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September 2004 Part B Medicare Bulletin

Table of Contents

• 3rd Quarter Update Part B Otherwise Classified Drug Fee Schedule
• Changes to the Laboratory NCD Edit Software for October 2004
• CIGNA Government Services to Begin Charging for Printed Version of Medicare Bulletin
• CMS Manual System-Payment to Bank
• Correct Billing for Durable Medical Equipment in an ASC
• Correction to a Previously Printed Article
• Coverage by Medicare Advantage Organizations for NCD Services Not Previously Included in Medicare Advantage's Capitated Rates
• CY 2005 Part B Fee Schedule and Participation Enrollment Material
• "Incident to" Services
• Instructions for Providing Supervisors Information
• Long Term Care Hospital Prospective Payment System - Revised Fact Sheets
• Medical Review Frequently Asked Questions-July 2004
• MMA - Clarification for CR 3064-(MSP) Policy for Hospital Reference Lab Services and Independent Reference Lab Services
• MMA-Implementation of Section 414 of the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003
• MMA-Skilled Nursing Facility Consolidated Billing and Services of Rural Health Clinics and Federally Qualified Health Centers
• Modifier Review
• MSN Messages for Mammography Claims
• October 2004 Quarterly Update of HCPCS Codes Used for SNF Consolidated Billing Enforcement
• OIG Alert About Charging Extra for Covered Services
• PCA Anesthesia Services with Colonoscopy - Article
• Procedures for Re-Issuance and Stale Dating of Medicare Checks
• Referral of Patients for X-rays by Chiropractors
• Rural Health Fact Sheets
• Skilled Nursing Facility Consolidated Billing
• Skilled Nursing Facility Consolidated Billing and Preventive/Screening Services
• Skilled Nursing Facility Consolidated Billing as it Relates to Certain Diagnostic Testing
• Skilled Nursing Facility Consolidated Billing as it Relates to Ambulance Services
• Skilled Nursing Facility Consolidated Billing and Erythropoietin (EPO, Epoetin Alfa) and Darbepoetin Alfa (Aranesp)
• Skilled Nursing Facility Consolidated Billing as it Relates to Certain Types of Exceptionally Intensive Outpatient Hospital Services
• Update to Claims Status Codes
• Vidaza™ (azacitidine for injectable suspension) (A21220)

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Changes to the Laboratory National Coverage Determination (NCD) Edit Software for October 2004

Provider Types Affected
Clinical Diagnostic Laboratories

Provider Action Needed

STOP – Impact to You
Laboratories must be aware of changes being made to the ICD-9-CM codes as part of the NCD Edit Software Update in October 2004.

CAUTION – What You Need to Know
These changes are necessary so that the lab edit module will appropriately process claims using the most current ICD-9-CM codes effective October 1, 2004. They also implement changes to the list of covered codes developed through the coding analysis public process.

GO – What You Need to Do
Adopt the new codes in your billing process effective October 2004 and begin using them for services on or after that time to assure prompt and accurate payment of your claim.

Background
The NCDs for clinical diagnostic laboratory services were developed by the laboratory negotiated rulemaking committee and published as a final rule on November 23, 2001. Nationally uniform software has been developed by Computer Sciences Corporation and incorporated in the Medicare’s claims processing systems so that laboratory claims subject to one of the 23 NCDs are processed uniformly throughout the nation effective January 1, 2003.

The laboratory edit module for the NCDs is being updated quarterly as necessary to reflect ministerial coding updates and substantive changes to the NCDs developed through the NCD process. (See Pub. 100-4, Chapter 16, §120.2.)

Implementation
This article describes upcoming changes to the list of codes associated with the 23 negotiated laboratory NCDs. Most of the changes are a result of new ICD-9-CM codes that become effective on October 1, 2004. A few changes are the result of coding analysis that were conducted through the public process announced in the December 24, 2003, Federal Register.

In accordance with the coding analysis the following laboratory services will have coding changes:

1. Deleting the following diagnosis codes from the list of “ICD-9-CM Codes Covered by Medicare” for the urine culture NCD:

• 584.5 Acute renal failure with lesion of tubular necrosis;
• 584.9 Acute renal failure, unspecified; and
• 586 Unspecified renal failure.

Coverage for these codes will terminate for services furnished on or after October 1, 2004.

2. Adding diagnosis code 729.81 Swelling of limb, to the list of “ICD-9-CM Codes Covered by Medicare” for the prothrombin time (PT) and partial thromboplastin time (PTT) NCDs. Coverage for this code will begin for services furnished on or after October 1, 2004.
3. Adding diagnosis code 600.01, Benign prostate hypertrophy with urinary obstruction, to the list of “ICD-9-CM Codes Covered by Medicare” for the prostate specific antigen (PSA) test NCD. Coverage for this code will begin for services furnished on or after October 1, 2004.

In order to accommodate the new ICD-9-CM coding changes that become effective on October 1, 2004, the Centers for Medicare & Medicaid Services (CMS) is making the following changes to the edit module.

These changes become effective for services furnished on or after October 1, 2004.

• CMS is adding new ICD-9-CM code 788.38 to the list of ICD-9-CM codes covered by Medicare for urine culture NCD.
• CMS is adding new ICD-9-CM codes 070.70, 070.71, 588.81, 588.89, V01.71, and V01.79 to the list of ICD-9-CM codes covered by Medicare for HIV testing (diagnosis). We are terminating coverage of ICD-9-CM codes V01.7 and 588.8 with services furnished on or after October 1, 2004.
• CMS is adding the following new ICD-9-CM codes to the list of ICD-9-CM codes that do not support medical necessity for the blood counts NCD: 521.06, 521.07, 521.08, 521.10-521.15, 521.20-521.25, 521.30-521.35, 521.40-521.42, 521.49, 524.07, 524.20-524.37, 524.39, 524.50-524.57, 524.59, 524.64, 524.75, 524.76. 524.81, 524.82, 524.89, 525.20-525.26, 618.00-618.05, 618.09, 618.81- 618.83, 618.89, 692.84, V72.40, and V72.41. We are removing the following ICD-9-CM codes that are no longer valid from that list: 521.1, 521.2, 521.3, 521.4, 524.2, 524.3, 524.5, 524.8, 525.2, 618.0, 618.8, and V72.4.
• CMS is adding the following new ICD-9-CM codes to the list of ICD-9-CM codes covered by Medicare for the partial thromboplastin time NCD: 070.70, 070.71, 453.40-453.42.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the prothrombin time NCD: 070.70, 070.71, 453.40-453.42, 530.86, and 530.87.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the serum iron studies NCD: 070.70 and 070.71.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the collagen crosslinks NCD: 252.00-252.02, and 252.08. We are removing ICD-9-CM code 252.0, which is no longer a valid code, from that list.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the blood
  glucose testing NCD: 491.22, 707.00-707.07, 707.09, and V58.67. We are removing ICD-9-CM code 707.0, which is no longer a valid code, from that list.
• CMS is adding new ICD-9-CM code V58.67 to the list of covered diagnoses for glycated hemoglobin.
• CMS is adding new ICD-9-CM codes to the list of covered diagnoses for the lipid testing NCD: 588.81, and 588.89. We are removing ICD-9-CM code 588.8, which is no longer a valid code, from that list.
• CMS is adding new ICD-9-CM codes to the list of covered diagnoses for the digoxin therapeutic drug assay NCD: 588.81, and 588.89. We are removing ICD-9-CM code 588.8, which is no longer a valid code, from that list.
• CMS is adding new ICD-9-CM code 273.4 to the list of covered diagnoses for alpha-fetoprotein.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the gamma glutamyl transferase NCD: 070.70, 070.71, 252.00- 252.02, 252.08, 273.4, 453.40-453.42, 588.81, and 588.89. We are removing ICD-9-CM code 252.0 and 588.8, which are no longer valid codes, from that list.
• CMS is adding the following new ICD-9-CM codes to the list of covered diagnoses for the hepatitis panel NCD: 070.70 and 070.71.
• CMS is adding new ICD-9-CM code V58.66 to the list of covered diagnoses for the fecal occult blood test.

Related Instructions
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. From that Web page, look for CR3358 in the CR NUM column on the right, and click on the file for that CR.

Additional Information
The Health Insurance Portability and Accountability Act (HIPAA) requires that medical code sets must be date-of-service compliant. Since ICD-9-CM is a medical code set, effective for dates of service on and after October 1, 2004, CMS will no longer provide a 90-day grace period for providers to use in billing discontinued ICD-9-CM diagnosis codes on Medicare claims.

The 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 Systems in Table 6 and effective each October 1.

Carriers and DMERCs must eliminate the ICD-9-CM diagnosis code grace period from their system effective with the October 1, 2004, update. Carriers and DMERCs will no longer accept discontinued diagnosis codes for dates of service October 1 through December 31 of the current year. Claims containing a discontinued ICD-9-CM diagnosis code will be returned as unprocessable.

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.

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MMA - Clarification for CR3064 - Medicare Secondary Payer (MSP) Policy for Hospital Reference Lab Services and Independent Reference Lab Services

Provider Types Affected
Hospitals, Critical Access Hospitals (CAHs), and Independent Reference Laboratories

Provider Action Needed

STOP – Impact to You
Hospitals are no longer required to collect MSP information where there is no face to face encounter with a beneficiary because independent reference laboratories no longer need the information to bill Medicare for reference laboratory services.

CAUTION – What You Need to Know
This clarification of CR3064 and Medlearn Matters article MM3064 provides additional information regarding preparation of the CMS-1500 claims form. Compliance with this instruction will help assure prompt and correct processing of reference laboratory claims.

GO – What You Need to Do
Affected providers should ensure that billing staff enter “None” in block 11 of the CMS-1500 when filing claims to Medicare for reference laboratory services when there is not a face-to-face encounter with the Medicare beneficiary.

Background
Section 943 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) mandates that:

“(T)he Secretary shall not require a hospital (including a critical access hospital) to ask questions (or obtain information) relating to the application of section 1862(b) of the Social Security Act (relating to Medicare Secondary Payer provisions) in the case of reference laboratory services described in subsection (b), if the Secretary does not impose such requirement in the case of such services furnished by an independent laboratory.”

Prior to the enactment of MMA, hospitals were required to collect MSP information every 90 days in order to bill Medicare for reference lab services.

Further, those providers billing carriers are reminded to enter “None” in Block 11 of the CMS-1500 claims form for reference laboratory services in order to bill Medicare for the reference laboratory services, as described in Section 943(b).

Additional Information
Because of these policy changes, Medicare intermediaries have been instructed not to include claims for reference laboratory services, as described in Section 943(b) of MMA, in the sample of claims that are reviewed during MSP hospital audits. This is effective for reference laboratory service claims with dates of service of December 8, 2003, and later.

To view the actual instruction issued to your carrier/intermediary, go to:
http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

Once at that site, scroll down the right hand CR NUM column to CR3267 and click on the link for that CR.

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

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Correction to a Previously Printed Article

CIGNA Government Services inadvertently posted an article on July 27, 2004, entitled, “Update to the Medicare Drug Payment Limits for J1000 and J9045.” This article has been removed from the CIGNA Government Services Web site and should be disregarded if already viewed. Further instruction regarding this issue is forthcoming.

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Coverage by Medicare Advantage Organizations for National Coverage Determination (NCD) Services Not Previously Included in Medicare Advantage’s Capitated Rates

Provider Types Affected
Physicians, providers, and suppliers billing for the services mentioned below

Provider Action Needed

STOP – Impact to You
Medicare Advantage (MA) rates were recently adjusted to account for three NCD services. These services are implantable automatic defibrillators (effective 10/1/03), ventricular assist devices (effective 1/1/04), and lung volume reduction surgery (effective 1/1/04). MA organizations are liable for payment for these NCD services beginning January 1, 2005.

CAUTION – What You Need to Know
For services rendered prior to January 1, 2005, payment for services relating to the three NCD services mentioned above are paid by Medicare on a fee for service basis for MA plan enrollees. Note that prior to January 1, 2005, beneficiaries are not responsible for Part A or Part B deductibles associated with these services, although they are responsible for coinsurance amounts appropriate under Medicare fee for service rules.

GO – What You Need to Do
Be aware that these services will not be paid on a fee for service basis on or after January 1, 2005. Instead, the MA plan will be responsible for making payment. Note also that MA enrollees receiving services for lung volume reduction surgery services must receive these services in designated hospitals.

Background
When Medicare issued these NCDs initially, new coverage was introduced and the cost of that coverage was not reflected in the rates paid to MA plans. Thus, Medicare paid for these services separately on a fee for service basis until such time as the cost could be considered in determining MA rates. The Centers for Medicare & Medicaid Services (CMS) will factor these costs into the MA payment rates as of January 1, 2005. At that time, Medicare will no longer pay for these services on the fee for service basis.

Additional Information
Procedure codes associated with these services are reflected in the following table:

Procedure Codes	Description
32491	Removal of lung, other than total pneumonectomy; excision plication of emphysematous lung(s) (bullous or non-bullous) for lung volume reduction, sternal split, or transthoracic approach, with or without any pleural procedure
33975	Implantation of VAD, single ventricular support
33976	Implantation of VAD biventricular support
G0302	Preoperative pulmonary surgery services for preparation for LVRS, complete course of services to include a minimum of 16 days of service
G0304	Preoperative pulmonary surgery services for preparation for LVRS, 1- 9 days of services
G0305	Post-discharge pulmonary surgery services after LVRS, minimum of 6 days of services
Inpatient Procedure Codes	Description
G0302	Preoperative pulmonary surgery services for preparation for LVRS, complete course ofservices to include a minimum of 16 days of service
G0304	Preoperative pulmonary surgery services for preparation for LVRS, 1-9 days of services
G0305	Post-discharge pulmonary surgery services after LVRS, minimum of 6 days of service ICD-9 CM 37.66 Implant of an implantable, pulsatile heart assist system

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

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CY2005 Part B Fee Schedule and Participation Enrollment Material

Each year CIGNA Government Services conducts an open enrollment period in order to provide eligible physicians with the opportunity to make their calendar year Medicare participation decision by December 31. In order to facilitate enrollment each year, CIGNA Government Services delivers this information, along with the Part B fee schedule, to all Medicare providers in Idaho, North Carolina, and Tennessee.

CMS has asked CIGNA Government Services, along with all other Part B carriers, to furnish the Part B fee schedule and participation enrollment information for CY2005 on CD-ROM rather than printed format. With a pilot program launched last year, CMS saw a cost savings associated with producing this information on CD-ROM and very positive feedback from the provider community.

The CD-ROM is less expensive to produce and mail than the printed format, and it also has the ability to furnish providers with supplemental information that would not be mailed otherwise, including archived issues of the Part B Medicare Bulletin, HIPAA information, and general Provider Enrollment information. All of the items on the CD -ROM, including the fee schedules, can also be easily printed and distributed throughout the office.

The CD-ROM, which is expected to be delivered to all providers by mid-November, will include an order form in the envelope for those providers unable to use the CD-ROM on their computer system. Please note: You do not need Internet access to view the contents of the CD-ROM. No pre-orders will be accepted. Additional information will be made available in future editions of the Medicare Bulletin, through the CIGNA Government Services Web site (www.cignamedicare.com), and through CIGNA Government Services ListServ announcements.

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Correct Billing for Durable Medical Equipment in an ASC

The list of codes below are covered by Part B, which means also payable to an ASC. However, when billing for these codes, do not append the ASC modifier (SG). The SG modifier is to be used only for approved ASC procedures assigned by CMS. If claims are filed by an ASC provider, they are to be billed under the ASC’s provider number with no modifier (SG) appended. Appending the SG modifier causes the claim to deny incorrectly as an invalid code.

A4561		L7500
A4562		L7520
A7042		L8499
A7043		L8600
E0616		L8603
E0749		L8606
E0752		L8610
E0754		L8612
E0756		L8613
E0757		L8614
E0758		L8619
E0759		L8630
E0781		L8631
E0782		L8641
E0783		L8642
E0785		L8658
E0786		L8659
E1340		L8670
E1399

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MMA-Implementation of Section 414 of the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003

Note: This is a re-release of this article to reflect the changes made in the re-release of the CR3079. The changes are shown in this article as red print and are italicized.

Providers Affected
All Ambulance services including volunteer, municipal, private, independent, and institutional providers such as hospitals, critical access hospitals and skilled nursing facilities.

Provider Action Needed
STOP – Impact to You
The new Medicare Prescription Drug, Improvements, and Modernization Act of 2003 (MMA) makes a number of important changes to Medicare payment for ambulance services rendered on or after July 1, 2004.

CAUTION – What You Need to Know
During the five-year period, July 1, 2004-December 31, 2009 Fee Schedule will include certain temporary increases in payment.

GO – What You Need to Do
Make sure your billing staff understands the new changes and bill according to those changes to assure receipt of accurate payment.

Background
The MMA provides several changes to the payment for ground ambulance services under Section 414 of the Act. Specifically, this section establishes a floor amount for the fee schedule portion of the payment, provides increased payments for urban and rural services, adds an increased payment for ambulance transports originating in certain low density population areas, and provides a 25 percent bonus on the mileage rate for ground transports of 51 miles or greater. These payment changes apply to ground transports only and the air ambulance base and mileage rates remain unchanged. All increases are percentage increases and are cumulative.

More details on these changes are as follows:
Regional Ambulance FS Payment Rate Floor for Ground Ambulance Transports
To discuss these changes further, we begin with the provision regarding the regional ambulance fee Schedule (FS) payment rate floor for ground transport services. For services furnished during the period of July 1, 2004, through December 31, 2009, the base rate portion of the payment under the ambulance FS for ground transports is subject to a minimum amount. This minimum depends upon the area of the country in which the service is furnished.

Basically, the country is divided into 9 census divisions and each of those divisions has a regional FS that is constructed using the same methodology as the national FS. Where the regional FS is greater than the national FS, the base rates for ground ambulance transports are determined by a blend of the national FS rate and the regional rate in accordance with the following schedule:

Year	National FS Percentage	Regional FS Percentage
7/1/04-12/31/04	20%	80%
CY 2005	40%	60%
CY 2006	60%	40%
CY 2007–CY 2009	80%	20%
CY 2010 and thereafter	100%	0%

Where the regional rate is not greater than the national rate, there is no blending and only the national FS amount applies.

Adjustment to the Ground Mileage Payment Amount for Miles Greater than 50
For services furnished during the period July 1, 2004 through December 31, 2008, a 25 percent increase is applied to the appropriate ambulance FS mileage rate for each mile of a transport (both urban and rural points of pickup (POP) that exceeds 50 miles (i.e., 51 miles or greater) when the beneficiary is onboard the ambulance.

The 50 percent increase applied to the rural ambulance FS mileage rate for the first 17 miles of a rural Point of Pickup (POP) continues to apply as it always has under the FS.

For services furnished during the period January 1, 2004 through June 30, 2004, for all ground miles greater than 17 miles, the FS rate equals the urban mileage rate per mile.

Adjustments for FS Payment Rate for Certain Rural Ground Ambulance Transports
For services furnished during the period July 1, 2004 through December 31, 2009, there is a 22.6 percent increase in the FS portion of the base payment for ground ambulance services in low population density rural areas. This increase applies where the POP is in a rural county (or Goldsmith Area) that is comprised by the lowest quartile by population of all such rural areas arrayed by population density. These rural areas are identified by a zip code with a “B” indicator on the national zip code file.

Adjustments for FS Payment Rates for Ground Ambulance Transports
The payment rates under the FS for ground ambulance transports (both the FS base rates and the mileage amounts) are increased for services furnished during the period of July 1, 2004, through December 31, 2006. For services furnished where the POP is urban, the rates are increased by 1 percent and for services furnished where the POP is rural, the rates are increased by 2 percent.

The following chart summarizes the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 payment changes for ground ambulance services that becomes effective on July 1, 2004:

This chart will give you the increase percentage on miles, along with the effective dates of service	Effective Dates	Payment Increase*
All rural miles	7/1/04 - 12/31/06	2%
Rural miles 51+	7/1/04 - 12/31/08	25% **
All urban miles	7/1/04 - 12/31/06	1%
Urban miles 51+	7/1/04 - 12/31/08	25% **
All rural base rates	7/1/04 - 12/31/06	2%
Rural base rates (lowest quartile)	7/1/04 - 12/31/09	22.6%**
All urban base rates	7/1/04 - 12/31/06	1%
All base rates (regional fee schedule blend)	7/1/04 - 12/31/09	Floor (regional fee schedule blend)

Note: * All payments are percentage increases and all are cumulative.
**Carrier/intermediary systems perform this calculation. All other increases are incorporated into the Medicare Ambulance FS file. However, carriers and intermediaries will continue to apply the applicable FS and reasonable charge/cost blended percentages to determine the payment rates through December 31, 2005, in accordance with the rules of the transition period.

Additional Information
Reimbursement for ambulance services will be based on two blended amounts. First, the FS portion of the payment is based on a blend of the national and regional FS amounts. Second, the FS portion is then blended with the reasonable charge/reasonable cost portion during the transition period.

For further information, you may wish to view the actual re-released instruction issued to your Medicare contractor.

That instruction can be seen at:
http://www.cms.hhs.gov/manuals/pm_trans/R220CP.pdf

Important Dates
These changes will sunset on different dates but all apply beginning with services furnished on July 1, 2004.

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“Incident to” Services

Provider Types Affected
All Medicare providers of professional services

Provider Action Needed
None. This article is for your information only. It clarifies when and how to bill for services “incident to” professional services.

Background
The intent of this article is to clarify “incident to” services billed by physicians and non-physician practitioners to carriers. “Incident to” services are defined as those services that are furnished incident to physician professional services in the physician’s office (whether located in a separate office suite or within an institution) or in a patient’s home.

These services are billed as Part B services to your carrier as if you personally provided them, and are paid under the physician fee schedule.

Note: “Incident to” services are also relevant to services supervised by certain non-physician practitioners such as physician’s assistants, nurse practitioners, clinical nurse specialists, nurse midwives, or clinical psychologists. These services are subject to the same requirements as physician-supervised services. Remember that “incident services” supervised by non-physician practitioners are reimbursed at 85% of the physician fee schedule. For clarity’s sake, this article will refer to “physician” services as inclusive of nonphysician practitioners.

To qualify as “incident to,” the services must be part of your patient’s normal course of treatment, during which a physician personally performed an initial service and remains actively involved in the course of treatment. You do not have to be physically present in the patient’s treatment room while these services are provided, but you must provide direct supervision; that is, you must be present in the office suite to render assistance, if necessary. The patient record should document the essential requirements for incident to service.

More specifically, these services must be all of the following:

• An integral part of the patient’s treatment course;
• Commonly rendered without charge (included in your physician’s bills);
• Of a type commonly furnished in a physician’s office or clinic (not in an institutional setting); and
• An expense to you.

Examples of qualifying “incident to” services include cardiac rehabilitation, providing non-self-administrable drugs and other biologicals, and supplies usually furnished by the physician in the course of performing his/her services, e.g., gauze, ointments, bandages, and oxygen.

The following paragraphs discuss the various care settings, which are important to note because the processes for billing vary somewhat depending on the care site.

Your Office
In your office, qualifying “incident to” services must be provided by a caregiver whom you directly supervise, and who represents a direct financial expense to you (such as a “W-2” or leased employee, or an independent contractor).

You do not have to be physically present in the treatment room while the service is being provided, but you must be present in the immediate office suite to render assistance if needed. If you are a solo practitioner, you must directly supervise the care. If you are in a group, any physician member of the group may be present in the office to supervise.

Hospital or SNF
For inpatient or outpatient hospital services and services to residents in a Part A covered stay in an SNF, the unbundling provision (1862 (a)(14) provides that payment for all services are made to the hospital or SNF by a Medicare intermediary (except for certain professional services personally performed by physicians and other allied health professionals). Therefore, “incident to” services are not separately billable to the carrier or payable under the physician fee schedule.

Offices in Institutions
In institutions including SNFs, your office must be confined to a separately identifiable part of the facility and cannot be construed to extend throughout the entire facility. Your staff may provide service incident to your service in the office to outpatients, to patients who are not in a Medicare covered stay or in a Medicare certified part of an SNF. If your employee (or contractor) provides services outside of your “office” area, these services would not qualify as “incident to” unless you are physically present where the service is being provided. One exception is that certain chemotherapy “incident to” services are excluded from the bundled SNF payments and may be separately billable to the carrier.

In Patients’ Homes
In general, you must be present in the patient’s home for the service to qualify as an “incident to” service. There are some exceptions to this direct supervision requirement that apply to homebound patients in medically underserved areas where there are no available home health services, only for certain limited services found in Pub 100-02. Chapter 15 Section 60.4 (B). In these instances, you need not be physically present in the home when the service is performed, although general supervision of the service is required. You must order the services, maintain contact with the nurse or other employee, and retain professional responsibility for the service. All other incident to requirements must be met.

A second exception applies when the service at home is an individual or intermittent service performed by personnel who meet pertinent state requirements (e.g., nurse, technician, or physician extender), and it is an integral part of the physician’s services to the patient.

Ambulance Service
Neither ambulance services nor EMT services performed under your telephone supervision are billable as “incident to” services.

Additional Information
To provide additional clarity, we present the following scenarios:

Must a supervising physician be physically present when flu shots, EKGs, Laboratory tests, or Xrays are performed in an office setting in order to be billed as “incident to” services? These services have their own statutory benefit categories and are subject to the rules applicable to their specific category. They are not “incident to” services and the “incident to” rules do not apply.

Can anti-coagulation monitoring be provided “incident to” a physician’s services in an office?
Yes, if the requirements are met; i.e., the services are part of a course of treatment during which the physician personally performs the initial service and is actively involved in the course of treatment; is physically present in the immediate office when services are rendered by the employee; and the service represents an expense to the physician or other legal entity that bills for the service.

If the treating physician (Doctor X) refers a patient to an anti-coagulation monitoring clinic, can Doctor X bill these services as “incident to?” No, because the services are not being provided by an employee under supervision of Doctor X.

Can the supervising physician (Doctor Y) at the anti-coagulation monitoring clinic (a physician group) bill the services as “incident to” if Doctor Y directly supervises those services at the clinic?
No, because Doctor Y is not treating the patient for the underlying condition. However, If Doctor Y receives a referral from Dr. X, and Dr. Y performs an initial evaluation of the patient and then orders and supervises the services, they may be billed by Doctor Y incident to her initial service.

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

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Instructions for Providing Supervisor’s Information When a Service Incident to the Ordering Physician Is Supervised by Another Physician in the Group

Provider Types Affected
Physicians and non-physician practitioners

Provider Action Needed
Physicians and non-physician practitioners should note that this instruction clarifies that the supervisor’s identification is required on a claim when a service performed incident to the service of one physician or non-physician practitioner is supervised by another member of the same group. It instructs how to report ordering physician and supervising physician information on the electronic claim form.

Background
The preamble of the proposed rule for the Medicare Physician Fee Schedule on November 1, 2001 (66 Fed Reg. 55267) stated:

“The billing number of the ordering physician (or other practitioner) should not be used if that person did not directly supervise the auxiliary personnel.”

This rule was included by the Centers for Medicare & Medicaid Services (CMS) to give instructions for providing the supervisor’s information on the CMS paper claim form (CMS-1500). Details regarding how to complete the paper claim form 1500 can be found in the Medicare Claims Processing Manual, Publication 100-04, Chapter 26 (Completing and Processing Form CMS-1500 Data Set), Section 10.4 (Items 14-33 - Provider of Service or Supplier Information). This CMS manual can be found at the following CMS Web site: http://www.cms.hhs.gov/manuals/104_claims/clm104index.asp

The requirement for direct supervision of a service incident to a physician or non-physician practitioner is not satisfied unless there is a specific physician or non-physician practitioner responsible for the supervision of the billed service. If more than one person supervises a service, the one who had the responsibility for the major part of the service should be identified on the claim. The claim is paid at the rate appropriate to the supervisor (at 85% if the supervisor is a non-physician practitioner).

This transmittal provides instructions in cases in which the electronic claim form is used. When filing electronic claims with incident to services, supply the:

• Ordering physician information for each line of service in the loop 2420E; and Supervising physician information in loop 2310E.
• If the supervising physician information differs for a specific detail line, supply that detail line supervising physician information in loop 2420D.

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

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

From that Web page, look for CR3242 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 at their toll-free number, which may be found at: http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf

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MMA-Skilled Nursing Facility Consolidated Billing and Services of Rural Health Clinics and Federally Qualified Health Centers

Provider Types Affected
Skilled Nursing Facilities (SNFs), physicians, Rural Health Clinics (RHC), and Federally Qualified Health Centers (FQHCs).

Provider Action Needed
This Special Edition is an informational article that describes SNF Consolidated Billing (CB) as it applies to services provided by RHCs and FQHCs.

Background
When the SNF Prospective Payment System (PPS) was introduced in 1998, it changed not only the way SNFs are paid, but also the way SNFs must work with suppliers, physicians, and other practitioners. Consolidated Billing (CB) places with the SNF itself the Medicare billing responsibility for virtually all of the services that the SNF’s residents receive during the course of a covered Part A stay.

Payment for this full range of services is included in the SNF PPS global per diem rate. The only exceptions are those services that are specifically excluded from this provision, which remain separately billable to Medicare Part B by the entity that actually furnished the service. For a detailed overview of SNF CB and a list of the services excluded from SNF CB, see Medlearn Matters Special Edition SE0431 at: http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0431.pdf.

RHC and FQHC services currently do not appear on the list of services that are excluded from the SNF CB requirement. Consequently, when a SNF resident receives RHC or FQHC services during a covered Part A stay, the services are bundled into the SNF’s comprehensive per diem payment for the covered stay itself, and are not separately billable to Part B. This means that rather than submitting a separate bill to Part B for these services, the RHC or FQHC looks to the SNF for its payment.

However, Section 410 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA, P.L. 108-173) has amended the law to specify that when an SNF’s Part A resident receives the services of a physician (or another type of practitioner that the law identifies as being excluded from SNF consolidated billing) from an RHC or FQHC, those services would not become subject to CB merely by virtue of being furnished under the auspices of the RHC or FQHC.

In effect, the amendment enables such services to retain their separate identity as excluded “practitioner” services in this context, rather than being considered bundled “RHC” or “FQHC” services. As such, these services remain separately billable to Part B when furnished to an SNF resident during a covered Part A stay. The MMA specifies that this provision becomes effective with services furnished on or after January 1, 2005.

Additional Information
See Medlearn Matters Special Edition SE0431 for a detailed overview of SNF CB. This article lists services excluded from SNF CB and can be found at:
http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0431.pdf.

Also, the Centers for Medicare & Medicaid Services (CMS) Medlearn Consolidated Billing Web site can be found at: http://www.cms.hhs.gov/medlearn/snfcode.asp

It includes the following relevant information:

• General SNF consolidated billing information;
• HCPCS codes that can be separately paid by the Medicare carrier (i.e., services not included in consolidated billing);
• Therapy codes that must be consolidated in a non- covered stay; and
• All code lists that are subject to quarterly and annual updates and should be reviewed periodically for the latest revisions.

The SNF PPS Consolidated Billing Web site can be found at: http://www.cms.hhs.gov/providers/snfpps/cb

It includes the following relevant information:

• Background;
• Historical questions and answers;
• Links to related articles; and
• Links to publications (including transmittals and Federal Register notices).

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Modifier Review

As you can well imagine, CIGNA Government Services receives many inquiries each and every day. Some of the inquiries come to us in the mail or others through our call center. Still more come through our appeals department. We track these inquiries to identify trends and problem areas. In the public relations department, we look for training opportunities through these identified problem areas.

This column has been created to address these identified issues, and provide training to you to help streamline your claim submissions. Submitting claims correctly the first time will save you time, money, and frustration. In addition, administrative costs are saved to the Medicare program by reducing the workload by avoiding unnecessary reviews and corrected claims.

Modifiers
Modifier -24 (unrelated E&M service by the same physician during a postoperative period)
A provider may need to indicate that an evaluation and management service was performed during a postoperative period for a reason(s) unrelated to the original procedure. This circumstance may be reported using modifier -24 to the appropriate E&M service.

Modifier -25 (Significant, separately identifiable E&M service by the same physician on the same day of procedure or other service)
Coverage may be allowed for a visit on the same day as a minor surgical procedure, only if a separately identifiable E&M service (above and beyond the usual pre- and postoperative services) is provided on the day of the procedure.

Modifier -51 (Multiple Procedures)
When multiple procedures, other than E/M services, are performed at the same operative session by the same provider, the primary procedure may be reported as listed. The additional procedure(s) or service(s) may be identified by appending modifier 51 to the additional procedure or service. Submit the highest reimbursed code without modifier -51 and append -51 to the remainder of the codes that are billed.

Modifier -54 (Surgical care only)
When one physician performs a surgical procedure and another provides preoperative and/or postoperative management, the surgical services should be identified by appending modifier -54 to the surgical procedure code.

Modifier -55 (Postoperative management only)
When one physician performs the postoperative management and another physician has performed the surgical procedure, the postoperative component should be identified by appending modifier -55 to the surgical procedure code.

Modifier -57 (Decision for major surgery)
An evaluation and management service that resulted in the initial decision to perform the surgery should be identified by appending modifier -57.

Modifier -59 (Distinct Procedural Service)
Under certain circumstances, the physician may need to indicate that a procedure or service was distinct or independent from other services performed on the same day. This may represent a different session or patient encounter, different procedure or surgery, different site or organ system, separate incision/excision, or separate injury. Modifier 59 is used with Correct Coding Initiative (CCI) and commercial coding combinations when applicable. An evaluation and management service that resulted in the initial decision to perform a surgery should be identified by appending modifier -57.

Modifier -76 (Repeat procedure by the same physician)
When the same procedure or service is repeated by they same physician subsequent to the original service (separate operative session) append modifier 76 to the procedure code. Report the procedure once and then report again with the modifier 76 on an additional line (two line items). This modifier is a review modifier requiring records to be reviewed each time it is submitted with a procedure.

Modifier -77 (Repeat procedure by another physician)
Refer to explanation for modifier -76.

Modifier -78 (Return to the operating room for a related procedure during the postoperative period due to complications)
The physician may need to indicate that another procedure was performed during the postoperative period of the initial procedure. When the subsequent procedure is related to the first, and requires the use the operating room, modifier -78 should be appended to the related procedure code.

Modifier -79 (Unrelated procedure or service by the same physician during the postoperative period)
The physician may need to indicate that the performance of a procedure or service during the postoperative period was unrelated to the original procedure. This circumstance should be reported by appending modifier -79 to the procedure code.

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MSN Messages for Mammography Claims

Provider Types Affected
Providers and suppliers who bill for mammography services.

Provider Action Needed
Suppliers and providers should note that this article discusses changes in Medicare Summary Notice (MSN), which are sent to Medicare beneficiaries, and Remittance Advice messages and related situations where both film and digital screening mammography or film and digital diagnostic mammography are performed on the same day.

Background
Screening mammography tests can be performed by both film and digital technology. Because of this, some suppliers/providers have assumed the annual frequency rule did not apply in situations where both a film and digital screening is performed. That is not the case, however; Medicare will only pay for one screening test annually, whether performed by film or digital technology. Additionally, Medicare will pay only once for a screening test for a woman between the ages of 35 and 39. Further, Medicare will only pay for one mammography diagnostic test per day, not two.

The revised manual instructions include Medicare Claims Processing Manual updates regarding which Medicare Summary Notice (MSN) message and ANSI X-12 8351 Adjustment Reason Code will be used on the Remittance Advice when Medicare denies a claim based on film and digital screening or film and digital diagnostic mammography services performed on the same day.

Currently, there are no established comparable MSN messages that can be used to explain why the claim is being denied. Without these new messages, beneficiaries would receive very general messages for denial of claims. The new MSN Messages are to be used when both film and digital screening mammography or film and digital diagnostic mammography has been performed on the same day. The Spanish translation for each new MSN messages has also been added to the revised manual.

Remittance Advice Messages
For providers/suppliers who bill carriers, the remittance advice messages will be as follows:

• If the claim is denied because two screening mammographies were performed on the same day, the claim will be denied with reason code A1 “Claim Denied Charges,” along with remark code M90 “Not covered more than once in a 12 month period.”
• If the claim is denied because two diagnostic mammographies were billed on the same day, the claim is denied with reason code A1 “Claim Denied Charges,” along with remark code M63 “Service denied because payment already made for same/ similar procedure within set timeframe.”
• For claims submitted by a facility not certified to perform digital mammographies, the remittance advice will contain reason code B6 “This payment is adjusted when performed/billed by this type of provider, by this type of provider in this type of facility, or by a provider of this specialty,” along with remark code N92 “This facility is not certified for digital mammography.”
• For claims that were submitted with an invalid or missing FDA identification number, use existing reason code 16 “Claim/service lacks information which is needed for adjudication,” along with remark code MA128 “Missing/incomplete/invalid six digit FDA approved identification number.”

Implementation
The implementation date of these changes is September 25, 2004.

Related Instructions
The Medicare Claims Processing Manual (Pub 100-4), Chapter 18 (Preventive and Screening Services), Section 20 (Mammography Services), Subsection 20.8 (Beneficiary and Provider Notices), Subsubsections 20.8.1 (MSN Messages) and 20.8.2 can be found on the CMS Web site at: http://www.cms.hhs.gov/manuals/104_claims/clm104index.asp

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

From that Web page, look for CR2617 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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October 2004 Quarterly Update (HCPCS) Codes Used For Skilled Nursing Facility (SNF) Consolidated Billing Enforcement

Provider Types Affected
Institutional providers billing claims to the Medicare Fiscal Intermediaries (FIs).
Physicians, practitioners, and suppliers billing Medicare carriers for services Provider Action Needed

STOP – Impact to You
HCPCS codes are being added to or removed from the SNF consolidated billing enforcement list.

CAUTION – What You Need to Know
Services included on the SNF consolidated billing enforcement list will be paid to SNF Medicare providers only. Services excluded from the SNF consolidated billing enforcement list may be paid to Medicare providers other than SNFs. See Background and Additional Information sections for further explanation.

GO – What You Need to Do
Be aware of the requirements explained below and how they can impact your Medicare payment.

Background
The Centers for Medicare & Medicaid Services (CMS) periodically updates the list of HCPCS codes that are subject to the consolidated billing provision of the SNF Prospective Payment System (SNF PPS).

Services appearing on this list submitted on claims to Medicare Fiscal Intermediaries (FIs) and Carriers, including Durable Medical Equipment Regional Carriers (DMERCs) will not be paid to any Medicare providers, other than a SNF, when included in SNF consolidated billing.

For non-therapy services, the SNF consolidated billing applies only when the services are furnished to a SNF resident during a covered Part A stay. However, the SNF consolidated billing applies to physical, occupational, or speech-language therapy services whenever they are furnished to a SNF resident, regardless of whether Part A covers the stay. Services excluded from the SNF consolidated billing may be paid to providers, other than SNFs, for beneficiaries, even when in a SNF stay.

Section 1888 of the Social Security Act codifies SNF PPS and consolidated billing. The new coding identified in each update describes the same services that are subject to SNF PPS payment by law. No additional services will be added by these routine updates. New updates are required by changes to the coding system, not because the services subject to the SNF consolidated billing are being redefined.

Other regulatory changes beyond code list updates will be noted when and if they occur.

The codes below are listed as being added or removed from the annual update, mentioned above. Deletions from Major Category I F. below, specifically HCPCS code 36489, is being removed because the HCPCS was discontinued as of December 31, 2003. additions to what is noted as Major Category III below means these services may be provided by any Medicare provider licensed to provide them, except a SNF, and are excluded from SNF PPS and consolidated billing. Additions to therapy inclusions, Major Category V below, mean SNFs alone can bill and be paid for these services when delivered to beneficiaries in a SNF, whereas codes being removed from this therapy inclusion list now can be billed and potentially paid to other types of providers for beneficiaries NOT in a Part A stay or in a SNF bed receiving ancillary services billed on TOB 22x.

Outpatient Surgery and Related Procedures (Major Category I F., FI Annual Update, INCLUSION)

Remove 36489 – placement of cv catheter

Note on Code above:

Code discontinued effective December 31, 2003.

Customized Prosthetic Devices (Major Category III, FI Annual Update, EXCLUSION)

For FI claims processing, remove K0556*, K0557*, K0558*, K0559* - Addition to lower extremity, below knee/above knee, custom fab. For carrier claims processing, these codes will remain payable for dates of service prior to January 1, 2004.

Add L5673** - addition to lower extremity, below knee/above knee, custom fabricated from existing mold or prefabricated, socket insert, silicone gel, elastomeric or equal, for use with locking mechanism

Add L5679** - addition to lower extremity, below knee/above knee, custom fabricated from existing mold or prefabricated, socket insert, silicone gel, elastomeric or equal, not for use with locking mechanism

Chemotherapy Administration (Major Category III, FI Annual Update, EXCLUSION)

Remove 36489*** - placement of cv catheter

Notes on Codes above:
* Codes were replaced by L5673, L5679, L5681 and L5683.
** Codes are added to exclusion list retroactive to 1/1/04.
*** Code discontinued effective 12/31/03.

Therapies (Major Category V, FI Annual Update, for FI billing use revenues codes 42x (physical therapy), 43x (occupational therapy), 44x (speech-language pathology)

Remove G0295^ Electromagnetic stimulation, to one or more areas (Not covered by Medicare) (This code was not previously included on carrier coding files.)

Remove G0237^^ - Therapeutic procd strg endur
Remove G0238^^ - Oth resp proc, indiv
Remove G0239^^ - Oth resp proc, group
Remove G0302^^ - pre-op LVRS service
Remove G0303^^ - pre-op service LVRS 10-15dos
Remove G0304^^ - pre-op service LVRS 1-9dos
Remove G0305^^ - post-op service LVRS min 6dos

Add G0329 ^^^– electromagnetic therapy, (unattended), to one or more areas, for chronic stage III and stage IV pressure ulcers, arterial ulcers, diabetic ulcers, and venous stasis ulcers not demonstrating measurable signs of healing after 30 days of conventional care, as part of a therapy plan of care

Notes on Codes above:
^ This code was erroneously added to file. Code was not previously included on carrier coding files.
^^ These codes are not considered therapy codes and are not payable to a SNF. They were
inadvertently added to the table.
^^^ This code was added to the therapy inclusion list effective July 1, 2004. (Information concerning this code was not received in time to issue a July 2004 update.)

Additional Information
Each January, separate instructions are published for FIs, Carriers and DMERCs for the annual notice on the SNF consolidated billing. The 2004 Annual Updates for FIs can be found on the CMS Web site at: www.cms.hhs.gov/manuals/pm_trans/R19CP.pdf

This instruction is referred to as CR2926.

Overall information regarding SNF CB can be found at: http://www.cms.hhs.gov/medlearn/snfcode.asp

Quarterly updates now apply to FIs, Carriers and DMERCs. There has been one joint FI/Carrier/DMERC quarterly update published subsequent to the 2004 Annual Updates. This update can be found at: www.cms.hhs.gov/manuals/pm_trans/R92CP.pdf

That instruction is also known as CR3070.

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

From that Web page, look for CR3348 in the CR NUM column on the right, and then click on the file for that CR.

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OIG Alert about Charging Extra for Covered Services

Provider Types Affected
Physicians, suppliers, and providers

Provider Action Needed
Participating physicians, suppliers, and providers who consider charging Medicare patients additional fees should be mindful that they are subject to civil money penalties if they request any payment for already covered services from Medicare patients other than the applicable deductible and coinsurance.

Background
On March 31, 2004, the Office of the Inspector General (OIG) issued an Alert that focused on physicians charging extra for services covered by Medicare. The Alert noted that these extra contractual charges beyond Medicare’s deductible and coinsurance constituted a potential assignment violation.

In the Alert, the OIG reminded Medicare participating physicians of the potential liabilities posed by billing Medicare patients for services that are already covered by Medicare. Charging extra fees for already covered services abuses the trust of Medicare patients by making them pay again for services already paid for by Medicare.

Medicare participating providers can charge Medicare beneficiaries extra for items and services that are not covered by Medicare. In addition, participating providers may charge beneficiaries for any Medicare deductibles and coinsurance without violating the terms of their assignment agreements.

However, when participating providers request added payment for covered services from Medicare patients, they are liable for substantial penalties and exclusion from Medicare and other Federal health care programs. The special services for added payment are known by various names and may include “concierge care,” “boutique medicine,” “retainer practice,” or “platinum practice.”

For example, the OIG recently alleged that a physician violated his assignment agreement when he offered his patients, including Medicare beneficiaries, a “Personal Health Care Medical Care Contract” that required payment of an annual $600 fee. The physician characterized the services to be provided under the contract as “not covered” by Medicare, and the services offered under this contract included:

• Coordination of care with other providers;
• A comprehensive assessment and plan for optimum health; and
• Extra time spent on patient care.

The OIG alleged that based on the specific facts and circumstances of this case, at least some of these contracted services were already covered and reimbursable by Medicare. Therefore, OIG alleged that each contract presented to this physician’s Medicare patients constituted a request for payment for already covered services, other than the coinsurance and deductible, and was therefore a violation of the physician’s assignment agreement. To resolve these allegations, the physician agreed to pay a settlement amount to the OIG, and to stop offering these contracts to his patients.

Participating physicians, suppliers, and providers who consider charging Medicare patients additional fees are reminded that they are subject to civil money penalties if they request any payment for already covered services from Medicare patients other than the applicable deductible and coinsurance.

Note that a participating provider is a provider of Medicare covered items and services who agrees to accept the Medicare-approved charge for all covered services to Medicare patients. A participating provider “accepts assignment” for all Medicare-payable services.

Also note that non-participating providers may also be subject to penalties and exclusion for overcharging beneficiaries for covered services. This is true whether the provider accepts assignment for a given service or not, in which case the provider’s charge is limited to the “limiting charge.”

Related Instructions
The Physicians Information Resource for Medicare Web site is extensive and includes information about Medicare Participation, Participating Physician Directory, Policies and Regulations, including the CMS Quarterly Provider Update, Medicare Coverage Issues Manual, Medicare National Determination Manual, Physician Fee Schedule, Practicing Physician Advisory Council, Medicare Learning Network, and much more. This Web site can be found at: http://www.cms.hhs.gov/physicians/

Additional Information
The OIG Alert, dated March 31, 2004 and titled “OIG Alerts Physicians About Added Charges for Covered Services,” can be found at the following Web site:
http://oig.hhs.gov/fraud/docs/alertsandbulletins/2004/FA033104AssignViolationI.pdf

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PCA Anesthesia Services with Colonoscopy - Article

Contractor Information

Contractor Name
CIGNA Government Services

Contractor Number
05130

Contractor Type
Carrier

Article Information

Article Database ID Number
A21838

Article Type
Basic Article

Article Version Number
2

Article Title
PCA Anesthesia Services with Colonoscopy

Primary Geographic Jurisdiction
ID

Article Publication Date
08/03/2004

Article Beginning Effective Date
08/03/2004

Article Ending Effective Date

Article Text
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 pre-payment or post payment basis.

A widespread post payment probe review was completed in July 2004 in Idaho for CPT code 00810*: anesthesia for lower intestinal endoscopic procedures, endoscope introduced distal to duodenum when billed with CPT codes 45378*-Colonoscopy, flexible, proximal to splenic flexure; diagnostic or HCPCS codes G0105-Colorectal Cancer screening; colonoscopy on high risk individual or G0121-Colorectal cancer screening; colonoscopy on individual not meeting criteria for high risk.

Fifty six (56) claims were reviewed for this probe review. Nine (9) providers were selected based on their utilization of anesthesia services billed with a colonoscopy. The calculated error rate for this probe review was 21% overall. The calculated error rate is based on the dollar amount of services paid in error determined by the review divided by the dollar amount of services medically reviewed. Calculated separately, the anesthesia services (00810*) error rate was 73%. The colonoscopy services error rate was 2%.

Beneficiary medical records were reviewed by matching the anesthesia provider with the colonoscopy provider to determine if the medical necessity for anesthesia with colonoscopy was documented by either the provider performing the colonoscopy or the anesthesia provider.

Payment for conscious sedation is included in the fee paid to the provider performing the colonoscopy and is not separately reimbursable. The medical necessity for participation of anesthesia personnel in addition to the provider performing the colonoscopy could be covered if the patient’s condition requires the expertise of qualified anesthesia personnel and this is documented in the medical record. This applies when the patient has an underlying medical condition that is significant enough to result in a higher risk and requires additional monitoring, management of medication, and the potential for acute intervention. The convenience of the provider performing the colonoscopy and/or the convenience of the patient does not qualify for the additional payment for CPT code 00810*-anesthesia for lower intestinal endoscopic procedures, to anesthesia personnel. Providers may wish to inform their Medicare patients that anesthesia administered when a colonoscopy is performed may not be covered by Medicare.

Coverage Topic
Anesthesia (Outpatient)

Other Comments

Does this Article contain a “Least Costly Alternative” provision?
No

Approval Notes

Approve this Article?
Yes

Related Documents
This Article has no Related Documents.

Article Attachments
There are no attachments for this Article

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Procedures for Re-Issuance and Stale Dating of Medicare Checks

The Centers for Medicare & Medicaid Services (CMS) is clarifying the policy for re-issuing, stale dating, and reporting outstanding checks. You will need to be aware of these instructions in the event you have a problem in the future regarding lost, stolen, defaced, mutilated, destroyed, forged, or uncashed checks from your Medicare carrier/intermediary. To read the changes to the policy go to the following Web site: http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/MM2951.pdf.

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Referral of Patients for X-rays by Chiropractors

Provider Types Affected
Chiropractic providers

Provider Action Needed

STOP – Impact to You
If you order an X-ray in the course of treating a Medicare beneficiary, the provider who takes and/or interprets it for you may not be reimbursed. However, chiropractors are no longer required to obtain x-rays prior to initiating treatment.

CAUTION – What You Need to Know
Even if the laws of your state permit you to order X-rays, any that you use in the treatment of a Medicare beneficiary must be ordered by a physician who is a doctor of medicine or osteopathy. Not having a physician order the X-ray may result in lack of reimbursement.

Note: A “plain” X-ray may be ordered by any physician. It is the only exception to the requirement that all diagnostic tests must be ordered by the beneficiary’s treating physician.

GO – What You Need to Do
Make certain that a physician orders any X-rays that you use in treating Medicare beneficiaries.

Background
A chiropractor, licensed or legally authorized by the state or jurisdiction of service, may provide treatment only in the form of manual spinal manipulation to correct a subluxation (provided such treatment is legal in the state where it is performed). Specifically, Medicare defines chiropractors, based on §18601(r) of the Act, as physicians with respect to treatment by means of manual manipulation of the spine (to correct a subluxation) which he is legally authorized to perform by the state or jurisdiction in which treatment is provided.

This article addresses ordering of X-rays for your patients. When you treat Medicare beneficiaries you don’t have to obtain X-rays prior to initiating treatment, since treatment based upon clinical evaluation alone is a covered service. But if you do use an X-ray in a patient’s treatment, you must have a physician who is a doctor of medicine or osteopathy order it.

Why? Because as with all diagnostic tests for beneficiaries, Medicare regulations require that X-rays be ordered by a physician. Further, except for X-rays, diagnostic tests must be ordered by the physician actually treating the patient’s specified condition at the time. To this point, Medicare considers tests not ordered by the beneficiary’s treating physician to be neither reasonable nor necessary.

The specific regulatory language from the regulation (42 CFR 410.32(a)) states as follows:
(a) Ordering diagnostic tests. All diagnostic X-ray tests, diagnostic laboratory tests, and other diagnostic tests must be ordered by the physician who is treating the beneficiary, that is, the physician who furnishes a consultation or treats a beneficiary for a specific medical problem and who uses the results in the management of the beneficiary’s specific medical problem. Tests not ordered by the physician who is treating the beneficiary are not reasonable and necessary.

Note: The only exception to this “treating physician” rule is the plain X-ray. Medicare does allow a physician other than the one actually treating the beneficiary for the disorder of the spine (such as the radiologist or beneficiary’s primary care physician) to order an X-ray to be used by a chiropractor for patient treatment.

In the regulation at 42 CFR 410.32(a)(1), this exception is mentioned as follows:

(1) Chiropractic exception. A physician may order an x-ray to be used by a chiropractor to demonstrate the subluxation of the spine that is the basis for a beneficiary to receive manual manipulation treatments even though the physician does not treat the beneficiary.

The thing to remember is that even though the laws in your state might permit you to order X-rays and other services or tests, Medicare providers may not be reimbursed for performing them from your order. Specifically, Medicare may not reimburse for X-rays that you order, regardless of the qualifications or status of the provider who takes and interprets it for you.

To ensure that all providers are reimbursed for X-rays that you use in patient care, you should refer the beneficiary to a radiologist, or other physician, who would then order the X-ray. The physician would enter his own name and UPIN on the claim as the ordering physician and referring UPIN.

The documentation for the X-ray should be maintained by that physician, in the beneficiary’s medical records. Documentation might consist of a written referral from you that includes:

• The X-ray test requested;
• A summary of the patient’s complaints including symptoms and location of pain, and other relevant findings;
• A summary of your findings on physical examination;
• A diagnosis and level of spine involvement; and
• The name and address of a primary care physician, if any, to whom a copy of the report may be sent as a courtesy (this must be authorized by the beneficiary). This provider may not be indicated as the ordering provider for the x-ray(s) on the submitted claim, unless there is an actual written order for the test from him/her.

Additional Information
You can find more information about the use of X-rays in your practice from the Internet Only Manual, Pub. 100-2, Medicare Benefit Policy Manual, Chapter 15, Covered Medical and Other Health Services, Section 240.1.1-Manual Manipulation Chiropractic Services, which you can find online at:
http://www.cms.hhs.gov/manuals/102_policy/bp102index.asp

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

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Rural Health Fact Sheets

The Medicare Learning Network Web site currently has information available on the four new Rural Health Fact Sheets. The Fact Sheets contain rural health information, definitions, helpful rural health resources, and Medicare Prescription Drug, Improvement and Modernization Act of 2003 enhancements. This information can be accessed at www.cms.hhs.gov/medlearn/pubs.asp.

The Fact Sheets are entitled:

• Rural Health Clinic
• Sole Community Hospital
• Federally Qualified Health Center
• Critical Access Hospital Program
  

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Skilled Nursing Facility Consolidated Billing

Provider Types Affected
All Medicare providers, suppliers, physicians, skilled nursing facilities (SNF), and rural swing bed hospitals.

Provider Action Needed
This article is informational only and is intended to remind affected providers that SNFs must submit all (BBA, P.L. 105-33) and is known as SNF Consolidated Billing (CB).

Background
Prior to the Balanced Budget Act of 1997 (BBA), a SNF could elect to furnish services to a resident in a covered Part A stay, either

• Directly, using its own resources;
• Through the SNF’s transfer agreement hospital; or
• Under arrangements with an independent therapist (for physical, occupational, and speech therapy services).

In each of these circumstances, the SNF billed Medicare Part A for the services. However, the SNF also had the further option of “unbundling” a service altogether; that is, the SNF could permit an outside supplier to furnish the service directly to the resident, and the outside supplier would submit a bill to Medicare Part B, without any involvement of the SNF itself. This practice created several problems, including the following:

• A potential for duplicate (Parts A/B) billing if both the SNF and outside supplier billed;
• An increased out-of-pocket liability incurred by the beneficiary for the Part B deductible and coinsurance even if only the supplier billed; and
• A dispersal of responsibility for resident care among various outside suppliers, which adversely affected quality (coordination of care) and program integrity, as documented in several reports by the Office of the Inspector General (OIG) and the General Accounting Office (GAO).

Based on the above-mentioned problems, Congress enacted the Balanced Budget Act of 1997 (BBA), Public Law 105-33, Section 4432(b). This section of the law contains the SNF CB requirements. Under the CB requirement, an SNF itself must submit all Medicare claims for the services that its residents receive (except for specifically excluded services listed below).

Conceptually, SNF CB resembles the bundling requirement for inpatient hospital services that’s been in effect since the early 1980s—assigning to the facility itself the Medicare billing responsibility for virtually the entire package of services that a facility resident receives, except for certain services that are specifically excluded.

CB eliminates the potential for duplicative billings for the same service to the Part A fiscal intermediary by the SNF and the Part B carrier by an outside supplier. It also enhances the SNF’s capacity to meet its existing responsibility to oversee and coordinate the total package of care that each of its residents receives.

Effective Dates
CB became effective as each SNF transitioned to the Prospective Payment System (PPS) at the start of the SNF’s first cost reporting period that began on or after July 1, 1998.

The original CB legislation in the BBA applied this provision for services furnished to every resident of an SNF, regardless of whether Part A covered the resident’s stay. However, due to systems modification delays that arose in connection with achieving Year 2000 (Y2K) compliance, the Centers for Medicare & Medicaid Services (CMS) initially postponed implementing the Part B aspect of CB, i.e., its application to services furnished during noncovered SNF stays.

The aspect of CB related to services furnished during noncovered SNF stays has now essentially been repealed altogether by Section 313 of the Benefits Improvement and Protection Act of 2000 (BIPA, P.L. 106-554, Appendix F). Thus, with the exception of physical therapy, occupational therapy, and speech language pathology services (which remain subject to CB regardless of whether the resident who receives them is in a covered Part A stay), this provision now applies only to those services that an SNF resident receives during the course of a covered Part A stay.

Excluded Services
There are a number of services that are excluded from SNF CB. These services are outside the PPS bundle, and they remain separately billable to Part B when furnished to an SNF resident by an outside supplier. However, Section 4432(b)(4) of the BBA (as amended by Section 313(b)(2) of the BIPA) requires that bills for these excluded services, when furnished to SNF residents, must contain the SNF’s Medicare provider number. Services that are categorically excluded from SNF CB are the following:

• Physicians’ services furnished to SNF residents. These services are not subject to CB and, thus, are still billed separately to the Part B carrier.
• Certain diagnostic tests include both a professional component (representing the physician’sinterpretation of the test) and a technical component (representing the test itself), and the technical component is subject to CB. The technical component of these services must be billed to and reimbursed by the SNF. (See Medlearn Matters Special Edition Article SE0440 for a more detailed discussion of billing for these diagnostic tests.)
• Section 1888(e)(2)(A)(ii) of the Social Security Act specifies that physical therapy, occupational therapy, and speech-language pathology services are subject to CB, even when they are furnished by (or under the supervision of) a physician.
• Physician assistants working under a physician’s supervision;
• Nurse practitioners and clinical nurse specialists working in collaboration with a physician;
• Certified nurse-midwives;
• Qualified psychologists;
• Certified registered nurse anesthetists;
• Services described in Section 1861(s)(2)(F) of the Social Security Act (i.e., Part B coverage of home dialysis supplies and equipment, self-care home dialysis support services, and institutional dialysis services and supplies);
• Services described in Section 1861(s)(2)(O) of the Social Security Act (i.e., Part B coverage of Epoetin Alfa (EPO, trade name Epogen) for certain dialysis patients. Note: Darbepoetin Alfa (DPA, trade name Aranesp) is now excluded on the same basis as EPO);
• Hospice care related to a resident’s terminal condition;
• An ambulance trip that conveys a beneficiary to the SNF for the initial admission, or from the SNF following a final discharge.

Physician “Incident To” Services
While CB excludes the types of services described above and applies to the professional services that the practitioner performs personally, the exclusion does not apply to physician “incident to” services furnished by someone else as an “incident to” the practitioner’s professional service. These “incident to” services furnished by others to SNF residents are subject to CB and, accordingly, must be billed to Medicare by the SNF itself. Examples of “incident to” services are laboratory tests or x-rays performed in the doctor’s office.

Outpatient Hospital Services
In Program Memorandum (PM) Transmittal # A-98-37 (November 1998, reissued as PM transmittal # A-00-01, January 2000), CMS identified specific types of outpatient hospital services that are so exceptionally intensive or costly that they fall well outside the typical scope of SNF care plans. CMS has excluded these services from SNF CB as well (along with those medically necessary ambulance services that are furnished in conjunction with them). These excluded service categories are:

• Cardiac catheterization;
• Computerized axial tomography (CT) scans;
• Magnetic resonance imaging services (MRIs);
• Ambulatory surgery that involves the use of an operating room;
• Emergency services;
• Radiation therapy services;
• Angiography; and
• Certain lymphatic and venous procedures.

Effective with services furnished on or after April 1, 2000, the Balanced Budget Refinement Act of 1999 (BBRA, P.L. 106-113, Appendix F) has identified certain additional exclusions from CB. The additional exclusions enacted in the BBRA apply only to certain specified, individual services within a number of broader service categories that otherwise remain subject to CB. Within the affected service categories the exclusion applies only to those individual services that are specifically identified by HCPCS code in the legislation itself, while all other services within those categories remain subject to CB. These service categories are:

• Chemotherapy items and their administration;
• Radioisotope services; and
• Customized prosthetic devices.

In addition, effective April 1, 2000, this section of the BBRA has unbundled those ambulance services that are necessary to transport an SNF resident offsite to receive Part B dialysis services.

Finally, effective January 1, 2004, as provided in the August 4, 2003 final rule (68 Federal Register 46060), two radiopharmaceuticals, Zevalin and Bexxar, were added to the list of chemotherapy drugs that are excluded from CB (and, thus, are separately billable to Part B when furnished to a SNF resident during a covered Part A stay).

Effects of CB
SNFs can no longer “unbundle” services that are subject to CB in order for an outside supplier to submit a separate bill directly to the Part B carrier. Instead, the SNF itself must furnish the services, either directly, or under an “arrangement” with an outside supplier in which the SNF itself (rather than the supplier) bills Medicare. The outside supplier must look to the SNF (rather than to Medicare Part B) for payment.

In addition, SNF CB:

• Provides an essential foundation for the SNF PPS, by bundling into a single facility package all of the services that the PPS payment is intended to capture;
• Spares beneficiaries who are in covered Part A stays from incurring out-of-pocket financial liability for Part B deductibles and coinsurance;
• Eliminates potential for duplicative billings for the same service to the Part A fiscal intermediary (FI) by the SNF and to the Part B carrier by an outside supplier; and
• Enhances the SNF’s capacity to meet its existing responsibility to oversee and coordinate each resident’s overall package of care.

Additional Information
While this article presents an overview of the SNF CB process, CMS also has a number of articles that provide more specifics on how SNF CB applies to certain services and/or providers. These articles are as follows:

• Skilled Nursing Facility Consolidated Billing as It Relates to Certain Types of Exceptionally Intensive Outpatient Hospital Services
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0432.pdf
• Skilled Nursing Facility Consolidated Billing as It Relates to Ambulance Service
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0433.pdf
• Skilled Nursing Facility Consolidated Billing and Erythropoietin (EPO, Epoetin Alfa) and Darbepoetin Alfa (Aranesp)
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0434.pdf
• Skilled Nursing Facility Consolidated Billing as It Relates to Dialysis Coverage
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0435.pdf
• Skilled Nursing Facility Consolidated Billing and Preventive/Screening Services
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0436.pdf
• Skilled Nursing Facility Consolidated Billing as It Relates to Prosthetics and Orthotics
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0437.pdf
• Medicare Prescription Drug, Improvement, and Modernization Act – Skilled Nursing Facility Consolidated Billing and Services of Rural Health Clinics and Federally Qualified Health Centers
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0438.pdf
• Skilled Nursing Facility Consolidated Billing as It Relates to Clinical Social Workers
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0439.pdf
• Skilled Nursing Facility Consolidated Billing as It Relates to Certain Diagnostic Tests
  http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/SE0440.pdf
• Skilled Nursing Facility Consolidated Billing and “Incident To” Services (Services That Are Furnished as an Incident to the Professional Services of a Physician or Other Practitioner) (coming soon)

In addition, the CMS Medlearn Consolidated Billing Web site can be found at: http://www.cms.hhs.gov/medlearn/snfcode.asp

It includes the following relevant information:

• General SNF consolidated billing information;
• HCPCS codes that can be separately paid by the Medicare carrier (i.e., services not included in consolidated billing);
• Therapy codes that must be consolidated in a non-covered stay; and
• All code lists that are subject to quarterly and annual updates and should be reviewed periodically for the latest revisions.
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