Tackling Medical Necessity, LCDs

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Tackling Medical Necessity, LCDs OCDs
Presented by
Pat McGlothin, RHIA, CCS-P
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Definitions

• LCDs Local Coverage Determinations
• Test, treatment or procedure that is neither
  specifically covered nor excluded in Medicare law
  or guidelines.
• Carriers make a coverage determination based upon
  the general acceptance of the test, treatment or
  procedure by the professional medical community
  as an effective and proven treatment for the
  condition for which it is being used.

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Definitions

• OCDs - Other Claim Denials
• Medicare Exclusion
• Experimental
• Not proven safe and effective
• Not approved by the FDA
• Cosmetic in nature
• Pre-existing condition
• Inpatient only procedure
• Duplicate claim

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Medical Necessity

• Medicare coverage guidelines for medical
  necessity Social Security Act (SSA)
• No payment will be made under Medicare Part A or
  Part B for any expenses incurred for items or
  services which are not reasonable and necessary
  for the diagnosis and treatment of illness or
  injury or to improve the functioning of a
  malformed body member.
• Billing beneficiaries for unreasonable services
  is prohibited!

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Medical Necessity

• Medically necessary services
• consistent with symptoms or diagnosis of illness
  or injury being treated
• within generally accepted professional medical
  standards
• not performed primarily for convenience of
  patient, attending physician, or supplier
• furnished at a level that is safe and effective
  for patient

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Medical Necessity

• Provider responsible for ensuring medical
  necessity of services
• Documentation in the medical record must contain
• information necessary to monitor the patients
  condition
• support the level of service rendered

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Limited Coverage

• Limited Coverage - the service is covered by
  Medicare only under certain circumstances
• If the patients diagnosis is a non-covered
  diagnosis for that service, the claim will be
  denied!
• Limited Coverage services require Advance
  Beneficiary Notice (ABN) or Waiver of
  Liability to bill the patient for the service.

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Local Coverage Determination (LCD)

• Adapted from/developed with Medicare Part
  A Part B (carrier) LCD
• Based on input from
• Carrier Advisory Committee (CAC)
• Intermediary Advisory Committee (IAC)
• Physician medical community
• Specialty providers
• LCD developed in cooperation w/ IAC CAC
• National Policy takes precedence over local
  policy!

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LCD / Limited Coverage

• Providers/physicians are not held liable or
  required to make refund if
• They did not know, and could not reasonably have
  been expected to know, that Medicare would not
  pay for the service.
• Prior to furnishing the service, they properly
  notified the beneficiary that Medicare would not
  pay for the service, and after being so informed,
  the beneficiary agreed to pay for the service.

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Advance Beneficiary Notice (ABN)

• Advance written notice to the beneficiary that
  the physician, provider or supplier believes that
  the service/item would likely be denied as not
  medically necessary
• Created to protect beneficiaries from liability
  in denial cases when services were found not to
  be medically necessary

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Advance Beneficiary Notice (ABN)

• Appropriately executed waiver / ABN
• Proof that beneficiary had knowledge prior to
  furnishing the service/item that it would likely
  be denied as not medically necessary
• Proof that patient agreed to be financially
  responsible for service/item
• No ABN / Waiver of Liability
• Provider/supplier could be held liable for charge
  if it is determined that he/she knew, or
  should have known, that the service/item would be
  denied as not medically necessary

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Information Required - Scheduling Services

• Patient Registration / Scheduling
• Collect relevant patient information
• Accurate title of procedure(s) or service(s)
• Narrative CPT code
• Clinical data w/ physician orders to substantiate
  Dx testing/procedure
• Symptom / Dx indicating medical necessity
• Narrative ICD-9-CM code

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Information Required - Scheduling Services

• If Dx possible, probable, suspected, or
  rule out
• Report symptom requiring procedure or service
• Identify inpatient only other non-covered
  services
• Issue notices of non-coverage (ABN)

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Limited Coverage Examples National Policy

• Screening mammography (76092)
• Screening flexible sigmoidoscopy (G0104)
• Screening colonoscopy - high risk individuals
  (G0105)
• Screening barium enema (G0106 G0120) as an
  alternative to flex sigmoidoscopy/screening
  colonoscopy
• Breast Pelvic Exam (G0101)
• Screening PSA test (G0103)

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Limited Coverage Examples National Policy

• G0220 PET imaging whole body Dx lymphoma
• G0221 - initial staging lymphoma
• G0222 - restaging lymphoma
• G0216 - Pet imaging whole body Dx melanoma
• G0217 - initial staging melanoma
• G0218 - restaging melanoma
• G0219 - melanoma for non-covered indications
• Non-covered by Medicare

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Limited Coverage - LCD

• G0296 PET imaging,, for restaging previously
  treated thyroid cancer of follicular origin
  following negative I-131 whole body scan
• G0253 PET imaging for breast Ca,, staging or
  restaging of local regional recurrence or distant
  mets (i.e., after or prior to course of
  treatment)
• G0254 - evaluation of response to treatment
  performed during course of treatment

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Limited Coverage / NCD vs. LCD

• Prothrombin Time (85610) - NCD
• Partial Thromboplastin Time (PTT) (85730) - NCD
• Radiation Shields D5984 - NCD
• Technetium Tc99m sestamibi (Miraluma) A9500
  NCD
• Technitium Tc99m pyrophosphate A9514 - LCD

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Limited Coverage / LCD

• EKG - 93005 ECG, routine w/ at least
  12 leads tracing only
• Diagnostic Mammography
• 76090 - Mammography unilateral
• 79091 - Mammography bilateral
• G0204 - Dx mammography, direct digital image,
  bilat
• G0206 - Dx mammography, direct digital image,
  unilat

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Limited Coverage - LCD

• Low Osmolar Contrast Media (LOMC)
  A4644, A4645, A4646 Payment for specific
  medical conditions
• Hx of prev adverse reaction to contrast material,
  w/ the exception of sensation of
  heat, flushing, or a single episode of nausea
  or vomiting
• Hx or condition of asthma or allergy
• Significant cardiac dysfunction incl. recent or
  imminent decompensation, severe arrhythmia,
  unstable angina, infarction, Pulm HTN
• Generalized debilitation
• Sickle cell disease

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Limited Coverage / LCD

• Hyaluronate Polymers (Synvisc, Hyalgan) for Tx of
  Osteoarthrosis of Knee
• 20610 Inject joint, bursa
• J7320 Synvisc - Hylan G-F 20,16mg for
  intra-articular injection
• J7317 Sodium hyaluronate 20-25 mg
• C9920 Sodium hyaluronate 30 mg
• Dx 715.x6 Osteoarthrosis, lower leg
• 715.16, 715.26, 715.36, 715.96

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Denial/Rejection - APCs

• APC Status Indicators
• C Inpatient procedure - Not paid
• E Non-covered items - Not paid
• N Incidental procedures - Not paid

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Denial Categories

• Clinical
• Pre-certification or LOS authorization
• Medical necessity
• Non-covered service
• Pre-existing condition

• Technical
• Code assignment
• Modifiers
• Patient ID
• Discharge disposition
• Duplicate claims

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Denial Management Stats

• Denial Rate Goal lt2
• Denials and underpayments
• Can be 2 - 8 of net patient revenue
• Approximately 90 of denials can be prevented
• 50 - 70 of denials can be recovered through
  appeals process

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Correct Coding Initiative (NCCI)

• CCI National Coding Policy
• Control improper coding and unbundling
• Edit categories
• Comprehensive vs. component procedures
• Mutually exclusive procedures

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Outpatient Code Editor

• Purpose
• Claims editor
• APC assignment for covered services
• Identifies individual coding errors
• Indicates action (and reason) taken by FI
• Potential Outcomes
• Hindered/reduced revenue

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Outpatient Code EditorRejection, Denial, RTP

• Claim Rejection -
• One/ more edits present cause whole claim to be
  rejected
• Correct and resubmit claim
• Claim Denial -
• One/more edits present cause whole claim to be
  denied
• Appeal the claim denial
• Claim Return to Provider (RTP) -
• One/more edits present cause the whole claim to
  be RTP
• Resubmit claim once the problems are corrected

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Outpatient Code Editor Rejection, Denial, RTP,
Suspension

• Claim Suspension -
• One or more edits cause the whole claim to
  be suspended
• Claim is not RTP, but is not processed for
  payment until FI makes a determination or obtains
  further information

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Outpatient Code Editor Rejection, Denial, RTP

• Line Item Rejection -
• One/more edits cause one/more individual line
  items to be rejected
• Claim processed w/ some line items rejected for
  payment
• Correct and resubmit the rejected line item(s)
• Line Item Denials
• One/more edits cause one/more individual line
  items to be rejected
• Claim processed w/ some line items denied for
  payment
• Appeal the denied line item

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OCE Edits

• Code/modifier validation 10
• valid code no age/sex conflict
• Partial hospitalization 8
• Inpatient/non-covered procedure 5
• NCCI edits 4
• Data validation 4
• correct dates sex
• Correct use of units/bilateral 4
• Multiple visits wo/ proper data 2
• Payment edits 2
• Inconsistencies 2
• Site of service 1
• Revenue code validation 1

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Code/Modifier Validation Edits
Edit Description 1 Invalid Dx Code 2 Dx age
conflict 3 Dx sex conflict 5 E-code as reason
for visit 6 Invalid Procedure code 7 Procedure
age conflict 8 Procedure and sex
conflict 22 Invalid Modifier 27 Only incidental
procedures reported 28 Code not recognized by
Medicare, alternate code for same
service Note Disposition of above listed edits
RTP
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Resolutions - Medical Necessity
Documentation/Coding

• Coverage Determination
• CMS National Coverage Policy
• Local Coverage Determination
• FI Interpretation
• Documentation coding education
• Coders
• Physicians
• Hospital staff

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Resolutions -Medical Necessity - Ancillary

• Ancillary
• Update CDM
• HCPCS codes
• Modifiers
• Review and update charge entry process
• Units
• Educate staff
• Physicians, ancillary professional and clerical
  staff

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Resolutions Medical Necessity

• Front End and Back End Edit Software
• Medical Necessity Software
• Claims Scrubber Software
• OCE Edits
• CCI Edits

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Questions?