19009 which replaces Section 6 - Chimeric Antigen Receptor (CAR) T- Cell Therapy - instructions on pages 5-7 of this article.
Implementation to Exchange the List of Electronic Medical Documentation Requests (eMDR) for Registered Providers via the Electronic Submission of Medical Documentation (esMD) System
Revision - Updates and clarifies information regarding the eMDR registration/enrollment to indicate the provider and the HIH roles with more detail.
Appropriate Use Criteria (AUC) for Advanced Diagnostic Imaging – Educational and Operations Testing Period - Claims Processing Requirements
Revision - Removes codes that are not available for 2020.
MEDICARE COVERAGE UPDATES
Proposed Decision Memo for Next Generation Sequencing (NGS) for Medicare Beneficiaries with Advanced Cancer
Expands coverage of Next Generation Sequencing (NGS) as a diagnostic laboratory test when performed in a CLIA-certified laboratory, when ordered by a treating physician and when specified requirements are met.
MEDICARE PRESS RELEASES AND FACT SHEETS
CMS Hospital Value-Based Purchasing Program Results for Fiscal Year 2020
The Hospital VBP Program works by adjusting what Medicare pays hospitals under the Inpatient Prospective Payment System (IPPS) based on the quality and cost of inpatient care the hospitals provide to patients.
MEDICARE EDUCATIONAL RESOURCES
Palmetto GBA 2020 Medical Review (MR) Hot Topic Targeted Probe and Educate (TPE) Teleconference Schedule
Palmetto GBA will host a series of Medical Review Hot Topic Targeted Probe and Educate (TPE) Teleconferences in 2020.
https://www.palmettogba.com/palmetto/providers.nsf/ls/JJ%20Part%20A"BGQT2X1030?opendocument
Medicare Fast Facts
Medicare Fast Facts resources this month include:
- Bill Correctly for Medicare Telehealth Services
OTHER MEDICARE UPDATES
Extension of Detailed Notice of Discharge Beyond Expiration Date
The currently available Detailed Notice of Discharge (hospital notice) has an expiration date of October 31, 2019. The current notice is covered under an extension and hospitals should continue using it until CMS publishes the updated notice.
https://www.cms.gov/Medicare/Medicare-General-Information/BNI/HospitalDischargeAppealNotices
2020 Outpatient Prospective Payment System/Ambulatory Surgical Center Final Rule
This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for Calendar Year 2020.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-24138.pdf
2020 Medicare Physician Fee Schedule Final Rule
This major final rule addresses: changes to the physician fee schedule (PFS); other changes to Medicare Part B payment policies to ensure that payment systems are updated to reflect changes in medical practice, relative value of services, and changes in the statute; and other topics.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-24086.pdf
Patients over Paperwork Newsletter November 2019
Through “Patients over Paperwork,” CMS established an internal process to evaluate and streamline regulations with a goal to reduce unnecessary burden, to increase efficiencies, and to improve the beneficiary experience.
https://www.cms.gov/files/document/november-2019-patients-over-paperwork-newsletter
KEPRO Case Review Connections Winter 2020 – Acute Care Edition
KEPRO is the Beneficiary and Family Centered Care QIO (BFCC-QIO) for 29 states. Case Review Connections is a quarterly newsletter that provides a glimpse into KEPRO and the services provided, along with success stories and updates from the Centers for Medicare & Medicaid Services (CMS).
https://keproqio.com/bene/newsletter/2020winteracute/
Hospital Price Transparency Requirements Final Rule
Establishes requirements for hospitals operating in the United States to establish, update, and make public a list of their standard charges for the items and services that they provide.
https://www.hhs.gov/sites/default/files/cms-1717-f2.pdf
Transparency in Coverage Proposed Rule
Sets forth proposed requirements for group health plans and health insurance issuers in the individual and group markets to disclose cost-sharing information upon request, to a participant, beneficiary, or enrollee (or his or her authorized representative), including an estimate of such individual’s cost-sharing liability for covered items or services furnished by a particular provider.
https://www.hhs.gov/sites/default/files/cms-9915-p.pdf
CY 2020 - Clinical Laboratory Fee Schedule Test Codes Final Determinations
In November of each year, CMS finalizes the basis of payment for new and substantially revised test codes and the amount of payment through the annual CMS instruction implementing the updated CLFS for the next CY.
Payment for Outpatient Clinic Visit Services at Excepted Off-Campus Provider-Based Departments
Revised Hospital Outpatient Prospective Payment System Pricer to update the rates being applied to claim lines for clinic visit services at excepted off-campus PBDs for 2019.
Extension of the MOON Beyond Expiration Date
The currently available Medicare Outpatient Observation Notice (MOON) has an expiration date of December 31, 2019. The currently available MOON is covered under an extension and hospitals should continue using the current notice until CMS publishes the updated notice.
https://www.cms.gov/Medicare/Medicare-General-Information/BNI/MOON
Does it seem that people are less willing to make concessions these days than in the past? I am not sure if this is generally true, but if you look at our governments, it certainly seems so. In Britain, the government cannot agree or compromise to accomplish Brexit, and in our own country, the political parties cannot seem to agree on anything. They also seem completely unwilling to compromise or offer any concessions to the opposing viewpoint. Due to my cynicism from such an environment, I was a bit surprised to read in the 2020 Physician Fee Schedule (PFS) Final Rule that CMS made 3 significant concessions concerning the requirements for the new modifiers for therapy services provided in whole or in part by a therapy assistant.
These new modifiers are mandated by the Balanced Budget Act (BBA) of 2018 which required that these modifiers:
- Be established by January 1, 2019;
- Be applied to claims lines for outpatient therapy services being furnished in whole or in part by a therapy assistant for dates of services beginning on January 1, 2020; and
- Effectuate a payment reduction for services furnished on and after January 1, 2022.
This is all in keeping with the major intent of the BBA provision that “for services furnished on or after January 1, 2022, payment for outpatient physical and occupational therapy services for which payment is made under sections 1848 or 1834(k) of the Act which are furnished in whole or in part by a therapy assistant must be paid at 85 percent of the amount that is otherwise applicable.”
This means beginning in 2022, therapy services furnished by physical or occupational therapy assistants will be paid less than services provided by therapists – 15% less to be specific. These services will be paid 85% of the usual applicable payment rate. For example, if a unit of therapeutic exercise (CPT 97110) is normally paid $35, when billed with one of the assistant modifiers, the payment would be $29.75. Remember the PFS therapy rates are dependent on your carrier jurisdiction and the multiple procedure payment reductions (MPPR) continue to apply also.
The modifiers that are required to be reported on therapy line items when the services are furnished in whole or in part by a therapy assistant beginning in 2020 are:
- CQ Modifier: Outpatient physical therapy services furnished in whole or in part by a physical therapist assistant.
- CO Modifier: Outpatient occupational therapy services furnished in whole or in part by an occupational therapy assistant.
These new modifiers will be reported alongside the GP and GO modifiers used to identify services furnished under a PT or OT plan of care, respectively. Other modifiers used for therapy services, such as the KX and 59 modifiers, should also continue to be reported. Thank goodness the functional limitation reporting modifiers are no longer required.
In the 2019 PFS Final Rule, CMS finalized a de minimis standard under which a service is considered to be furnished in whole or in part by a PTA or OTA when more than 10% of the service is furnished by the PTA or OTA. For example, for therapy services of 60 minutes, 10% would be 6 minutes and for the assistant to furnish more than 10% would be 7 minutes or more. This means once the PTA/OTA furnishes at least 7 minutes of the service, the CQ/CO modifier would be required to be added to the claim for that service. Untimed codes include services such as evaluative services, group therapy, and supervised modalities. Although assistants cannot perform an evaluation or re-evaluation, they can assist the therapists by performing clinical labor tasks such as obtaining vital signs, providing self-assessment tools to the patient and verifying their completion.
So, what are the concessions CMS made concerning the new therapy modifiers?
- CMS agreed with commenters that the time when a therapist and a therapist assistant furnish services to the same patient at the same time should not be counted as part of the assistant time. This means the time spent by a PTA/OTA furnishing a therapeutic service “concurrently,” or at the same time, with the therapist will not count for purposes of assessing whether the 10 percent standard has been met. The final policy is that only the minutes that the PTA/OTA spends independent of the therapist will count towards the 10 percent de minimis standard.
- CMS proposed, for billing purposes, that each outpatient therapy service that is subject to the 10 percent de minimis standard would be identified on the claim by a single procedure code, for both untimed codes and codes described in 15-minute-unit increments. Commenters pointed out the 15-minute code issue, so CMS finalized a revised definition of a service to which the de minimis standard is applied to include untimed codes and each 15-minute unit of codes described in 15-minute increments as a service. This revised definition will allow the separate reporting, on two different claim lines, of the number of 15-minute units of a code to which the therapy assistant modifiers do not apply, and the number of 15-minute units of a code to which the therapy assistant modifiers do apply.
For a 15-minute increment that equals 1 unit of a timed code, the assistant would have to furnish 3 or more minutes of the treatment to meet the 10% de minimis standard. If a PTA independently furnishes 8 consecutive minutes of therapeutic exercises to a patient who receives a total of 45 minutes of ther ex (therapist provides the other 37 minutes of ther ex), then the hospital would bill 2 units of CPT 97110 without the CQ modifier and 1 unit of CPT 97110 with the CQ modifier.
- CMS proposed to add a requirement that the treatment notes explain, via a short phrase or statement, the application or non-application of the CQ/CO modifier for each service furnished that day. CMS agreed that the addition of narrative phrases for each service could be duplicative of existing documentation requirements so they did not finalize this requirement. Neither does the documentation have to specify therapist and therapy assistant minutes.
However, CMS does expect the documentation in the medical record to be sufficient to know whether a specific service was furnished independently by a therapist or a therapist assistant, or was furnished “in part” by a therapist assistant, in sufficient detail to permit the determination of whether the 10% standard was exceeded.
Particularly related to number 1 and 2 above, CMS intends to provide further detail regarding examples of clinical scenarios to illustrate their final policies regarding the applicability of the therapy assistant modifiers through information that will be posted on the cms.gov website. Check the CMS therapy website at https://www.cms.gov/Medicare/billing/therapyServices/index for updates.
The modifier reporting and future payment reductions do not apply to critical access hospitals (CAHs) or to other providers that are not paid based on PFS rates. It also does not apply to outpatient therapy services that are furnished by, or incident to the services of, physicians or nonphysician practitioners (NPPs). This is because only therapists and not therapy assistants can furnish outpatient therapy services incident to the services of a physician or NPP.
Bottom line for hospitals – be sure to have the new therapy assistant modifiers set up and processes in place to get them appended to line item therapy services. Apply the modifiers:
- To all therapy services’ billing codes that are furnished in whole by therapy assistants,
- To untimed therapy services’ billing codes when an assistant independently furnishes more than 10% of the service (time of service divided by 10, rounded to the nearest whole integer, plus one minute)
- To timed 15-minute increments of a timed-code service when the assistant independently furnishes 3 minutes or more of a 15-minute service (for services > 8 minutes, but < 23, determine 10% as described above for untimed codes, i.e. 8-14 minutes – 2 minutes Assistant time; 15-23 minutes – 3 minutes Assistant time).
This last explanation of assistant time for timed codes is my understanding from the discussion in the final rule. I will be looking for more examples from CMS as promised to verify my understanding is correct. I definitely concede that Medicare rules can be difficult to understand and follow.
Debbie Rubio
There has been a lot of talk lately about surprise medical bills. These are usually that seemingly never-ending stream of bills people get after having a procedure or surgery from “other” physicians such as anesthesiologists, radiologists, pathologists, etc. But what if you were a Medicare Advantage (MA) insurer and that surprise bill was for $375,000 or more for an innovative therapy newly approved by Medicare? Luckily for the MA plans, Medicare fee-for-service (FFS) will be paying for CAR T-cell therapy for MA beneficiaries for two years – 2019 and 2020. CMS has instructed the MA plans to account for CAR T-cell therapy for cancer items and services in their contract year 2021 bids.
Chimeric Antigen Receptor (CAR) T-cell therapy is an immunotherapy where a patient’s lymphocyte T-cells are genetically altered to improve their ability to fight cancer. In a new National Coverage Determination, CMS approved coverage for CAR T-cell therapy:
Effective for services performed on or after August 7, 2019, the Centers for Medicare & Medicaid Services (CMS) covers autologous treatment for cancer with T-cells expressing at least one Chimeric Antigen Receptor (CAR) when administered at healthcare facilities enrolled in the Food and Drug Administration (FDA) Risk Evaluation and Mitigation Strategies (REMS) and used for a medically accepted indication as defined at Social Security Act Section 1861(t)(2) ‐i.e., is used for either an FDA-approved indication (according to the FDA-approved label for that product), or for other uses when the product has been FDA-approved and the use is supported in one or more CMS-approved compendia.
On October 24, 2019, CMS released MLN Matters Article SE19024 concerning billing instructions for beneficiaries enrolled in MA plans for CAR T-cell therapy. As a result of the significant cost of this therapy, effective August 7, 2019, original fee-for-service Medicare will pay for CAR T-cell therapy for cancer obtained by beneficiaries enrolled in Medicare Advantage (MA) plans when the coverage criteria outlined in the decision memorandum is met. This applies for Calendar Years (CYs) 2019 and 2020 only.
The MLN article goes on to provide billing instructions for MA beneficiaries. The main issue with billing for CAR T-cell therapy is that providers can choose different methods of reporting charges for the various steps required to collect and prepare CAR T-cells. These costs can be included in the charge for the biological or they may be reported separately for tracking purposes. Medicare payment for the preparation services is included in the payment for the biological. HCPCS and revenue codes reported separately for the preparation services are not paid separately and will be rejected by Medicare. As stated above, this option is only for tracking purposes.
Do not report the same charge(s) twice. Providers should choose one option described below. You must not include charges for pre-infusion steps in both the drug revenue code (0891) and separately listed for the pre-infusion revenue codes (0871, 0872, and 0873).
When all services are provided on an outpatient basis:
- Report CPT code 0540T with Revenue Code 0874 for the administration of CAR T-cells
- Report HCPCS Q-code Q2041 or Q2042 for the drug/biological with Revenue Code 0891
- Option 1 for charges to collect and prepare CAR T-cells - report
- HCPCS 0537T with revenue code 0871
- HCPCS 0538T with revenue code 0872
- HCPCS 0539T with revenue code 0873
- Option 2 for charges to collect and prepare CAR T-cells - include the charges for these various steps in the charge submitted for the biological
When CAR-T dosing and preparation services are done in an outpatient setting, but the T-cells are administered in the hospital inpatient setting:
- Report the administration of the T-cells on the inpatient claim with revenue code 0874
- Report the drug/biological on the inpatient claim with revenue code 0891
- Option 1 for charges to collect and prepare CAR T-cells - report on inpatient claim under revenue codes 0871, 0872, and 0873 OR
- Option 2 for charges to collect and prepare CAR T-cells - include the charges for these various steps in the charge reported for the biological using revenue code 0891
If CAR-T dosing and preparation Services are performed in the hospital outpatient setting, but the viable T-cells are never administered back to the patient, report CPT codes 0537T, 0538T, and 0539T (as appropriate) and the charges associated with each code under the appropriate revenue code on the outpatient claim. Medicare will not pay for these services when the T-cells are not administered. They will reject these codes but reporting allows tracking of the services and inclusion of the associated costs in your charges.
For more details on billing CAR-T, refer to the MLN Matters Article referenced above or MLN Matters Article SE19009.
Debbie Rubio
MEDICARE TRANSMITTALS – RECURRING UPDATES
Changes to the Laboratory National Coverage Determination (NCD) Edit Software for January 2020
Announces changes to be included in the January 2020 quarterly release of the edit module for clinical diagnostic laboratory services.
January 2020 Quarterly Average Sales Price (ASP) Medicare Part B Drug Pricing Files and Revisions to Prior Quarterly Pricing Files
Informs MACs about new and revised Average Sales Price (ASP) and ASP Not Otherwise Classified (NOC) drug pricing files for Medicare Part B drugs.
Updating Calendar Year (CY) 2020 Medicare Diabetes Prevention Program (MDPP) Payment Rates
CMS intends to calculate the payment rates for each calendar year, based on the Consumer Price Index for All Urban Consumers (CPI-U); and instruct the MACs and the Railroad Specialty MAC to update the MDPP payment rates each year.
Notice of New Interest Rate for Medicare Overpayments and Underpayments - 1st Qtr Notification for FY 2020
The interest rate for the first quarter of FY 2020 is 10.125%.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019Downloads/R327FM.pdf
OTHER MEDICARE TRANSMITTALS
Provider Enrollment Rebuttal Process
Puts into operation the provision which permits providers/suppliers whose Medicare billing privileges are deactivated to file a rebuttal.
Inpatient Psychiatric Facilities Prospective Payment System (IPF PPS) Updates for Fiscal Year (FY) 2020
Identifies changes as part of the annual IPF PPS update established in the IPF PPS FY 2020 Final Rule. These changes are applicable to discharges occurring from October 1, 2019, through September 30, 2020 (FY 2020).
Fiscal Year (FY) 2020 Inpatient Prospective Payment System (IPPS) and Long Term Care Hospital (LTCH) PPS Changes
The Fiscal Year (FY) 2020 update to the Inpatient Prospective Payment System (IPPS) and LTCH Prospective Payment System (PPS).
Add Dates of Service (DOS) for Pneumococcal Pneumonia Vaccination (PPV) Health Care Procedure Code System (HCPCS) Codes (90670, 90732), and Remove Next Eligible Dates for PPV HCPCS
Instructs Medicare's Common Working File (CWF) to send the Date of Service (DOS) for both PPV HCPCS codes (90670 and 90732) to the Medicare Beneficiary Database (MBD).This will allow other systems to know whether the DOS was for the initial vaccine or the second vaccine. Once the CR is implemented, providers will receive more detail in reply to eligibility transactions on whether their beneficiaries have received one or both PPV vaccines.
REVISED MEDICARE TRANSMITTALS
International Classification of Diseases, 10th Revision (ICD-10) and Other Coding Revisions to National Coverage Determination (NCDs) – January 2020 Update – REVISED
Revised on October 1, 2019, to clarify that the effective date is January 1, 2020, unless noted otherwise.
October 2019 Update of the Hospital Outpatient Prospective Payment System (OPPS) – REVISED
Revised to correct Table 7 to reinstate C9043 rather than delete it effective October 1, 2019. Also adds a new HCPCS code J0642, which is effective October 1, 2019, and revises the descriptor for J0641.
MEDICARE SPECIAL EDITION ARTICLES
Billing Instructions for Beneficiaries Enrolled in Medicare Advantage (MA) Plans for Services Covered by Decision Memo CAG-00451N
CMS is providing this information for hospitals providing CAR T-cell therapy to beneficiaries enrolled in Medicare Advantage (MA) plans.
MEDICARE EDUCATIONAL RESOURCES
Medicare Fast Facts
Medicare Fast Facts resources this month include:
- Cardiac Device Credits: Medicare Billing
- Proper Use of the KX Modifier for Part B Immunosuppressive Drug Claims
- Payment for Outpatient Services Provided to Beneficiaries Who Are Inpatients of Other Facilities
OTHER MEDICARE UPDATES
Final Rule: Revisions to Requirements for Discharge Planning for Hospitals, Critical Access Hospitals (CAH), and Home Health Agencies (HHA), and Hospital and CAH Changes to Promote Innovation, Flexibility, and Improvement in Patient Care
The rule finalizes requirements for hospitals, CAHs, and HHAs to implement discharge planning processes that will provide more information (such as a PAC provider or supplier’s performance in quality measures and resource measures) to patients and their families to help them make more informed decisions about PACs in order to better address their goals for care and treatment preferences.
Final Rule: Omnibus Burden Reduction (Conditions of Participation)
Finalizes provisions of three separate proposed rules: the Omnibus Burden Reduction proposed rule (dated September 20, 2018); Hospital and Critical Access Hospital Changes to Promote Innovation, Flexibility, and Improvement in Patient Care proposed rule (dated June 6, 2016); and the Fire Safety Requirements for Certain Dialysis Facilities proposed rule (dated November 4, 2016).
Modernizing and Clarifying the Physician Self-Referral Regulations Proposed Rule
A proposed rule to modernize and clarify the regulations that interpret the Medicare physician self-referral law (often called the “Stark Law”), which has not been significantly updated since it was enacted in 1989.
Adjustment to the Amount in Controversy Threshold Amounts for Calendar Year 2020
The annual adjustment in the amount in controversy (AIC) threshold amounts for Administrative Law Judge (ALJ) hearings and judicial review. The 2020 AIC threshold is $170 for ALJ hearings and $1,670 for judicial review.
https://www.govinfo.gov/content/pkg/FR-2019-10-07/pdf/2019-21751.pdf
Medicare Quarterly Provider Compliance Newsletter October 2019
This quarter’s newsletter addresses Ambulance Services Subject to SNF Consolidated Billing Requirements and Outpatient Physical Therapy Services.
MAC UPDATES
Palmetto GBA 2020 Medical Review TPE Teleconference Schedule
https://www.palmettogba.com/palmetto/providers.nsf/ls/JJ%20Part%20A"BGQT2X1030?opendocument
The holiday season is almost upon us. Since it is the time of year for spending time with family and revisiting old friends, I thought it would be a good time for this newsletter to revisit an old “friend,” the three-day payment window. This issue especially deserves a revisit since it is also being revisited by some of our favorite Medicare review entities. In August 2019, the Office of Inspector General (OIG) published a new Work Plan item, “Review of the Medicare DRG Window Policy”, and the Recovery Auditors have long had an automated issue for “Outpatient Service Overlapping or During an Inpatient Stay.”
The description from the OIG Work Plan item provides a good summary of the 3-day payment window – “Outpatient services directly related to an inpatient admission are considered part of the inpatient payment and are not separately payable by Medicare. The diagnosis-related group (DRG) window policy defines when CMS considers outpatient services to be an extension of inpatient admissions, and generally includes services that are (1) provided within the 3 days immediately preceding an inpatient admission to an acute-care hospital, (2) diagnostic services or admission-related nondiagnostic services, and (3) provided by the admitting hospital or by an entity wholly owned or operated by the admitting hospital.”
The DRG window policy can be found in Section 40.3 of the Medicare Claims Processing Manual (CPM), Chapter 3. However, reading through this section can be somewhat confusing to me, especially with all the directions of “before this date” and “after this date.” Let’s simplify as to where the rules stand now.
Entities to Which the Payment Window Applies
The payment window policy applies to both IPPS hospitals, and hospitals and units excluded from IPPS which are psychiatric hospitals and units, inpatient rehabilitation facilities (IRF) and units, long-term care hospitals (LTCH), children’s hospitals, and cancer hospitals. For these hospitals and units excluded from IPPS, this provision applies only to services furnished within one day prior to and including the date of the beneficiary's admission.
The window policy applies to services provided by the admitting hospital or by an entity wholly owned or operated by the admitting hospital. According to the CPM referenced above, “An entity is considered to be "wholly owned or operated" by the hospital if the hospital is the sole owner or operator. A hospital need not exercise administrative control over a facility in order to operate it. A hospital is considered the sole operator of the facility if the hospital has exclusive responsibility for implementing facility policies (i.e., conducting or overseeing the facility's routine operations), regardless of whether it also has the authority to make the policies.”
The provision applies to the technical portion of services rendered at a hospital-owned or hospital-operated physician clinic or practice. The provision does not apply when the admitting hospital is a critical access hospitals (CAH) but services rendered to a beneficiary at a CAH that is wholly owned or operated by a non-CAH hospital, during the payment window, are subject to the 3-day (or 1-day) payment window policy. The 3-day (or 1-day) payment window policy does not apply to outpatient services that are included in the rural health clinic (RHC) or Federally qualified health center (FQHC) all-inclusive rate.
Services Affected by the Payment Window for IPPS Hospitals
I like to break this down into three different categories – services on the day of admission, diagnostic services, and related, nondiagnostic services:
- All outpatient services (both diagnostic and nondiagnostic services) provided on the day of an inpatient admission must be billed with the inpatient stay.
- Diagnostic services (including clinical diagnostic laboratory tests) provided within 3 days prior to admission are deemed to be inpatient services and included in the inpatient payment, unless there is no Part A coverage.
- Diagnostic services are defined by the presence on the bill of specific revenue and/or CPT codes as listed in this section of the CPM.
- Nondiagnostic outpatient services that are related to a beneficiary’s hospital admission and that are provided to the patient during the 3 days immediately preceding are deemed to be inpatient services and are included in the inpatient payment.
- Nondiagnostic services are considered related unless they are clinically distinct or independent from the reason for the beneficiary’s admission.
- Hospitals must attest that nondiagnostic services are unrelated by adding a condition code 51 (definition “51 - Attestation of Unrelated Outpatient Non-diagnostic Services”) to the separately billed outpatient non-diagnostic services claim.
The 3-day timeframe along with the day of admission bundling requirement means that if a patient is admitted on a Wednesday, outpatient services meeting the above criteria provided by the hospital on Sunday, Monday, Tuesday, or Wednesday are included in the inpatient Part A payment.
Hospitals must include on the inpatient Medicare claim the diagnoses, procedures, and charges for all preadmission outpatient diagnostic services and all preadmission outpatient nondiagnostic services that meet the above requirements. The hospital must convert CPT codes to ICD procedure codes and must only include outpatient diagnostic and admission-related nondiagnostic services that span the period of the payment window. POA (present on admission) indicators are assigned based on conditions the patient has at the time of the inpatient admission order, irrespective of whether or not the patient had the condition at the time of being registered as a hospital outpatient.
The Payment Window provision does not apply to ambulance and maintenance renal dialysis services or to Part A services furnished by skilled nursing facilities, home health agencies, and hospices.
Separately Billable Services
Unrelated nondiagnostic services and services outside the payment window are separately billable to Medicare on an outpatient claim.
- This means outpatient nondiagnostic services provided during the payment window that are unrelated to the admission and are covered by Part B may be separately billed to Part B. Hospitals should use condition code 51 as described above and must maintain documentation in the patient’s medical record to support that the services are unrelated to the inpatient admission.
- Outpatient services furnished to a patient more than 3 days (or 1 day for non-IPPS hospitals/units) preceding the date of admission, are not part of the payment window and must not be bundled on the inpatient bill with other outpatient services that were furnished during the span of the 3-day (or 1-day) payment window, even when all of the outpatient services were furnished during a single, continuous outpatient encounter. Instead, the outpatient services that were furnished prior to the span of the payment window may be separately billed to Part B.
Understanding and correctly applying the Medicare DRG payment window will help hospitals avoid recoupments by Medicare reviewers such as the RACs and the OIG. Hospitals also need to understand when it is acceptable to separately bill for Part B services to prevent inappropriate bundling and loss of separate payments.
One other concern for hospitals is that the OIG continues to encourage expansion of the 3-day time frame in order to capture more admission-related outpatient services into the inpatient admission payment. As noted in their Work Plan, they want to “determine the amounts that Medicare and beneficiaries would have saved in 2018 if the DRG window policy had been updated to include more days and other hospital ownership structures.” Looks like our “old friend” could be becoming less friendly.
Debbie Rubio
One of the most complicated phrases in Southern lexicon is “bless your heart.” It can convey concern, empathy, pity, spitefulness, rudeness, or plain meanness. Whatever the intended meaning, if you are on the receiving end of this catchphrase, something is not going well for you.
This is my third article in the Wednesday@One newsletter about Appropriate Use Criteria (AUC) in the last six weeks. When a topic appears that many times in such a short timeframe, it means it is difficult; likely to have serious impact, either financially or in work processes; and hospitals need to pay attention. I focus on hospitals because they are MMP’s target client, but the AUC requirements affect more than just hospitals. This adds an additional layer of difficulty by requiring communication and coordination between the various providers.
You can refer back to my previous articles for more details about the requirements – Appropriate Use Criteria Is Coming Soon and Clarification of AUC Requirements for Emergency Conditions. In this week’s article, I want to offer some suggestions on how you might approach the process. AUC requires the ordering practitioner to consult an interactive, electronic tool known as a Clinical Decision Support Mechanism (CDSM) prior to ordering advanced imaging studies (CTs, MRs, NM studies and PET scans) to determine if the study is appropriate for the patient’s condition or signs and symptoms. That information, including which CDSM was consulted, or why a CDSM was not consulted if applicable, must be communicated to the facility performing the technical portion of the test and to the interpreting radiologist. Finally, the facility and the interpreting professional must append modifiers and sometimes HCPCS codes to their claims conveying the AUC information to Medicare. 2020 is a testing year but once the program is fully implemented, claims without the appropriate information will not be paid. The goal of the program is to ultimately be able to identify practitioners who overutilize or inappropriately utilize advanced imaging studies and require those practitioners to get a prior approval (PA) for advance imaging studies. The desired outcome is reduced costs and radiation exposure by eliminating unnecessary advanced imaging studies.
If I still worked in Compliance in a hospital, how would I approach this? Who needs to be involved? What questions need to be considered? How can we make the process work?
As with most issues, after you are familiar with the requirements, you will need to start with a meeting of the key players. The necessary team members may vary among facilities and you may not think of everyone for the first meeting. Here are some departments you will likely want to include – compliance, information technology, business office/billing, registration, scheduling, radiology, and the emergency department. At your first meeting, you will want to make sure everyone understands what the requirements are and what role they will likely play in the process. An excellent resource to share with team members is the Appropriate Use Criteria MLN Fact Sheet.
Also, I recommend developing a list of questions that must be answered, such as:
- Where and how does our facility receive orders for advanced imaging tests? Who are these orders communicated from and to?
- Are the practitioners who order advanced imaging exams aware of the new requirements and where are they on preparedness? What can we do to educate the ordering physicians/NPPs?
- Are there hospital clinics or hospital-employed practitioners that must use a CDSM? If so, have we/they selected a CDSM to be purchased and installed? Who and when will users be trained on the CDSM?
- Can IT develop queries in the electronic scheduling and ordering system to gather the needed information? Can these queries select the appropriate CPT/HCPCS code(s) and modifiers and push them to the claim?
- How will the facility share this information with the interpreting professional?
- Are there other facility departments that need to be involved?
- How do we determine if a patient in the emergency room meets the emergency condition exception or not? If not, who in the ED is responsible for checking the CDSM and entering the information?
I found over the years that as much as I wracked my brain prior to such a meeting, once the meeting occurred, many other questions and issues arose from the meeting members. That is definitely what you want and how you start! As you answer the questions, you will begin to develop ideas on how the process will work and how information will be communicated between parties and eventually to the claim.
The key to success is working with smart people who work well as a team and are dedicated to making the process a success. If you do not have such people working with you, good luck and “bless your heart.”
Debbie Rubio
MEDICARE TRANSMITTALS – RECURRING UPDATES
2020 Annual Update of Healthcare Common Procedure Coding System (HCPCS) Codes for Skilled Nursing Facility (SNF) Consolidated Billing (CB) Update
Annual Clotting Factor Furnishing Fee Update 2020
The clotting factor furnishing fee for 2020 is $0.226 per unit.
Influenza Vaccine Payment Allowances - Annual Update for 2019-2020 Season
October 2019 Integrated Outpatient Code Editor (I/OCE) Specifications Version 20.3
October 2019 Update of the Hospital Outpatient Prospective Payment System (OPPS)
Includes numerous new and revised codes.
October Quarterly Update for 2019 Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) Fee Schedule
October 2019 Quarterly Average Sales Price (ASP) Medicare Part B Drug Pricing Files and Revisions to Prior Quarterly Pricing Files
Quarterly Healthcare Common Procedure Coding System (HCPCS) Drug/Biological Code Changes - October 2019 Update
OTHER MEDICARE TRANSMITTALS
Implementation to Exchange the List of Electronic Medical Documentation Requests (eMDR) for Registered Providers via the Electronic Submission of Medical Documentation (esMD) System – REVISED
Article revised on August 26, 2019, to reflect changes made to the eMDR registration screens within NPPES. The article includes illustrations of the new screens that providers will have to complete in order to register to receive the eMDRs.
Implementation of the Award for the Jurisdiction H Part A and Part B Medicare Administrative Contractor (JH A/B MAC)
Announces the Jurisdiction JH A/B MAC re-competition procurement that was recently awarded to Novitas Solutions, Inc., the incumbent contractor for this workload.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019Downloads/R2358OTN.pdf
Billing for Hospital Part B Inpatient Services
Reminder of the policy regarding billing instructions for hospital Part B inpatient service claims, including the allowance of Revenue Code 0240 on 012x Type of Bills (TOB).
MEDICARE SPECIAL EDITION ARTICLES
Medicare Part B Clinical Laboratory Fee Schedule: Revised Information for Laboratories on Collecting and Reporting Data for the Private Payor Rate-Based Payment System – REVISED
Revised on September 5, 2019, to delete incorrect information in the section titled Only Applicable Information Attributed to non-Hospital Patients is Reported.
Activation of Systematic Validation Edits for OPPSProviders with Multiple Service Locations – Update – REVISED
Revised on September 5, 2019, to announce a delay of full implementation until April 2020.
MEDICARE EDUCATIONAL RESOURCES
Medicare Fast Facts
Medicare Fast Facts resources this month include:
OTHER MEDICARE UPDATES
Case Review Connections, Fall 2019
KEPRO Quarterly Acute Care Newsletter
In the August 20, 2019 Wednesday@One, we published an article about Appropriate Use Criteria (AUC) which will enter the Educational and Operations Testing Period beginning January 1, 2020. During this phase, providers are encouraged to participate, but claims will not be denied for lack of AUC claim elements. In that article, I stated, “It is confusing to me why applicable settings include hospital emergency departments when patients with an emergency medical condition are exempt.” I reached out to CMS for further clarification and they directed me to the CY 2019 Physician Fee Schedule final rule on page 59699 (https://www.govinfo.gov/content/pkg/FR-2018-11-23/pdf/2018-24170.pdf) for more information about this exception. I appreciated their prompt response and I think it actually did answer my question.
After reading the above reference and the section of the Social Security Act which it references, I determined that the difference in the exception versus all services provided in a hospital emergency department depends on differing definitions of the term “emergency.”
The exception for following the AUC guidelines does not apply to section 1867(a) of the Act which is where the requirement for an appropriate medical screening examination is set forth. This section states,
- “In the case of a hospital that has a hospital emergency department, if any individual (whether or not eligible for benefits under this title) comes to the emergency department and a request is made on the individual’s behalf for examination or treatment for a medical condition, the hospital must provide for an appropriate medical screening examination within the capability of the hospital’s emergency department, including ancillary services routinely available to the emergency department, to determine whether or not an emergency medical condition (within the meaning of subsection (e)(1)) exists.”
We all know that many patients present to the emergency department for conditions that are not really “emergencies” as defined further in the Act. Advanced imaging services provided for these types of conditions will be required to follow the AUC guidelines.
It is only those “serious jeopardy” emergency conditions as defined in section 1867(e)(1) of the SSA that are exempt from the AUC requirements. This section of the Act defines “emergency medical condition” to mean
- a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that the absence of immediate medical attention could reasonably be expected to result in—
- placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,
- serious impairment to bodily functions, or
- serious dysfunction of any bodily organ or part; or
- with respect to a pregnant woman who is having contractions—
- that there is inadequate time to effect a safe transfer to another hospital before delivery, or
- that transfer may pose a threat to the health or safety of the woman or the unborn child.
The discussion in the 2019 MPFS Final Rule does clarify that the exception to using AUC includes “instances where an emergency medical condition is suspected, but not yet confirmed. This may include, for example, instances of severe pain or severe allergic reactions. In these instances, the exception is applicable even if it is determined later that the patient did not in fact have an emergency medical condition.”
Even though I think I understand the distinction between less severe conditions of ED patients and those with conditions placing the patient’s health in serious jeopardy, impairment or dysfunction, I am curious to see how CMS will make this determination for payment purposes once consultation and reporting of use of AUC is required. For example, an ED claim with a diagnosis of GERD could have been a patient presenting with chest pain, a condition that could potentially place the patient’s health in serious jeopardy. Is CMS going to perform a complex review to determine if AUC is required or not? If so, what documentation would they expect to see in the ED record to support that an emergency medical condition was suspected? I guess we will just have to wait and see how it all plays out.
Debbie Rubio
Medicare has National Coverage Determinations (NCDs) that describe the requirements that must be performed and documented for the cardiac services of Transcatheter Aortic Valve Replacement (TAVR), Left Atrial Appendage Closure (LAAC), and Transcatheter Mitral Valve Repair (TMVR). Be sure to read the other article in this week’s Wednesday@One that discusses these requirements. Hopefully your cardiology department is familiar with the NCDs and has implemented processes to ensure the documentation in your records supports Medicare’s requirements. But isn’t it frustrating if all the requirements are met and appropriately documented, to have your Medicare claim denied, rejected, or returned due to missing claim elements? And in addition to the frustration, your facility is delaying or missing out on your Medicare DRG payments.
Claims for these services obviously must include the appropriate procedure codes and diagnosis codes. In addition, since all of these cardiac services are covered under Coverage with Evidence Development (CED), the claims must include a secondary diagnosis code, condition code, and value code related to the clinical trial/registry. All three of these procedures are inpatient-only procedures and would be billed on an inpatient claim, type of bill, 11x and paid under a Medicare DRG payment.
Specifically, for each procedure the following is required on the institutional inpatient claim:
Left Atrial Appendage Closure (LAAC) (Watchman procedure):
- Procedure Code - 02L73DK (Occlusion of Left Atrial Appendage with Intraluminal Device, Percutaneous Approach)
- One of the following diagnosis codes –
- I48.0 - Paroxysmal Atrial Fibrillation
- I48.1 - Persistent Atrial Fibrillation
- I48.2 - Chronic Atrial Fibrillation
- I48.91 - Unspecified Atrial Fibrillation
- Secondary diagnosis code – Z00.6 - Encounter for examination for normal comparison and control in clinical research program
- Condition Code 30 - Qualified Clinical Trial
- Value Code D4 and corresponding 8-digit clinical trial number (Clinical trail and/or registry numbers can be found on Medicare’s CED website.)
Transcatheter Aortic Valve Replacement (TAVR):
- Procedure Code – One of the following procedure codes –
- 02RF37Z (Replacement of Aortic Valve with Autologous Tissue Substitute, Percutaneous Approach),
- 02RF38Z (Replacement of Aortic Valve with Zooplastic Tissue, Percutaneous Approach),
- 02RF3JZ (Replacement of Aortic Valve with Synthetic Substitute, Percutaneous Approach),
- 02RF3KZ (Replacement of Aortic Valve with Nonautologous Tissue Substitute, Percutaneous Approach),
- 02RF37H (Replacement of Aortic Vavle with Autologous Tissue Substitute, Transapical, Percutaneous Approach),
- 02RF38H (Replacement of Aortic Valve with Zooplastic Tissue, Transapical, Percutaneous Approach),
- 02RF3JH (Replacement of Aortic Valve with Synthetic Substitute, Transapical, Percutaneous Approach), or
- 02RF3KH (Replacement of Aortic Valve with Nonautologous Tissue Substitute, Transapical, Percutaneous Approach)
- Procedure Code - X2A5312 (Cerebral Embolic Filtration, dual filter in innominate artery and left common carotid artery, percutaneous approach) when used
- One of the following diagnosis codes –
- I35.0 - Nonrheumatic aortic (valve) stenosis
- T82.222A - Displacement of biological heart valve graft, initial encounter (Code for when a previously placed valve was malpositioned or became displaced)
- T82.857A - Stenosis of cardiac prosthetic devices, implants and grafts, initial encounter (Code for when the previously placed valve developed stenosis prematurely)
- T82.223A - Leakage of biological heart valve graft, initial encounter (Code for when the previously placed valve developed regurgitation prematurely)
- Z45.09 - Encounter for adjustment and management of other cardiac device (Code for when the previously placed valve developed stenosis or regurgitation as an expected occurrence as it degenerates towards end-of-life)
- Secondary diagnosis code – Z00.6 - Encounter for examination for normal comparison and control in clinical research program
- Condition Code 30 - Qualified Clinical Trial
- Value Code D4 and corresponding 8-digit clinical trial number
Transcatheter Mitral Valve Repair (TMVR) (MitraClip procedure):
- One of the following Procedure Codes
- 02UG3JZ - Supplemental Mitral Valve with Synthetic Substitute, Percutaneous approach
- 02QG3ZE - Repair Mitral Valve created from Left Atrioventricular Valve, Percutaneous Approach
- 02QG4ZE - Repair Mitral Valve created from Left Atrioventricular Valve, Percutaneous Endoscopic Approach
- 02UG37E - Supplement Mitral Valve created from Left Atrioventricular Valve with Autologous Tissue Substitute, Percutaneous Approach
- 02UG38E - Supplement Mitral Valve created from Left Atrioventricular Valve with Zooplastic Tissue, Percutaneous Approach
- 02UG3JE - Supplement Mitral Valve created from Left Atrioventricular Valve with Synthetic Substitute, Percutaneous Approach
- 02UG3KE - Supplement Mitral Valve created from Left Atrioventricular Valve with Nonautologous Tissue Substitute, Percutaneous Approach
- 02UG3KZ - Supplement Mitral Valve with Nonautologous Tissue Substitute, Percutaneous Approach
- 02UG47E - Supplement Mitral Valve created from Left Atrioventricular Valve with Autologous Tissue Substitute, Percutaneous Endoscopic Approach
- 02UG48E - Supplement Mitral Valve created from Left Atrioventricular Valve with Zooplastic Tissue, Percutaneous Endoscopic Approach
- 02UG4JE - Supplement Mitral Valve created from Left Atrioventricular Valve with Synthetic Substitute, Percutaneous Endoscopic Approach
- 02UG4KE - Supplement Mitral Valve created from Left Atrioventricular Valve with Nonautologous Tissue Substitute, Percutaneous Endoscopic Approach
- 02WG37Z - Revision of Autologous Tissue Substitute in Mitral Valve, Percutaneous Approach
- 02WG38Z - Revision of Zooplastic Tissue in Mitral Valve, Percutaneous Approach
- 02WG3JZ - Revision of Synthetic Substitute in Mitral Valve, Percutaneous Approach
- 02WG3KZ - Revision of Nonautologous Tissue Substitute in Mitral Valve, Percutaneous Approach
- One of the following diagnosis codes –
- I34.0 - Nonrheumatic mitral (valve) insufficiency
- I34.1 - Nonrheumatic mitral valve prolapse
- Secondary diagnosis code – Z00.6 - Encounter for examination for normal comparison and control in clinical research program
- Condition Code 30 - Qualified Clinical Trial
- Value Code D4 and corresponding 8-digit clinical trial number
MACs will fully reject inpatient claims for these cardiac procedures when billed without the appropriate procedure, diagnosis, or clinical trial codes. Hospitals that perform these procedures need to put processes in place for communication between the clinical department, coding, and the billing office so that the appropriate claim elements are added. Internal claim processing edits to halt claims with one of the applicable procedure codes may be an option to verify appropriate diagnosis codes and allow the addition of the clinical trial codes.
Refer to the NCDs and corresponding claims processing instructions for complete Medicare requirements.
Debbie Rubio
Back in 2017, I wrote the section below about changes to the laboratory date-of-service policy changes from the 2018 OPPS Final Rule. The importance of laboratory date of service (DOS) requirements is that they are used to determine whether a hospital bills Medicare directly for a clinical diagnostic laboratory test (CDLT) or whether the laboratory performing the test bills Medicare. Remember, most CDLTs are conditionally packaged under OPPS, and are only paid separately to the hospital when they are: (1) the only service provided to a beneficiary on a claim; (2) considered a preventive service; (3) a molecular pathology test; or (4) an advanced diagnostic laboratory test (ADLT) that meets certain criteria. Preventive services, molecular pathology tests, and ADLTs are assigned an OPPS status indicator (SI) of “A” and paid under the Clinical Lab Fee Schedule (CLFS). CDLTs with an SI of “Q4” are paid separately under the CLFS when they are the only types of services on the claim, but payment is bundled when they appear with other outpatient services.
Excerpt from Prior Wednesday@One Article on Laboratory Date of Service Rule
“Laboratory date of service (DOS) rules start simple:
- The DOS for clinical diagnostic laboratory services generally is the date the specimen is collected.
- For archived lab specimens that are stored for more than 30 days before testing, the DOS is the date the specimen was obtained from storage.
Now this is where it starts getting complicated with what is known as the 14-day rule.
- The DOS is the date the test was performed (instead of the date of collection) if the following conditions are met:
- The test is ordered by the patient’s physician at least 14 days following the date of the patient’s discharge from the hospital;
- The specimen was collected while the patient was undergoing a hospital surgical procedure;
- It would be medically inappropriate to have collected the sample other than during the hospital procedure for which the patient was admitted;
- The results of the test do not guide treatment provided during the hospital stay; and
- The test was reasonable and medically necessary for the treatment of an illness.
- Another 14-day rule applies to chemotherapy sensitive tests performed on live tissue under the same conditions as described above with only slight variation to the first condition:
- The decision regarding the specific chemotherapeutic agents to test is made at least 14 days after discharge;
Both of these 14-day rules apply to hospital inpatients and outpatients and the key point is that the test is ordered at least 14 days after discharge. These DOS requirements determine whether the hospital bills Medicare for a clinical diagnostic laboratory test (CDLT) or whether the laboratory performing the test bills Medicare directly. When the 14-day rule applies, laboratory tests are not bundled into the hospital stay, but are instead paid separately under Medicare Part B to the testing laboratory.
Stakeholders expressed concerns about the current (2017) DOS policy because it requires hospitals to bill for tests they did not perform and that may have no relationship to or bearing on treatment received by the patient while in the hospital and it creates billing difficulties for the hospital. CMS agreed with these concerns and modified the date of service rule for hospital outpatients for molecular pathology tests and advanced diagnostic laboratory tests (ADLTs) that are not packaged under OPPS. These types of lab test have a Status Indicator of “A” on Addendum B.
The new rule (from the 2018 OPPS Final Rule) states that in the case of a molecular pathology test or an ADLT, the DOS of the test must be the date the test was performed only if—
- The test was performed following a hospital outpatient’s discharge from the hospital outpatient department;
- The specimen was collected from a hospital outpatient during an encounter (as both are defined in 42 CFR 410.2);
- It was medically appropriate to have collected the sample from the hospital outpatient during the hospital outpatient encounter;
- The results of the test do not guide treatment provided during the hospital outpatient encounter; and
- The test was reasonable and medically necessary for the treatment of an illness.
This new exception to the laboratory DOS policy does not apply to ADLT or molecular pathology tests when performed on a specimen collected from a hospital inpatient.
This new laboratory DOS policy will enable laboratories performing ADLTs and molecular pathology tests excluded from the OPPS packaging policy to bill Medicare directly for those tests, instead of requiring them to seek payment from the hospital outpatient department. In fact, for molecular pathology tests and ADLTs meeting the above requirements, the DOS must be the date the test was performed and the test must be billed by the performing laboratory. Hospital laboratories cannot bill for these tests unless they perform them.”
Although the “new” lab DOS rule from the 2018 OPPS Final Rule described above was originally set to be implemented July 2, 2018, many hospitals and laboratories reported to CMS they were having administrative difficulties implementing the DOS exception. For that reason, CMS has repeatedly exercised enforcement discretion regarding the new rule, with the latest enforcement discretion in effect until January 2, 2020.
Because of continued concerns about the readiness of labs and hospitals to implement the new rule and additional concerns that some entities performing molecular pathology testing subject to the laboratory DOS exception, such as blood banks and blood centers, may not be enrolled in the Medicare program and may not have established a mechanism to bill Medicare directly, CMS is rethinking this DOS rule. In the 2020 OPPS Proposed Rule, they are seeking comments on three options for potential changes to the laboratory DOS exception.
- Changing the Test Results Requirements – Under this option, the test would be considered a hospital service unless the ordering physician determines that the test does not guide treatment during a hospital outpatient encounter.
- Limiting the Laboratory DOS Exception to ADLTs
- Excluding Blood Banks and Blood Centers from the Laboratory DOS Exception
These options would only affect the new lab DOS exception put forth in the 2018 OPPS Final Rule that applies to molecular pathology tests and ADLTs. The basic lab DOS rules and the 14-day rule DOS exception and the chemotherapy sensitivity test DOS exception would not be affected.
I encourage hospitals and laboratories affected by these date of service rules to read the discussion in the Proposed Rule and to submit comments to CMS. (Lab DOS Policy section begins on page 201 of 247 pages of the pdf printed version.)
Debbie Rubio
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