Knowledge Base Category -
The Comprehensive Care for Joint Replacement (CJR) Model is a mandatory model for participants in selected Metropolitan Specific Areas (MSAs) aimed at testing to see if an episode based payment approach for lower extremity joint replacement (LEJR) can incentivize hospitals to reduce cost and concurrently maintain or improve quality.
The first performance year examined LEJR episodes initiated on or after April 1, 2016 and ended December 31, 2016. The Lewin Group with partners was contracted by CMS to evaluate the impact of the Comprehensive Care for Joint Replacement (CJR) model. On August 31, 2018, CMS posted the First Annual Report to CMS’ CJR webpage.
Key Report Findings
“CJR participant hospitals were able to reduce payments through changes in utilization while maintaining quality of care. At the same time, we found no indication that CJR participant hospitals selected healthier patients to achieve these results.”
- Total episode payments decreased 3.3% ($910) more for CJR episodes than control group episodes. “At the same time, quality of care was maintained, as indicated by claims-based quality measures.”
- Average total payment reductions for CJR episodes occurred in both historically high and low Metropolitan Statistical Areas (MSAs). Historically high MSAs averaged a $1,127 decrease and historically low MSAs averaged a $577 decrease in episode payment as compared to the control episodes.
- Average Total Payments were reduced for both elective and fracture episodes relative to the control group.
- Elective Episodes were reduced by $880, and
- Fracture Episodes were reduced by $1,345
A driver in episode payment reduction by participating hospitals was by reducing institutional Post-Acute Care (PAC) payments. Specifically, fewer Inpatient Rehabilitation Facility (IRF) transfers and patients spending fewer days in a skilled nursing facility (SNF). Key ways participating hospitals changed their PAC use included the following:
- Expanded patient education efforts,
- Starting discharge planning earlier,
- Increasing coordination with PAC providers, and
- Developing preferred provider networks.
Before this model started, there was a concern that participating hospitals would pick healthier patients for participation. Claims data analysis by the Lewin Group “provided no indications of changes in patient characteristics for CJR episodes relative to control group episodes.”
“Possibly the most notable outcome during the first CJR model performance year was that statistically significant changes in utilization and payments occurred so quickly. With approximately nine months of implementation, the CJR model resulted in outcomes that are consistent with what has been achieved in other bundled payment initiatives. More time under the CJR model will help in determining if continued improvements can be achieved.”
The entire report, report appendices and a two page high level “Findings at a Glance” summary can be accessed on the CMS CJR webpage at https://innovation.cms.gov/initiatives/cjr.
Beth Cobb
It has been a while since we have reviewed the issues approved for audit by the Recovery Auditors (RACs). Since CMS has banned the review of the medical necessity of inpatient admissions by RACs (other than upon referral from the QIO), the impact of RAC reviews is greatly diminished from their prior Statement of Work. This does not mean they have been idle. Currently, there are 105 CMS approved RAC Topics across all types of providers. Between the RAC reviews and reviews by the Medicare Administrative Contractors (MACs), Comprehensive Error Rate Testing (CERT) reviewers, and other Medicare entities, providers may still feel overwhelmed by the enormity of the task of ensuring appropriate billing, accurate coding, and complete documentation for Medicare services. When you are overwhelmed, we all know that you have to eat that elephant one bite at a time.
You can see a listing of the approved topics and proposed review topics on CMS’s Recovery Audit Program website. The website also includes links to the websites of the various Recovery Auditors where you can find your specific state RAC’s active review topics. Hospital inpatient and outpatient review topics approved by CMS since the beginning of this year are discussed below. Topic posting dates and claim types may vary from RAC to RAC so providers need to review their RAC’s website to see if the claim type is applicable to them. As a reminder, automated reviews can result in automatic denials based solely on claims data. The RAC will request medical record documentation from the provider for complex reviews and coverage/payment decisions are based on that documentation.
0074 - Excessive or Insufficient Drugs and Biologicals Units Billed (complex review)
Drug and biological units should be reported in multiples of the dosage specified in the HCPCS code long descriptor. Units are determined by dividing the amount of the drug administered by the dosage in the HCPCS descriptor. If there is drug wastage that meets Medicare requirements for billing and is appropriately documented, it can also be billed with the JW modifier and units determined the same as for the administered drug. If the amount of drug used is not a multiple of the HCPCS code dosage descriptor, round up to the next highest unit. Claims will be reviewed to determine the actual amount administered and the correct number of billable/payable units. (Affected Codes - C9025, C9295, J0129, J0178, J0256, J0583, J0585, J0894, J0897, J1300, J1459, J1561, J1566, J1569, J1572, J1745, J2323, J2353, J2357, J2505, J2778, J2796, J2997, J3101, J3262, J3487, J7325, J9033, J9035, J9041, J9043, J9055, J9171, J9228, J9263, J9264, J9299, J9303, J9305, J9306, J9310, J9351, J9355, Q2050, J9034)
0078 - Complex Cardiac Pacemaker Review (complex review)
Medicare coverage for pacemakers is defined in National Coverage Determination NCD 20.8.3 and in numerous Medicare Administrative Contractor (MAC) coverage articles (e.g. Palmetto's Cardiac Pacemaker Coverage Article). Documentation will be reviewed to determine if Cardiac Pacemakers meet Medicare coverage criteria, meet applicable coding guidelines, and/or are medically reasonable and necessary. (Affected Codes - 33206, 33207, 33208)
0083 - Cataract Removal Excessive Units (Partial)
0084 - Cataract Removal Excessive Units (Full) (automated reviews)
Medicare will only pay for one cataract removal performed on the same eye on the same date of service. Claims with more than one unit of cataract removal for the same eye, on the same claim line, will be partially denied and payment will only be made for one cataract removal. This may be the result of reporting more than one of the cataract CPT codes for the same surgery. As explained in Chapter 8 of the National Correct Coding Initiative manual, “CPT codes describing cataract extraction (66830-66984) are mutually exclusive of one another. Only one code from this CPT code range may be reported for an eye.”
If there are multiple claims for cataract removal for the same patient for the same eye, only one will be paid and the others fully denied. (Affected Codes - CPT 66830, 66840, 66850, 66852, 66920, 66930, 66940, 66982, 66983, 66984)
0085 - Lab Services Rendered During an Inpatient Stay (automated review)
Laboratory services provided to a patient during an inpatient admission are paid as part of the DRG payments and are not separately billable to Medicare. These services should be denied as unbundled services. (Affected Codes - 80048-80076, 80150-80203, 80400-80439, 81000- 81050, 82009-84830, 85002- 85810, 86602- 86804, 87003-87905)
0092 - Percutaneous Implantation of Neurostimulator Electrode Array (complex review)
NCD 160.7.1 describes Medicare coverage of percutaneous electrical nerve stimulation. Documentation in the medical record must support the code billed was actually the service rendered and that all coverage criteria were met. (Affected Codes - 64553, 64555)
0093 - Automatic Defibrillators (complex review)
Medicare has a long and complex NCD (NCD 20.4) for implantable automatic defibrillators, electronic devices designed to detect and treat life-threatening tachyarrhythmias. Prior reviews by the Department of Justice (DOJ) and other Medicare entities have found numerous claims billed that did not meet Medicare requirements. The RACs will be reviewing documentation to support medical necessity and validate that implantable automatic cardiac defibrillators are used only for covered indications. (Note: there is a pending update to this NCD that should be finalized soon.) (Affected Codes - 33240, 33241, 33242, 33243, 33249)
0095-Facet Injections (complex review)
Facet Joint Injections are reasonable and necessary for chronic pain (persistent pain for three (3) months or greater) suspected to originate from the facet joint. Medical documentation will be reviewed to determine that services were medically reasonable and necessary. Although this issue has been approved by CMS, so far none of the RACs have added this to their approved issues list. (Affected Codes - 64490-64495, 64633-64636, 0213T-0218T, G0260)
0099-Skilled Nursing Facility (SNF) Consolidated Billing (automated review)
Most services provided to a Skilled Nursing Facility (SNF) inpatient (skilled stay) are part of the SNF consolidated billing prospective payment. This means the Medicare Part A payment made to the SNF includes payment for these services. Other outpatient providers that furnish these services to a SNF inpatient must receive payment from the SNF. A few select services are exempt from consolidated billing and the rendering provider can bill Medicare directly for these exempt services. Refer to the Medicare SNF Consolidated Billing website for information and lists of exempt categories and codes. (Affected Codes - CPT/HCPCS codes listed in the SNF Consolidated Billing Table, Major Category I.F and V.A.)
0101-Outpatient Hospital Comprehensive APC Coding (complex review)
For comprehensive APCs, Medicare makes one inclusive payment for the primary procedure and all adjunctive services. This means payment for most services is not made separately but bundled into the payment for the primary service. If the primary service is not billed properly or not supported by documentation, the entire claim may be denied. According to CMS’s explanation of the issue, “Comprehensive APC coding requires that procedural information, as coded and reported by the hospital on its claim, match both the attending physician description and the information contained in the beneficiary's medical record. Reviewers will validate the APC by reviewing the procedures affecting or potentially affecting the APC assignment.” (Affected Codes – Codes with an OPPS status indicator (SI) = J1)
The good news about the RAC issues under the current scope of work is that the limited number of issues makes it easier for providers to internally review their processes and documentation to ensure they are meeting Medicare requirements. It is also easier to make improvements if deficiencies are found and limit future recoupments. Providers may still feel like they are eating an elephant one bite at a time, but at least the bites are smaller.
Debbie Rubio
The March 1, 2018 edition of the Medicare Learning Network e-newsletter mlnconnects, includes a list of new and revised Provider Compliance Tips Fact Sheets. This article focuses on the new Provider Compliance Tips for Bariatric Surgery Fact Sheet.
Provider Compliance Tips for Bariatric Surgery Fact Sheet
CMS notes there is a National Coverage Determination (NCD) 100.1 for Bariatric Surgery for Treatment of Obesity. As a matter of fact this NCD is now in its 5th iteration with the first version having an effective date of 10/1/1979.
Bariatric procedures are performed to treat the comorbid conditions associated with morbid obesity and a beneficiary must meet all of the following Medicare coverage criteria:
- Have a Body-Mass Index (BMI) of ≥ 35 kg/m2,
- At least one comorbidity related to obesity, and
- Had prior unsuccessful medical treatment for obesity.
Bariatric surgery as treatment for obesity alone remains non-covered by Medicare.
Reasons for denials cited in the fact sheet include insufficient documentation, documentation fails to support procedures as reasonable and necessary, and Providers do not comply with signature requirements.
Bariatric Surgery Medical Necessity Reviews
Bariatric Surgery is not new, so the question for me is why a Fact Sheet now? More importantly, for hospitals performing bariatric procedures, have you self-audited medical record documentation to validate that procedures being performed are reasonable and necessary? If not, you should because what I have found in writing this article is that Medicare Auditors have and continue to review these procedures for medical necessity.
Comprehensive Error Rate Testing (CERT)
The Fact Sheet includes the July 2014 edition of the Medicare Quarterly Compliance Newsletter as a resource for more information about bariatric surgery. The newsletter includes an overview of a special study of HCPCS codes for bariatric surgery (43644 and 43770) conducted by the CERT. They found that insufficient documentation (something was missing from the record) caused approximately 98 percent of the improper payments. The newsletter also provides examples of improper payments for bariatric surgery.
Supplemental Medical Review Contractor (SMRC): Completed Project 2015-0216 Bariatric Surgery
The SMRC completed a review of bariatric surgery for the treatment of morbid obesity at the direction of CMS as a result of the 2014 CERT special study. The Project included a review of claims with dates of service from January 1, 2014 through December 31, 2014.
In their report they noted that CMS identified Type 2 diabetes mellitus as being one co-morbidity related to obesity and go on to indicate that CMS delegated the authority to determine additional co-morbidities and whether coverage will be extended to other types of bariatric surgery than outlined in NCD 100.1 to the Medicare Administrative Contractors (MACs).
At the time this project was completed, co-morbidities covered by one or more MAC included:
- Refractory hypertension (HTN),
- Obesity-induced cardiomyopathy,
- Clinically significant obstructive sleep apnea,
- Obesity-related hypoventilation,
- Pseudo tumor cerebri (documented idiopathic intracerebral HTN),
- Severe arthropathy of spine or weight-bearing joints, and
- Hepatic steatosis without prior evidence of active inflammation.
The Project overall error rate was 35 percent. This included claims recommended for denial due to providers not submitting the requested records and claims recommended for denial after review. Specific examples of insufficient documentation provided in the report included:
- Lack of documentation to support that the beneficiary had been previously unsuccessful with medical attempts (supervised dieting, exercise) at weight loss prior to surgical intervention,
- The submitted documentation did not include a signed operative report, and
- The submitted documentation did not include preoperative psychological evaluation with clearance for surgery and if treatable metabolic causes for obesity, such as adrenal or thyroid disorders, had been ruled out.
Recovery Auditors approved issue: Bariatric Surgery
Complex reviews for medical necessity of bariatric surgery is a current review issue for all four Recovery Audit Regions in the country. The approval date for this issue varies among the four Regions from November 2016 to February 1, 2017. Remember that the Recovery Audit look back period is three years.
Office of Inspector General (OIG) Work Plan: Review of Medicare Payments for Bariatric Surgeries
In October 2017, the OIG added the Review of Medicare Payments for Bariatric Surgeries to their Active Work Plan Issues. As with the SMRC, the OIG referenced the CERT special study in the announcement. The OIG indicated that they will be reviewing “supporting documentation to determine whether the bariatric services performed met the conditions for coverage and were supported in accordance with Federal requirements.”
Next Step: Know the Coverage Requirements
While the new Fact Sheet references NCD 100.1 it does not reference additional guidance by the MACs. Do you know if your MAC has published additional guidance? The following table details the MACs that have published a Local Coverage Determination (LCD) or Coverage Article.
As you can see, it is pretty clear why a Fact Sheet now and MMP, Inc. encourages you to become familiar with the NCD, any applicable MAC guidance, use the new Fact Sheet and Medicare Quarterly Compliance Newsletter as teaching tools and make sure your records support the medical necessity for the procedure.
Beth Cobb
Ambulance Inflation Factor for CY 2018 and Productivity Adjustment
The Calendar Year (CY) 2018 Ambulance Inflation Factor (AIF) for determining the payment limit for ambulance services is 1.1 percent.
Correction to Prevent Payment on Inpatient Information Only Claims for Beneficiaries Enrolled in Medicare Advantage Plans
Sets system edits to zero out payment on inpatient information only claims billed with condition codes 04 and 30 for Investigational Device Exemption (IDE) Studies and Clinical Studies Approved Under Coverage with Evidence Development (CED).
New Common Working File (CWF) Medicare Secondary Payer (MSP) Type for Liability Medicare Set-Aside Arrangements (LMSAs) and No-Fault Medicare Set- Aside Arrangements (NFMSAs) - RESCINDED
Clarifying Signature Requirements
Medicare requires that services provided/ordered/certified be authenticated by the persons responsible for the care of the beneficiary in accordance with Medicare’s policies. Claim denials shall be limited to those instances in which signatures that are required by Medicare policies are flawed or missing.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R751PI.pdf
Clinical Laboratory Improvement Amendments of 1988 (CLIA); Fecal Occult Blood (FOB) Testing
Clarifies CLIA regulations that the waived test categorization applies only to non- automated fecal occult blood tests.
https://www.gpo.gov/fdsys/pkg/FR-2017-10-20/pdf/2017-22813.pdf
Calculating Interim Rates for Graduate Medical Education (GME) Payments to New Teaching Hospitals – REVISED
Re-issued to revise several policy statements and to address how to handle certain impacted claims.
New Common Working File (CWF) Medicare Secondary Payer (MSP) Type for Liability Medicare Set-Aside Arrangements (LMSAs) and No-Fault Medicare Set-Aside Arrangements (NFMSAs) – REPLACED
Removes provider education requirements from original transmittal.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R1954OTN.pdf
Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs Final Rule
Revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2018.
https://www.gpo.gov/fdsys/pkg/FR-2017-11-13/pdf/2017-23932.pdf
Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B for CY 2018
Addresses changes to the Medicare physician fee schedule (PFS) and other Medicare Part B payment policies to update payment systems to reflect changes in medical practice and the relative value of services, as well as changes in the statute. In addition, this final rule includes policies necessary to begin offering the expanded Medicare Diabetes Prevention Program model.
https://www.gpo.gov/fdsys/pkg/FR-2017-11-15/pdf/2017-23953.pdf
Implementation of the Award for the Jurisdiction Part A and Part B Medicare Administrative Contractor (JJ A/B MAC)
Announces CMS has awarded the JJ A/B MAC contract for the administration of the Part A and Part B Medicare fee-for-service claims in the states of Alabama (AL), Georgia (GA) and Tennessee (TN) to Palmetto GBA LLC.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R1960OTN.pdf
Update to Pub 100-04, Chapter -18 Preventive and Screening Services -Screening for Lung Cancer with Low Dose Computed Tomography (LDCT)
Adds ICD-10 diagnosis codes: F17.210 (Nicotine dependence, cigarettes, uncomplicated), F17.211 (Nicotine dependence, cigarettes, in remission), F17.213 (Nicotine dependence, cigarettes, with withdrawal), F17.218 (Nicotine dependence, cigarettes, with other nicotine-induced disorders), or F17.219 (Nicotine dependence, cigarettes, with unspecified nicotine-induced disorders), for LDCT coverage.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R3901CP.pdf
Billing Requirements for Ophthalmic Bevacizumab
Clarifies HCPCS code for billing ophthalmic bevacizumab.
Notification of the 2018 Dollar Amount in Controversy Required to Sustain Appeal Rights for an Administrative Law Judge (ALJ) Hearing or Federal District Court Review
ALJ hearing requests amount for 2018 will remain at $160. Federal District Court appeals amount will increase to $1,600 for 2018.
Accepting Payment from Patients with a Medicare Set-Aside Arrangement
Explains what a MSA is and explains why it is appropriate to accept payment from a patient that has a funded MSA.
CMS Hospital Value-Based Purchasing Program Results for Fiscal Year 2018
Fact Sheet describing VBP program and updates. Estimates the total amount available for value-based incentive payments for FY 2018 discharges will be approximately $1.9 billion.
Additional Appeals Settlement Option
CMS will make available an additional settlement option for providers and suppliers (appellants) with appeals pending at the Office of Medicare Hearings and Appeals (OMHA) and the Medicare Appeals Council (the Council) at the Departmental Appeals Board.
ICD-10 and Other Coding Revisions to National Coverage Determinations (NCDs)
NCD coding changes the result of newly available codes, coding revisions to NCDs released separately, or coding feedback received.
CMS Posts RAC Review Topics
CMS has begun to post a list of review topics that have been proposed, but not yet approved, for RACs to review. These topics will be listed, on a monthly basis, on the Provider Resources page.
Partial Settlement of 2-Midnight Policy Court Cases
Provides instructions to Medicare Administrative Contractors (MACs) on how to ensure hospitals receive additional payments due to a partial settlement agreement regarding the 0.2 percent downward adjustment beginning in Fiscal Year ("FY") 2014.
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R1969OTN.pdf
New Waived Tests
New Clinical Laboratory Improvement Amendments of 1988 (CLIA) waived tests approved by the Food and Drug Administration (FDA).
Annual Update of HCPCS Codes Used for Home Health Consolidated Billing Enforcement
Provides the 2018 annual update to the list of Healthcare Common Procedure Coding System (HCPCS) codes used by Medicare systems to enforce consolidated billing of home health services.
Remittance Advice Remark Code (RARC), Claims Adjustment Reason Code (CARC), Medicare Remit Easy Print (MREP), and PC Print Update
Updates the Remittance Advice Remark Codes (RARC) and Claims Adjustment Reason Code (CARC) lists and instructs Medicare Shared System Maintainers (SSMs) to update Medicare Remit Easy Print (MREP) and PC Print.
Claim Status Category Codes and Claim Status Codes Update
MAC and shared systems changes will be made as necessary as part of a routine release to reflect applicable changes such as retirement of previously used codes or newly created codes.
Therapy Cap Values for Calendar Year (CY) 2018
For physical therapy and speech-language pathology combined, the CY 2018 cap is $2,010. For occupational therapy, the CY 2018 cap is $2,010.
New Positron Emission Tomography (PET) Radiopharmaceutical/Tracer Unclassified Codes
CMS has created two new PET radiopharmaceutical unclassified tracer codes that can be used temporarily pending the creation/approval/implementation of permanent CPT codes that would later specifically define their function: A9597 - Positron emission tomography radiopharmaceutical, diagnostic, for tumor identification, not otherwise classified; A9598 – Positron emission tomography radiopharmaceutical, diagnostic, for non-tumor identification, not otherwise classified.
2018 Medicare Parts A & B Premiums and Deductibles
On November 17, 2017, the Centers for Medicare & Medicaid Services (CMS) released the 2018 premiums, deductibles, and coinsurance amounts for the Medicare Part A and Part B programs. The standard monthly premium for Medicare Part B enrollees will be $134 for 2018, the same amount as in 2017. The annual deductible for all Medicare Part B beneficiaries will be $183 in 2018, the same annual deductible in 2017. The Medicare Part A annual inpatient hospital deductible that beneficiaries pay when admitted to the hospital will be $1,340 per benefit period in 2018, an increase of $24 from $1,316 in 2017.
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet-items/2017-11-17.html
Quarterly Update of HCPCS Codes Used for Home Health Consolidated Billing Enforcement
Provides the quarterly update of HCPCS codes used for HH consolidated billing effective April 1, 2018.
I once illustrated the myriad of Medicare contractors and affiliates that perform pre-payment and/or post-payment medical reviews as a spider’s web – a day late for a Halloween connection. There are at least a couple of reasons supporting an association between the two. First, healthcare providers would never want to be caught in the “web” of reviews (especially if the spider proves to be the cause of their demise). And secondly, as the filaments of a spider’s web connect together, there are connections between the different Medicare auditors. Medicare Administrative Contractors (MACs) may review problematic issues identified by the Comprehensive Error Rate Testing program (CERT). MACs may refer at-risk issues to other reviewers such as the Recovery Auditors (RACs) or the RACs might refer topics back to the MACs. The MACs or RACs may follow-up on overpayment issues identified by the Office of Inspector General (OIG) or the OIG may further investigate inappropriate payment issues identified by the MACs or RACs. This month’s report on new RAC and OIG review issues are perfect examples of this inter-related web of reviews.
There has not been a lot of new issues approved for Recovery Audit Contractor (RAC) reviews in the last month. HMS, the Region 4 Recovery Auditor, appears to have reposted some issues such as the complex review of medical necessity of sacral neurostimulation for outpatient hospitals. HMS also added an automated review for critical access hospital (CAH) and outpatient hospital services on October 6, 2017 – Outpatient Services Overlapping or During an Inpatient Stay. This review topic may be the result of findings of a recent report from the Office of Inspector General (OIG), which was addressed in detail in a Wednesday@One article from August. This automated issue is not yet listed on either the Cotiviti or Performant websites. There were no other newly approved issues related to hospital services for any of the RACs.
Hospital related issues have also been rare in the new updates to the OIG Work Plan the past few months. In the October updates, there is one issue that affects hospitals. The OIG will be reviewing supporting documentation to determine whether bariatric services meet the conditions for coverage and are supported in accordance with Federal requirements (Social Security Act, §§ 1815(a) and 1833(e)) and in keeping with the CMS National Coverage Determination (NCD) 100.1. Medicare Parts A and B only cover certain bariatric procedures when the patient meets the following criteria:
- a body mass index of 35 or higher,
- at least one comorbidity related to obesity, and
- had previously unsuccessful medical treatment for obesity.
Treatments for obesity alone are not covered. A CERT special study of bariatric surgical procedures found that approximately 98 percent of improper payments lacked sufficient documentation to support the procedures. This issue was highlighted in the July 2014 Medicare Quarterly Provider Compliance newsletter.
So even though these are new posted issues for these contractors, they are issues we have seen before.
Debbie Rubio
As we approach the 4th of July Holiday it is a time to reflect on the history of our great nation. It is also a time to say a prayer of thanks and gratitude for all those who have served and continue to serve to protect the personal freedoms and rights guaranteed to us by the Bill of Rights.
While there has been much debate as to whether healthcare is a right, Medicare beneficiaries, Medicare Advantage (MA) plan enrollees, Medicare as a Secondary Payor (MSP), and dual-eligible beneficiaries who are hospital inpatients have long had a statutory discharge appeal right.
Effective July 1, 2007, hospitals were required to begin delivering a revised version of the Important Message from Medicare (IM) form informing Medicare beneficiaries about their appeal rights. This second form was and still is to be given within two days of discharge. Additionally, beneficiaries who choose to appeal a discharge decision must also be provided the Detailed Notice of Discharge (DND) form from the hospital or his/her Medicare Advantage plan, if applicable.
Frequently Asked Questions
Over time, MMP has received questions regarding the process for delivering the IM form. On April 3, 2007 CMS released a Q&A document that in general has answered specific IM questions posed to us by our clients. Below are two of the most frequently asked questions and a link to the entire CMS document.
Question: Are we required to provide the IM and DND forms to all patients, regardless of payment source?
Answer: “This rule applies to all Medicare beneficiaries, including enrollees in Medicare Advantage (MA) plans and other Medicare health plans subject to MA regulations. Section 1154 of the Social Security Act applies to all patients who are under Medicare, regardless of where Medicare falls in the sequence of payment. Thus, all Medicare beneficiaries, no matter where in the sequence of payers Medicare falls, must receive these notices.”
Question: “Does the follow-up copy of the IM need to be signed again? If the follow-up copy is delivered and the patient ends up staying several more days, does another follow up copy need to be delivered?”
Answer: “The regulations do not require that the follow-up copy be signed. It serves as a reminder of the information that was given on the initial IM. However, while the beneficiary’s signature is not required, a hospital must be able to document that the notice has been delivered. One way to accomplish this would be to have the beneficiary initial the form to indicate that he or she has received it. We intend to provide an “Additional Information” area for an entry on the latest version of the IM. If the follow-up copy of the IM has been delivered and a beneficiary remains in the hospital for more than 2 additional calendar days, another follow-up copy should be issued according to the required timeframes.”
CMS Document Final Rule: Notification of Hospital Discharge Appeal Rights (CMS-4105-F) Qs And As (April 3, 2007) at https://www.cms.gov/Medicare/Medicare-General-Information/BNI/Downloads/CMS4105FINALRULEQsandAs2007.pdf
Appeal Notice Updates Timeline
As mentioned earlier, on July 1, 2007 hospitals were required to begin delivering a second copy of the IM letter within two days of the beneficiaries discharge. Since that time there have been updates to the IM Form CMS-R-193 and DND Form CMS 10066 as outlined below.
July 2010 IM Form Update
In 2010 the OMB released an updated form approved 07/10 that added a place to put the time the letter was signed in addition to the date.
August 2014 QIO Contact Information Change
With the 11th Scope of Work for the Quality Improvement Organizations (QIOs), responsibilities were split into two separate QIOs. The Quality Innovation Network (QIN) QIOs and the Beneficiary and Family Centered Care (BFCC) QIOs. Hospital Discharge Appeals are managed by the BFCC-QIOs. With this change, in August of 2014, CMS required hospitals to update their forms with the correct BFCC-QIO contact information no later than September 1, 2014.
June 2017 Form Update
A few weeks ago on June 6th CMS posted updated IM and DND forms to their Hospital Discharge Appeal Notices webpage. Comparing the new forms to the previous forms, MMP only noted the following form updates:
- IM Form CMS-R-193:
- At the bottom left corner of the first page “Form CMS-R-193 (approved 07/10)” has been changed to “Form CMS-R-193 (Exp. 03/31/2020), and
- Above the “Additional Information” box on the bottom of page two the following verbiage has been added, “CMS does not discriminate in its programs and activities. To request this publication in an alternate format, please call: 1-800-MEDICARE or email: AltFormatRequest@cms.hhs.gov.”
- DND Form CMS 10066:
- At the bottom of the form the following verbiage has been added, “CMS does not discriminate in its programs and activities. To request this publication in an alternative format, please call: 1-800-MEDICARE or email: AltFormatRequest@cms.hhs.gov, and
- At the bottom left corner for the form “CMS 10066 (approved 07/10)” has been changed to “CMS 10066 (Exp. 10/31/2019).”
Additional information about Hospital Discharge Appeals can be found at the following resources.
BFCC-QIO Appeals webpages
- KEPRO at https://www.keproqio.com/providers/appeals.aspx
- Livanta at https://bfccqioarea5.com/casetypes.html
Medicare Claims Processing Manual, Chapter 30 – Financial Liability Protections, Section 200 – Expedited Review Process for Hospital Inpatients in Original Medicare at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/clm104c30.pdf
State Operations Manual, Appendix A – Survey Protocol, Regulations and Interpretive Guidelines for Hospitals, §482.13(a)(1) at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/som107ap_a_hospitals.pdf
Beth Cobb
It is a curious thing what seems to “stick with you” from your college years. It is even more curious that Elisabeth Kubler-Ross’ five stages of grief is one of those things that for me, stuck. With that in mind, I have been known to attribute the five levels of Medicare Appeals to the five stages of grief.
On January 17, 2017, CMS published a Final Rule making changes to the Medicare Appeals process. More specifically, “this final rule revises the procedures that the Department of Health and Human Services (HHS) follows at the Administrative Law Judge (ALJ) level for appeals of payment and coverage determinations for items and services furnished to Medicare beneficiaries, enrollees in Medicare Advantage (MA) and other Medicare competitive health plans, and enrollees in Medicare prescription drug plans, as well as appeals of Medicare beneficiary enrollment and entitlement determinations, and certain Medicare premium appeals. In addition, this final rule revises procedures that the Department of Health and Human Services follows at the Centers for Medicare & Medicaid Services (CMS) and the Medicare Appeals Council (Council) levels of appeal for certain matters affecting the ALJ level.”
The effective date of the rule is March 20, 2017. With the release of this Final Rule, will hospitals find relief from the grief they have been subjected to over the past several years? That remains to be seen. But for now, let’s look at a couple of highlights from the Final Rule.
Background
Overview of Appeals Process
- Under section 1869 of the Act, the Medicare claims appeal process involves redeterminations conducted by the Medicare Administrative Contractors (which are independent of the staff that made the initial determination).
- The next level is a Reconsiderations conducted by Qualified Independent Contractors (QICs).
- The Medicare Prescription Drug, Improvement, and Modernizations Act (MMA) of 2003 required the transfer of responsibility for the ALJ hearing level of the Medicare claim and entitlement appeals process from SSA to HHS. OMHA ALJs began adjudicating appeals in July 2005, based on section 931 of the MMA.
- The OMHA, a staff division within the Office of the Secretary of HHS, administers the nationwide ALJ hearing program for Medicare claim, organization and coverage determination, and entitlement and certain premium appeals.
- “ALL of the appeals discussed in this final rule can be appealed to the ALJs at the Office of Medicare Hearings and Appeals (OMHA) if the amount in controversy requirement and other requirements are met after these first and/or second level of appeals.”
Recent Workload Challenges
- At OMHA, the number of requests for an ALJ hearing or review increased 1,222 percent, from FY 2009 through FY 2014
- Growth in appeals have been attributed to the following:
- Expanding beneficiary population and utilization of services,
- Enhanced monitoring for payment accuracy in the Medicare Part A and Part B (fee-for-service) programs,
- Growth in appeals from State Medicaid agencies for beneficiaries dually enrolled in both Medicare and Medicaid; and
- Implementation of the Recovery Audit program nationwide in 2009
- OMHA ALJ Productivity
- FY 2009: There was an average of 471 decisions and 80 dismissals per ALJ.
- FY 2014: There was a record average of 1,048 decisions and an additional 446 dismissals per ALJ.
- As of September 30, 2016, OMHA had over 650,000 pending appeals, while OMHA’s adjudication capacity – based on a maximum sustainable capacity of 1,000 appeals per ALJ team – was approximately 92,000 appeals per year.
- HHS has three-prong approach to address the increasing backlog
- Request new resources
- Take administrative actions to reduce the number of pending appeals; and
- Propose legislative reforms that provide additional funding and new authorities to address the volume of appeals.
“In this final rule, HHS is pursuing the three-prong approach by implementing rules that expand the pool of available OMHA adjudicators and improve the efficiency of the appeals process by streamlining the processes so less time is spent by adjudicators and parties on repetitive issues and procedural matters. In particular, we believe the proposals we are finalizing in section II.A.2 below to provide authority for attorneys to issue decisions when a decision can be issued without an ALJ hearing, dismissals when an appellant withdraws his or her request for an ALJ hearing, remands as provided in §§405.1056 and 423.2056 as finalized in this rule or at the direction of the Council, and reviews of QIC and IRE dismissals, could redirect approximately 24,500 appeals per year to attorney adjudicators, who would be able to process these appeals at a lower cost than would be required if only ALJs were used to address the same workload (see section VI below for more details regarding our estimate).”
Precedential Final Decisions of the Secretary
Finalized Proposal: The Chair of the Departmental Appeals Board (DAB) will have authority to designate a final decision of the Secretary issued by the Council as precedential.
CMS perceives that benefits of this finalized proposal include:
- “This would provide appellants with a consistent body of final decisions of the Secretary upon which they could determine whether to seek appeals.”
- “It would assist appeal adjudicators at all levels of appeal by providing clear direction on repetitive legal and policy questions, and in limited circumstances, factual questions.”
- “In the limited circumstances in which a precedential decision would apply to a factual question, the decision would be binding where the relevant facts are the same and evidence is presented that the underlying factual circumstances have not changed since the Council issued the precedential final decision.”
To help ensure appellants and other stakeholders are aware of Council decisions that are designated as precedential…
- Notice of precedential decisions would be published in the Federal Register, and the decisions themselves would be made available to the public.
- Designated precedents would be posted on an accessible website maintained by HHS, and
- Decisions of the Council would bind all lower-level decision-makers from the date that the decisions are posted on the HHS website.
- Make precedential decisions binding meaning “the precedential decision would be binding on CMS and its contractors in making initial determinations, redeterminations, and reconsiderations.
CMS notes that “the designation of a decision as precedential does not create a new law or policy. By designating decisions as precedential, the DAB Chair is merely providing for consistent legal interpretation and analysis of CMS’s existing laws, rule and policies…the mission of the DAB is to provide impartial, independent review of disputed decisions in a wide range of HHS programs under more than 60 statutory provisions. The DAB Chair will continue to advance that mission when designating precedential Council decisions.”
Attorney Adjudicators
Finalized Proposal: CMS proposed and finalized without modification changes to provide authority for attorney adjudicators to issue decisions when a decision can be issued without an ALJ conducting a hearing under the regulations, to dismiss appeals when an appellant withdraws his or her request for an ALJ hearing, to remand appeals as provided in §§405.1056 and 423.2056 or at the direction of the Council, and to conduct reviews of QIC and IRE dismissals.
Also finalized was §405.902 which defines an attorney adjudicator as a licensed attorney employed by OMHA with knowledge of Medicare coverage and payment laws and guidance.
In FY 2015, OMHA ALJs addressed approximately 370 requests to review whether a QIC or IRE dismissal was in error. Also adding to the ALJs’ workload are remands to Medicare contractors for information that can only be provided by CMS or its contractors under current §§405.1034(a) and 423.2034(a), and for further case development or information at the direction of the Council. Staff may identify the basis for these remands before an appeal is assigned to an ALJ and a remand order is prepared, but an ALJ must review the appeal and issue the remand order, taking the ALJ’s time and attention away from hearings and making decisions on the merits of appeals.
CMS estimated in the proposed rule that, based on FY 2015 data, the proposal to expand the pool of adjudicators at OMHA could redirect approximately 23,650 appeals per year to attorney adjudicators. Basing the estimates on FY 2016 data, CMS now estimates the impact to be approximately 24,500 appeals per year.
While this article highlights two issues within the Final Rule it is important to note that this Rule covers many additional areas (i.e. amount in controversy required for an ALJ hearing and CMS and CMS contractors as participants or parties in the adjudication process). For this reason, it is important that key stakeholders within your facility take the time to read this Final Rule.
Resources:
Federal register / Vol. 82, No. 10 / Tuesday, January 17, 2017 / Rules and Regulations at https://www.gpo.gov/fdsys/pkg/FR-2017-01-17/pdf/2016-32058.pdf
CMS Medicare Parts A & B Appeals Process (ICN 006562 May 2016) at https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/MedicareAppealsProcess.pdf
Link to 1/17/2017 Federal Register document: https://www.federalregister.gov/documents/2017/01/17/2016-32058/medicare-program-changes-to-the-medicare-claims-and-entitlement-medicare-advantage-organization
Beth Cobb
Fall and spring are my favorite seasons. Summer is not so bad either. It’s the transition from winter to spring that can be a challenge. The December holidays are over. Most New Year’s Resolutions have gotten lost in the busy day to day of living. Here in the south the weather can be crazy with an ice storm one weekend, spring like weather the next week and then back into the deep freeze of winter.
The transition from a law consisting of less than four hundred words to implementation of the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act is proving to be a difficult transition too.
NOTICE Act to MOON Implementation Timeline
- August 6, 2015: NOTICE Act signed into law
- August 6, 2016: Effective date for compliance with the law
- August 22, 2016: With the release of the 2017 IPPS Final Rule, implementation was delayed due to the Medicare Outpatient Observation Notice (MOON) being open to public comment and having to go through the Paperwork Reduction Act (PRA).
- December 8, 2016: Final MOON posted to the CMS Beneficiary Notices Initiatives (BNI) webpage with a note that Manual Instructions were to be made available in the coming weeks.
- January 11, 2017: CMS Open Door Forum (ODF). A caller asked for clarification on what they would expect to see on the MOON as the reason the beneficiary is not an inpatient. CMS did not provide an answer and instead instructed hospitals to look for the Manual Instructions to be released in the coming weeks.
- January 20, 2017: Transmittal 3695: Subject: MOON Instructions issued.
- March 8, 2017: Hospitals and Critical Access Hospitals (CAHs) are required to begin providing the MOON no later than this date.
This article highlights the detailed instructions that were issued in Transmittal 3695 that updates the Medicare Claims Processing Manual, Chapter 30 – Financial Liability Protections, section 400 – Part A Medicare Outpatient Observation Notice.
400.2- Scope
Who should receive the MOON? The MOON is to be given to beneficiaries who have been receiving observation services for more than 24 hours. It must be provided no later than 36 hours after the observation services began. The distinction on determining who receives the MOON is if the beneficiary is entitled to Medicare benefits, not if Medicare makes a payment. Specifically, this would include the following:
- The individual enrolled in Medicare Part A and Part B,
- The individual enrolled in Medicare Part A only “would still receive notice even though the observation services received as an outpatient fall under the Part B benefit and would not be covered or payable by Medicare for that person,”
- Individuals enrolled in a Medicare Advantage (MA) or other Medicare health plan, and
- Individuals where Medicare or MA is the secondary payer. CMS notes “the applicability of the notice requirement depends on whether the individual is entitled to benefits under Title XVIII, not on whether Medicare makes payment (primary or otherwise).”
Timing of Delivery of the MOON: CMS is allowing delivery of the MOON prior to 24 hrs to “afford hospitals and CAHs the flexibility to deliver the MOON consistent with any applicable State law that requires notice to outpatient receiving observation services within 24 hours after observation services begins.”
400.3 – Medicare Outpatient Observation Notice
The MOON is subject to the PRA process and approval by the OMB. The MOON has accompanying instructions that can be found along with the MOON on the CMS BNI web page. Manual instructions advise the following:
- The MOON may only be modified by its accompanying instructions and guidance in the Medicare Claims Processing Manual, Chapter 30.
- Unapproved modifications cannot be made to the OMB-approved, standardized MOON.
400.3.1 – Alterations to the MOON
- The MOON is two pages in length and must remain so unless additional information or state-specific information results in additional page(s).
- The MOON can be two sides of one page or one side of separate pages. However, it “must not be condensed to one page.”
- Hospitals are allowed to include their hospital logo and contact information at the top of the MOON. However, the text on page 1 of the MOON “may not be shifted from page 1 to page 2 to accommodate large logos, address headers, or any other information.”
400.3.2 – Completing the MOON
“Hospitals must use the OMB-approved MOON (CMS-10611). Hospitals must type or write the following information in the corresponding blanks of the MOON:
- Patient name;
- Patient number; and
- Reason patient is an outpatient.”
MOON Pain Point: Why is Your Patient Not an Inpatient?
Earlier I indicated that during the January 11, 2017 CMS ODF a caller asked for clarification of what CMS would expect to see as the reason a patient is an outpatient and not an inpatient. Unfortunately, above I have included this entire section of the manual instructions, leaving hospitals with an unanswered question and a March 8, 2017 compliance date.
For those reading this that are still developing your internal processes for this new requirement, here are a few resources for consideration as to what CMS has said about why a physician would order observation services.
- “By definition…the reason for ordering observation services will always be the result of a physician’s decision that the individual does not currently require inpatient services and observation services are needed for the physician to make a decision regarding whether the individual needs further treatment as a hospital inpatient or if the individual is able to be discharged from the hospital.” (Medicare Benefits Policy Manual (Pub. 100-02), Chapter 6, Section 20.6)
- CMS indicated in the 2017 IPPS Final Rule that they “may consider, in the future, the other suggestions commenters made to improve the MOON, such as checkboxes with common reasons for the patient’s outpatient status or suggested narratives for insertion in this section.”
- In the official U.S. government Medicare handbook, Medicare and You 2017, CMS tells the beneficiary that “staying overnight in a hospital doesn’t always mean you’re an inpatient. You only become an inpatient when a hospital formally admits you as an inpatient, after a doctor orders it. You’re still an outpatient if you haven’t been formally admitted as an inpatient, even if you’re getting emergency department services, observation services, outpatient surgery, lab tests, or X-rays.”
- CMS Product No. 11435, Are You a Hospital Inpatient or Outpatient? content is like an unabridged version of the MOON and reinforces the fact that observation services are provided to help the doctor decide if a patient needs to be admitted or can be discharged.
So, why is your patient not an inpatient? There are basically two reasons. Either your doctor expects you will need hospital care less than two midnights or because you’re Medicare Advantage Plan has advised that the stay should be observation. What you put on the MOON will be a decision to be made as part of the implementation process plan at your hospital.
400.3.3 – Hospital Delivery of the MOON
Hospitals are to deliver a written MOON, as well as provide oral notification.
Oral Notification must:
- Consist of an explanation of the standardized written MOON.
- The format for oral notification is at the discretion of the hospital or CAH.
- The format may include, but is not limited to, a video format.
- No matter the format, a staff member must always be available to answer questions related to the MOON in its written and oral delivery formats.
Signature Requirement
The beneficiary or his/her representative must sign and date the MOON “to demonstrate that the beneficiary or representative received the notification and understands its contents. Use of assistive devices may be used to obtain a signature.”
Delivery of the MOON
- A hospital can issue the MOON in electronic format for signing. However, the beneficiary must be given the option of requesting a paper copy to sign if they prefer.
- Regardless of digital or paper form and signature, “the beneficiary must be given a paper copy of the MOON.
400.3.4 – Required Delivery Timeframes
- The MOON must be delivered when the beneficiary has received observation services as an outpatient for more than 24 hours.
- The MOON must be delivered no later than 36 hours after observation services began.
- If a beneficiary is transferred, discharged, or admitted the MOON must be delivered before 36 hours.
- The MOON may be delivered before receiving 24 hours of observation services.
Observation Start Time
For purposes of delivering the MOON, the start time “is the clock time observation services are initiated (furnished to the patient)…in accordance with a physician’s order.
Elapsed Time
Again, for purposes of delivering the MOON, time is to be measured as elapsed time beginning at the time in the record when services began in accordance with the order for observation rather than billable observation time.
400.3.5. – Refusal to Sign the MOON
When a beneficiary refuses to sign the MOON and there is no representative to sign on behalf of the beneficiary the following guidance is to be followed:
- The MOON must be signed by the staff member presenting the written notification.
- The signature must include their name, title, and a certification that the notification was presented, and the date and time it was presented.
- The staff member would annotate the “Additional Information” section of the MOON to include their signature and certification of the delivery.
- The date and time of refusal is considered the date of notice receipt.
400.3.6 – MOON Delivery to Representative
- The MOON may be delivered to a beneficiary’s appointed representative or authorized representative.
- If the MOON is delivered to a “representative who has not been named in a legally binding document, the hospital or CAH annotates the MOON with the name of the staff person initiating the contact, the name of the person contacted, and the date, time and method (in person or telephone) of the contact.”
Exception: Delivery to a representative not physically present to receive delivery of the notice.
If this exception occurs the hospital must:
- Complete the MOON as required and telephone the representative,
- Information provided telephonically includes all contents of the MOON,
- The date and time the hospital communicates or makes a good faith attempt to communicate the information is considered the receipt date of the MOON,
- The hospital would need to annotate the “Additional Information” section to reflect that all of the indicated information was communicated, and
- The hospital would need to annotate the “Additional Information” section with the name of the staff person initiating the contact, the name of the representative contacted by phone, the date and time of the telephone contact and the telephone number called.
Specific guidance on mailing a copy to the representative is in the manual instructions. The important thing to note is that CMS indicates that “the burden is on the hospital or CAH to demonstrate that timely contact was attempted with the representative and that the notice was delivered.”
400.3.7 – Ensuring Beneficiary Comprehension
The standardized MOON is available in English and Spanish. If the beneficiary is unable to read and/or comprehend the required oral explanation, “hospitals and CAHs must employ their usual procedures to ensure notice comprehension.” Usual procedures may include:
- Translators,
- Interpreters, and
- Assistive technologies.
400.3.8 – Completing the Additional Information Field of the MOON
CMS instructs that this section may be populated with any additional information a hospital wishes to convey to a beneficiary. CMS specific examples of what may be put in this section include:
- Contact information for specific hospital departments or staff members.
- Additional content required under applicable State law related to notice of observation services.
- Part A cost-sharing responsibilities if a beneficiary is admitted as an inpatient before 36 hours following initiation of observation services.
- The date and time of the inpatient admission if a patient is admitted as an inpatient prior to delivery of the MOON.
- Medicare Accountable Care Organization information.
- Hospital waivers of the beneficiary’s responsibility for the cost of self-administered drugs.
- Any other information pertaining to the unique circumstances regarding the particular beneficiary.
CMS will allow hospitals to attach additional pages to the MOON when more room is needed.
400.3.9 – Notice Retention of the MOON
- The hospital or CAH must retain the original signed MOON in the beneficiary’s medical record.
- Electronic notice retention is permitted.
- The beneficiary is to receive a paper copy of the MOON that includes all of the required information.
400.4 – Intersection with State Observation Notices
“States that have State-specific observation notice requirements may add State-required information to the “Additional Information” field, attach an additional page, or attach the notice required under State law to the MOON.”
MMP, Inc. strongly encourages hospitals to closely review the MOON form instructions found on the BNI webpage as well as the Manual instructions to ensure compliance with the NOTICE Act.
Beth Cobb
With the release of the 2017 IPPS Final Rule last week, we are one step closer to the MOON. The Medicare Outpatient Observation Notice (MOON) is a requirement of the August 6, 2015 Notice of Observation Treatment and Implication for Care Eligibility Act (the NOTICE Act). Guidance for provision of the MOON to Medicare beneficiaries was in the 2017 IPPS Proposed Rule. This week we will walk through the 2017 IPPS Final Rule, which is not the final step to the MOON.
When to Begin Providing the MOON?
The NOTICE Act provided the effective date for this notification to begin 12 months after enactment of the Act on August 6, 2015.
However, in the Final Rule, CMS indicates the standardized notice, the MOON, is going through the Paperwork Reduction Act (PRA) approval process and is subject to a 30-day public comment period that begins on the date of publication of Final Rule. “Following review of comments and final approval of the MOON under the PRA process, hospitals and CAHs must fully implement use of the MOON no later than 90 calendar days from the date of PRA approval of the MOON.” So, when will you be required to provide the Moon?
- Public Comment Period: August 22nd through September 21st
The Final Rule is scheduled for publication in the Federal Register on August 22nd. The public will have 30 days after that to “comment” on the form which puts us at September 21st.
- PRA Process: At a minimum November 20th
An FAQ regarding how long the PRA clearance process takes indicates that “the complete review and approval process can take anywhere from 6-9 months, depending on the number of requests currently in the process and the data collection of the subject matter. This estimate includes the 60-day and 30-day public comment periods and the 60 days OMB has to review and act upon each submission.
- PRA approval to Full Implementation of the MOON: Date TBD
CMS notes the implementation date will be announced on the CMS Beneficiary Notices Initiative Web site at: https://www.cms.gov/Medicare/Medicare-General-Information/BNI/index.html and in an HPMS memorandum to MA plans.
Further, “Hospitals and CAHs will be required to deliver the MOON to applicable patients who begin receiving observation services as outpatients on or after the notice implementation date.”
Who should receive the MOON?
Insurance Coverage
Individuals entitled to benefits under Title XVIII of the Act, whether or not the services furnished are payable under the title should receive the MOON when he/she receives observation services as an outpatient for more than 24 hours. This would include the following:
- The individual enrolled in Medicare Part A and Part B,
- The individual enrolled in Medicare Part A only “would still receive notice even though the observation services received as an outpatient fall under the Part B benefit and would not be covered or payable by Medicare for that person,”
- Individuals enrolled in a Medicare Advantage (MA) or other Medicare health plan, and
- Individuals where Medicare or MA is the secondary payer. CMS notes “the applicability of the notice requirement depends on whether the individual is entitled to benefits under Title XVIII, not on whether Medicare makes payment (primary or otherwise).”
States with a similar Notice Requirement
“The NOTICE Act specifically requires hospitals and CAHs to deliver notice (written and oral)…to Medicare beneficiaries who receive observation services as an outpatient for more than 24 hours. The MOON satisfies the written NOTICE Act requirement for a designated population of Medicare beneficiaries receiving a specific set of services.”
Comments were submitted noting that several states are already required to provide a notice similar to the MOON and it would be beneficial to allow for delivery of the MOON to a broader population (i.e. all Outpatients) to avoid confusion. CMS, reiterated that the NOTICE Act specifically requires provision of the MOON to outpatients receiving observation services and provided the following guidance:
- On a state-by-state basis Hospitals and CAHs will need to determine if delivery of the MOON fulfills individual state requirements.
- When State law, “requires notification to Medicare beneficiaries who receive observation services as an outpatient for more than 24 hours and requires such notice to contain content that is not included in the MOON, hospitals may utilize the free text field in the MOON’s “Additional Information” section for communicating such additional content.”
- “Hospitals and CAHs subject to State law notice requirements may also attach an additional page to the MOON to supplement the “Additional Information” section in order to communicate additional content required under State law, or may attach the notice required under State law to the MOON.”
Timing of Delivery of the MOON
Before 24 Hours of Observation
A commenter noted that while the NOTICE Act requires delivery of the MOON to individuals receiving more than 24 hours of observation services as an outpatient, there are State specific laws that require written notice within 24 hours of initiation of services.
CMS clarified “that hospitals and CAHs may deliver the MOON before an individual has received more than 24 hours of observation services as an outpatient.”
After 24 Hours of Observation
Even with this clarification CMS went on to indicate “that we do not encourage hospitals and CAHs to deliver the MOON at the initiation of outpatient observation services. Routine and systematic delivery of the MOON by a hospital or CAH at the initiation of observation services would, in effect, render the MOON a notice of receiving outpatient observation services, as all patients receiving observation services would be given the MOON independent of the length of time they received observation services.”
When does the 24 hour timeframe begin?
Several commenters requested clarification as to whether the timeframe starts:
- After services begin following the written order for observation services;
- When related services commence if such services commence before the written order was executed and the patient occupies an outpatient bed count; or
- Based on the documentation of when nursing care began.
CMS indicated “there may be times when an individual is subject to an order for observation services, but is not actually receiving observation services. For example, following an order for observation services in an emergency department, a hospital may need to wait to begin furnishing observation services until a bed is available for the patient. In this situation, services are considered initiated when observation services commence.”
They went on to clarify “that the start of observation services, for the purposes of determining when more than 24 hours of observation services have been received, is the clock time as documented in the patient’s medical record at which observation services are initiated (furnished to the patient) in accordance with a physician’s order.”
What if a Resident writes the order?
Several commenters also requested clarification when the order for observation services was written by a resident. CMS responded that “to the extent that a resident is authorized by State licensure law and hospital staff bylaws to order outpatient services, once observation services are initiated in accordance with the resident’s order, the 24 hour time period will commence.”
Billable or Elapsed Time to Count the Hours?
A commenter noted that the counting of hours could be interpreted as elapsed time or billable time. CMS believes using elapsed time is most consistent with language in the NOTICE Act. “Therefore, for purposes of identifying the 24-hour timeframe for which an individual has received observation services, and thus is required by the NOTICE Act to receive notice by the hospital or CAH, observation time will be measured as the elapsed time in hours beginning at the clock time documented in the patient’s medical record, which coincides with the time that observation care is initiated in accordance with a physician’s order.”
How will the MOON work with the 2-Midnight Policy?
“The NOTICE Act requires hospitals to inform patients who have remained outpatients of the hospital and received observation services for more than 24 hours that they are not hospital inpatients and are subject to potentially different cost-sharing requirements and postacute care benefits than someone who has been admitted as an inpatient. We note that a scenario could arise whereby a patient is admitted to the hospital immediately after being a hospital outpatient receiving observation services for greater than 24 hours. In such a scenario, the inpatient admission may be payable under Medicare Part A under the 2-midnight policy and, as stated earlier, the hospital or CAH would still be required to furnish the MOON to the patient within 36 hours after the time the individual begins receiving observation services.”
What if the Inpatient Admission occurs prior to delivery of the MOON?
As recommended by a commenter, CMS agrees that when “an inpatient admission occurs prior to delivery of the MOON, the MOON should be annotated with date and time of the inpatient admission. Therefore, we are requiring that, in the event that a patient is subsequently admitted as a hospital inpatient directly after receiving observation services for more than 24 hours, and the inpatient admission occurs prior to delivery of the MOON, the MOON be annotated with the date and time of the inpatient admission. Additional guidance regarding elements for the free text field of the MOON will be provided in the CMS Internet Only Manual.”
Written Notice Requirements
A standard notice (the MOON) is to be used by all hospitals and CAHs. Several comments were submitted regarding the form content and format. Changes made in response to comments include:
- A reduced number of fillable fields on the MOON, specific examples provided by CMS include:
- The physician name and the date and time observation services began are no longer on the notice,
- The field for the hospital name was removed. CMS indicated that consistent with current beneficiary notices, and as will be detailed in future guidance, hospitals will be permitted to preprint the MOON to include their hospital name and logo at the top of the notice.
- One commenter suggested making the MOON a single page. CMS noted this would require the font to be too small but did note that hospitals may print the MOON as two sides of a single page.
- The CMS’s Office of Communications performed a plain language review and appropriate changes were incorporated wherever possible.
- In response to suggestions to keep the focus of the MOON on status and related coverage and cost-sharing implications, the QIO contact section was removed from the MOON.
What “Additional Information” is expected to be included in this section of the MOON?
CMS generally does not specify expected language for additional information of beneficiary notices. However, they believe this section may be used for the following:
- A place to include information such as unique circumstances regarding the particular patient,
- A place to note when a beneficiary refuses to sign the MOON,
- A place to note hospital waivers of the beneficiary’s responsibility for the cost of self-administered drugs,
- Part A cost sharing responsibilities if the beneficiary is subsequently admitted as an inpatient, or specific information for contacting hospital staff.
Required Retention of the MOON in the Medical Record
Several commenters requested clarification on how the document must be maintained. CMS indicated that “consistent with longstanding practice in implementing beneficiary notices, we will require that hospitals and CAHs retain a signed copy of the MOON. Such a practice assures both hospitals and CAHs and surveyors that the appropriate notices have been delivered as required. However, in the past, we have permitted providers to determine the method of storage. This same flexibility will be afforded to hospitals and CAHs delivering the MOON. Hospitals and CAHs may choose to retain a signed notice as a hard copy or electronically.”
Delivering the MOON
CMS proposed the use of the MOON to include all of the information elements required by section 1866(a)(1)(Y)(ii) of the Act to fulfill the written notice requirement of the NOTICE Act. An English language version of this notice has been submitted to the OMB for approval. Once the English language version is approved a Spanish language version will be made available.
CMS notes that if an individual cannot read the MOON or comprehend the required oral explanation, they expect hospitals and CAHs to employ their usual procedures to ensure notice comprehension and refers you to the Medicare Claims Processing Manual (Pub. 100-4), Chapter 30, Section 40.3.4.3, for similar existing procedures related to comprehension of the Advance Beneficiary Notice of Noncoverage (ABN). CMS finalized the proposed provisions for delivering the MOON without modification.
Oral Notice
Several commenters questioned how they should handle and document the oral explanation required by the NOTICE Act. Interestingly, one commenter recommended that CMS allow the oral explanation to be delivered as a video presentation with staff being present to answer any questions and provide additional explanation when needed. The following are CMS responses to comments and questions:
- The statute requires an oral explanation of the written notification, or MOON.
- A video presentation is acceptable if there is someone available to answer questions.
- The NOTICE Act requires delivery of a written and oral explanation of the MOON when notice delivery is required.
Signature Requirements
The NOTICE Act sets forth that the written notice must be:
- Signed by the individual receiving observation services as an outpatient, or
- Signed by a person acting on the individual’s behalf to acknowledge receipt of the notice, or
- If the individual or person refused to provide a signature, “the written notification is to be signed by the staff member of the hospital or CAH who presented the written notification and certain information needs to be included with such signature.” The “certain information” to be included is the staff member’s name and title, a certification statement that the notice was presented, and the date and time the notice was presented.
CMS finalized the proposed signature requirements without modification.
No Appeal Rights under the NOTICE Act
In the proposed rule CMS stated the NOTICE Act “does not afford appeal rights to beneficiaries…to provide clarity to this point, we are proposing to amend the regulations at 42 CFR 405.926 relating to actions that are not initial determinations, by adding new paragraph (u) to explain that issuance of the MOON by a hospital or CAH does not constitute an initial determination and therefore does not trigger appeal rights under 42 CFR part 405, subpart I.” After consideration of public comments the proposed revision to §405.926(u) was finalized without modification.
When will you be required to provide the MOON? Not for a while. In the meantime, the current draft document looks different from the first iteration. I would encourage key stakeholders to closely review this document, submit comments to the Office of Information and Regulatory Affairs, Office of Management and Budget and begin to work through the process of providing the MOON.
Resources:
Link to pre-published 2017 IPPS Final Rule: https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-18476.pdf
Link to Details for CMS Form Number CMS-10611: Medicare Outpatient Observation Notice: https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing-Items/CMS-10611.html?DLPage=2&DLEntries=10&DLSort=1&DLSortDir=descending
- Note: Instructions for submitting public comments are not in the final rule document. Until a correction notice can be published in the Federal Register, instructions are available at this website.
Beth Cobb
TRANSMITTALS
Recovering Overpayments from Providers Who Share Tax Identification Numbers
- MLN Matters Article SE1612
- Issued June 22, 2016
- Affects providers of services and suppliers who share the same Tax Identification Number (TIN) even though they may have different National Provider Identifiers or other billing numbers used to bill Medicare.
Summary of Changes: Allows CMS to recover payments made to a provider of services or supplier that shares the same TIN with a provider of services or supplier that has an outstanding Medicare overpayment across multiple states within a Medicare Administrative Contractor (MAC) jurisdiction
October Quarterly Update to 2016 Annual Update of HCPCS Codes Used for Skilled Nursing Facility (SNF) Consolidated Billing (CB) Enforcement
- Transmittal 3546, Change Request 9688, MLN Matters Article MM9688
- Issued June 17, 2016, Effective October 1, 2016, Implementation October 3, 2016
- Affects physicians, providers, and suppliers submitting claims to all Medicare Administrative Contractors (MACs) for services to Medicare beneficiaries who are in a Part A Skilled Nursing Facility (SNF) stay.
Summary of Changes: This notification provides updates to the lists of Healthcare Common Procedure Coding System (HCPCS) codes that are subject to the consolidated billing provision of the SNF Prospective Payment System (PPS)
JW Modifier: Drug Amount Discarded/Not Administered to any Patient
- Transmittal 3538, Change Request 9603, MLN Matters Article MM9603
- Issued June 9, 2016, Effective January 1, 2017, Implementation January 3, 2017
- Affects physicians, providers, and suppliers submitting claims to Medicare Administrative Contractors (MACs) for drugs or biologicals administered to Medicare beneficiaries.
Summary of Changes: Transmittal 3530, dated May 24, 2016, is being rescinded and replaced by Transmittal 3538 to update the Effective and Implementation dates. Effective January 1, 2017, claims for discarded drug or biological amount not administered to any patient, shall be submitted using the JW modifier. Also, effective January 1, 2017, providers must document the discarded drugs or biologicals in patient's medical record. This CR updates the Section 40 - Discarded Drugs and Biologicals of Chapter 17 of the Claims Processing Manual 100-04.
Claim Status Category and Claim Status Codes Update
- Transmittal 3527, Change Request 9550, MLN Matters Article MM9550
- Issued May 20, 2016, Effective October 1, 2016, Implementation October 3, 2016
- Affects physicians, other providers, and suppliers submitting claims to Medicare Administrative Contractors (MACs) for services provided to Medicare beneficiaries..
Summary of Changes: The purpose of this Change Request (CR) is to update as needed the Claim Status and Claim Status Category Codes used for the Accredited Standards Committee (ASC) X12 276/277 Health Care Claim Status Request and Response and ASC X12 277 Health Care Claim Acknowledgment transactions. This Recurring Update Notification (RUN) can be found in Chapter 31, Section 20.7.
July 2016 Update of the Hospital Outpatient Prospective Payment System (OPPS)
- Transmittal 3523, Change Request 9658, MLN Matters Article MM 9658
- Issued May 13, 2016, Effective July 1, 2016, Implementation July 5, 2016
- Affects providers and suppliers who submit claims to Medicare Administrative Contractors (MACs), including Home Health and Hospice (HH&H) MACs, for services provided to Medicare beneficiaries and which are paid under the Outpatient Prospective Payment System (OPPS).
Summary of Changes: This Recurring Update Notification describes changes to and billing instructions for various payment policies implemented in the July 2016 OPPS update.
July 2016 Integrated Outpatient Code Editor (I/OCE) Specifications Version 17.2
- Transmittal 3524, Change Request 9661,MLN Matters Article MM9661
- Issued May 13, 2016, Effective July 1, 2016, Implementation July 5, 2016
- Affects providers submitting claims to Medicare Administrative Contractors (MACs) for outpatient services provided to Medicare beneficiaries and paid under the Outpatient Prospective Payment System (OPPS) and for outpatient claims from any non-OPPS provider not paid under the OPPS. It is also intended for claims for limited services when provided in a Home Health Agency (HHA) not under the Home Health PPS (HH PPS) or claims for services to a hospice patient for the treatment of a non-terminal illness..
Summary of Changes: This notification provides the Integrated OCE instructions and specifications for the Integrated OCE that will be utilized under the OPPS and Non-OPPS for hospital outpatient departments, community mental health centers, all non-OPPS providers, and for limited services when provided in a home health agency not under the Home Health Prospective Payment System or to a hospice patient for the treatment of a non-terminal illness. The attached Recurring Update Notification applies to 100-04, Chapter 4, section 40.1
OTHER NEWS
Temporary Pause of QIO Short Stay Reviews
- Inpatient Hospital Reviews Webpage
- Updated June 6, 2016
Summary of Changes: CMS requires that beginning June 6, 2016, the BFCC-QIOs re-review all short stay patient status claims that were denied under the QIO medical review process.
Medicare Will Use Private Payor Prices to Set Payment Rates for Clinical Diagnostic Laboratory Tests Starting in 2018
- CLFS Payment Rates Press Release
- Issued June 17, 2016
- Affects laboratories performing clinical diagnostic laboratory tests
Summary of Changes: CMS released a final rule implementing Section 216(a) of the Protecting Access to Medicare Act of 2014 (PAMA), requiring laboratories performing clinical diagnostic laboratory tests to report the amounts paid by private insurers for laboratory tests. Medicare will use these private insurer rates to calculate Medicare payment rates for laboratory tests paid under the Clinical Laboratory Fee Schedule (CLFS) beginning January 1, 2018. Further details of this rule can be found by clicking here.
CMS Proposes Rule to Improve Health Equity and Care Quality in Hospitals
- https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2016-Press-releases-items/2016-06-13.html
- Issued June 13, 2016
- Affects the 6,228 hospitals and critical access hospitals that participate in Medicare or Medicaid.
Summary of Changes: The rule proposes to reduce overuse of antibiotics and implement comprehensive requirements for infection prevention. The proposed rule also advances protections for traditionally underserved and often excluded populations based on race, color, religion, national origin, sex (including gender identity), age, disability, or sexual orientation. For a closer look at this proposed rule, click here.
Medicare Makes Enhancements to the Shared Savings Program to Strengthen Incentives for Quality Care
- https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2016-Press-releases-items/2016-06-06.html
- Issued June 6, 2016
- Affects Accountable Care Organizations in the Medicare Shared Savings Program.
Summary of Changes: CMS released a final rule improving how Medicare pays Accountable Care Organizations in the Medicare Shared Savings Program for delivering better patient care. Medicare is moving away from paying for each service a physician provides towards a system that rewards physicians for coordinating with each other. Accountable Care Organizations are a major part of that transition, rewarding providers that deliver high-quality, efficient, and coordinated care for patients.
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