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August 2004 Part B Medicare Bulletin

Table of Contents

• Arthroscopic Lavage and Arthroscopic Debridement for the Osteoarthritic Knee
• Bexxar® (Tositumomab and Iodine 131 Tositumomab) - LCD Article
• Centers for Medicare and Medicaid Services (CMS )Working to Improve Provider Enrollment Process
• Change to the Skilled Nursing Facility Consolidated Billing Edits for Ambulance Transports
• Clarification of Change Request 2631
• CMS Manual System - Payment to Bank
• Correction to CR 2944
• Elimination of Regulations for Written Statement of Intent
• Medicare Contractor Annual Update of the International Classification of Diseases
• MMA- Nurse Practitioners as Attending Physicians in the Medicare Hospice Benefit
• NCD Sensory Nerve Conduction Threshold Test (sNCTs)
• Notice of Exclusions from Medicare Benefits
• Progressive Corrective Action Review
• Quarterly Udpate to Correct Coding Initiative
• Update to the Correct Billing for New Technology Intraocular Lenses NTIOLs Furnished by Medicare

Arthroscopic Lavage and Arthroscopic Debridement for the Osteoarthritic Knee

Provider Types Affected
All Medicare physicians and providers

Provider Action Needed

STOP – Impact to You
Medicare has issued a national coverage determination (NCD) related to the arthroscopic lavage and arthroscopic debridement for the Osteoarthritic knee.

CAUTION – What You Need to Know
The Centers for Medicare & Medicaid Services (CMS) has issued an NCD stating that (1) arthroscopic lavage alone for treatment of osteoarthritis of the knee, (2) arthropscopic debridement for presentation of knee pain only, or (3) arthroscopic debridement and lavage with or without debridement, for patients with severe osteoarthritis of the knee are now nationally noncovered. All other indications of debridement for patients without severe osteoarthritis of the knee who present with symptoms other than pain alone are at the discretion of the Medicare contractor (carrier or intermediary).

GO – What You Need to Do
Be aware of this NCD and its impact on the services you provide.

Background
Arthroscopy is a surgical procedure that allows the direct visualization of the interior joint space. In addition to providing visualization, arthroscopy enables the process of joint cleansing through the use of lavage or irrigation. Lavage alone may involve either large or small volume saline irrigation of the knee by arthroscopy. Although generally performed to reduce pain and improve function, current practice does not recognize the benefit of lavage alone for the reduction of mechanical symptoms.

Arthroscopy also permits the removal of any loose bodies from the interior joint space, a procedure termed debridement. Debridement, when used alone or not otherwise specified, may include low-volume lavage or washout. Osteoarthritis is a chronic and painful joint disease caused by degeneration. The American College of Rheumatology defines a patient diagnosis of osteoarthritis of the knee as presenting with pain, and meeting at least five of the following criteria:

• Over 50 year of age;
• Less than 30 minutes of morning stiffness;
• Crepitus (noisy, grating sound) on active motion;
• Bony tenderness;
• Bony enlargement;
• No palpable warmth of synovium;
• ESR <40mm/hr;
• Rheumatoid Factor <1:40; and
• Synovial fluid signs.

Because the clinical effectiveness of arthroscopic lavage and arthropscopic debridement for the severe arthritic knee has not been verified by scientifically controlled studies and after thorough discussions with clinical investigators, the orthopedic community, and other interested parties, CMS issued this NCD.

In this NCD, CMS determines that the following procedures are not considered reasonable or necessary in treatment of the osteoarthritic knee and are not covered by the Medicare program:

• Arthroscopic lavage used alone for the osteoarthritic knee;
• Arthroscopic debridement for osteoarthritic patient presenting with knee pain only; or
• Arthroscopic debridement and lavage, with or without debridement, for patients presenting with severe osteoarthritis. Severe osteoarthritis is defined in the Outerbridge classification scale, grades III and IV.

Outerbridge is the most commonly used clinical scale that classifies the severity of joint degeneration of the knee by compartments and grade. Grade I is defined as softening or blistering of joint cartilage. Grade II is defined as fragmentation or fissuring in an area <1 cm. Grade III presents clinically with cartilage fragmentation or fissuring in an area >1 cm. Grade IV refers to cartilage erosion down to the bone. Grade III and IV are characteristic of severe osteoarthritis.

Other than the above noncovered indications for arthroscopic lavage and/or arthroscopic debridement of the osteoarthritic knee, all other indications of debridement for patients without severe osteoarthritis of the knee who present with symptoms other than pain alone, remain at the discretion of the local carrier or intermediary. In order to determine coverage in such cases, the carrier or intermediary may require submission of one or all of the following documents:

• Operative notes;
• Reports of standing x-rays; and/or
• Arthroscopy results.

Additional Information
This is a revision of Chapter 1 section 150.9 of Pub. 100-03, the Medicare National Coverage Determination Manual. The NCDs are binding on all Medicare carriers, fiscal intermediaries, quality improvement organizations, health maintenance organizations, competitive medical plans, and health care prepayment plans.

Under 42 CFR 422.256(b), an NCD that expands coverage is also binding on a Medicare+Choice Organizations. In addition, an administrative law judge may not review an NCD. (See 1869(f) (1) (A) (i) of the Social Security Act). To view the actual NCD issued by CMS, go to:
http://www.cms.hhs.gov/manuals/pm_trans/R14NCD.pdf

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Bexxar® (Tositumomab and Iodine 131 Tositumomab) - LCD Article

This article is to describe the method of payment for tositumomab (cold antibody) and I-131 labeled tositumomab (the radiopharmaceutical) when these agents are covered by the Medicare program. Currently, this regimen is approved only for treatment of patients with CD20+ follicular, non Hodgkins lymphoma with and without transformation, whose disease is refractory to rituximab, and has relapsed following chemotherapy. The Bexxar therapeutic regimen is administered in two separate steps: the dosimetric and the therapeutic. Each step consists of a sequential infusion of tositumomab followed by I-131 tositumomab.

The dosimetric step involves radionuclide scanning to determine the biodistribution of tositumomab. The procedure encompasses administration of radiolabeled tositumomab and whole body radionuclide scanning following administration of I-131 tositumomab. The purpose of the dosimetric dose is to determine individual pharmacokinetics and amount of radioactivity to be delivered in the therapeutic dose. Determining appropriate biodistribution involves making a qualitative comparison of isotope uptake in several organ systems between three scans taken over the seven days following the dosimetric administration of I-131 tositumomab. The therapeutic step is administered 7 - 14 days after the dosimetric step.

When Bexxar® is administered in the hospital outpatient setting it is paid under the Hospital OPPS. Please see the intermediary instructions for appropriate billing in those situations. Whether given in the hospital setting or ambulatory setting, the 78990, 78999 and 78800, 78803 codes are NOT to be used. Similarly, codes 79900, 79100, 79400 and 77750 are NOT to be used when billing for Bexxar® treatment.

If a physician furnishes Bexxar® to a Medicare beneficiary outside the hospital setting, the physician should bill using the following HCPCS codes:

1. Dosimetric/Diagnostic Regimen
   G3001 for the supply of tositumomab, 450mg, and administration of the tositumomab. G3001 can be billed for the dosimetric/diagnostic step only once.
   90780 for the infusion of I-131 tositumomab diagnostic
   A9533 for I-131 tositumomab diagnostic
   78804 Radiopharmaceutical localization of tumor or distribution of radiopharmaceutical agent(s); whole body, requiring two or more days imaging
2. Therapeutic Regimen
   G3001 for the supply of tositumomab, 450mg, and administration of the tositumomab. G3001 can be billed for the therapeutic regimen only once.
   A9534 for I-131 tositumomab therapeutic
   79403 Radiopharmaceutical therapy, radiolabeled monoclonal antibody by intravenous infusion
3. Dosimetric Calculation
   77300 should be used to bill for the dosimetric calculation. Only one 77300 will be paid per complete treatment course.

The radiopharmaceutical and the cold tositumomab will be paid at invoice, and the claim, if filed electronically, should have the actual invoice cost/invoice on file stated in the narrative field. If filing on paper, the invoice should accompany the claim, with the statement invoice attached in Box 19.

The claims for the Dosimetric/Diagnostic step should be submitted on one claim, the Therapeutic on another. Only one 78804 will be paid per complete treatment course of Bexxar®, regardless of the number of scans performed.
Services furnished after 7/1/03 but before 1/1/04 should be billed as above, but with G0273 instead of 78804 and G0274 instead of 79403.

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Centers for Medicare & Medicaid Services (CMS) Working to Improve Provider Enrollment Process

Provider Types Affected
All Medicare physicians and providers.

Provider Action Needed
This article is primarily for informational purposes, but providers want to be sure they understand the processes available to assist them when enrolling for Medicare or when updating their information with Medicare. This article deals mostly with problems carriers are having in processing new provider enrollment applications, changes in provider enrollment information, and applications for reassignment of payments by providers.

Background
For some time, providers have expressed concerns about the length of time it takes to enroll in Medicare and about the processes they must go through to accomplish that enrollment. CMS also has been concerned about ways to improve the process, while assuring it has the information needed to process claims correctly and the data needed to safeguard Medicare Trust Funds.

As a way to improve the overall infrastructure for the systems supporting the provider enrollment function, CMS launched a new national enrollment system, the Provider Enrollment and Chain/Ownership System, (PECOS). This system was implemented in July 2002 for Medicare fiscal intermediaries (FIs) and the process began rather smoothly for providers who deal with FIs.

On November 3, 2003, CMS implemented PECOS for carriers, extending the new process to physicians and other providers who interact with carriers. Unfortunately, the extension of PECOS to the carriers was considerably more problematic than the implementation for FIs. Some of the problems with the carrier implementation phase included the following:

• Some carriers were already facing backlogs of work in the enrollment area and the introduction of PECOS initially increased that backlog.
• The PECOS system and its supporting infrastructure were not as stable on the carrier side as on the FI side, mostly due to the much larger provider population on the carrier side, and a correspondingly higher volume of data and transactions.
• The interaction between PECOS and carrier systems was more problematic than the interaction between PECOS and FI systems.
• CMS may have underestimated the amount of time that carrier staff needed to train on the system and the carrier staff actually needed more training on the enrollment process itself in order to use PECOS effectively.

To compound these problems, CMS was operating under a continuing budget resolution in November 2003, which meant it had no budgetary authority to enable the carriers to hire temporary staff or to work significant amounts of overtime to handle the increased and problematic workloads. The result was that many providers trying to enroll with carriers or change their enrollment information encountered undue delays in processing their requests and this caused a significant problem for many providers. CMS regrets these problems and has been working aggressively with the carrier community to eliminate the bottlenecks.

Additional Information
As soon as CMS became aware of the problems, it took measures to resolve the issues. CMS’ actions included the following:

• An emergency team, led by a senior CMS manager, was formed to identify the specific problems, visit the carriers with the more significant backlogs, and to formulate solutions.
• In February 2004, CMS was able to provide fiscal year 2004 budget authority to the carriers and, more recently, CMS directed the carriers to identify funding needs and to hire temporary staff to reduce the backlogs and expedite processing of enrollment actions.
• Special work teams, consisting of CMS staff and staff from the CMS contractor that developed PECOS, have been formed to communicate with the carriers daily to resolve known problems and to surface new problems for resolution.
• CMS has directed the carriers to make some basic changes to their enrollment processes so initial screenings of enrollment actions are made early and missing information can be identified and obtained from providers more quickly than was previously done.
• CMS has directed the carriers to make other changes to streamline the overall enrollment process while preserving the integrity and accuracy of those processes.

CMS and the carriers believe these initial steps will result in significant improvements, but CMS is also aware that it will take some time to reduce the backlogs and bring stability to these processes. If any provider is facing a severe problem as a result of this situation, CMS encourages them to contact their carrier at the toll-free enrollment help line. These toll-free numbers may be found at:
http://www.cms.hhs.gov/providers/enrollment/contacts

In addition, CMS outlines some steps that providers can take to speed up the processes for their own transactions, such as the following:

• Providers are encouraged to be sure to submit complete and correct applications, including all necessary information.
• If your carrier contacts you for additional information, be ready to provide it promptly.
• When the carrier contacts you by letter for more information, be sure to reply by letter to the specific address listed in the communication to you.
• When contacted by phone, ask the carrier how best to get the information back to them, i.e., by phone, mail, e-mail, or fax.
• Use the pdf version of the enrollment application. This pdf form has built in edits that help eliminate basic errors. This form can also be found at: http://www.cms.hhs.gov/providers/enrollment/forms
• Remember that you need not complete an entire form to change an address. Complete only the portions required to effect the change.

CMS regrets the inconvenience and burden these problems have caused providers. It is not unusual to experience growing pains when new and improved computer systems are installed. Nonetheless, CMS appreciates that providers should expect prompt and correct processing of their transactions. CMS and the carriers are working aggressively to make that happen.

Eventually, providers will benefit from PECOS because the new system will make it much easier for providers to establish additional offices with Medicare or to enroll for multiple sites with Medicare.

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Clarification of Change Request 2631

Provider Types Affected
All physicians, nonphysician practitioners, and suppliers billing for services paid under the Medicare physician fee schedule and for anesthesia services.

Provider Action Needed
On August 1, 2003, the Centers for Medicare & Medicaid Services (CMS) released Change Request (CR) 2631 to enforce the carrier jurisdiction rules effective for claims with dates of service on or after April 1, 2004. The CR has resulted in some confusion and has generated a number of calls to carrier call centers. This article provides some further clarification and, hopefully, will eliminate the confusion.

Background
Medicare carriers process Part B fee-for-service claims for covered services furnished in specific
geographic areas (e.g., Florida). Services paid under the Medicare Physician Fee Schedule (MPFS) and anesthesia services are paid by the Medicare carrier with jurisdiction over the geographical area where the services are furnished. Jurisdiction is based on the zip code of the area where the service was rendered.

Physicians, suppliers, and group practices that provide physician fee schedule services at more than one office/practice location may submit their claims through one office to the carrier for processing. However, the specific location where the services are provided must be entered on the claim so that the correct jurisdiction and correct MPFS amount can be applied to the claim.

Effective for claims with dates of service on or after April 1, 2004, this applies to all places of service
(POS) except “home.” For POS “home,” the Medicare carriers will use the beneficiary address on file to determine geographical payment.

Electronic Claims
As reflected in the implementation guide of the 4010/4010A1 version of the ASC X12N 837 electronic claims format, it is acceptable for claims to contain the code for POS home and any number of additional POS codes. If different POS codes are used for services on the claim, a corresponding service facility location and address must be entered for each service at the line level, if that location is different from the billing provider, the Pay-To provider, or claim level service facility location.

Refer to the current implementation guide of the ASC X12N 837 to determine how information must be entered on a claim.

The following information is based on the implementation guide:

• On version 4010/4010A of the ASC X12N 837 electronic claim format, the Billing Provider loop 2010AA is required and must always be entered. If the Pay-To Provider Name and Address loop 2010AB is the same as the Billing Provider, only the Billing Provider must be entered. If no Pay-To Provider Name and Address is entered in loop 2010AB, and the Service Facility Location loop 2310D (claim level) or 2420C (line level) is the same as the Billing Provider, then only the Billing Provider must be entered.
• If the Pay-To Provider Name and Address loop 2010AB is not the same as the Billing Provider, both must be entered. If the Service Facility Location loop 2310D is not the same as the Billing Provider or the Pay-To Provider, the Service Facility Location loop 2310D (claim level) must be entered.
• When the same POS code and same service location address is applicable to each service line on the claim, the service facility location name and address must be entered at the claim level loop 2310D.
• If the POS code is the same for all services, but the services were provided at different addresses, each service must be submitted with line-level information. This will provide a zip code to price each service on the claim.

Paper Claims Submitted on the Form CMS-1500
It is acceptable for claims to contain POS “home” and an additional POS code. No service address for POS “home” needs to be entered in Item 32 in this situation because the address will be drawn from the beneficiary file and the information on the claim will apply to the other POS.

The specific name, address, and zip code of the location where the services were furnished must be
entered on the claim in Item 32. This applies even if the place of service is “office.” The zip code of
the address entered in Item 32 will be used to price the claim.

For carriers to be able to correctly determine where services were provided and pay correct locality rates, no more than one name, address, and zip code may be entered in Item 32 of the Form CMS-1500.

Assigned claims with more than one address entered in Item 32 will be rejected and unassigned claims will be denied.

If POS “home” and more than one additional POS code is entered, assigned claims will be rejected and unassigned claims will be denied.

Physicians, nonphysician practitioners, and suppliers that have had claims rejected or denied must resubmit the claims with the correct information entered in Item 32 in order to have the claims considered for payment.

Additional Information
To view CR2631, go to: http://www.cms.hhs.gov/manuals/pm_trans/R169CP.pdf

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Correction to CR 2944, Transmittal 90, Issued on February 6, 2004

Provider Types Affected
Physicians, suppliers, and providers

Provider Action Needed

STOP – Impact to You
Change Request (CR) 2944, Transmittal 90, issued on February 6, 2004, entitled “Implementation of Skilled Nursing Facility Consolidated Billing CWF Edit for Therapy Codes Considered Separately Payable Physician Services” incorrectly indicated that services provided in a noncovered skilled nursing facility stay are reimbursed through the prospective payment system.

CAUTION – What You Need to Know
This instruction corrects the business requirements of CR 2944 and the relevant Internet Only Manual (IOM). In addition, the associated Medlearn Matters article number MM2944 also was incorrect and will need to be reissued. Though this change is necessary, claims will be processed correctly according to the business requirements established in CR 2944 and CR 3156.

GO – What You Need to Do
Refer to the Background and Additional Information sections of this instruction for additional information regarding these changes.

Background
This instruction corrects Section 1B of the Business Requirements of CR 2944, Transmittal 90, issued on February 6, 2004, entitled “Implementation of Skilled Nursing Facility Consolidated Billing CWF Edit for Therapy Codes Considered Separately Payable Physician Services,” which incorrectly indicated that services provided in a noncovered skilled nursing facility stay are reimbursed through the prospective payment system.

Language contained in CR 2944 incorrectly indicated that services provided in a noncovered skilled nursing facility stay are both subject to consolidated billing and reimbursed through the prospective payment system. This instruction provides the corrected language (by removing the language indicating that the services are subject to the prospective payment system when provided to beneficiaries in a noncovered SNF stay) as follows:

“Physical, occupational, and speech therapy services are subject to consolidated billing when provided to beneficiaries in either a Part A covered skilled nursing facility (SNF) stay or during a noncovered stay. A small number of these services are considered surgery when performed by a physician and may be separately paid by the carrier. They are considered therapy when performed by a physical and occupational therapist and continue to be subject to consolidated billing.”

A complete list of the services affected by SNF consolidated billing can be found on the CMS Web site at: http://www.cms.hhs.gov/medlearn/snfcode.asp

Lastly, the Medlearn Matters article number MM2944 associated with CR 2944 was incorrect and will need to be reissued.

Also, note that even though this change is necessary to correct the concept, claims will be processed correctly according to the business requirements established in CR 2944 and CR 3156.

Implementation
The implementation date for this instruction is July 6, 2004.

Related Instructions
The Medicare Claims Processing Manual (Pub 100-4), Chapter 6 (SNF Inpatient Part A Billing) Section 110 (Carrier Claims Processing for Consolidated Billing for Physician and Nonphysician Practitioner Services Rendered to Beneficiaries in a SNF Part A Stay), Subsection 2.6 (Edit for Therapy Services Separately Payable When Furnished by a Physician) is being revised. The updated manual instructions are included in the official instruction issued to your carrier, and it can be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web site, look for CR3333 in the CR NUM column on the right, and click on the file for that CR. If you have any questions, please contact your carrier/intermediary at their toll-free number, which may be found at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf.

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Elimination of Regulations for Written Statement of Intent

Provider Types Affected
All Medicare Providers

Provider Action Needed

STOP – Impact to You
Effective with the claims filing period ending on December 31, 2004, and thereafter, Medicare will no longer accept Statements of Intent (SOIs) to extend the timely filing limit for filing initial claims.

CAUTION – What You Need to Know
Know the Medicare timely filing requirements for submitting claims. These requirements are in Chapter 1, Section 70 of the Medicare Claims Processing Manual, which may be found at:
http://www.cms.hhs.gov/manuals/104_claims/clm104index.asp

GO – What You Need to Do
To ensure accurate claims processing, please submit filings in a timely manner and make certain that you will no longer utilize SOIs.

Background
Medicare regulations at 42 CFR Part 424.45 allowed for the submission of written SOIs to claim Medicare benefits. The purpose of an SOI was to extend the timely filing period for the submission of an initial claim. An SOI, by itself, did not constitute a claim, but rather was used as a placeholder for filing a timely and proper claim.

A Final Rule published in the Federal Register, dated April 23, 2004, Volume 69, Number 79, pages 21963-21966, amended 42 CFR Part 424 by removing the SOI provision at 424.45, effective May 24, 2004.

Therefore, for the claims filing period ending on December 31, 2004, and all periods thereafter, Medicare carriers, intermediaries, and Medicare Regional Offices will no longer accept SOIs to extend the timely filing period for claims.

Additional Information
If you have questions regarding this issue, contact your carrier/intermediary at their toll-free number. You may find their number at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf

The official instruction issued to the carrier/intermediary regarding this change can be found online, referenced via CR 3310, at:
http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

On the above online page, scroll down while referring to the CR NUM column on the right to find the link for CR3310. Click on the link to open and view the file for the CR.

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MMA- Nurse Practitioners as Attending Physicians in the Medicare Hospice Benefit

Provider Types Affected
Nurse practitioners, hospices

Provider Action Needed

STOP – Impact to You
Nurse practitioners and hospices should note that nurse practitioners are being added to the definition of an attending physician for beneficiaries who have elected the hospice benefit.

CAUTION – What You Need to Know
Beginning December 8, 2003, Medicare pays for services provided by nurse practitioners to Medicare beneficiaries who have elected the hospice benefit and have selected a nurse practitioner as his/her attending physician.

GO – What You Need to Do
Refer to the Background and Additional Information sections of this instruction for more information regarding these changes.

Background
This instruction implements Section 408 of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA), which amends the Social Security Act (Section 1861(dd)(3)(B)) and (Section 1814(a)(7)) to include nurse practitioners to the definition of an attending physician for beneficiaries who have elected the hospice benefit.

Beginning December 8, 2003, Medicare pays for services, with the exception of certifying the terminal illness with a prognosis of 6 months or less, if the illness runs its usual course, provided by nurse practitioners to Medicare beneficiaries who have elected the hospice benefit and have selected a nurse practitioner as his/her attending physician. A physician will be required to certify the terminal illness and 6 month prognosis.

Hospice agencies will bill their RHHI for attending physician services performed by a nurse practitioner employed by or under contract to the hospice agency. Also, nurse practitioners providing attending physician services, who are not employed by or under contract with a hospice agency, will bill the Medicare Local Part B carrier.

Medicare Local Part B carriers and intermediaries will pay for these physician services rendered by nurse practitioners on or after December 8, 2003, at the lesser of actual charges or 85% of the physician fee schedule.

Instructions for care plan oversight for this provision will be provided under separate instruction.

Implementation Instructions/Dates
Medicare carriers have been instructed to search for and reopen denied claims for professional services of nurse practitioners serving as the hospice beneficiary’s attending physician that were billed with the GV modifier and where the services were furnished on or after December 8, 2003.

Where such services were not billed with the GV modifier, Medicare carriers will not reopen the claims unless the nurse practitioner brings such claims to the attention of the carrier. If the nurse practitioner prefers, they can rebill such services rendered on or after December 8, 2003 with the GV modifier in order to have the claims reprocessed.

Regional Home Health Intermediaries (RHHIs) will accept all claims for attending physician services performed by a nurse practitioner in a hospice on or after 12/8/03.

Hospice agencies are no longer required to submit copies of Notices of Election (NOEs) to Medicare carriers; however, when such agencies bill Regional Home Health Intermediaries (RHHIs), the hospice agency should continue submitting the NOEs to the RHHIs.

The implementation date for this instruction is June 28, 2004, for providers who bill Local Part B carriers.

For providers billing intermediaries, use of the GV modifier is also to be implemented on June 28, 2004, as presented in the Medicare Claims Processing Manual update in the transmittal, section 30.2, Form Locator (FL) 42, revenue code 0657.

Related Instructions
The following Internet Only Medicare Manuals (IOM) has been edited with revised and new sections to reflect the requirements to implement section 408 of the Medicare Prescription Drug Improvement and Modernization Act of 2003:

• The Medicare Claims Processing Manual (Pub. 100- 4), Chapter 11 (Processing Hospice Claims), and
• The Medicare Benefit Policy Manual (Pub. 100-2), Chapter 9 (Coverage of Hospice Services Under
  Hospital Insurance).

Additional Information
The official instruction (CR3226) issued to your carrier/intermediary regarding this change may be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web page, look for CR3226 in the CR NUM column on the right and click on the file for that CR. If you have any questions, please contact your carrier/intermediary at their toll-free number, which may be found at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf

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NCD: Sensory Nerve Conduction Threshold Test (sNCTs)

Provider Types Affected
Physicians, suppliers, and providers

Provider Action Needed
This instruction reaffirms the existing Medicare noncoverage policy on any type of Sensory Nerve Conduction Threshold Test (sNCT), and the device(s) used to perform the test, to diagnose sensory neuropathies or radiculopathies. This instruction constitutes a technical correction to previously issued Change Request (CR) 2988. CR2988 should be discarded and replaced with this instruction. CR2988 was issued on March 19, 2004.

Background
As a result of reconsideration, this instruction reaffirms the existing Medicare noncoverage policy on any type of Sensory Nerve Conduction Threshold Test (sNCT), and the device(s) used to perform the test, to diagnose sensory neuropathies or radiculopathies.

The revision to Section 160.23 of Pub. 100-03 is a National Coverage Determination (NCD), and NCDs are binding on all Medicare carriers, fiscal intermediaries, quality improvement organizations, health maintenance organizations, competitive medical plans, and health care prepayment plans. Under 42 CFR 422.256(b), an NCD that expands coverage is also binding on a Medicare Advantage Organization. In addition, an administrative law judge may not review an NCD. (See the Social Security Act, Section 1869(f)(1)(A)(i))

Note that this instruction constitutes a technical correction to previously issued Change Request (CR) 2988. CR2988 should be discarded and replaced with this instruction.

Implementation
The implementation date for this instruction is April 1, 2004.

Related Instructions
The updated manual instructions are also included in the official instruction issued to your carrier, and it can be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web site, look for CR3339 in the CR NUM column on the right, and click on the file for that CR.

If you have any questions, please contact your carrier/intermediary at their toll-free number, which may be found at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf.

Additional Information
The following is the revision to the Medicare National Coverage Determinations Manual, Pub. 100-03, Chapter 1 (Coverage Determinations), Section 160 (Nervous System), Subsection 160.23 (Sensory Nerve Conduction Threshold Tests (sNCTs). Revised sections are bolded and italicized.

Medicare National Coverage Determinations Manual Chapter 1 - Coverage Determinations
160 - Nervous System
160.23 - Sensory Nerve Conduction Threshold Tests (sNCTs)
160.23 - Sensory Nerve Conduction Threshold Tests (sNCTs)

1. General
   Sensory Nerve Conduction Threshold Tests (sNCT) is a psychophysical assessment of both central and peripheral nerve functions. It measures the detection threshold of accurately calibrated sensory stimuli. This procedure is intended to evaluate and quantify function in both large and small caliber fibers for the purpose of detecting neurologic disease. Sensory perception and threshold detection are dependent on the integrity of both the peripheral sensory apparatus and peripheral-central sensory pathways. In theory, an abnormality detected by this procedure may signal dysfunction anywhere in the sensory pathway from the receptors, the sensory tracts, the primary sensory cortex, to the association cortex.

This procedure is different and distinct from assessment of nerve conduction velocity, amplitude and latency. It is also different from short-latency somatosensory evoked potentials.

Effective October 1, 2002, CMS initially concluded that there was insufficient scientific or clinical evidence to consider the sNCT test and the device used in performing this test reasonable and necessary within the meaning of section 1862(a)(1)(A) of the law.

Therefore, sNCT was noncovered.

Effective April 1, 2004, based on a reconsideration of current Medicare policy for sNCT, CMS concludes that the use of any type of sNCT device (e.g. “current output” type device used to perform current perception threshold (CPT), pain perception threshold (PPT), or pain tolerance threshold (PTT) testing or “voltage input” type device used for voltage nerve conduction threshold (v-NCT) testing) to diagnose sensory neuropathies or radiculopathies in Medicare beneficiaries are not reasonable and necessary.

2. Nationally Covered Indications
   Not applicable.
3. Nationally Noncovered Indications
   All uses of sNCT to diagnose sensory neuropathies or radiculopathies are noncovered.
   (This NCD last reviewed June 2004.)

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Notice of Exclusions from Medicare Benefits [NEMB], Form CMS-20007

The Notice of Exclusions from Medicare Benefits (NEMB, form CMS-20007) is an optional form that the Centers for Medicare & Medicaid Services (CMS) developed to assist suppliers and providers in informing beneficiaries that the services they are receiving are excluded from Medicare coverage, because they do not meet the definition of a Medicare benefit or because they are specifically excluded by law. When an ABN is not appropriate for use because medical necessity is not the basis for the expected denial, an NEMB may be used.

There is an NEMB (form CMS-20007) for general use and other NEMBs customized for certain items and services.

The NEMB forms are available in English and Spanish on-line and can be accessed at the CMS Beneficiary Notices Initiative Web page at http://www.cms.hhs.gov/medicare/bni/.

Providers who choose to use the NEMB should prepare and deliver the form to the patient (Medicare beneficiary), or person acting on his or her behalf, when it is known that Medicare will not pay for, or will not continue to pay for, items or services on the basis of categorical statutory exclusions such as:

• Personal comfort items.
• Routine physicals and most tests for screening.
• Routine eye care, eyeglasses, and examinations.
• Hearing aids and hearing examinations.
• Cosmetic surgery.
• Dental care and dentures (in most cases).
• Routine foot care and flat foot care.
• Health care received outside of the USA.

Further instructions for the use of the NEMB form are located in Section 90 of Chapter 30 of the Medicare Claims Processing Manual (Pub. 100-4): http://www.cms.hhs.gov/manuals/104_claims/clm104c30.pdf

As a reminder, the use of the NEMB is strictly voluntary, as providers are not required to notify Medicare beneficiaries of Medicare program exclusions prior to rendering services. Nor are providers required to submit claims to Medicare for services that are statutorily excluded from coverage by the Medicare program.

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Progressive Corrective Action Review

Progressive Corrective Action (PCA) was developed by the Centers for Medicare & Medicaid Services (CMS) to conduct medical review through sampled claims to validate potential errors and to educate providers concerning the errors. The goal of PCA is to lower the error rate. PCA probe reviews may be conducted either on a prepayment or post payment basis.

A widespread post payment probe review was completed in June 2004 in Idaho for CPT code 99205*-Office or other outpatient visit for the evaluation and management of a new patient which requires these three key components, a comprehensive history, a comprehensive exam and medical decision making of high complexity.

One hundred (100) claims were reviewed for this probe review. Twenty (20) providers were selected based on their utilization of CPT codes 99205*. The calculated error rate for this probe review was 25.86%. 58 out of 100 claims were down-coded.

The errors that were identified in the course of the probe review of 99205* were lack of documentation of a complete review of systems in the history component, lack of documentation of a comprehensive examination, and/or the medical decision making component scored as less than high.

In order for a provider/supplier to bill CPT code 99205*, their documentation needs to have three key components. These components are a comprehensive history, a comprehensive examination, and high complexity medical decision making. A comprehensive history includes 4 or more elements of the history of the present illness, a complete (10 or more) review of systems and a complete past, family and social history. A comprehensive exam includes 8 or more of the 12 organ systems as defined by the 1995 Evaluation and Management Documentation Guidelines. If the provider/supplier chooses to utilize the 1997 E&M Documentation Guidelines, he/she should include at least nine organ systems or body areas. For each system/area selected, all elements of the examination identified by a bullet should be performed unless specific directions limit the content of the examination. For each area/system, documentation of at least two elements identified by a bullet is expected. Comprehensive single organ system examinations (specialty exams) should include performance of all elements identified by a bullet whether in a shaded or unshaded box. Documentation of every element in a shaded box and at least one element in an unshaded box is expected. High complexity medical decision making includes an extensive number of diagnoses or management options, an extensive amount and/or complexity of data to be reviewed, and/or high risk of complications and/or morbidity or mortality. The assessment of risk of the presenting problem(s) is based on the risk related to the disease process anticipated between the present encounter and the next one. The assessment of risk of selecting diagnostic procedures and management options is based on the risk during and immediately following any procedures or treatment. The highest level of risk in any one category-presenting problem(s), diagnostic procedure(s), or management option(s) determines the overall risk.

The 1995 and 1997 Evaluation and Management Documentation Guidelines can be found online at the CMS Web site at www.cms.hhs.gov/medlearn. The most recent updates to these guidelines can be found in Chapter 6 of the Medicare Resident and New Physician Guide. This chapter can be downloaded and printed from the CMS Web site. CIGNA Government Services utilizes either the 1995 or 1997 guidelines, whichever one benefits the provider the most.

** CPT codes, descriptors and other data only are copyright 2004 American Medical Association. All Rights Reserved. Applicable Federal Acquisition Regulation System (FARS) and Defense Federal Acquisition Regulation Supplement (DFARS) apply.

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Quarterly Update to Correct Coding Initiative (CCI) Edits, Version 10.2, Effective July 1, 2004

Provider Types Affected
Physicians

Provider Action Needed
This is a reminder for physicians to take note of the quarterly updates to the coding initiatives. The next round of Correct Coding Initiative (CCI) edits will be effective on July 1, 2004. Physicians can find the current CCI edits and the current Mutually Exclusive Code (MEC) Edits on the Centers for Medicare & Medicaid Services (CMS) Web site at: http://www.cms.hhs.gov/physicians/cciedits

The Web site will be updated with the Version 10.2 edits as soon as they are effective.

Background
The National Correct Coding Initiative developed by CMS helps to promote national correct coding methodologies and controls improper coding. The coding policies developed are based on coding conventions defined in the American Medical Association’s Current Procedural Terminology (CPT) manual, national and local policies and edits, coding guidelines developed by national societies, analysis of standard medical and surgical practice, and review of current coding practice.

The latest package of CCI edits, Version 10.2, is effective on July 1, 2004.

This version will include all previous versions and updates from January 1, 1996, to the present and will be organized in two tables: Column 1/Column 2 Correct Coding Edits and MEC Edits.

Additional Information
The CCI and MEC files will be maintained in the Internet Only Manual, Chapter 23, Section 20.9 which can be found at: http://www.cms.hhs.gov/manuals/104_claims/clm104index.asp

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CMS Manual System – Payment to Bank

Provider Types Affected
Providers and suppliers.

Provider Action Needed
Become familiar with the revised policy regarding Medicare payments to be sent to a bank in the name of a provider/supplier.

STOP
There is a change in the policy allowing Medicare to send a payment to an individual provider or supplier’s bank account for deposit.

CAUTION
If certain conditions are met, payments from Medicare to a provider or supplier may be sent to the provider’s bank (or similar financial institution) for deposit into the provider’s account. Please refer to the Background section for a review of these conditions.

GO
Follow these revised criteria if you want Medicare to deposit payments directly into your bank account.

Background
Medicare payments may be sent to a bank (or similar financial institution) to be deposited into a provider/supplier’s account so long as the following requirements are met:

• The bank may provide financing to the provider/supplier as long as the bank states in writing, in the loan agreement, that it waives its right of offset. (This allows the bank to lend money to the provider as well as deposit money from Medicare into the provider/supplier’s account.)
• The bank account is in the provider/supplier’s name and only the provider/supplier may issue
  instructions on that account.
• The bank should only be bound by the provider/supplier’s instructions.
• No other agreement that a provider/supplier has with a third party can have any influence on the account. In other words, if a bank is under a standing order from the provider/supplier to transfer funds from the provider/supplier’s account to the account of a financing entity in the same or another bank and the provider/supplier rescinds that order, the bank honors this rescission notwithstanding the fact that it is a breach of the provider/supplier’s agreement with the financing entity.
• Irrespective of the language in any agreement a provider/supplier has with a third party that is providing financing, that third party cannot purchase the provider/supplier’s Medicare receivables.

Additional Information
The official instruction issued to your carrier regarding this change may be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

Once at that web page, look for 3079 in the CR NUM column on the right and click on the file for that CR.

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Update to the Correct Billing for New Technology Intraocular Lenses NTIOLs Furnished by Medicare Approved Ambulatory Surgical Centers ASCs

Effective July 15, 2004, ASC facilities must bill the new technology intraocular lenses (NTIOLS) using two line items on form HCFA-1500. One line item must be for one of the following procedures: 66982, 66983, 66984, 66985, or 66986, whichever appropriately describes the surgical insertion procedure that was performed. In addition, a second line item must show whichever Medicare approved NTIOL was furnished, either Q1001 or Q1002. The $50 payment is per lens.

This policy has been in effect since May 18, 2000, however a short period of time was allowed for provider education on the correct billing of claims. Procedure code 66982 was effective after the May 18, 2000 implementation date and has been added to the list of eligible codes to receive the additional payment for the NTIOLs.

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Change to the Skilled Nursing Facility Consolidated Billing Edits for Ambulance Transports to and from a Diagnostic or Therapeutic Site other than a Hospital

Provider Types Affected
Skilled Nursing Facilities (SNF) and suppliers of ambulance services

Provider Action Needed

STOP – Impact to You
Your claim will be denied for ambulance transportation of a Medicare beneficiary in a Part A SNF stay to or from a diagnostic or therapeutic center other than a hospital.

CAUTION – What You Need to Know
Ambulance transports of beneficiaries in Part A SNF stays are considered to be paid as part of the SNF prospective payment system (PPS) rate, and may not be billed as Part B services to the carrier, except in specific instances. Effective October 1, 2004, your carrier has been instructed to deny your Part B claims for ambulance transports of your Medicare Part A residents to or from a diagnostic or therapeutic site other than a hospital (e.g., a non-hospital setting, such as an independent diagnostic testing facility (IDTF), or a freestanding cancer center, radiation therapy center, or wound care center).

GO – What You Need to Do
Make sure your billing staff are aware that, for beneficiaries in a Part A stay, a separate Part B claim for the ambulance transport of Medicare Part A residents to or from a diagnostic or therapeutic center other than a hospital will be denied.

Background
Section 4432(b) of the Balanced Budget Act (BBA) requires consolidating billing (CB) for SNFs. Under the CB requirement, the SNF must submit all Medicare claims for all the services its residents receive under Part A (except for certain excluded services). In addition, the SNF must also submit Medicare claims for all physical and occupational therapies, and speech-language pathology services its residents receive under Part B.

All Medicare-covered Part A services that are deemed to be within a SNF’s scope or capability are considered paid in the SNF PPS rate. As mentioned above, ambulance transports to or from diagnostic or therapeutic sites other than a hospital are considered paid in the SNF PPS rate and may not be billed as Part B services to the carrier.

In addition, please note that transport of beneficiaries in Part A stays from one SNF to another before midnight of the same day is also included in the SNF PPS rate and may not be billed separately as a Part B service. In this instance, payment is bundled in the first SNF’s PPS rate and it is responsible for the costs of the transport.

Please note that this change does not replace existing CB policies as they relate to Critical Access Hospitals (CAHs) and End-Stage Renal Disease (ESRD) facilities.

Additional Information
You can find additional material related to this CR on the CMS Website at: http://www.cms.hhs.gov/manuals/transmittals/cr_num_dsc.asp
From that web page, look for 3196 in the CR NUM column on the right, and click on the file for that CR.

Attached to that CR, you can find the revised Medicare manual pages for the Medicare Claims Processing Manual (Publication 100-4), Chapter 6, Section 20.3.1 – Ambulance Services, and Chapter 15, Section 30.2.3 – SNF Billing. These pages will provide further detail on this issue.

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Medicare Contractor Annual Update of the International Classification of Diseases

Provider Types Affected
Physicians, suppliers, and providers

Provider Action Needed

STOP – Impact to You
Medicare will soon issue the annual update of the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) to Medicare contractors. This update will apply for claims with service dates on or after October 1, 2004.

CAUTION – What You Need to Know
Remember that, as of October 1, 2004, Medicare no longer can provide a 90-day grace period for physicians, practitioners and suppliers to use in billing discontinued ICD-9-CM diagnosis codes.

GO – What You Need to Do
Be ready to use the updated codes on October 1, 2004. Refer to the Background and Additional Information sections of this article for further details regarding this instruction.

Background
This instruction is a reminder that Medicare carriers and intermediaries will use the annual International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) coding update effective for:

• Dates of service on or after October 1, 2004; and
• Discharges on or after October 1, 2004 for institutional providers.

The Centers for Medicare & Medicaid Services (CMS) has been evolving the use of ICD-9-CM codes as follows:

• Beginning in 1979, ICD-9-CM codes became mandatory for reporting provider services on Form CMS-1450.
• On April 1, 1989, the use of ICD-9-CM codes became mandatory for all physician services submitted on Form CMS-1500.
• Effective October 1, 2003, an ICD-9-CM code is required on all paper and electronic claims billed to Medicare carriers with the exception of ambulance claims (specialty type 59) (see Change Request (CR) 2725, dated June 6, 2003, at http://www.cms.hhs.gov/manuals/pm_trans/B03045.pdf).
• Effective for dates of service on and after October 1, 2004, CMS will no longer provide a 90-day grace period for physicians, practitioners and suppliers to use in billing discontinued ICD-9-CM diagnosis codes on Medicare claims. The Health Insurance Portability and Accountability Act (HIPAA) requires that medical code sets be date-of-service compliant, and ICD-9-CM diagnosis codes are a medical code set (see CR 3094 dated February 6, 2004, at http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/MM3094.pdf ).

Updated ICD-9-CM codes are published in the Federal Register in April/May of each year as part of the Proposed Changes to the Hospital Inpatient Prospective Payment System and are effective each October first. Physicians, practitioners, and suppliers must use the current and valid diagnosis code that is in effect beginning October 1, 2004.

After the ICD-9-CM codes are published in the Federal Register, CMS places the new, revised, and discontinued codes on the following Web site: http://www.cms.hhs.gov/medlearn/icd9code.asp

The update should be available at this site in June.

Implementation
The implementation date for this instruction is October 4, 2004.

Related Instructions
The Medicare Claims Processing Manual, Pub. 100-04, Chapter 23 (Fee Schedule Administration and Coding Requirements), Section 10.2 (Relationship of ICD-9-CM Codes and Date of Service) has been revised. The updated manual instructions are included in the official instruction issued to your carrier, and it can be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web site, look for CR3303 in the CR NUM column on the right, and click on the file for that CR. If you have any questions, please contact your carrier/intermediary at their toll-free number, which may be found at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf.

Additional Information
The new, revised, and discontinued ICD-9-CM diagnosis codes are posted annually on the following CMS Web site: www.cms.hhs.gov/medlearn/icd9code.asp

Providers can view the new updated codes at this Web site in June and providers are also encouraged to purchase a new ICD-9-CM book or CD-ROM on an annual basis.

In addition, the National Center for Health Statistics (NCHS) also will place the new ICD-9-CM Addendum on their Web site (www.cdc.gov/nchs/icd9.htm) in June, which is also available for providers to visit.

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