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5/29/2018
MEDICARE TRANSMITTALS
Revisions to the Telehealth Billing Requirements for Distant Site Services
Implements requirements for billing modifier GT for Telehealth Distant Site Services. As of January 1, 2018, the GT modifier is only allowed on institutional claims billed by a Critical Access Hospital (CAH) Method II.
Implementation of Changes to the Pre-Payment Additional Documentation Request (ADR) Letters for Medical Review
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R2083OTN.pdf
Quarterly Update for Clinical Laboratory Fee Schedule and Laboratory Services Subject to Reasonable Charge Payment
Updates to Publication 100-04, Chapters 1 and 27, to Replace Remittance Advice Remark Code (RARC) MA61 with N382
MACs will use N382 in place of MA61 to communicate reject/denials for patient identifiers (HICN or MBI) in all remittance advices and 835 transactions. However, MACs will continue to use RARC MA61 only when/if communicating rejections/denials related to a missing/incomplete/invalid social security number.
Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) PPS Extensions per the Advancing Chronic Care, Extenders, and Social Services (ACCESS) Act Included in the Bipartisan Budget Act of 2018
Information and implementation instructions for:
- Section 50204 – Extension of Increased Inpatient Hospital Payment Adjustment for Certain Low-Volume Hospitals
- Section 50205 – Extension of the Medicare-Dependent Hospital (MDH) Program
- Section 51005 – Adjustments to the LTCH Site Neutral Payment Rate
Supervised Exercise Therapy (SET) for Symptomatic Peripheral Artery Disease (PAD) – REVISED
The article was revised on May 15, 2018, to clarify that one of the requirements of the SET program is it must be conducted in a hospital outpatient setting or in a physician’s office.
Quarterly Healthcare Common Procedure Coding System (HCPCS) Drug/Biological Code Changes – July 2018 Update – REVISED
A sentence is added to show that Part B payment for Q9995 includes the clotting factor furnishing fee.
Intent to Reopen
Provides instructions for contractors to: provide notification of the reopening process and to notify the provider or supplier of their intent to reopen a specific claim when requested documentation is received after a denial of the claim has been made.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R796PI.pdf
Remittance Advice Remark Code (RARC), Claims Adjustment Reason Code (CARC), Medicare Remit Easy Print (MREP) and PC Print Update
Quarterly Update to the Medicare Physician Fee Schedule Database (MPFSDB) - July 2018 Update
MEDICARE COVERAGE UPDATES
International Classification of Diseases, Tenth Revision (ICD-10) and Other Coding Revisions to National Coverage Determinations (NCDs)
CR10622 makes coding and clarifying adjustments to the following NCDs:
- NCD 110.18 Aprepitant
- NCD 150.3 Bone Mineral Density Studies
- NCD 190.11 Prothrombin Time/International Normalized Ratio (PT/INR)
- NCD 220.6.16 Positron Emission Tomography (PET) for Infection/Inflammation
- NCD 220.6.17 PET for Solid Tumors
- NCD 220.13 Percutaneous Image-Guided Breast Biopsy
MEDICARE PRESS RELEASES
CMS Announces Agency’s First Rural Health Strategy
The agency’s first Rural Health Strategy intended to provide a proactive approach on healthcare issues to ensure that the nearly one in five individuals who live in rural America have access to high quality, affordable healthcare.
CMS Unveils Enhanced “Drug Dashboards” to Increase Transparency on Drug Prices
For the first time, the dashboards include year-over-year information on drug pricing and highlight which manufactures have been increasing their prices.
MEDICARE EDUCATIONAL RESOURCES
Palmetto JM Provider Contact Center (PCC) Frequently Asked Questions (FAQs): January 2018 - April 30, 2018
MLN Fact Sheet Complying with Medicare Signature Requirements
Targeted Probe and Educate Video
MEDICARE RULES
Hospital IPPS and LTC 2019 FY Proposed Rule
The proposed rule proposes updates to Medicare payment policies and rates under the Inpatient Prospective Payment System (IPPS) and the Long-Term Care Hospital (LTCH) Prospective Payment System (PPS). Also includes proposal concerning Quality Programs, EHR Incentive Programs, Cost-Reporting and Physician Claim Certifications.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-08705.pdf
Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities (SNF) Proposed Rule for FY 2019, SNF Value-Based Purchasing Program, and SNF Quality Reporting Program
This proposed rule would update the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2019.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-09015.pdf
Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2019
This proposed rule would update the prospective payment rates for inpatient rehabilitation facilities (IRFs) for federal fiscal year (FY) 2019.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-08961.pdf
FY 2019 Inpatient Psychiatric Facilities Prospective Payment System and Quality Reporting Updates for Fiscal Year Beginning October 1, 2018 (FY 2019)
This proposed rule would update the prospective payment rates for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPFs), which include psychiatric hospitals and excluded psychiatric units of an acute care hospital or critical access hospital.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-09069.pdf
OTHER MEDICARE UPDATES
Kepro Case Review Connections, Acute Care Edition, Spring 2018
A quarterly e-newsletter from your Beneficiary and Family Centered Care Quality Improvement Organization (BFCC-QIO).
https://www.keproqio.com/providers/spring-2018-acute-newsletter/
Trump Administration Releases Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs
5/22/2018
“We rarely talk about cost. We talk about waste, quality, and safety, and we find our costs go down.”
- Patrick Hagan, former COO of Seattle Children’s Hospital
Risk Factor: Socio-economic Status
The Establishing Beneficiary Equity in the Hospital Readmission Reduction Program Act of 2015 (S. 688 and H.R. 1343) would have required the CMS to account for socio-economic status when calculating risk-adjusted readmission penalties. This bill garnered support from the Association of American Medical Colleges as well as the American Hospital Association. You can read more about this Act in a related MMP article.
A year later the House Ways and Means Committee released the Helping Hospitals Improve Patient Care Act of 2016 (H.R. 5273) that included a modified version of H.R. 1343. This latest version of the bill was passed in the House and was sent to the Senate where it was read twice and referred to the Committee on Finance.
Fast Forward to the 2019 IPPS Proposed Rule which includes a discussion about “Accounting for Social Risk Factors” (including socioeconomic status) in the following Programs discussed in the Proposed Rule:
- Hospital Readmission Reduction Program (HRRP),
- Hospital Value Based Purchasing (VBP) Program,
- Hospital Acquired Condition (HAC) Reduction Program,
- Hospital Inpatient Quality Reporting (IQR) Program,
- IPPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program, and
- Long Term Care Hospital Quality Reporting Program (LTCH QRP).
Accounting for Social Risk Factors
CMS notes their “commitment to ensuring that medically complex patients, as well as those with social risk factors, receive excellent care. We discussed how studies show that social risk factors, such as being near or below the poverty level as determined by HHS, belonging to a racial or ethnic minority group, or living with a disability, can be associated with poor health outcomes and how some of this disparity is related to the quality of health care.”
Specific CMS aims within their core objectives include:
- Improving health outcomes,
- Attaining health equity for all beneficiaries, and
- Ensuring that complex patients as well as those with social risk factors receive excellent care.
The Office of the Assistant Secretary for Planning and Evaluation (ASPE) and the National Academy of Medicine
The ASPE and National Academy of Medicine have examined the influence of social risk factors in the CMS value-based purchasing programs. To date, as required by the IMPACT Act of 2014, ASPE has provided a report to Congress where they found that “in the context of value-based purchasing programs, dual eligibility was the most powerful predictor of poor health care outcomes among those social risk factors they examined and tested.” ASPE is continuing to examine this issue in a second report required by the IMPACT Act that is due to Congress in the fall of 2019.
National Quality Forum (NQF)
CMS noted in the FY 2018 IPPS/LTCH PPS Final Rule, that the NQF “undertook a 2-year trial period in which certain new measures and measures undergoing maintenance review have been assessed to determine if risk adjustment for social risk factors is appropriate for those measures.” This period ended April 2017.
NQF Trial Conclusion:
The NQF notes in the July 2017 Social Risk Trial Final Report Abstract that “the trial period has illuminated the feasibility of adjusting measures for social risk, with 17 measures endorsed by NQF for factors such as a person’s level of education.” The NQF has extended the socioeconomic status (SES) Trial, allowing further examination of social risk factors in outcome measures.
The Centers for Medicare and Medicaid Services
CMS solicited feedback in the FY and CY 2018 Proposed Rules on which social risk factors provide the most valuable information to stakeholders for illuminating differences in outcome rates among patient groups. Commenters encouraged CMS to stratify measures by other social risk factors such as age, income, and educational attainment (82 FR 38404).
CMS Next Steps
As next steps, CMS is considering the following:
- Options to reduce health disparities among patient groups within and across hospitals by increasing the transparency of disparities as shown by quality measures,
- Implementing a hospital-specific disparity method that would promote quality improvement by calculating difference in outcome rates among patient groups within a hospital while accounting for their clinical risk factors,
- Implementing a method to assess hospitals’ outcome rates for subgroups of patients, such as dual eligible patients, across hospitals, allowing for a comparison among hospitals on their performance caring for patients with social risk factors.
Specific to the Hospital IQR Program, CMS acknowledges the complexity of interpreting stratified outcome measures and plans to stratify Pneumonia Readmission measure (NQF #0506) data by highlighting both hospital-specific disparities and readmission rates specific for dual-eligible beneficiaries across hospitals for dual-eligible patients in hospitals’ confidential feedback reports beginning Fall 2018. CMS is considering expanding confidential hospital feedback reports for other measures and eventually making this data publicly available on the Hospital Compare website.
CMS believes “the stratified results will provide hospitals with information that could illuminate disparities in care or outcome, which could subsequently be targeted through quality improvement efforts. We further believe that public display of this information could drive consumer choice and spark additional improvement efforts.” CMS plans to continue to work with the ASPE, the public and key stakeholders to “identify policy solutions that achieve the goals of attaining health equity for all beneficiaries and minimizing unintended consequences.”
Beth Cobb
5/22/2018
“No payment may be made under (Medicare) part A or part B for any expenses incurred for items or services — which, …, are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member, …”Social Security Act 1862(a)(1)(A)
If your work involves knowledge of Medicare requirements, you are likely very familiar with the above statement that is the basis for the concept of “medical necessity” for covered healthcare services. But do you actually consider the implications of this statement when billing Medicare for services?
It appears a large number of providers did not assess their services against this statement before billing Medicare for specimen validity testing as a recent Office of Inspector General (OIG) report found $66.3 million in overpayments for this type of testing. Specimen validity testing is used to analyze urine specimens prior to drug testing to determine whether the specimens have been adulterated or tampered with. Although necessary to assure the legitimacy of the drug testing, these tests themselves are not used to provide a diagnosis or treatment to a patient.
As the OIG report explains, the requirements for laboratory testing are that tests meet the requirement for medical necessity as described above and more specifically, to be covered under Medicare Part B, clinical laboratory tests must:
- Be ordered by a physician who is treating a beneficiary for a specific medical problem;
- Be related to the patient’s illness, injury, symptom or complaint; and
- The results must be used in the management of the patient’s problem.
The overpayments occurred because the same tests used for specimen validity testing may be medically necessary if used to diagnose certain conditions. “For example, tests for urinary pH and specific gravity may be performed to diagnose diseases of the kidney and urinary system. If these tests are used for diagnosis, treatment, or management, they may be Medicare-covered services. However, when used for the purpose of determining whether a specimen is adulterated, the test results are not being used to manage a beneficiary’s specific medical problem. In these cases, specimen validity testing is not a separately billable Medicare-covered service.”
Providers should have known this because, over the years, Medicare and their contractors have addressed this issue numerous times. Almost all the Medicare Administrative Contractors (MACs) have a Local Coverage Determination (LCD) for drug testing that includes direction that tests to validate urine specimens are not separately billable. The first such LCD instruction was in 2010 and in 2015 the Medicare National Correct Coding Initiative (NCCI) manual included the statement, “Providers performing validity testing on urine specimens utilized for drug testing should not separately bill the validity testing.” Beginning in 2016, new HCPCS codes for urine drug testing include specimen validity testing in their code descriptions and payments, regardless of whether specimen validity testing is performed or not. And in April 2016, NCCI edits were created to prevent payment for the type of lab tests performed for validity testing when billed on the same date of service as a urine drug test unless modified by the provider to indicate a “separate and distinct” service.
Although the number of overpayments dramatically decreased from 2014 to 2016, the OIG thinks further actions by CMS could reduce the risk of estimated overpayments of $12,146,760 over a 5-year period. The OIG recommends CMS “strengthen its system edits to prevent improper payments for specimen validity tests and instruct the Medicare contractors to educate providers on properly billing for specimen validity and urine drug tests.” Also, be warned that CMS may be recouping the overpayments identified in the OIG audit.
Now is a good time to investigate your billing practices for specimen validity testing with the understanding that if you have been separately billing these services, you owe the government some money back. Going forward, be sure to first apply the Social Security Act standard in determining whether to bill for services – i.e., to be paid under Medicare, a service must be reasonable and necessary for the diagnosis or treatment of illness or injury. After that, there are a lot more coverage rules that need to be considered, but it is a good place to start.
Debbie Rubio
5/16/2018
Q:
Have there been any recent updates to the hospital Post-acute Care Transfer (PACT) Policy?
A:
Yes. Transmittal 2055 added discharges to hospice care as a post-acute care setting that would invoke the payment adjustments of the Post-acute Care Transfer policy beginning FY 2019.
The transmittal summarizes the facts of Medicare’s transfer policies in the Background section:
“When a patient is transferred to another hospital and his or her length of stay is less than the geometric mean length of stay for the Medicare Severity Diagnosis-Related Group (MS–DRG), the transferring hospital would be paid based on a graduated per diem rate for each day of stay, not to exceed the full MS–DRG payment. For discharges to certain post-acute care settings, this per diem-based payment adjustment is limited to discharges to certain MS-DRGs. Currently, the regulation limits post-acute care transfers to those where the patient is transferred to a distinct part hospital unit, a skilled nursing facility, or discharged with a written plan for home health services commencing within 3 days of discharge.”
The policy revision is based on the requirements of Section 53109 of the Bipartisan Budget Act of 2018. Beginning in FY 2019 (October 1, 2018), discharges to hospice care will also qualify as a post-acute care transfer and be subject to payment adjustments.
The post-acute care setting and discharge statuses to which the policy applies are:
- Inpatient rehab facilities and units (discharge status code 63)
- Long term care hospitals (code 62)
- Psychiatric hospitals and units (code 65)
- Children’s and Cancer hospitals (code 05)
- Skilled nursing facilities (code 03)
- Home with a home health plan of care that begins within 3 days (code 06)
- Hospice care (code 50 or 51) – NEW for claims with through date on or after October 1, 2018
Here are some other facts about the post-acute care transfer policy from a prior Wednesday@One article.
- PACT policy only applies to certain MS-DRGs. The list of MS-DRGs to which the policy applies is updated annually as Table 5 of the IPPS Final Rule.
- PACT policy only applies when the patient is transferred to certain post-acute care settings – see list above
- Medicare identifies transfers to the affected settings by the discharge status code on the claim. If Medicare receives a claim from a post-acute care provider for days immediately after discharge, they will ask the transferring hospital to adjust their discharge status code if needed.
- Payment is reduced to the transferring hospital. A per diem rate is calculated by dividing the MS-DRG rate by the GMLOS. The transferring hospital is paid 2x the per diem rate for the first day and the per diem rate for subsequent days up to the full MS-DRG payment.
- There are special pay MS-DRGs (also noted in Table 5) that are paid differently, with a higher payment percentage for the first day of hospitalization.
- Transfer cases are eligible for outlier payments.
Debbie Rubio
5/8/2018
Several years ago, there was a lot of excitement among laboratories and hospitals when CMS stated that a laboratory requisition did not have to be signed by the ordering practitioner. That excitement was short-lived however, when it became apparent that the lack of a signature requirement for lab requisitions did not mean a signed order for the laboratory testing was not required. Upon medical review by a Medicare contractor, the billing entity (such as the hospital) was required to submit a signed practitioner’s order, or other documentation, such as an office progress note, supporting the intent to order the specific laboratory tests. Many laboratories quickly realized it was easier and more efficient to continue to require the physician’s signature on the lab requisition.
Bearing this cautionary tale in mind, what does the proposed policy change to remove the requirement that written inpatient admission orders are a specific requirement for Medicare Part A payment actually mean for hospitals? I certainly do not think it means you no longer need an order for inpatient admission.
In fact, the 2019 Inpatient Prospective Payment System (IPPS) proposed rule states, “This proposal does not change the requirement that an individual is considered an inpatient if formally admitted as an inpatient under an order for inpatient admission.”
What it does mean is a shift in the focus of Medicare reviewers away from the admission order itself. The Proposed Rule affirms that Medicare reviewers will focus on the medical necessity of the inpatient services. The wording in the proposed rule also provides hints as to the types of “technical discrepancies” reviewers may overlook, such as:
- Missing practitioner admission signatures,
- Missing authentication signatures or co-signatures, or
- Signatures occurring after discharge.
Reviewers may also be more willing to allow payment for inpatient admissions when there is not an admission order but “the intent, decision, and recommendation of the ordering physician or other qualified practitioner to admit the beneficiary as an inpatient can clearly be derived from the medical record.” This should still be a rare occurrence because hospitals are expected to comply with the Medicare Conditions of Participation which require an admission order.
The rule change for admission orders does not change the “two-midnight” policy. This change, if finalized, will allow hospital personnel to concentrate on ensuring documentation is present in the record to support the medical necessary expectation of a two-midnight stay instead of chasing physicians to obtain signatures before the patient is discharged.
Debbie Rubio
5/2/2018
Q:
What is the “Approach” for a needle aspiration of Bone Marrow from a lumbar vertebra when performed during an open lumbar spinal fusion?
A:
The operative “Approach” for needle aspiration of Bone Marrow would be assigned to “Open”. This would not be considered a “Percutaneous” approach because the aspiration did not cut through the skin. The code assigned would be 07DS0ZZ, Extraction of Vertebral Bone Marrow, Open Approach
In addition, needle aspiration of bone marrow from the iliac crest is commonly performed during spinal fusions and would be assigned to 07DR0ZZ, Extraction of Iliac Bone Marrow, Open Approach. This would be reported once even if performed bilaterally.
Resources:
Coding Clinic, Third Quarter 2016, page 41
Coding Tip: Biopsy Coding in PCS When Fluid is Aspirated; Kim Carrier, Health Information Associates
5/1/2018
As I write this article, I realize the word “challenge” appears frequently in my articles. How could it not? Dealing with Medicare is a lot of things, but always a challenge. Especially since Medicare tends to change their guidance often and without warning. Sometimes guidance changes are couched as “clarifications” and sometimes providers wait and hope for additional guidance that seems to take forever to come. Such is the case with Medicare’s transmittal that manualizes the new laboratory date of service policy from the 2018 Outpatient Prospective Payment System (OPPS) Final Rule. The good news is that this transmittal includes a list of codes to which the new policy applies, which was not clear from the discussion in the final rule.
Prior to the new lab date of service policy, hospitals had to bill Medicare directly for all outpatient laboratory tests unless the test was ordered at least 14 days following the date of the patient’s discharge from an outpatient hospital procedure. This policy created unintentional operational consequences for hospitals and testing laboratories when molecular pathology tests and ADLTs, that are separately paid at the clinical lab fee schedule (CLFS) rate and not under the hospital OPPS rate, were performed on specimens collected during a hospital outpatient encounter. CMS recognized the concerns and in the 2018 OPPS Final Rule, changed the lab date of service policy as follows:
“In the case of a molecular pathology test or an Advanced Diagnostic Laboratory Test (ADLT) that meets the criteria of section 1834A(d)(5)(A) of the Act, the date of service must be the date the test was performed only if the following conditions are met:
- The test is 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 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 laboratory DOS policy will permit laboratories performing ADLTs and molecular pathology tests excluded from the Outpatient Prospective Payment System (OPPS) packaging policy to bill
Medicare directly for those tests, instead of requiring them to seek payment from the hospital outpatient department.” In fact, under the new policy the testing lab must bill for the applicable tests; the hospital can no longer bill Medicare directly for these tests.
In the final rule, CMS appeared to exclude some lab tests that now are included according to Transmittal 4000 – the final rule stated, “we are not including ADLTs under Criterion (B), GSP (genomic sequencing procedures) tests, PLA (proprietary laboratory analysis) tests, or protein-based MAAAs (multianalyte assays with algorithmic analyses) in the revised DOS policy at this time.” In CMS’s defense, I think they meant GSP, PLA, and MAAA laboratory tests that are conditionally packaged under OPPS. All ADLT and molecular pathology-type codes that are conditionally packaged laboratory tests codes under OPPS are not included in the new policy – only separately payable molecular path and ADLT test codes with an OPPS status indicator of “A” are included. As noted above, the transmittal includes a list of codes to which the policy applies –-
- CPTs 81105-81383, 81400-81408, 81410-81479, 81493, 81504, 81507, 81519–81528, 81540-81595, 0004M, 0006M–0009M, 0001U, 0004U, 0008U, 0010U, 0012U–0014U, 0016U–0019U, 0022U, and 0023U. (0004U was deleted effective January 1, 2018, but is included in Medicare’s listing.)
This new policy prevents hospitals from having to bill Medicare directly for these types of tests which encompassed accepting Medicare CLFS payment rates and paying a reference laboratory their charges to perform the tests. Under the new policy, Medicare pays the CLFS rate directly to the testing laboratory. Hospital labs will have to be aware of which tests fall under this policy (testing lab bills Medicare) and which do not (hospital lab bills Medicare directly). Also, hospitals must develop a process to provide the patients’ billing information to the testing lab in order for the testing lab to bill Medicare.
The transmittal is effective for dates of service on and after January 1, 2018, but the implementation date of the transmittal is not until July 2, 2018. I recommend hospitals proceed now with allowing the testing laboratory to bill for the applicable services. Should Medicare deny any payments prior to the implementation date, the transmittal allows for correction of the claim payment when brought to the Medicare contractor’s attention. Alternatively, testing labs may hold such claims until after the implementation date.
The challenge continues as we try to read between the lines, make our best guess, and remain prepared for CMS “clarifications” in order to code, bill and document correctly to meet Medicare guidelines. In my line of work, I guess this translates to job security.
Debbie Rubio
5/1/2018
We hope our readers find our articles helpful in understanding the ins and outs of dealing with Medicare. We provide the latest updates on Medicare issues and dig deep into the more complex or unclear topics. Did you know all of our prior articles can be found under the Knowledge Base tab on our website at www.mmplusinc.com ? This page includes a search function that allows viewers to search by title, category, text keyword or date. One of our most popular prior articles, based on internet search traffic, is the “type of bill” article from 2014. Today, we are rerunning a slightly revised version of that article as a reminder of exactly what a type of bill is and the appropriate TOB for the various types and settings of healthcare.
A ‘type of bill’ designation is required on the institutional uniform billing form known as a UB-04 or CMS-1450. Chapter 25 of the Medicare Claims Processing Manual, section 70.1 describes the form as:
“… a uniform institutional provider bill suitable for use in billing multiple third party payers. Because it serves many payers, a particular payer may not need some data elements. The National Uniform Billing Committee (NUBC) maintains lists of approved coding for the form. Medicare Administrative Contractors servicing both Part A and Part B lines of business (A/B MACs (A) and (HHH)) responsible for receiving institutional claims also maintain lists of codes used by Medicare.”
The type of bill goes in field (FL) 4 on the UB-04. Type of bill consists of four digits, the first digit being zero. This leading zero is ignored by Medicare for processing and is usually dropped when discussing bill types. The second digit identifies the type of facility and the third classifies the type of care being billed. For example, claims with a second digit of “1” are hospital claims, such as 011x or 013x.
The fourth digit of the TOB indicates the sequence of the bill for a specific episode of care as defined below:
- “0” indicates a non-payment/zero claim. For example, if a facility determines an inpatient admission is not medically necessary after discharge, they would first submit a no-pay/provider liable inpatient claim, a 110 TOB. After denial, they would then submit a Part B inpatient claim (TOB 121) to receive payment for the Part B services furnished.
- “1” is for an admit-through-discharge claim.
- “2” is the first interim claim in a series of claim when the patient is expected to remain in a facility for an extended period of time or is receiving outpatient recurring services, such as physical therapy.
- “3” is a continuing claim in a series of claims.
- “4” indicates the last claim in a series.
- “5” is used as the last digit for late charges only claims.
- “7” is a replacement claim to be used when a previously finalized claim needs to be rebilled entirely such as corrected or adjustment claims.
- “8” is used to cancel a claim.
There are some additional fourth characters for special providers such as hospice and home health.
As usual with Medicare, nothing is as straight forward as it seems. Be sure to read the Medicare manual and other resources to ensure you are using the type of bill codes correctly. For example, Medicare Claims Processing Manual, Chapter 1, section 50.2 discusses Frequency of Billing for Providers.
Debbie Rubio
4/24/2018
MEDICARE TRANSMITTALS
Adjustments to Qualified Medicare Beneficiary (QMB) Claims Processed Under CR 9911
Directs MACs to mass adjust QMB claims impacted by CR9911.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10494.pdf
April 2018 Integrated Outpatient Code Editor (I/OCE) Specifications Version 19.1 – REVISED
Revised to correct the status indicator for the drug code J0606 from SI=G to SI=K.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10514.pdf
April 2018 Update of the Hospital Outpatient Prospective Payment System (OPPS) - REVISED
Updated the number of drugs and biologicals with OPPS pass-through status effective April 1, 2018, from twelve to eleven and removed HCPCS code J0606, Injection, etelcalcetide, 0.1 mg, from Table 5, Attachment A in the CR since its status indicator remains "K" for the April update.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10515.pdf
Claims Processing Actions to Implement Certain Provisions of the Bipartisan Budget Act of 2018
Provides direction to MACs to reprocess claims related to several provisions of the Bipartisan Budget Act of 2018, specifically the Ambulance add-on payment provisions, the Work Geographic Practice Cost Index (GPCI) Floor, the 3% Home Health (HH) Rural Add-on Payment, and the repeal of outpatient therapy caps with requirement to submit the KX modifier for services in excess of the prior cap amounts.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10531.pdf
Institutional Billing for No Cost Items
Provides clarification of the billing instructions specific to drugs provided at no cost when claims processing edits prevent drug administration charges from being billed when the claim does not contain a covered/billable drug charge.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10521.pdf
New Waived Tests
New Clinical Laboratory Improvement Amendments of 1988 (CLIA) waived tests approved by the Food and Drug Administration (FDA).
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10586.pdf
Supervised Exercise Therapy (SET) for Symptomatic Peripheral Artery Disease (PAD) – REVISED
Clarifies that the SET program must be provided in a physician’s office (Place of Service code 11).
NOTE: MMP contacted CMS and was informed another revision of this CR would be forthcoming.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10295.pdf
Quarterly Update to the National Correct Coding Initiative (NCCI) Procedure-to-Procedure (PTP) Edits, Version 24.2 Effective July 1, 2018
Change in Type of Service (TOS) for Current Procedural Terminology (CPT) Code 77067
Corrects the TOS indicator assigned to CPT code 77067 – Screening Mammography to “1” instead of “4” to allow screening mammography claims to be billed without referring physician information on the claim, consistent with Medicare’s coverage policy for screening mammograms.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM10607.pdf
Notice of New Interest Rate for Medicare Overpayments and Underpayments - 3rd Qtr Notification for FY 2018
Medicare contractors shall implement an interest rate of 10.25 percent effective April 17, 2018 for Medicare overpayments and underpayments.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R303FM.pdf
Internet Only Manual Update to Pub 100-04, Chapter 16, Section 40.8 - Date of Service Policy
Updates the Date of Service (DOS) Policy for Clinical Laboratory and Pathology Specimens
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R4000CP.pdf
Quarterly Healthcare Common Procedure Coding System (HCPCS) Drug/Biological Code Changes – July 2018 Update
Quarterly update of drug/biological HCPCS codes.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNmattersArticles/downloads/MM10624.pdf
MEDICARE SPECIAL EDITION ARTICLES
Prohibition Billing Dually Eligible Individuals Enrolled in the Qualified Medicare Beneficiary (QMB) Program - REVISED
Updates information about the Remittance Advice (RA) and Medicare Summary Notice (MSN) for all Medicare Fee-For-Service (FFS) QMB claims and includes new statistics on the number of beneficiaries enrolled in QMB.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE1128.pdf
Proper Coding for Specimen Validity Testing Billed in Combination with Drug Testing
Reminds laboratories and other providers performing validity testing on urine specimens utilized for drug testing not to separately bill the validity testing.
https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE18001.pdf
MEDICARE COVERAGE UPDATES
Decision Memo for Magnetic Resonance Imaging (MRI) (CAG-00399R4)
Evidence is sufficient to conclude that magnetic resonance imaging (MRI) for Medicare beneficiaries with an implanted pacemaker (PM), implantable cardioverter defibrillator (ICD), cardiac resynchronization therapy pacemaker (CRT-P), or cardiac resynchronization therapy defibrillator (CRT-D) is reasonable and necessary. Will modify current NCD to eliminate the collection of additional information under the Coverage with Evidence Development paradigm.
https://www.cms.gov/medicare-coverage-database/details/nca-decision-memo.aspx?NCAId=289&TimeFrame=7&DocType=All&bc=AgAAYAAAQAAA&
OTHER MEDICARE UPDATES
New Proposed RAC Review Topics – April 2018
April 2018 proposed topics include:
- Exact Duplicate Claims
- Implantable Automatic Defibrillators
- Group 3 Support Surfaces
- Percutaneous Implantation of Neurostimulator Electrode Array
March Patients Over Paperwork Newsletter
New OIG Compliance Resource Portal
OIG launches new compliance resource portal that provides links to handy resources for the public that can help ensure that you are in compliance with Federal health care laws.
https://oig.hhs.gov/compliance/compliance-resource-portal/
4/17/2018
The Outpatient Prospective Payment System (OPPS) final rule is released each year around the first of November, and that only gives hospitals two months (during an already busy and short-staffed holiday season I might add) to implement the new requirements for the coming year. Sometimes this means beginning to make changes before final guidance and addenda are available – a good way to get a jump on necessary revisions. The caution for this approach is to be sure to check any additional guidance and revised addenda prior to implementation and make the necessary adjustments.
For example, the 2018 OPPS final rule required the reporting of modifiers for drugs purchased through the 340B drug discount program. Modifier JG is reported with separately payable drugs with a status indicator of “K” by most hospitals purchasing drugs through the 340B program. The JG modifier causes Medicare payment to be made at average sale price (ASP) minus 22.5%, instead of the ASP +6% that is paid for separately payable drugs not purchased through the 340B program and a few other exceptions. Modifier TB is reported on the applicable drugs by certain excepted types of providers (rural sole-community hospitals, children’s hospitals and cancer hospitals) and for pass-through drugs which have a status indicator of “G.” If your hospital proactively added the applicable modifiers to your chargemaster, did you remember to verify that the status indicator for each drug did not change for 2018?
In claim review, MMP has observed some drugs, whose status indicator changed from “G” in 2017 to “K” in 2018, being reported with the incorrect modifier. Status indicator “G” pass-through drugs purchased through the 340B program are reported with a TB modifier, but once their SI changes to “K” they are to be reported with a JG modifier resulting in a reduced drug payment. Below is a table of those drugs that had a status indicator of “G” for 2017 that changed to “K” for 2018.
Hospitals may want to verify again that the modifiers they are reporting for drugs purchased through the 340B program are correct and appropriate based on the drug’s OPPS status indicator. When billing Medicare, it is a good idea to check and double-check as things can change in an instant.
Debbie Rubio
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