March 2010 - AACIWeb.com Healthcare Consulting
Contents
1. possibility of being an RRE what if you conclude that you are not an RRE and that you would not have anything to report Here is the comment from the User s Guide NGHP RREs that expect to have nothing to report are not required to register until such time as the RRE determines published CMS guidance establishes that the RRE will have claims to report However when they do have a reasonable expectation of having claims to report they must then register in enough time to allow a full calendar quarter for data transmission testing prior to sending production files Note that the process of registering and then testing the ability to transmit and receive the various files takes a significant amount of time Because you never quite know what kinds of situations might arise in the future you may want to register as a contingency just in case something happens that you didn t anticipate If you decide to take a minimalist approach then you may want to register and then use an agent to handle the entire computer related communications testing etc While there is some cost this may simplify the process See the Users Manual for more information on registering Here are the basic steps for registering Step 1 Identify an Authorized Representative Account Manager and Other COBSW Users Step 2 Determine Reporting Structure Step 3 RRE Registration on the COBSW New Registration See OIG Advisory Opinion 08 072. 1 The interpretation of the primary diagnosis is not as precise on the outpatient side as it is on the inpatient side The primary diagnosis on the 1500 claim form is the first diagnosis for an individual line item on the claim For hospital outpatient claims the principal diagnosis is the first diagnosis and goes into the principal diagnosis location on the UB 04 2 From time to time you should anticipate adjudication issues or even issues raised from your QIO Be prepared to fully analyze and justify your coding For example the DRG assignment can be affected by pre admission services and associated diagnosis coding through inclusion or exclusion 3 Whether the RACs Recovery Audit Contractors will address this pre admission window is yet to be answered Bottom Line Anticipate that you will need to address DRG Pre Admission Window concerns Be fully prepared to explain your position coding processes and the proper application of the CMS guidance in this area Here are the main citations 1 February 11 1998 Federal Register 2 Program Memorandum A 03 013 February 14 2003 3 Transmittal 1429 February 1 2008 4 42 CFR 412 2 5 Medicare Intermediary Manual 3610 3 Question If a patient is admitted as an inpatient and is discharged the next day before Utilization Review can check the case and it is determined after the fact that the case should have been an observation case what billing can we make Obvio
3. Transmittal 1803 August 28 2009 there are two paragraphs providing additional guidance concerning drugs biologicals and radiopharmaceuticals While the topic appears limited the language seems quite broad When billing for biologicals where the HCPCS code describes a product that is solely surgically implanted or inserted whether the HCPCS code is identified as having pass through status or not hospitals are to report the appropriate HCPCS code for the product In circumstances where the implanted biological has pass through status a separate payment for the biological is made In circumstances where the implanted biological does not have pass through status the OPPS payment for the biological is packaged into the payment for the associated procedure This statement appears logically consistent Unless the implanted or inserted biological has pass through status payment for the item is packaged Now CMS is quite clear on the charging and billing side in that hospitals are to report the appropriate HCPCS code for the product Page 14 Ya ABBEY amp ABBEY CONSULTANTS Inc Presumably this would include a charge based on costs using typical markup formulas Note that the instruction to report the HCPCS or CPT code means that the hospital is instructed to separately report or equivalently separately bill for the item While there is mixed language relative to payment and then also to charging billing everyt
4. Abbey amp Abbey Consultants Inc Medical Reimbursement Newsletter A Newsletter for Physicians Hospital Outpatient amp Their Support Staff Addressing Medical Reimbursement Issues March 2010 Volume 22 Number 3 APC APG Update Watch for any new guidance on APCs for the April 1 quarterly update Be certain to review both the APC transmittal and the I OCE transmittal There have been no indications of significant changes Be certain to review any changes or additions to the HCPCS coding system as well Also now is the time to start watching for the MS DRG proposed update for FY2011 MSP Mandatory Reporting Update The reporting date for NGHPs Non Group Health Plans has been moved out to January 1 2011 Apparently CMS has recognized that there are many unanswered questions and more guidance is needed Also Version 3 0 of the NGHP User s Manual was issued on February 25 2010 There are many changes and additions The main question for hospitals and other healthcare providers is whether or not the mandatory reporting does or could apply to them In other words is your hospital an RRE Responsible Reporting Entity under the MSP mandatory reporting Note If this reporting issue were simply a routine process then hospitals and healthcare providers would not worry unduly about the subtle issues that we are discussing However the penalties and fines in this area are horrendous and amount to 1 000 00 per day
5. June 27 2008 In this case the word payment is referring to not collecting from the patient which has the effect of paying the patient by not collecting Step 4 RRE Account Setup on the COBSW Account Manager Step 5 Return Signed RRE Profile Report Authorized Representative As you can probably tell even from this simple listing a significant bureaucracy has been developed to address this whole reporting process Be certain to carefully read the User s Guide that has now become several hundred pages long Editor s Note See a related article in the February issue of this Newsletter Also see the Questions from Our Readers section concerning situations in which the hospital forgives payment in certain cases that possibly might be construed to require reporting Supplies amp Devices Another Continuing Saga Issues surrounding supplies biologicals implants and devices never seem completely clear CMS continues to provide guidance that is often puzzling at least at face value One of the more recent sources of information has been the transmittals that update and clarify the APC payment system and the associated Integrated Outpatient Code Editor I OCE Note As we discuss some recent guidance from CMS keep in mind that packaging is a payment issue Hospitals are typically concerned about charging issues n theory these two concepts are separate but CMS tends to merge them in their discussions From
6. NG ISSUES Medicare Secondary Payer Part 3 wan More on RAC Audits and Issues a LPN CPC CCS Contributing Chargemaster Pricing Issues oo More on Coding Billing Compliance Contact Chris Smith for subscription information at 515 More on Payment System Interfaces 232 6420 Penny Reed RHIA ARM MBA Contributing Editor 2010 Abbey amp Abbey Consultants Inc Abbey amp Abbey Consultants Inc publishes this newsletter twelve times per year Electronic subscription is available at no cost Subscription inquiries should be sent to Abbey amp Abbey Consultants Inc Administrative Services P O Box 2330 Ames IA 50010 2330 The sources for information for this Newsletter are considered to be reliable Abbey amp Abbey Consultants Inc assumes no legal responsibility for the use or misuse of the information contained in this Newsletter CPT Codes 2010 2009 by American Medical Association ACTIVITIES amp EVENTS Schedule your Compliance Review for you hospital and associated medical staff now A proactive stance can assist hospitals and physicians with both compliance and revenue enhancement These reviews also assist in preparing for the RACs Worried about the RAC Audits Schedule a special audit study to assist your hospital in preparing for RAC audits Please contact Chris Smith or Mary J Wall at Abbey amp Abbey Consultants Inc for further information Call 515 232 6420 or 515 292 8650 E Mail Dua
7. any related services i e related to the inpatient admission provided in the window be included on the inpatient claim The key word is related Just what does this mean From the February 11 1998 Federal Register page 6866 We CMS note that we have defined services as being related to the admission only when there is an exact match between the ICD 9 CM diagnosis code assigned for both the preadmission services and the inpatient stay 63 FR 6866 This means that for therapeutic services to meet the relatedness criterion there must be an exact match between the principal diagnosis for the inpatient claim and the primary diagnosis for the outpatient services While such a match can occur the specificity of the principal diagnosis for the inpatient admission will tend to be greater than for the outpatient services For example a patient may present to a family practice provider based clinic with cough congestion and fever While the patient is treated two or three days later the patient may be admitted to the hospital and then a Note that the trigger for applying the DRG Pre Admission Window is owned or operated by the hospital While provider based clinics fall under this trigger your hospital may also have freestanding clinics that are owned or operated definitive diagnosis of pneumonia is developed Most likely the principal diagnosis and primary diagnosis will be different Notes
8. ents of AACI See CSmith aaciweb com for information Also Dr Abbey s ninth book The Chargemasier Coordinator s Handbook available from HCPro His tenth book Introduction to Healthcare Payment Systems is available from Taylor amp Francis Contact Chris Smith concerning Dr Abbey s books e Emergency Department Coding and Billing A Guide to Reimbursement and Compliance e Non Physician Providers Guide to Coding Billing and Reimbursement e ChargeMasier Review Strategies for Improved Billing and Reimbursement and e Ambulatory Patient Group Operations Manual e Outpatient Services Designing Organizing amp Managing Outpatient Resources e Introduction to Payment Systems is available from Francis amp Taylor A 20 discount is available from HCPro for clients of Abbey amp Abbey Consultants E Mail us at Duane aaciweb com Abbey amp Abbey Consultants Inc Web Page Is at http www aaciweb com http www APCNow com http www HIPAAMaster com Page 17 Ya ABBEY amp ABBEY CONSULTANTS Inc Abbey amp Abbey Consultants Inc Administrative Services Division P O Box 2330 Ames IA 50010 2330 EDITORIAL STAFF INSIDE THIS ISSUE APC APG Update Duane C Abbey Ph D CFP Managing Editor MSP Mandatory fencing Update2 More on Supplies and Devices Mary Abbey M S MPNLP Managing Editor Questions from our Readers FOR UPCOMI
9. er is currently being updated to Version 13 0 If you would like a copy of the updated paper please contact Duane aaciweb com Questions from Our Readers Question On Monday a Medicare patient presents to the ED after an automobile accident The ED services amount to 5 000 00 The automobile insurance is billed and eventually pays 3 000 00 In the meantime on Wednesday the same patient presents to the ED with an exacerbation of a chronic condition that is totally unrelated to the automobile accident The patient is admitted to the hospital using diagnosis codes that are different from the diagnosis codes relative to the accident Medicare pays for the inpatient admission However when submitting the Medicare secondary claim for the remaining 2 000 00 charges from the accident case the claim is being returned indicating that there is a violation of the DRG Pre Admission window What should we do The most immediate answer to this situation is to contact your FI or Part A MAC You will need to ask them to manually review the two claims Additionally you should be prepared to support your situation that the secondary claim is appropriate and not a part of the inpatient stay two days later This question really illustrates a major issue with filing a primary claim to one payer and then a secondary to Medicare Because the Medicare program has special claim filing requirements that the primary payer does not have a disconnect can rapid
10. hing appears logically consistent Now to the second paragraph When billing for biologicals where the HCPCS code describes a product that may either be surgically implanted or inserted or otherwise applied in the care of a patient hospitals should not separately report the biological HCPCS code with the exception of biologicals with pass through status when using these items as implantable devices including as a scaffold or an alternative to human or nonhuman connective tissue or mesh used in a graft during surgical procedures Under the OPPS hospitals are provided a packaged APC payment for surgical procedures that includes the cost of supportive items including implantable devices without pass through status When using biologicals during surgical procedures as implantable devices hospitals may include the charges for these items in their charge for the procedure report the charge on an uncoded revenue center line or report the charge under a device HCPCS code if one exists so these costs would appropriately contribute to the future median setting for the associated surgical procedure Amazingly this paragraph consists of three sentences The first two sentences tell us that implantable biologicals are not reported separately unless they are pass through items This means the HCPCS code is not included during the billing process Obviously a pass through item must be reported with an appropriate HCPCS and proper cha
11. ly arise As we go through an analysis of this particular case look for places where there may be ambiguity in proper claims filing Page 15 Ya ABBEY amp ABBEY CONSULTANTS Inc At issue in this question is the proper interpretation and application of the DRG Pre Admission Window This is sometimes called the 72 hour rule but this is really a misnomer The window is three dates of service before the patient s admission If the patient is admitted late in the day the number of hours could approach 96 hours Basically the guidance surrounding this window is that certain outpatient services provided during the window are to be included in the inpatient billing Alright so exactly which services must be included First of all the Medicare rules indicate that all diagnostic services related or not must be put on the inpatient claim During the first encounter in the ED there probably were some diagnostic tests performed Most likely these tests include laboratory and radiology services This means that for Medicare the laboratory and radiology from the first encounter should go onto the inpatient claim for the second encounter But now what about the primary payer for the ED services Should they not be billed for these diagnostic services Or perhaps we should simply remove the laboratory and radiology services when we file the secondary claim to Medicare for the first encounter Second the window requires that
12. ne aaciweb com Need an Outpatient Coding and Billing review Charge Master Review Concerned about maintaining coding billing and reimbursement compliance Contact Mary Wall or Chris Smith at 515 232 6420 or 515 292 8650 for more information and scheduling E Mail Duane aaciweb com Page 18
13. per case Any kind of a misstep could result in huge fines Here is the key definition from the User s Manual 42 U S C 1395y b 2 A provides that an entity that engages in a business trade or profession shall be deemed to have a self insured plan if it carries its own risk whether by a failure to obtain insurance or otherwise in whole or in part Self insurance or deemed self insurance can be demonstrated by a settlement ISSN 1061 0936 judgment award or other payment to satisfy an alleged claim including any deductible or co pay on a liability insurance no fault insurance or workers compensation law or plan for a business trade or profession See also 42 C F R 411 50 The phrase deemed self insurance is of importance Whenever words like deemed or imputed are used then situations that do not obviously apply suddenly come under scrutiny Now your hospital or clinic may overtly retain some liability relative to possible liability claims This may even be in the form of a retained deductible that you pay in connection with other liability payments Note From the perspective of the mandatory reporting for MSP it would be better if the healthcare provider paid the deductible to the insurance company and then had the insurance company make any payments to patients as claimants This way the insurance company bears the burden of being the RRE Now overt self insurance and or retention of some liability is easil
14. rge because the payment for the item will use the charge times the appropriate cost to charge ratio CCR as the payment Now the last sentence appears as more general guidance in which biologicals are a specific instance In the statement there are three ways to charge that are listed i Include charges for the item in the charges for procedure i e bundle the charges into the procedure ii Report the charge on an uncoded revenue center line i e Separately charge without HCPCS iii Report the charge under a device HCPCS code if one exists i e separately report or bill On the surface the third way to charge appears to contradict the guidance in the first sentence concerning not reporting i e not coding the biological While this statement is certainly open to interpretation the third alternative appears to apply to those situations in which the HCPCS must be reported to gain proper payment i e Status Indicator G H or K Of course this general guidance does not apply to the various supply and implantable items that have C codes such as stents pacemakers and the like These items must be reported with C codes and hopefully with meaningful charges i e charge appropriately based on costs These are all Status Indicator N so that payment is packaged Editors Note Abbey amp Abbey Consultants Inc has developed an ever lengthening position paper on supply categorization This pap
15. s that are underway hospitals and other healthcare providers must consider even remote possibilities Current Workshop Offerings Editor s Note The following lists a sampling of our publicly available workshops A link for a complete listing can be found at www aaciweb com JantoDecember2010EdCal htm On site teleconferences and Webinars are being scheduled for 2010 Contact Chris Smith at 515 232 6420 or e mail at CSmith aaciweb com for information A variety of Webinars and Teleconferences are being sponsored by different organizations Georgia Hospital Association Ohio Hospital Association Florida Hospital Association Instruct Online Texas Hospital Association and the Eli Research Group are all sponsoring various sessions Please visit our main website listed above for the calendar of presentations for CY2010 The Georgia Hospital Association is sponsoring a series of Webinars Presentations are planned for all of CY2010 For more information contact Carol Hughes Director of Distance Learning at 770 249 4541 or CHughes gha org The webinar scheduled for April 20 Physician Supervision for Provider Based Clinics that will run from 9 30 a m to 11 00 a m EST Dr Abbey s eighth book Compliance for Coding Billing amp Reimbursement a Systematic Approach to Developing a Comprehensive Program is now available This is the 2 Edition published by CRC Press ISBN 978156327681 There is a 20 discount for cli
16. us of the mandatory reporting under MSP Given the convoluted interpretations and logic trains of thought that are involved with current Medicare laws rules and regulations this kind of concern is justified to some degree This same logic can be applied to conditions that are not present on admission and develop during a hospital inpatient stay For these POA situations the MS DRGs will reduce the payment by not considering those conditions that were not present on admission Thus the hospital in some sense assumes financial liability for the services Because the hospital has assumed primary liability for these situations does that mean that Medicare is secondary While the issues of never events and not present on admission would not appear related to the mandatory reporting for MSP you should watch carefully for developments and future guidance Note As an exercise consider the logic used in this question and apply the same thought pattern to the preceding question That is take the fact that there was an inpatient stay for which the hospital takes responsibility due to not correctly classifying the stay Does taking this financial responsibility then mean anything to the hospital assuming liability for ongoing services relative to the conditions requiring the hospital stay Once again the application of this type of logic appears well outside any reasonable norm However given all of the fraud abuse and recoupment effort
17. usly we did not have the opportunity to use Condition Code 44 Can we bill this as a noncovered service There is not a great deal of guidance for this particular situation One document that does mention this situation is from AdminaStar Federal Inc In two page document entailed Hospital Guidelines for Outpatient Observation Services issued in December 2002 we have fa hospital determines after the patient s discharge that an inpatient admission was not medically necessary the inpatient admission should be billed provider liable aka no pay bil Page 16 Ya ABBEY amp ABBEY CONSULTANTS Inc Also Part B inpatient services that is ancillary services can be billed These generally are relatively minimal See CMS Publication 102 Medicare Benefit Policy Manual Chapter 6 10 Basically there is very little that a hospital can do in situations of this type other than absorb the costs Question When a never event occurs the Medicare program does not pay for the services and basically the hospital takes financial responsibility for the services Does this kind of situation fall under the MSP mandatory reporting requirements The hospital is taking responsibility that may even involve an ongoing liability In some cases there will be a liability settlement In other cases there could simply be a loss in payment There is no simple answer to this question given the current stat
18. y recognizable and you can make decisions about being an RRE as appropriate However what about the subtle situations in which you may be addressing patient dissatisfaction Let us join the Apex Medical Center for two situations that are creating concern about whether Apex is an RRE or not Case Study 1 The Apex Medical Center has a policy that if a patient including Medicare beneficiaries has a minor complaint slow service parking lot full rude employee etc that does not directly involve medical issues that gift certificates of either 25 00 or 50 00 can be provided While a formal legal opinion would be necessary this type of customer service arrangement would not appear to cause Apex to be an RRE and go through the process Page 13 a ABBEY amp ABBEY CONSULTANTS Inc of setting up reporting to the COB Coordinator of Benefits through the COBWS COB Website Case Study 2 The Apex Medical Center has worked extensively on policies of writing off deductibles and co payment based upon financial need This policy is for all patients including Medicare beneficiaries Many if not most hospitals and other healthcare providers have provisions for writing off deductibles and co payments under specific financial circumstances While this type of process would not appear to fall under any sort of liability payment be certain to watch for further guidance Under the assumption that you have analyzed the
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