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As the summer winds down and school is fast approaching, it takes me back to all the hours of taking notes, studying and then having to take tests. Just like a test in school is a reflection of
how well you have learned what you are being taught, in the world of Medicare & Medicaid Review Contractors the Comprehensive Error Rate Testing (CERT) Contractor performs audits to see how well Medicare Administrative Contractors (MACs) are adjudicating claims.

Error Rate Testing, a Historical Perspective:

• From 1996 through 2002 the HHS Office of Inspector General (OIG) estimated the Medicare Fee-for-Service (FFS) error rate.
• The Centers for Medicare and Medicaid Services (CMS) took over responsibility for the error rate measurement programs in FY 2003. At this time the sample size for the program increased from approximately 6,000 claims to approximately 120,000 claims thus allowing for the projection of a national error rate and for the first time for contractor and service level error rates.

CERT Review Process:

• The purpose of CERT reviews is to measure improper payments.
• The volume of claims reviewed is small.
• Claims are randomly selected from all claims submitted for payment.
• Claims reviewed are only post-payment complex reviews.
• The CERT Documentation Contractor requests medical records.
• If a provider does not submit the requested record, this counts as an improper payment and the payment is recouped from the providers.
• At least one nurse at the CERT Review Contractor will review the claim.
• Claims that are determined to be incorrect are scored as an error and payments are adjusted.
• Major Causes of Improper Claims includes:
• Missing Physician orders
• Illegible or missing signatures
• National Coverage Determinations (NCDs) or Local Coverage Determinations (LCDs) not being met; and
• The medical record does not support the medical necessity.

2010 CERT Report by the Numbers:

The CERT publishes an annual Improper Payment Report. The most recent report released November 22, 2011 reports the error rate and findings for 2010.

• The 2010 Medicare Fee-for-Service (FFS) paid claims error rate was 10.5% which equates to $34.3 billion in improper payments.
• Improper payments for inpatient hospital claims increased significantly from 2009 with inappropriate “place of service” errors accounting for a projected $5.1 billion.
• The Medicare Part B error rate decreased from 18.9% in 2009 to 12.9% in 2010.
• The Medicare Part A non-inpatient hospital claims decreased from 8.8% in 2009 to 4.2% in 2010.

What does the Medicare Administrative Contractor (MAC) do with the CERT Findings?

• Utilizes the findings to determine issues for Provider Education and Pre-Payment Reviews.

To learn more about the CERT visit the CMS CERT web page.

Self-Administered Drugs Used as Supplies

Question:
Is it ever appropriate to bill for self-administered drugs (SADs) as covered services?

Answer:
Yes, when these drugs function as supplies. This occurs when the drugs provided are an integral component of a procedure or are directly related to it, i.e., when they facilitate the performance of or recovery from a particular procedure

For example, drugs used as supplies would include:

• sedatives administered to prepare a patient for a procedure
• antibiotic ointment placed on a wound/incision at the completion of a procedure.

See the July 2012 OPPS update (MLN Matters MM7847) for more examples of when self-administered drugs would and would not be separately billable to Medicare. Drugs paid as supplies should be reported under the revenue code associated with the cost center under which the hospital accumulates the costs for the drugs (most hospitals use revenue code 0250).

In the January 2012 OPPS Update, CMS revised the guidance for the use of modifiers 52, 73 and 74 for discontinued and reduced services in outpatient hospitals and ambulatory surgical centers. The choice of an appropriate modifier is based on whether the reduced, discontinued or cancelled procedure requires the use of anesthesia or not.

• Modifiers 73 and 74 are used for procedures that require anesthesia.
• Modifier 52 is used for procedures that do not require the use of anesthesia.

Anesthesia is defined to include local, regional block(s), moderate sedation/analgesia (“conscious sedation”), deep sedation/analgesia, or general anesthesia.

Discontinued / Cancelled Procedures

For procedures that are terminated due to extenuating circumstances or circumstances that threatened the well being of the patient,

• Use modifier 73 if:
• Anesthesia is planned for the procedure
• The procedure is terminated prior to the administration of anesthesia,
• The patient had been prepared for the procedure and taken to the room where the procedure was to be performed.
• Use modifier 74 if:
• Anesthesia is planned for the procedure
• The procedure is terminated after the induction of anesthesia or after the procedure has been started (incision made, scope inserted, etc.)
• A planned surgical or diagnostic procedure is discontinued or cancelled at the physician’s discretion after administration of anesthesia
• Use modifier 52 if:
• Anesthesia is not planned for the procedure
• The patient had been prepared for the procedure and taken to the room where the procedure was to be performed.

*Do not report procedures that are electively cancelled.

Note that the patient must be taken to the room where the procedure is to be performed in order to report these modifiers.

Multiple Procedures Planned - If any procedures of multiple planned procedures are completed, report only the completed procedure(s). If none of multiple planned procedures are completed, report only the first planned procedure with the appropriate modifier.

Reduced Procedures

• Use modifier 74 for services that are partially reduced after the administration of anesthesia
• Use modifier 52 for services that are partially reduced for which anesthesia was not planned.

Effect on Payment

Services appended with modifier 73 or modifier 52 will be paid at 50% of the full OPPS payment amount. Services appended with modifier 74 will be paid at the full OPPS payment amount.

In 1999, CMS proposed a policy to pay only the hospital for the technical component (TC) of physician pathology services furnished to hospital patients. However, various legislative provisions since then have continued to delay the implementation of this provision. Under these delays, the independent or pathology laboratories providing the technical component of pathology services for covered hospitals have continued to bill Medicare directly. Covered hospitals are those hospitals that had an arrangement with an independent laboratory that was in effect as of July 22, 1999, under which the laboratory furnished the TC of physician pathology services to fee-for service Medicare beneficiaries who were patients of the hospital.

The Tax Relief Act of 2012 again extended the moratorium on this policy through June 30, 2012. Effective July 1, 2012, the moratorium expires and only hospitals can bill for the TC of physician pathology services furnished to hospital inpatients or outpatients. Pathologists and independent laboratories that provide the TC of physician pathology services furnished to hospital patients may no longer bill for and receive Medicare payment for these services, effective for claims with dates of service on and after July 1, 2012.

Medical Management Plus, Inc. has received numerous questions concerning this requirement. Following are several questions and answers to help hospitals understand the implementation of the rule.

1. Is this change for certain? It is always possible that Congress will pass legislation extending the moratorium again prior to July 1, 2012. However, at this time, the regulation is expected to begin July 1.
   
2. Which hospitals are affected? Hospitals that were covered under the grandfather clause of the original regulation (see definition of covered hospitals above), send their pathology specimens to an independent or pathology laboratory for processing and allow the processing laboratory to bill Medicare directly.
   
   
3. Note that some larger hospitals may provide pathology processing services in the hospital laboratory and bill Medicare directly for these services. Some other hospitals may send pathology specimens out for processing, but may already bill Medicare directly by choice or because they do not meet the definition of a covered hospital.
4. What types of services are involved? Physician cytopathology and surgical pathology technical component services for hospital inpatients and outpatients. Tissue specimens removed during an inpatient or outpatient surgical procedure are processed prior to the microscopic evaluation/interpretation by a pathologist. This processing is the technical component of pathology services and includes such services as embedding the tissue specimen, slicing thin tissue sections, preparing and staining the pathology slides. See the 88xxx CPT codes paid under APCs 0342, 0343, and 0344 on the Outpatient Prospective Payment System (OPPS) Addendum B for the affected codes. Note that pathology TC services provided during surgery, such as frozen sections, would also be included when these are performed and billed to Medicare by the pathology laboratory.
   
5. How will hospitals be reimbursed by Medicare for these services? For hospital inpatients, Medicare payment is made under a DRG payment which includes any pathology services provided to the patient. The pathology services will be paid under the Outpatient Prospective Payment System (OPPS) APCs for hospital outpatient services.
   
6. How will hospitals know what CPT codes to bill for each patient? Since each patient specimen may require different pathology testing, it is best to have the processing laboratory provide the hospital the applicable CPT codes for each case. The hospital and laboratory providing the TC should develop a process for timely exchange of this information in order not to delay hospital billing. Pathologists may request additional testing in order to make a definitive diagnosis of a pathology specimen, so remember to address add-on or late charges.
   
7. How will the independent/pathology laboratory be paid for its services? The hospital and independent/pathology laboratory will have to negotiate a financial agreement where the hospital pays the processing laboratory for its pathology TC services. The hospital will have to consider the reimbursement it will receive for outpatient services versus the cost of TC services plus any other costs for providing the service (such as handling, supplies, billing cost, etc.) The testing laboratory will have to consider its total costs versus the payment amount from the hospital. The parties will also have to consider whether payment is per CPT code, per case, per specimen, etc.
   
8. Does this affect the pathology professional charges? No, pathologists will continue to bill and be reimbursed by Medicare Part B directly for their professional services.

The following flowchart illustrates the process.

Medicare Hospital Dialysis Services 

CMS Transmittal 2455 released April 26, 2012 informs hospitals about the correct billing of acute dialysis services for Medicare inpatients and outpatients.

HCPCS code G0257 is only to be billed for hospital outpatients with ESRD. G0257 is not to be reported for hospital inpatient services billed under Part B (12x type of bill) or for hospital outpatients who do not have ESRD. HCPCS code G0257 is used for hospital outpatients with ESRD when the criteria listed below from the Medicare Claims Processing Manual, chapter 4, section 200.2 is met.

“Payment for unscheduled dialysis furnished to ESRD outpatients and paid under the OPPS is limited to the following circumstances:

• Dialysis performed following or in connection with a dialysis-related procedure such as vascular access procedure or blood transfusions;
• Dialysis performed following treatment for an unrelated medical emergency; e.g., if a patient goes to the emergency room for chest pains and misses a regularly scheduled dialysis treatment that cannot be rescheduled, CMS allows the hospital to provide and bill Medicare for the dialysis treatment; or
• Emergency dialysis for ESRD patients who would otherwise have to be admitted as inpatients in order for the hospital to receive payment.”

HCPCS code G0257 may only be reported on Type of Bill (TOB) 13X (hospital outpatient service) or TOB 85X (Critical Access Hospital). Effective for services on and after October 1, 2012, claims containing HCPCS code G0257 will be returned to the provider for correction if G0257 is reported with a type of bill other than 13X or 85X (such as a 12x inpatient claim).

Hospitals should report HCPCS code 90935 (Hemodialysis procedure with single physician evaluation) for the following hospital dialysis services.

• Hospital inpatients with or without ESRD who have no coverage under Part A, but have Part B coverage. The service must be reported on a Type of Bill 12X or Type of Bill 85X.
• Hospital outpatients who do not have ESRD and are receiving hemodialysis in the hospital outpatient department. The service is reported on a TOB 13X or l 85X.

CPT code 90945 (Dialysis procedure other than hemodialysis (e.g. peritoneal dialysis, hemofiltration, or other continuous replacement therapies)), with single physician evaluation, may be reported by a hospital paid under the OPPS or CAH method I or method II on type of bill 12X, 13X or 85X.

For complete information see the transmittal at the link above or the MLN Matters Article MM7732.

The diagnosis codes required to receive payment for blood clotting factors provided to hemophilia inpatients were changed effective October 1, 2011 with the new ICD-9-CM code updates.

ICD-9-CM diagnosis codes 286.52 (acquired hemophilia), 286.53 (Antiphospholipid antibody with hemorrhagic disorder), and 286.59 (Other hemorrhagic disorder due to intrinsic circulating anticoagulants, antibodies, or inhibitors) replace 286.5 effective October 1, 2011.

Note that the add-on payment criteria will not be updated until April 2, 2012. If you use the new codes on claims prior to April 2012, you will not receive the add-on reimbursement. There will be no automatic adjustment of affected claims. Providers must notify the MAC to have the affected claims adjusted after the implementation.

For more information, see MLN Matters Article MM7553 

CMS has released a revised version of MLN Matters Article SE1138 . This transmittal explains that when a non-specific procedure code is reported on a 5010 institutional or professional claim, a corresponding description of the service is required. The original transmittal incorrectly stated that "simply using Not Otherwise Classified as the description does not pass editing and the claim will be rejected". The claim will not be rejected if “Not Otherwise Classified” is submitted as the description. If the corresponding non-specific procedure code description is not submitted, the transaction does not comply with the implementation guide and is not, therefore, HIPAA compliant.

The transmittal does not specific where on the claim the description should be entered but refers readers to the 837I and 837P implementation guides for detailed information regarding this new requirement.

A complete listing of Not Otherwise Classified (NOC) Code Set is available at http://www.cms.gov/ElectronicBillingEDITrans/40_FFSEditing.asp on the Centers for Medicare & Medicaid Services (CMS) website.

The Medicare Quarterly Compliance Newsletter provides guidance to Fee-for-Service providers, suppliers and billing staff by:

• Describing an identified problem and the issues that may occur as a result of the problem,
• Detailing the steps taken by CMS to make providers aware of the problem, and
• Guidance on how to avoid the identified problem.

Who else is looking at the specific DRGs identified as problems in the Newsletter?

MMP, Inc. strongly encourages our clients to review your PEPPER Report for possible outliers.

All prior Medicare Quarterly Compliance Newsletters have been archived and can be accessed at: https://www.cms.gov/MLNProducts/downloads/MedQtrlyCompNL_Archive.pdf

In 2009, CMS transitioned Part A inpatient medical review responsibility from Quality Improvement Organizations (QIOs) to Medicare Administrative Contractors (MACs) and Fiscal Intermediaries (FIs).

Along with this transition, CMS has made the reduction of combined Part A/Part B inappropriate claims payments through the Comprehensive Error Rate Testing (CERT) program a high priority for the Medicare program.  

So, what does this mean? For the first time one entity (MACs) have the ability to review Part A and Part B claims.

This past fall this ability became a reality for TrailBlazer (the MAC for Colorado, New Mexico, Oklahoma, Texas and the Indian Health Service), when they posted Notice ID 14572: "Part A/B Cross-Claim Medical Review: The Impact It Will Have on Physicians announcing that “to increase consistency in Medicare reimbursement, effective November 1, 2011, TrailBlazer will begin cross-claim review” of services. Two other notices were referenced in this announcement that Hospitals and Physicians should pay close attention to (Notice ID 14561: "Part A/B Cross-Claim Medical Review" and Notice ID 14362: "Joint Replacement Documentation").

Key Points from the TrailBlazer Notices:

• For the first time a MAC will be looking at the physician’s related outpatient claims when inpatients stay/service is denied.
• Physician documentation for inpatient services should be as robust and complete as their clinic/office (outpatient documentation).
• Hospitals may need to request and include physician clinic notes in their medical records to help support the medical necessity and other requirements of hospital procedures.

MACs are no longer simply looking at the medical necessity of the admission but also whether or not the procedure was medically necessary.

Description Required for Non-Specific Procedure Codes,

HIPAA Version 5010

Although the Office of E-Health Standards and Services (OESS) has deferred enforcement of compliance with HIPAA Version 5010 until March 31, 2012, the official compliance date remains January 1, 2012. CMS encourages providers to implement use of the 5010 version as soon possible. MLN Matters Article SE1138 describes the HIPAA compliance requirement when reporting non-specific procedure codes. When a non-specific procedure code is reported on a 5010 institutional or professional claim, a corresponding description of the service is required. Detailed information regarding this new requirement can be found in the 837I and 837P implementation guides. Non-specific procedure codes are codes that include, in their descriptor, terms such as: “Not Otherwise Classified (NOC); Unlisted; Unspecified; Unclassified; Other; Miscellaneous; Prescription Drug Generic; or Prescription Drug, Brand Name”. These terms included in the descriptors are not sufficient to meet the HIPAA compliance requirements. For example, using a description of “not otherwise classified” will not pass editing and the claim will be rejected.

A complete listing of Not Otherwise Classified (NOC) Code Set is available at http://www.cms.gov/ElectronicBillingEDITrans/40_FFSEditing.asp on the Centers for Medicare & Medicaid Services (CMS) website.