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November 2004 Part B Medicare Bulletin

Posted November 3, 2004

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Update to Medicare Deductible, Coinsurance, and Premium Rates for Calendar Year (CY) 2005

Provider Types Affected
Physicians, providers, and suppliers

Provider Action Needed
This instruction updates Medicare deductibles, coinsurance, and premium rates for CY 2005.

Background
Most individuals age 65 and older (and many disabled individuals under age 65) are insured for Health Insurance (HI) or Part A benefits without a premium payment. The Social Security Act provides that certain aged and disabled persons who are not insured may voluntarily enroll, but they are subject to the payment of a monthly premium. Since 1994, voluntary enrollees may qualify for a reduced premium if they have 30- 39 quarters of covered employment. When voluntary enrollment takes place more than 12 months after a person’s initial enrollment period for HI benefits, the monthly premium is increased by 10 percent.

Under the Supplementary Medical Insurance (SMI) plan or Part B, all enrollees are subject to a monthly premium. Most SMI services are subject to an annual deductible and coinsurance (percent of costs that the enrollee must pay) that are set by statute. When SMI enrollment by a beneficiary takes place more than 12 months after the initial enrollment period, the monthly premium increases by 10 percent for each full 12-month period during which the individual could have been enrolled, but was not.

Beneficiaries who use covered Part A services may be subject to deductible and coinsurance requirements.

Inpatient Hospital Services
A beneficiary is responsible for an inpatient hospital deductible amount for inpatient hospital services furnished in a spell of illness (which is deducted from the amount payable by the Medicare program to the hospital).

• More than 60 Days. When a beneficiary receives such services for more than 60 days during a spell of illness, he/she is responsible for a coinsurance amount equal to one-fourth of the inpatient hospital deductible per day for the 61st-90th day spent in the hospital.

Disclaimer
Medlearn Matters articles are prepared as a service to the public and are not intended to grant rights or impose obligations. Medlearn Matters articles may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations, and other interpretive materials for a full and accurate statement of their contents.

• After the 90th Day. An individual has 60 lifetime reserve days of coverage, which he or she may elect to use after the 90th day in a spell of illness. The coinsurance amount for these days is equal to one half of the inpatient hospital deductible.

• Skilled Nursing Facility (SNF) (21st through 100th day). A beneficiary is responsible for a coinsurance amount equal to one-eighth of the inpatient hospital deductible per day for the 21st through the 100th day of SNF services furnished during a spell of illness.

For CY 2005, the premium, deductible, and coinsurance amounts are as follows:
Year 2005 Medicare Part A Deductible, Coinsurance, and Premium Amounts:

• Deductible: $912.00 per benefit period
• Coinsurance:
$228.00 a day for days 61-90 in each period
$456.00 a day for days 91-150 for each lifetime reserve day used
$114.00 a day in a SNF for days 21-100 in each benefit period

• Premium per month:
$375.00 for those who must pay a premium
$412.50 for those who must pay both a premium and a 10 percent increase
$206.00 for those who have 30-39 quarters of coverage
$226.60 for those with 30-39 quarters of coverage who must pay a 10 percent increase

Year 2005 Medicare Part B Deductible, Coinsurance, and Premium Amounts:
• Deductible: $110.00 per year
• Coinsurance: 20 percent
• Premium per month: $78.20

The following table compares Medicare Part A Deductible, Coinsurance, and Premium Amounts for Years 2001 through 2005:

Year
Inpatient Hospital Deductible, 1st 60 Days ($)
Inpatient Hospital Coinsurance, 61st-90th Days ($)

60 Lifetime Reserve Days Coinsurance ($)

SNF Coinsurance ($)
2001
792
198
396
99.00
  
2002
812
203
406
101.50
  
2003
840
210
420
105
  
2004
876
219
438
109.50
  
2005
912
228
456
114
  

Implementation
The implementation date for this instruction is January 3, 2005.

Related Instructions
CR 3121 (Transmittal 3), “New Part B Annual Deductible,” was issued on March 12, 2004. CR 3121 updated the 2005 Part B deductible based on section 629 of the Medicare Prescription Drug, Improvement and Modernization Act. The same information held in CR 3121 is being communicated in CR 3463.

Therefore, CR 3463 is replacing CR 3121 to prevent unintended consequences that may result from implementing both CR 3463 and CR 3121 together.

Additional Information
The Medicare General Information, Eligibility, and Entitlement Manual (Pub. 100-01), Chapter 3 (Deductibles, Coinsurance Amounts, and Payment Limitations) has been revised and the updated manual instructions are attached to the official instruction released to your carrier/intermediary. You may view that instruction by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web page, look for CR3463 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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Clarification of Epoetin Alfa (EPO) Billing Procedures and Codes in ESRD

Provider Types Affected
Physicians, suppliers, and renal dialysis facilities (RDFs) caring for patients with End Stage Renal Disease (ESRD)

Provider Action Needed
Physicians, suppliers, and RDFs should note that this Special Edition provides an overview of the differences between Medicare’s billing procedures and codes for End Stage Renal Disease Renal Disease (ESRD) usage of EPO/DPA.

Background Epoetin Alfa (EPO) Billing Procedures and Codes
The Centers for Medicare & Medicaid Services (CMS) has assigned a new HCPCS code (Q4055) for EPO, and the new Healthcare Common Procedure Coding System (HCPCS) code (Q4055) is provided for ESRD EPO usage only. Also, CMS has deleted all the current “Q” codes (Q9920 through Q9940) established for ESRD patients on EPO.

All other rules still apply for billing EPO for ESRD related anemia.

Intermediaries pay for EPO to ESRD facilities as a separately billable drug to the composite rate. No additional payment is made to administer EPO, whether in a facility or a home. Medicare beneficiaries dialyzing from home may choose between two methods of payment.

EPO payment is in addition to the composite rate and the following billing procedures are to be used for EPO administered in your facility. Identify EPO and the number of injections by:

Summarizing for EPO
For dates of service on and after January 1, 2004, claims include the following:

Example 1: The following numbers of EPO units were administered during the billing period 2/1/04 – 2/28/04:

Date

 EOP Units Date EPO Units
2/1 3000 2/15 2500
2/4 3000 2/18 2500
2/6 3000 2/10 2560
2/8 3000 2/22 2500
2/11 2500 2/25 2000
2/13 2500 2/27 2000

Total: 31,060 units

For value code 68, enter 31,060.

Your intermediary uses 31,100 to determine the rate payable. This is 31,060 rounded to the nearest 100 units. The rate payable is $311.00 (31.1 × $10).

Hgb=10.2

Revenue Code: 634 – 12

Value Code: 68 – 31,060

HCPCS: Q4055

VC 48: 10.2

Example 2: The following number of EPO units was administered during the billing period 5/1/04 – 5/30/04:

Date EPO Units Date EPO Units
5/10 20,000 5/24 9,500
5/12 9,000 5/26 10,000
5/14 11,000 5/28 10,000
5/19 8,000 5/30 10,000
5/22 15,000    

Total: 102,500 units

HCPCS code: Q4055

Revenue Code: 634, 3 (number of administration dates)

HCPCS code: Q4055

Revenue Code: 635, 6 (number of administration dates)

Value Code: 68, 102,500

Value Code: 49, 30.9 (Hct)

(See ESRD Manual Section 60.)

If an electronic submitter has additional documentation, which Medicare may require, they can indicate “DOCUMENTATION AVAILABLE UPON REQUEST” in the narrative (NTE02) segment. If the additional documentation you have is needed for Medicare to make its payment determination, a development letter will be sent requesting the information.

If the NTE02 segment does not indicate the availability of the additional documentation or the information is not returned in a timely manner, the claim will be returned as unprocessable.

Related Instructions
Change Request (CR) 2963, Transmittal 39, January 6, 2004 can be found at the following CMS Web site: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

CR 3037; Transmittal 36, December 24, 2003 can be found at the following CMS Web site:
http://cms.hhs.gov/manuals/pm_trans/R36OTN.pdf

CR 2984, Transmittal 118, March 5, 2004 can be found at the following CMS Web site:
http://www.cms.hhs.gov/manuals/transmittals/cr_num_asc.asp

Additional Information
The Medicare Renal Dialysis Facility Manual, Chapter II, Coverage of Services can be found at the
following CMS Web site: http://www.cms.hhs.gov/manuals/29_rdf/rd200.asp?#_1_17

Also, you can find the Medicare Benefit Policy Manual Chapter 11, regarding billing and payment details for EPO and DPA at the following CMS Web site: http://www.cms.gov/manuals/102_policy/bp102c11.pdf

Lastly, see the Medicare Claims Process Manual, Pub. 100-04, Chapter 8, Section 60.4 at the following CMS Web site: http://www.cms/manuals/104_claims/clm104c08.pdf

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Billing Instructions for ADVATE rAHF-PFM on Medicare Claims

Provider Types Affected
Hospitals, providers, and independent ESRD facilities

Provider Action Needed

STOP – Impact to You
This is a one-time notification to ensure that providers, hospitals, and independent ESRD facilities are aware of the correct HCPCS code to use when billing for Advate.

CAUTION – What You Need to Know
Advate rAHF-PFM was approved by the Food and Drug Administration (FDA) on July 25, 2003; the payment limit that should be used for Advate is the same payment limit that is currently assigned to HCPCS code J7192. This payment limit will apply to all Advate claims submitted for services from January 1, 2004 through December 31, 2004. Also, effective for dates of services on or after July 25, 2003, claims submitted to Medicare fiscal intermediaries for Advate will be rejected if reported with any other code except J7192. Claims submitted to carriers for dates of service on or after July 25, 2003, without J7192 will be adjusted to reflect J7192 and carriers will append modifier “CC” to reflect this adjustment.

GO – What You Need to Do
Make sure that your billing staff knows that HCPCS code J7192 must be used when billing for the drug, Advate, effective for dates of services on or after July 25, 2003.

Background
Beginning January 1, 2004, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) provides that the payment limits for most drugs and biologicals not paid on a cost or prospective payment basis are based on 85 percent of the Average Wholesale Price (AWP) reflected in the published compendia as of April 1, 2003, for those drugs and biologicals furnished on and after January 1, 2004.

However, one of the exceptions to this general rule is the payment limit for blood clotting factors. Specifically, the payment limits for blood clotting factors are 95 percent of the AWP reflected in the published compendia as of September 1, 2003.

Advate is a blood clotting factor that was approved by the FDA on July 25, 2003 for the treatment of people with hemophilia A. Advate should be reported using the existing HCPCS code J7192.

Implementation Date
This change will be implemented in Medicare claims processing systems on September 27, 2004.

Additional Information
For the calendar year 2004, the Advate payment limit for providers and for independent ESRD facilities can be found in the 2004 MMA drug pricing file that was issued in CR 3105. A Medlearn Matters article on this CR can be found at: http://www.cms.hhs.gov/MedlearnMattersArticles/downloads/MM3105.pdf

The MMA Drug Payment Limits Pricing Files for Dates of Service 1/1/2004 and after are available at:
http://cms.hhs.gov/providers/drugs/default.asp

For hospital Outpatient Prospective Payment System (OPPS), the payment rate for Advate can be found in the latest quarterly update of the OPPS Outpatient Code Editor that is posted on the CMS OPPS Web site.

The CMS Hospital Outpatient Prospective Payment System Web site can be found at:
http://www.cms.hhs.gov/providers/hopps/

If you have any questions regarding this issue, 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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Brachytherapy of Prostate Cancer in an Ambulatory Surgical Center (ASC) 

Article Beginning Effective Date
09/22/2004

Article Text
General Rules for Ambulatory Surgical Centers (ASCs)

*Medically necessary services that are on the CMS approved ASC list are reimbursable to the facility per group payment;

*Medically necessary services that are not on the CMS approved ASC list are not reimbursable to the facility but are still reimbursable to the physician at the non-facility payment rate;

*Any service with an associated technical component (-TC) that is rendered by a physician in an ASC and is not on the CMS approved ASC list should be submitted globally (no -TC or -26 modifier);

*Facility payment for technical components of services may be obtained by arrangement from the performing provider;

Specifics to Prostate Brachytherapy in Ambulatory Surgical Centers (ASCs)

*ASC bills CPT code 55859 with modifier –SG;

*Physician, usually urologist, bills CPT code 55859 (prostate brachytherapy) without modifier;

*Provider licensed and trained for nuclear materials use, usually radiation oncologist, bills CPT code 79900 (supply of radioactive seeds per invoice);

*All other associated medically necessary services on the day of the procedure that are performed in an ASC and are not on the CMS approved ASC list must be billed by the respective providers without modifier -TC of -26 — with the potential to reimburse the technical components to the facility per contractual arrangement;

*Place of service: 24 (ASC);

*Preplan tumor mapping and simulations done prior to the implant should not be billed again at the time of the implant;

*Any use of radioactive material requires full compliance with Nuclear Regulatory Commission (NRC) guidelines.

Coverage Topic
Diagnostic Tests and X-Rays

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Coverage by Medicare Advantage Organizations for National Coverage Determination (NCD) Services Not Previously Included in the 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 National Coverage Determination (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 for dates of service 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 initially issued these NCDs, 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
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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Clarification of Medicare Secondary Payer (MSP) Rules in Relation to a Temporary Leave of Absence

Provider Types Affected
All providers.

Provider Action Needed

STOP – Impact to You
MSP rules state that if an employee retains their employment status, Medicare remains the secondary payer.

CAUTION – What You Need to Know
There has been confusion regarding MSP rules when an employee takes a company-approved leave of absence. Because the employee still has employee status, health coverage through their employer is retained.

GO – What You Need to Do
Stay current with rules pertaining to employees and retained employment rights to ensure accurate billing and claims processing. This article clarifies that Medicare remains a secondary payer for employees on an approved leave of absence.

Background
Examples of retained employment rights can include: company-approved temporary leave of absence for any reason, furlough, temporary layoff, sick leave, short-term or long-term disability, leave for teachers and seasonal workers who normally do not work year round, and for employees who have health coverage that extends beyond or between active employment periods. The employees in the latter category are sometimes referred to as having an “hours bank” arrangement.

Additional Information
You may also refer to the revised Publication 100-05, Chapter 1, Section 50B, which is part of the official instruction issued to your carrier/intermediary regarding this change. That instruction may be found at: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

On the above page, scroll down while referring to the CR NUM column on the right to find the link for CR 3447. Click on the link to open and view the file for the CR.

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

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Documentation Needed for Chiropractic Claims (A22813) - Article

Contractor Information

Contractor Name
CIGNA Government Services

Contractor Number
05535

Contractor Type
Carrier

Article Information

Article Database ID Number
A22813

Article Type
Basic Article

Article Title
Documentation Needed for Chiropractic Claims

Primary Geographic Jurisdiction
NC

Article Publication Date
09/13/2004

Article Beginning Effective Date
09/13/2004

Article Text
The Medicare program pays for one service rendered by Chiropractors – manual manipulation of the spine – for one diagnosis – subluxation of the spine. Claims for any other conditions or treatments are not Medicare benefits. The diagnosis of subluxation may be made by radiography or by physical examination. Documentation of the presence of subluxation must be stated in the medical record, and documented, either in the x-ray report or in the physical examination. The level of the subluxation must also be clearly stated to substantiate the Chiropractic claim.

When the subluxation is demonstrated by physical exam, at least two of the following four criteria must be identified and documented:

  1. Pain/tenderness evaluated in terms of location, quality and intensity
  2. Asymmetry/misalignment identified on a sectional or segmental level
  3. Range of motion abnormality (changes in active, passive, and accessory joint movements resulting in an increase or a decrease of sectional or segmental mobility)
  4. Tissue, tone changes in the characteristics of contiguous or associated soft tissues, including skin, fascia, muscle and ligament.

One of the two criteria documented must be either asymmetry or range of motion abnormality.

A thorough history must be recorded at the time of the initial visit, including:

A detailed plan of treatment should be developed and documented at the initial visit as well, and should include, at a minimum:

The history, physical exam and treatment plan should be updated at each subsequent visit, to document changes in the patient’s signs and symptoms, physical findings, response to treatment and any modifications to the treatment plan. All of these must be clearly documented for payment to be possible.

Medicare will pay for treatment of acute subluxation for a reasonable time, and for treatment of chronic conditions that show reasonable likelihood of substantial long-term improvement from that treatment. Once a chronic condition has been stabilized, treatment is no longer a Medicare benefit. This would apply even if each treatment of a chronic condition resulted in some temporary improvement – if there is no substantial long-term improvement, this would be considered “chronic maintenance” treatment and not payable by Medicare.

Maintenance therapy, defined as a plan that seeks to prevent disease, promote health or prolong life and enhance quality, is not a Medicare benefit. Maintenance therapy performed to stabilize a chronic condition or to prevent further deterioration is also not a Medicare benefit. Once maximum therapeutic benefit has been achieved for a given condition, on-going maintenance therapy is not considered medically necessary under the Medicare program.

A patient with a resolving acute, or a stable chronic condition may occasionally experience a marked worsening (an exacerbation) for some reason. If treatment is re-initiated for such an exacerbation, this should be clearly documented with date and nature of exacerbating event, along with all the other required criteria and elements noted above in this article – subluxation, level of subluxation, examination, and treatment plan. Failure to include these things in the record will result in denial of the claim.

In summary, claims for Chiropractic services must:

  1. Be for only manual manipulation of the spine
  2. State that a subluxation is present, and document x-ray or physical findings as above
  3. Indicate level of the subluxation(s)
  4. Include a detailed treatment plan
  5. Document that the condition is acute, chronic improving, chronic stable, maintenance or an exacerbation.

If these things are all clearly documented in the medical record, using the specific words noted, it will lead to more accurate claim reviews and payment.

Coverage Topic
Chiropractic Services

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Guidance Regarding Elimination of Standard Paper Remittance (SPR) Advice Notices in the Old Format

Provider Types Affected
All Medicare physicians, providers, and suppliers.

Provider Action Needed
Be advised that only the most recent version of the Standard Paper Remittance (SPR) Advices will be used. The 835 version 4010A1 flat file is the appropriate format to produce SPRs. Also, no data may be included in paper remittance advices that are not included in an electronic remittance advice (ERA).

Background
The Centers for Medicare & Medicaid Services (CMS) prohibits the inclusion of data in paper remittance advice notices that is not included in the ERA transactions. The most recent version of the SPR Advice and the ERA contain the same information in the comparable fields and date elements, including the same codes. The same flat file is supposed to be used to produce both the SPR and 835 version 4010A1 ERA.

CMS has issued a memorandum to all Medicare carriers and fiscal intermediaries, including durable medical equipment carriers and regional home health intermediaries, stating that, effective January 1, 2005, only the 835 version 4010A1 flat file is to be used to produce the SPRs; no other format for SPRs will be used.

Additional Information
Refer to Chapter 22 of the Medicare Claims Processing Manual, Publication 100-4, which can be found online at: http://www.cms.hhs.gov/manuals/104_claims/clm104c22.pdf

Additional information regarding the Fiscal Intermediary Part A 835 flat file, including a sample of the most recent SPR format, is available in CR 3344. You may view that CR at:
http://www.cms.hhs.gov/manuals/pm_trans/R252CP.pdf

If you have any questions regarding receipt of or conversion to ERAs, please contact your carrier/intermediary. If you bill an intermediary, their number may be found at:
http://www.cms.hhs.gov/providers/edi/anum.asp

If you bill a carrier, the number may be found at: http://www.cms.hhs.gov/providers/edi/bnum.asp

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Implementation of New Medicare Redetermination Notice

Providers Affected
All Medicare physicians, providers, and suppliers.

Provider Action Needed

STOP – Impact to You
Redeterminations are the new first level of appeal for fee-for-service appeals. You and your patients will receive a formal notification letter, the Medicare Redetermination Notice (MRN), for any decision made on a request for redetermination made on or after October 1, 2004.

CAUTION – What You Need to Know
Contractors who judge these redetermination appeals must make their decisions within 60 days as a result of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) and must then notify the providers and beneficiaries involved via the Medicare Redetermination Notice (MRN). This document describes the redetermination process, explains the results of the Medicare appeal, and provides information about how to file an appeal regarding Medicare’s decision.

GO – What You Need to Do
The newly initiated Redetermination Appeals Process provides for timely notification of beneficiaries and providers via the Medicare Redetermination Notice (MRN). Be sure to understand how these new procedures affect your appeal rights.

Background
The Medicare claims appeal process was amended by the Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA, section 521). Section 1869 (a)(3)(C)(ii) required contractors to mail a written notification of the redetermination decision to the parties of an appeal. This section was then amended by MMA [Sections 1869 (a)(5) and 1869 (a)(4)(B)] to include specific requirements for the notices themselves. The requirements ensure that claim appellants receive complete, accurate and understandable information about their redetermination decisions, as well as information explaining the process of further appeals.

CMS has provided a model cover letter and a Medicare Redetermination Notice to serve as guidelines for Medicare carriers and intermediaries who make the redeterminations. The MMA also ensures that redetermination decisions are made in a timely manner by requiring that 100% of redeterminations must be completed and mailed within 60 days of the receipt of the request. [Section 940(a)(1)]

Additional Information
The MRN must be written in language that is clear and understandable to the beneficiary and must be printed legibly on white paper using black ink. The MRN include specific required elements such as the sections outlined below:

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Information and Education Resources for Medicare Providers, Suppliers, and Physicians

Provider Types Affected
All Medicare physicians, providers, and suppliers

Provider Action Needed
This article is informational only and is intended to notify Medicare physicians and other providers about the information and education resources that the Centers for Medicare & Medicaid Services (CMS) have developed to help meet their Medicare business needs.

Background
One of the goals of CMS is to give Medicare’s 1.2 million physicians and other providers the information they need to understand the program, be aware of changes, and bill correctly. By making information and education resources easily accessible, understandable, and as timely as possible, physicians and other providers will be better able to submit bills correctly the first time, receive reimbursements more quickly, and spend less time dealing with paperwork. All of this can result in more time to spend on patient care.

We are committed to accomplishing this goal by offering Medicare physicians and other providers a variety of educational products and services and using various information delivery systems to reach the broadest and most appropriate audiences possible.

Three-Pronged Provider Information and Outreach Approach
CMS relies on the cooperative efforts of its Medicare contractors, Regional Offices, and Central Office provider communications staff to deliver a seamless information and outreach approach to Medicare physicians and other providers.

1) Medicare Contractors
Medicare contractors, also called fiscal intermediaries and carriers, serve as the primary point of contact for most Medicare physicians and other providers. These contractors provide toll-free telephone lines for inquiries, conduct outreach and education, and often interact with local professional associations. Their outreach and education activities include in-person seminars, bulletins and newsletters, speaker appearances, and quick dissemination of timely information via Web sites and provider-specific electronic ListServs (mailing lists).

If you have questions about the Medicare Program, you should first get in touch with your fiscal intermediary or carrier. To find fiscal intermediary and carrier contact information, please visit:
http://www.cms.hhs.gov/MedlearnProducts/downloads/CallCenterTollNumDirectory.pdf

2) CMS Regional Offices
Staff at CMS’ Regional Offices provide oversight of Medicare contractors and play a key role in resolving issues that physicians and other providers cannot get resolved. Our Regional Offices are active with the physician and other provider communities at State and local levels through their relationships with State and local associations and big billers, and through outreach activities such as hosting provider-oriented meetings and furnishing speakers at professional conferences.

CMS Regional Offices are located at various locations around the country. You can find their contact information at: http://www.cms.hhs.gov/about/regions/professionals.asp

3) CMS Central Office in Baltimore, Maryland
The provider communications staff at the CMS Central Office work closely with both Medicare contractor and Regional Office staff to ensure that consistent and coordinated Medicare information and resources are available to all physicians and other providers. Education and outreach activities from the CMS Central Office are generally targeted to national associations with consistency and timeliness as our top priorities.

Given the hectic schedules of today’s health care professionals, most of our current initiatives are aimed at fostering a “self-service” environment so that physicians and other providers can access information and education 24 hours a day, 7 days a week. As a result, we have significantly increased the use of the Internet as a key tool for continuous-improvement customer service. Our efforts have resulted in a variety of products and services, such as:

Physician and Other Provider Feedback
Although we try our best to be responsive to the Medicare physician and other provider community’s education and information needs, we can’t do it alone. Your feedback on the effectiveness and usefulness of our educational resources is very important to us as it helps ensure that we are “getting it right.” Please submit your comments or suggestions at http://www.cms.hhs.gov/providers by selecting “Feedback” from the blue template located at the top of the page. There is also a feedback link on the Medlearn Web Pages for your suggestions on new educational products at http://www.cms.hhs.gov/medlearn/suggestform.asp.

We look forward to hearing from you.

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Magnetic Resonance Spectroscopy (MRS) for Diagnosing Brain Tumors

Provider Types Affected
Physicians, providers, and suppliers

Provider Action Needed
This instruction notifies physicians, providers and suppliers that upon reconsideration, the Centers for Medicare & Medicaid Services (CMS) determined that MRS used as a diagnostic tool for distinguishing indeterminate brain lesions and/or as an aid in conducting brain biopsies is not reasonable and necessary, and CMS reaffirms its existing noncoverage policy for all indications of MRS.

Background
Magnetic Resonance Spectroscopy (MRS) is an application of magnetic resonance imaging (MRI). It is a non-invasive diagnostic test that uses strong magnetic fields to measure and analyze the chemical composition of human tissues. On March 22, 1994, CMS considered MRS an investigational procedure and issued a national noncoverage determination for all indications of MRS.

Upon thorough review and reconsideration of the existing noncoverage policy, as well as the available evidence for the use of MRS as a diagnostic tool for distinguishing indeterminate brain lesions, and/or as an aid in conducting biopsies, CMS determined that the evidence is not adequate to conclude that MRS is reasonable and necessary under Section 1862(a)(1)(A) of the Social Security Act.

Therefore, CMS reaffirms its existing noncoverage policy at Section 220.2.1 (Magnetic Resonance Spectroscopy) of the National Coverage Determinations (NCD) Manual for all indications of MRS.

This addition to Section 220.2.1 is an NCD, and NCDs are binding on all carriers, fiscal intermediaries, quality improvement organizations, health maintenance organizations, competitive medical plans, and health care prepayment plans. In addition, an administrative law judge may not review an NCD (see Section 1869(f)(1)(A)(i) of the Social Security Act).

Implementation
The implementation date for this reaffirmation of the NCD is September 10, 2004.

Additional Information
In addition to the updated manual instructions found at Section 220.2.1 (MRS) of the Medicare NCD Manual (Pub 100-03), Chapter 1, as outlined above, Sections 220.2 (MRI), and 220.3 (Magnetic Resonance Angiography) are being reprinted with clerical/technical edits/clarifications. There are no substantive revisions and no changes to existing NCD policy. 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 page, look for CR3425 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 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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MSN Messages and Reason Codes for Mammography

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 Notices (MSNs), which are sent to Medicare beneficiaries, and Remittance Advice messages sent to providers and suppliers regarding mammography claims.

Background
Revised instructions for the Medicare Claims Processing Manual have been issued regarding which MSN message and ANSI X-12 8351 Adjustment Reason Code will be used on the Remittance Advice when Medicare processes mammography claims. The Spanish translation for each new MSN message 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:

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 at: http://ww.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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Nursing Facility Visits (Codes 99301 – 99313)

Provider Types Affected
Physicians, Non-Physician Practitioners (NPP), Skilled Nursing Facilities (SNFs).

Provider Action Needed
This article conveys revised payment policy so that NPPs may provide other covered, medically necessary visits prior to and after the initial visit by the physician in a SNF. This instruction states that Medicare policy requires a face-to-face visit with the resident for the SNF/Nursing Facility (NF) discharge day management service. The instruction also clarifies that a split/shared evaluation and management visit may not be reported in the SNF or NF setting.

Background
Section 483.40 (c)(4) at Title 42 of the Code of Federal Regulations (CFR) did not define what the law meant by “initial” physician visit and therefore left the meaning open to interpretation, which impacted access to medically necessary care by other providers.

Therefore, the Centers for Medicare & Medicaid Services (CMS) has increasingly been asked to clarify “initial” visit and to allow NPPs to provide medically necessary visits when needed prior to the initial visit by the physician.

To ensure that all residents of nursing facilities have appropriate access to medical care, CMS has defined “initial visit” (comprehensive assessment) according to Survey and Certification memorandum (S&C-04-08) released on November 13, 2003 to State Survey Agencies and Medicare Part A and B contractors. Prior to release of that memorandum, NPP visits could not be paid prior to the initial visit by the physician in a SNF per 42 CFR 483.40 (c)(4) and (e) and in a NF per requirements at 42 CFR 483.40(f).

The Medicare Claims Processing Manual is now being revised per the Survey and Certification memorandum (S&C-04-08, dated November 13, 2003) so that NPPs may provide other covered, medically necessary visits prior to and after the initial visit by the physician. This instruction states that Medicare policy requires a face-to-face visit with the resident for the SNF/NF discharge day management service.

The revision also states that a split/shared evaluation and management visit may not be reported in the SNF/NF setting.

This definition will now permit medically necessary visits to be provided by NPPs prior to and after the “initial” (comprehensive assessment) by the physician. Medicare contractors are being instructed to implement this payment policy revision as soon as possible.

CMS reminds providers of the following:

Implementation
Medicare will implement these instructions on October 25, 2004.

Related Instructions
Survey and Certification memorandum (S&C-04-08), dated November 13, 2003, entitled Physician Delegation of Tasks in Skilled Nursing Facilities (SNFs) and Nursing Facilities (NFs) can be found at: http://www.cms.hhs.gov/medicaid/survey-cert/sc0408.pdf

Additional Information
The Medicare Claims Processing Manual (Pub 100-4), Chapter 12 (Physician/Nonphysician Practitioners), Section 30 (Correct Coding Policy), Subsection 6.13 (Nursing Facility Visits (Codes 99301-99313)) is being revised. The updated manual instructions are included in the official instruction issued to your carrier, and can be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web page, look for CR3096 in the CR NUM column on the right, and click on the file for that CR.

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

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Nursing Facility Visits (Codes 99301 – 99313) - Revised

Provider Types Affected
Physicians, Non-Physician Practitioners (NPP), Skilled Nursing Facilities (SNFs).

Provider Action Needed
This article conveys revised payment policy so that NPPs may provide other covered, medically necessary visits prior to and after the initial visit by the physician in a SNF. This instruction states that Medicare policy requires a face-to-face visit with the resident for the SNF/Nursing Facility (NF) discharge day management service. The instruction also clarifies that a split/shared evaluation and management visit may not be reported in the SNF or NF setting.

Background
Section 483.40 (c)(4) at Title 42 of the Code of Federal Regulations (CFR) did not define what the law meant by “initial” physician visit and therefore left the meaning open to interpretation, which impacted access to medically necessary care by other providers.

Therefore, the Centers for Medicare & Medicaid Services (CMS) has increasingly been asked to clarify “initial” visit and to allow NPPs to provide medically necessary visits when needed prior to the initial visit by the physician.

To ensure that all residents of nursing facilities have appropriate access to medical care, CMS has defined “initial visit” (comprehensive assessment) according to Survey and Certification memorandum (S&C-04-08) released on November 13, 2003 to State Survey Agencies and Medicare Part A and B contractors. Prior to release of that memorandum, NPP visits could not be paid prior to the initial visit by the physician in a SNF per 42 CFR 483.40 (c)(4) and (e) and in a NF per requirements at 42 CFR 483.40(f).

The Medicare Claims Processing Manual is now being revised per the Survey and Certification memorandum (S&C-04-08, dated November 13, 2003) so that NPPs may provide other covered, medically necessary visits prior to and after the initial visit by the physician. This instruction states that Medicare policy requires a face-to-face visit with the resident for the SNF/NF discharge day management service.

The revision also states that a split/shared evaluation and management visit may not be reported in the SNF/NF setting.

This definition will now permit medically necessary visits to be provided by NPPs prior to and after the “initial” (comprehensive assessment) by the physician. Medicare contractors are being instructed to implement this payment policy revision as soon as possible.

CMS reminds providers of the following:

Implementation
Medicare will implement these instructions on October 25, 2004.

Related Instructions
Survey and Certification memorandum (S&C-04-08), dated November 13, 2003, entitled Physician Delegation of Tasks in Skilled Nursing Facilities (SNFs) and Nursing Facilities (NFs) can be found at: http://www.cms.hhs.gov/medicaid/survey-cert/sc0408.pdf

Additional Information
The Medicare Claims Processing Manual (Pub 100-4), Chapter 12 (Physician/Nonphysician Practitioners), Section 30 (Correct Coding Policy), Subsection 6.13 (Nursing Facility Visits (Codes 99301-99313)) is being revised. The updated manual instructions are included in the official instruction issued to your carrier, and can be found by going to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

From that Web page, look for CR3096 in the CR NUM column on the right, and click on the file for that CR.

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

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Payment Allowances for the Influenza Virus Vaccine CPT 90658 and the Pneumoccocal Vaccine CPT 90732

The Medicare Part B payment allowance for CPT 90658 is $10.10 and for CPT 90732 is $23.28, effective September 1, 2004. Annual Part B deductible and coinsurance amounts do not apply. All physicians, non-physician practitioners and suppliers who administer the influenza virus vaccination and the pneumoccocal vaccination must take assignment on the claim for the vaccine.

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Payment for Outpatient End Stage Renal Disease (ESRD)-Related Services

Provider Types Affected
Physicians and practitioners.

Provider Action Needed
This one-time clarification is provided to assist physicians and practitioners in billing for End Stage Renal Disease (ESRD) related services furnished to patients in hospital observation status and for various partial month scenarios (e.g., partial month without a complete assessment of the patient, patients who have a change in their monthly capitation payment [MCP] physician during the month, and transient patients). Also, clarification is provided for outpatient billing on ESRD-related services when the beneficiary changes modalities during the month (e.g., a home dialysis patient who switches to center dialysis and vice versa).

Background
In the final rule published November 7, 2003, (68 FR 63216) the Centers for Medicare & Medicaid Services (CMS) established new G codes for managing patients on dialysis with payments varying based on the number of visits provided within each month. Under this methodology, separate codes are billed for providing one visit per month, two to three visits per month and four or more visits per month.

The lowest payment amount applies when a physician provides one visit per month; a higher payment is provided for two to three visits per month. To receive the highest payment amount, a physician would have to provide at least four ESRD-related visits per month. The G codes are reported once per month for services performed in an outpatient setting that are related to the patient’s ESRD.

Since changing our payments for managing patients on dialysis, we have received a number of comments from the nephrology community requesting guidance on billing for outpatient ESRD-related services provided to patients in hospital observation settings, transient patients, and in partial month scenarios where the comprehensive visit may not have been furnished. Additionally, questions have been raised regarding the appropriate billing code for patients switching modalities during the month (e.g., from home dialysis to center dialysis).

Therefore, the purpose of CR3414 and of this article is to provide immediate, short-term guidance as to the appropriate codes physicians and practitioners should use and how carriers should price claims regarding these specific ESRD-related scenarios. CMS has a proposal in the CY 2005 physician fee schedule rule (published August 5, 2004 and available on our Web site regarding how ESRD-related visits furnished in the observation setting, transient patients and other partial months scenarios would be coded in the future. The address of that Web site is: http://www.cms.hhs.gov/physicians

Policy Clarifications

1. Patients in Hospital Observation Status General Policy
ESRD-related visits furnished to patients in hospital observation status that occur prior to December 31, 2004, should be coded using the unlisted dialysis procedure code. Physicians and practitioners should use the unlisted dialysis procedure code as described by CPT code 90999 when submitting claims for ESRD related visits furnished to patients in the hospital observation setting.

Guidelines for Physician or Practitioner Billing and Documentation
In submitting bills for outpatient ESRD-related visits furnished to patients in hospital observation status, physicians and practitioners should include documentation in the medical record describing the type of ESRD-related services provided during the visit. Only one claim should be submitted for all ESRD-related services provided during the visit.

Physicians and practitioners providing ESRD-related visits to beneficiaries in observational status should bill CPT code 90999 outside of the monthly capitation payment (MCP). If the MCP physician furnishes a complete assessment of the patient, he or she may bill the appropriate G code corresponding to the number of visits furnished during the month. However, the visit furnished in the observational setting must be billed separately from the MCP.

Example #1: The MCP physician or practitioner furnishes an ESRD-related visit for a 70 year-old ESRD beneficiary in hospital observation status. Prior to the ESRD-related visit furnished in the observation setting, the MCP physician furnished a visit for this beneficiary that included a complete monthly assessment and two non-comprehensive visits without a complete assessment at a freestanding ESRD facility. In this scenario, the MCP physician should bill the appropriate two to three visit code (for example G0318), and CPT code 90999, for the visit furnished to the patient in the hospital observation status.

Example #2: A physician other than the beneficiary’s MCP physician furnishes an ESRD-related visit when the beneficiary is in hospital observation status. The MCP physician or practitioner furnishes one visit that included a complete assessment of the patient during the same month. In this scenario, the physician furnishing the visit in the hospital observation setting should bill for the unlisted dialysis procedure code CPT 90999, and the MCP physician should bill for the appropriate one visit monthly capitation code (e.g., G0319).

Guidance for Pricing Claims
The unlisted dialysis procedure code as described by CPT 90999 is carrier-priced. When pricing claims for outpatient ESRD-related visits furnished to patients in hospital observation status, your carrier should consider pricing these ESRD-related visits based on the incremental increase between the one visit MCP code and the two to three visit MCP (e.g., the payment difference between G0319 and G0318).

Example: A 70 year-old ESRD beneficiary is in hospital observation status for two days and is visited once by a physician. The physician bills CPT code 90999 for the ESRD-related visit and payment is based on the difference between G0319 (ESRD-related services with one face-to-face visit per month) and G0318 (ESRD-related services with two to three face-to-face visits per month). Based on the CY 2004 physician’s fee schedule, the RVUs for ESRD-related visits furnished when a beneficiary is in hospital observation status would be 1.36 (6.76 - 5.40 = 1.36).

2. Partial Month Scenarios General Policy
Partial month scenarios should also be coded using the unlisted dialysis procedure code. Physicians and practitioners should use CPT code 90999 when submitting claims for ESRD-related visits furnished in the following scenarios:

For purposes of this article, the term “month” means a calendar month. The first month the beneficiary begins dialysis treatments is the date the dialysis treatments begin through the end of the calendar month.

Thereafter, the term “month” refers to a calendar month.

Guidelines for Physician or Practitioner Billing Transient Patients and Partial Month Without a Complete Assessment of the Patient
With regard to transient patients and partial month scenarios (as listed above) the physician or practitioner should specify the number of days he or she was responsible for the beneficiary’s outpatient ESRD-related services during the month (e.g., similar to the methodology used for home dialysis patients, less than full month).

Only one code should be used to report the daily management of transient patients and for partial month scenarios. For example, if a transient patient is away from his or her home dialysis site for two weeks, then 14 units of the unlisted dialysis code as described by CPT 90999 is billed.

For transient patients, the physician or practitioner responsible for the transient patient’s ESRD-related care should bill CPT code 90999. Only the physician or practitioner responsible for the traveling ESRD patient’s care would be permitted to bill for ESRD-related services using CPT code 90999.

For partial month scenarios resulting from hospitalization, kidney transplant, transient patients, or if the patient expired, if the MCP physician or practitioner furnished a visit that included a complete monthly assessment of the patient, he or she should bill using the appropriate G code (G0308 through G0319) that reflects the number of visits furnished during the month.

Example #1: A 70 year-old ESRD beneficiary was hospitalized on the 10th through the 20th day of the month. On the third day of the month, the MCP physician or practitioner furnished a face-to-face visit that included a complete outpatient assessment and a subsequent outpatient visit on the 25th day of the month.

While the patient was hospitalized, an inpatient ESRD-related visit was furnished. In this scenario, the MCP physician or practitioner may bill for the appropriate outpatient monthly capitation payment (e.g., G0318). The physician or practitioner who furnished the inpatient visit may bill for the appropriate inpatient ESRD-related service code, e.g., the 90935.

Example #2: A 70 year-old ESRD beneficiary vacationing in Florida is away from his or her home dialysis site from August 15 through September 7. On August 10, the MCP physician furnishes a face-to-face visit including a complete assessment of the patient. For the month of September, the MCP physician furnishes a visit with a complete assessment on the September 9 and a subsequent visit on the 25th of the month. A physician in Florida is responsible for the beneficiary’s ESRD-related care from August 15 through September 7.

In this scenario, the physician or practitioner responsible for the transient patients ESRD-related care bills sixteen units of the unlisted dialysis procedure code (CPT 90999) for the month of August and seven units of CPT code 90999 for the month of September. The MCP physician bills G0319 (ESRD-related services with one visit) for the month of August and G0318 (ESRD-related services with two to three visits) for the month of September.

If the transient beneficiary is under the care of a physician or practitioner other than his or her regular MCP physician for an entire calendar month, the physician or practitioner responsible for the transient patient’s ESRD-related care must furnish a complete assessment and bill for ESRD-related services under the MCP.

Patients Who Have a Change in their MCP Physician During the Month
CPT code 90999 should be billed in situations where an ESRD beneficiary permanently changes their MCP physician during the month. For example, the new MCP physician has the ongoing responsibility for the evaluation and management of the patient’s ESRD-related care and is not part of the same group practice or an employee of the first MCP physician. The new MCP physician should use CPT code 90999 when submitting claims for ESRD-related services for the remainder of the month, when the first MCP physician furnishes a complete assessment of the beneficiary during the month.

If the first MCP physician does not furnish a complete assessment of the patient during the month the patient permanently changes their MCP physician, the new MCP physician may bill for the appropriate G code (G0308 through G0319) and the first MCP physician may bill CPT code 90999 for the partial month as described above.

Example: An ESRD patient residing in Virginia Beach, Virginia, for the first 20 days of the month moves to Atlanta, Georgia. As a result, a different physician or practitioner is now responsible for the ongoing management of the beneficiary’s ESRD-related care. Both the first and second MCP physician furnishes a visit with a complete assessment of the patient and establishes a monthly plan of care. In this situation, the first MCP physician should bill the G code that reflects the number of visits he or she furnished during the month and the second MCP physician should bill CPT code 90999. Thereafter, the new MCP physician would bill for the appropriate monthly capitation payment, e.g., G0318.

In this example, if the first MCP physician does not provide a complete assessment of the patient, he or she should bill 20 units of CPT code 90999 but may not bill for the MCP during the month the beneficiary permanently changes his or her MCP physician. The second MCP physician may bill for the appropriate monthly capitation payment after furnishing a visit with a complete assessment of the ESRD beneficiary.

Guidance for Pricing Claims
With regard to pricing claims for ESRD-related services furnished to transient patients and the other partial month scenarios as described above, your carrier should consider using the payment amounts for the per diem codes G0324 through G0327. When using these codes, payment is based on the number of days the physician or practitioner was responsible for the beneficiary’s outpatient ESRD-related services during the month.

Example #1: A 17-year-old ESRD beneficiary is away from his or her home dialysis site for 2 weeks vacationing in Florida. The physician or practitioner responsible for the transient patient’s ESRD-related care should bill 14 units of CPT code 90999. Under the per diem method, payment for CPT code 90999 would be based on G0326 and the RVUs would be 5.74 (.41 x 14 = 5.74).

Example #2: A 10-year-old ESRD beneficiary is hospitalized for 20 days during the month and a complete (outpatient) assessment of the patient for that month was never furnished. The MCP physician should bill 10 units of CPT code 90999. Under the per diem method, payment is based on G0325 and the RVUs would be 3.60 (.36 x 10 = 3.60).

NOTE: The use of CPT code 90999 is intended to accommodate unusual circumstances where the outpatient ESRD-related services would not be paid under the MCP.

3. Patients Who Switch Modalities During The Month General Policy
If a home dialysis patient receives dialysis in a dialysis center or other facility during the month, the physician or practitioner is paid the management fee for the home dialysis patient and cannot bill the codes in the range of G0308 through G0319.

This situation should be coded using the ESRD-related services G codes for a home dialysis patient per full month. Physicians and practitioners should use G0320 through G0323 when billing for outpatient ESRD related services when a home dialysis patient receives dialysis in a dialysis center or other facility during the month.

Example #1: A 70-year-old ESRD beneficiary receives dialysis at home for the first 10 days of the month and at a dialysis center for the remaining 20 days. The MCP physician should bill G0323.

Example #2: A 70-year-old ESRD beneficiary receives dialysis at a dialysis center for the first 10 days of the month and at home for the remaining 20 days. The MCP physician should bill G0323.

Claims Processing
Carriers will deny claims with G0308 through G0319 when submitted in the same month as G0320 through G0323 for the same ESRD beneficiary. In making the denial, the carrier will generate Remittance Advice (RA) codes B13 and M86.

4. Effective Date and Previously Submitted Claims
These clarifications are effective for claims with dates of service on or after January 1, 2004. Your carrier will not reprocess previously paid claims. Additionally, claims submitted for ESRD-related services for the situations described in CR3414 that have not yet been paid may be processed using the methods outlined in CR3414.

Additional Information
To view the entire set of instructions issued to your carrier on this clarification, go to: http://www.cms.hhs.gov/manuals/transmittals/comm_date_dsc.asp

Once at that site, scroll down the right CR NUM column to locate CR3414 and click on the file for that CR.

If you have additional 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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Physician Education for the Revisions to the Health Professional Shortage Area (HPSA) Bonus Payment Processes and Implementation of the Physician Scarcity Area (PSA) Bonus Payments



SPECIAL NOTE: The language in this Medlearn Matters article reflects proposed billing and claims processing guidance consistent with the Health Professional Shortage Area (HPSA) and Physician Scarcity Area (PSA) bonus requirements discussed in the Notice of Proposed Rulemaking (NPRM) for the 2005 Physician Fee Schedule which was published on August 5, 2004. This language reflects our current implementation efforts and is subject to change consistent with publication of the final rule. Additional information will be posted when the final rule is published. Also, please note that this article was re-released on September 20, 2004 to reflect additional instructions for physician use of modifiers when billing anesthesia services (page 6) and to show that the list of zip codes eligible for automatic payment of the PSA bonus will be posted on the CMS Web site on or about October 1, 2004.

Provider Types Affected
Physicians who provide services in designated HPSAs or in PSAs.

Provider Action Needed

STOP – Impact to You
Medicare is revising the processes for paying HPSA bonuses and will be implementing the provision of the Medicare Modernization Act (MMA) that authorizes bonus payments for physician services in PSAs. This article conveys information based on the NPRM published on August 5, 2004.

CAUTION – What You Need to Know
These proposed policies apply to relevant services provided in HPSAs or PSAs on or after January 1,
2005.

GO – What You Need to Do
Affected physicians should make sure that their billing staffs are aware of the pending HPSA and PSA bonus payment policy changes and are prepared to bill Medicare in accordance with the final rule, when published, to receive the correct bonus payments for services rendered on or after January 1, 2005. Understanding the areas that qualify for the bonus payments, knowing when to use related modifiers, and knowing what information is available from your Medicare carrier are all essential to submitting correct claims. This article provides an overview of these requirements.

Background

PSA Overview
MMA Section 413(a) requires that a new five-percent bonus payment be established and paid for services rendered by physicians in geographic areas designated as PSAs. Under the NPRM, physician scarcity designations will be based on the lowest primary care and specialty care ratios of Medicare beneficiaries to active physicians in every county. In addition, based on rural census tracts of metropolitan statistical areas identified through the latest modification of the Goldsmith Modification (i.e., the Rural-Urban Commuting Area Codes), additional PSAs will be identified based on the lowest primary care and specialty care ratios of Medicare beneficiaries to active physicians in each identified rural area.

Medicare will automatically pay this new bonus on a quarterly basis without the need for a modifier on the claim for services provided in zip code areas that:

In some cases, a service may be provided in a county that is considered to be a PSA, but the zip code is not considered to be dominant for that area. In these cases, the bonus payment cannot be made automatically. To receive the bonus for such services, physicians will need to include a new modifier of AR to reflect a physician service provided in a PSA.

Some key points to remember regarding the PSA bonus are the following:

HPSA Overview
MMA Section 413(b) requires CMS to revise some of the policies that address HPSA bonus payments.

Section 1833(m) of the Social Security Act provides bonus payments for physicians who furnish medical care services in geographic areas that are designated by the HRSA as primary medical care HPSAs under section 332 (a)(1)(A) of the Public Health Service (PHS) Act.

In addition, for claims with dates of service on or after July 1, 2004, psychiatrists (provider specialty 26) furnishing services in mental health HPSAs are also eligible to receive bonus payments. But keep in mind that if a zip code falls within both a primary care and mental health HPSA, only one bonus will be paid on the service.

MMA Changes
Effective January 1, 2005, you no longer have to include the QB (physician providing a service in a rural HPSA) or QU (physician providing a service in an urban HPSA) modifier on claims to receive your HPSA bonus payment, which will be paid to you automatically, if you provide care in zip code areas that either:

To determine if you qualify to automatically receive the bonus payment, you can review the information provided on the CMS Web site. If the zip code of the location where you render services does not appear there, you should check your carrier’s Web site for HPSA designations to determine if the location where you render services is within a HPSA bonus area, but still requires the submission of a modifier. More information on these Web aids will be provided in the Additional Information section of this article.

Some points to remember include the following:

Additional Information
CMS will make substantial revisions to Section 90 of Chapter 12 of the Medicare Claims Processing Manual. An official Change Request (CR) will be released at a later date. We will provide instructions later on how to access that CR, but key revisions/additions that are proposed, based on the NPRM are listed as follows:

HPSA Designations
Effective January 1, 2005, payment files for the automated payment of the HPSA bonus payment will be developed and updated annually. Once the annual designations are made, no interim changes will be made to the automated payment files to account for HRSA updates to designations throughout the year. New designations and withdrawals of HPSA designations during a calendar year will be included in the next annual update.

For newly designated HPSA areas (those added during the year), physicians will be able to receive the bonus by self-designating through the use of the QB or QU modifier. They will also need to submit the modifier for any designated areas not included in the automated file due to the cut off date of the data used. This will only be necessary if the zip code of where they provide their service is not already on the list of zip codes that will automatically receive the bonus payment.

Physicians must not continue to self-designate through the use of the modifiers for HPSA designations that are withdrawn during the year, but are not part of the automated files.

Prior to the beginning of each calendar year beginning with 2005, CMS will post on its Web site zip codes that are eligible to automatically receive the bonus payment as well as information on how to determine when the modifier is needed to receive the bonus payment. Through regularly scheduled bulletins and ListServs, carriers must notify all physicians to verify their zip code eligibility via the CMS Web site for the area where they provide physician services.

To determine whether a modifier is needed, physicians must review the information provided on the CMS Web site for HPSA designations to determine if the location where they re