Knowledge Base - Full Library

The last Wednesday@One of each month includes an article highlighting Medicare Transmittals and Other Updates released by CMS during that month. This month brings the addition of a new standing article highlighting offerings from the Medicare Administrative Contractors or MACs. More specifically, highlights from MAC daily e-newsletters and alerts that provide useful information even when it is not the MAC for your hospitals.  

Background

MACs are multi-state, regional contractors responsible for administering both Medicare Part A and Medicare Part B claims. MACs perform many activities including:

• Process Medicare FFS claims
• Make and account for Medicare FFS payments
• Enroll providers in the Medicare FFS program
• Handle provider reimbursement services and audit institutional provider cost reports
• Handle redetermination requests (1st stage appeals process)
• Respond to provider inquiries
• Educate providers about Medicare FFS billing requirements
• Establish local coverage determinations (LCD’s)
• Review medical records for selected claims
• Coordinate with CMS and other FFS contractors

Currently there are 12 A/B MACs who serve more than 1.5 million health care providers enrolled in the Medicare Fee-for-Service (FFS) program. Collectively, the MACs process more than 1.2 billion Medicare FFS claims annually. You can learn more about the MACs on the CMS MAC webpage at https://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/MedicareAdministrativeContractors.

It is in the spirit of provider inquiries, education, and medical reviews that prompted the addition of this monthly article to our newsletter.

January 6, 2020 WPS GHA Medicare eNews: Major Joint Replacement (Hip and Knee) CERT Reviews

The Comprehensive Error Rate Testing (CERT) contractor has noted error findings for joint replacement services. In most cases, the CERT contractor found the documentation for these services to be insufficient to support the service(s) according to Medicare guidelines.

 Documentation Reminders

• Physical examination should document the specific patient condition(s), past and present, and plan of care
• Investigation through radiology reports
• Documentation of tried and failed conservative (non-surgical) treatments
• Signed and dated operative report 

For more information, see the MLN Matters article SE1236.

Link to website: https://www.wpsgha.com/wps/portal/mac/site/claim-review/news-and-updates/major-joint-replacement-hip-knee-cert-reviews/!ut/p/z0/fYzNDoIwEISfaLOAkXBVoyGGBk8GejEbWKX8bJtS8fWtL-BtJt98gxob1EKbeVEwVmiOvdX541aWeZkWSVVnKkkO6nLfnYvqWKd7vKL-P4gPmVcn9ULtKAxg5GmxEf6sQNLD2_UUeMVmodF6GK2RAJ7dTB0vHPNgHEzCDB37H9lMVNFNuv0CArAQCg!!/

January 8, 2020 First Coast Service Options, Inc. eNews

Appeals News: Q&A’s to questions regularly received by the First Coast contact center regarding general information about appeals, overpayment appeals, and re-openings. https://medicare.fcso.com/Appeals/0410177.asp

January 8, 2020: Palmetto GBA Provider Contact Center (PCC) FAQs:

Oct – December 2019 FAQs published were based upon data analytics identifying topics generating a high volume of telephone enquiries. Following is an example of one FAQ that MMP gets asked on occasion also:

• Question: When did CMS begin to require one calendar years as timely filing?
• Answer: All claims for services furnished on or after Jan 1, 2010, must be filed to the Medicare contractor no later than one calendar year (12 months) from the date of service or Medicare will deny those claims. You may refer to MM6960, (PDF, 74 KB) MM7080   (PDF, 78 KB) and New Maximum Period for the Submission of Medicare Claims podcast  .

https://www.palmettogba.com/palmetto/providers.nsf/ls/JJ%20Part%20A"BKLSNF7223?opendocument

January 9, 2020 NGS Urgent News: [Update} NCD ICD-10 Diagnosis Code Changes for 2020

Date Reported: 12/19/2019

Date Modified: 1/8/2020

Status: Open
Provider Type(s) Impacted: Part A, including home health and hospice (HHH) and federally qualified health centers (FQHCs)
Reason Code(s): Part A RCs, see below
Claim Coding Impact: Multiple ICD-10 codes to be added to the listed national coverage determinations (NCDs).
Description of Issue
On 11/1/2019, the Centers for Medicare & Medicaid Services (CMS) issued Change Request (CR) 11491 and accompanying MLN11491 with an effective date of 4/1/2020. CMS has now issued additional instructions impacting the following NCDs, for which new ICD-10 diagnosis codes will not be systematically implemented until 4/6/2020. Local editing will be temporarily implemented for the following, allowing claims to process:

• NCD 20.9 Artificial Hearts and Related Devices – RC 59242-59243
• NCD 20.34 Percutaneous Left-Atrial Appendage Closure – RC 59267
• NCD 190.11 Home PT/INR – RC 59079-59080
• NCD 260.9 Heart Transplants – RC 59180-59181

Editing will remain in place for the following, and denied claims subject to the standard appeal process:

• NCD 110.4 Extracorporeal Photophoresis RC59019-59020, 59023-59024
• NCD 210.3 Colorectal Cancer Screening RC 59099-59100

National Government Services Action
For NCDs 20.9, 20.34, 190.11 and 260.9, National Government Services (NGS) will now modify internal editing to allow processing for claims with the new ICD-10 diagnosis codes. For NCDs 110.4 and 210.3, denials relative to new ICD-10 codes may be submitted as appeals. In addition, NGS will adjust claims already denied since 10/1/2019 relative to this issue when brought to our attention.

Provider Action
Rejected claims (59267) will be reprocessed. Any claim with a LINE LEVEL denial can be resubmitted instead of filing an appeal (please refer to Submit an Adjustment to Correct Claims Partially Denied by Automated LCD/NCD Denials). Fully denied claims may be submitted as appeals. When submitting associated appeals, providers may identify CR 11491 as a reference.

Proposed Resolution/Fix
Will be systematically implemented on 4/6/2020.

January 9, 2020: Palmetto GBA Daily Newsletter: Medicare Beneficiary Identifier (MBI) Q&A

The following Q&A appeared in Palmetto’s Thursday January 9, 2020 Daily e-Newsletter:

• Question: Can I obtain an MBI for a deceased beneficiary using the eServices MBI Lookup tool?
• Answer: Yes. Users may obtain an MBI as long as the Medicare beneficiary information entered is valid and the beneficiary's date of death is less than 13 months prior to the date the MBI Lookup inquiry is performed.

If the Medicare beneficiary information submitted in the MBI Lookup is valid, but the beneficiary's recorded date of death is more than 13 months prior to the date the MBI Lookup inquiry is performed, the user will receive a message advising that the date of death exceeds the timely claim filing requirement. The MBI will not be returned.

https://www.palmettogba.com/palmetto/providers.nsf/ls/JJ%20Part%20A"BJ9RJ40743?opendocument

January 13, 2020: WPS GHA Medicare Review (MR) Targeted Probe & Educate (TPE) Quarterly Update – J5A

Throughout quarter four of 2019, the MR clinical staff identified the following common errors:

• Inpatient Psychiatric Hospital Services (IPS):
• Reviews identify the psychiatric evaluations are incomplete. The CMS Internet-Only Manual (IOM) Publication 100-02, Chapter 2, Section 30.2 lists the components of the psychiatric evaluation. These include the following:
• a medical history,
• record of mental status,
• onset of illness and circumstances leading to admission,
• description of attitudes and behaviors, intellectual functioning, memory functioning and orientation, and
• an inventory of the patient's assets.
• Reviews continue to identify errors related to certification requirements. For more information related to certification requirements review our Inpatient Psychiatric Facility (IPF) Certification/Recertification Review Results resource.
• Wound Care: Reviews identify the documentation is incomplete and not meeting the requirements of WPS Local Coverage Determination (LCD) L37228. The documentation should support evidence of improvement, which includes measurable changes. Measurable changes include the amount of drainage, inflammation, swelling, pain, wound dimensions, and necrotic tissue. If there is no wound improvement the documentation should support a modification to the treatment plan.
• Inpatient Rehabilitation Facilities (IRF): The results of the Round 2 reviews support improvement of the documentation on the pre-admission screening and post admission evaluation. Five providers completed Round 2 and are no longer undergoing review.

January 13, 2020: WPS GHA Medicare Review (MR) Targeted Probe & Educate (TPE) Quarterly Update – J8A

Throughout quarter four of 2019, the MR clinical staff identified the following common errors:

• Malnutrition: Twelve providers completed Round 1 of TPE and were successful in their reviews. The diagnosis of severe malnutrition was evident in the documentation.  
• Outpatient Hyperbaric Oxygen Therapy (HBO-T): Reviews identify incomplete documentation to support the HBO-T condition. When providers treat a patient for multiple diagnoses, it is important to state clearly which diagnosis necessitated the need for HBO-T, and to include the prior history and treatment for support. The CMS National Coverage Determination (NCD) 20.29 outlines the covered conditions.

January 13, 2020: Palmetto GBA Daily Newsletter: Medical Necessity of Therapeutic Exercise

In this edition of their Daily Newsletter, Palmetto GBA posted a module focused on the medical necessity of therapeutic exercises. The following topics are covered in this module:

• Therapeutic Exercise Overview,
• Therapy Billing,
• Requirements for Medical Necessity,
• Documentation Requirements, and
• Reminders.
• At the top of the list of reminders list is the reminder that beginning January 1, 2020 a new modifier is required on claims for physical and occupational therapy services provided in whole or in part by a therapy assistant.

Palmetto advises you to share this with appropriate staff.

https://www.palmettogba.com/internet/eLearn3.nsf/MedicalNecessityPartB/story_html5.html

January 14, 2020: Palmetto GBA Daily Newsletter: Intensity-Modulated Radiation Therapy Module

Just a day after the Therapeutic Exercise Module, Palmetto posted an Intensity-Modulated Radiation Therapy (IMRT) Module which includes information about covered conditions, billing and coding guidelines, multileaf collimator and medical necessity.

https://palmettogba.com/internet/eLearn3.nsf/IntensityModulatedRadiationTherapy/story_html5.html

Q:

I recently read the MMP article New Modifiers for Therapy Assistant Services. Are you aware of any other payors adopting a similar policy?

A:

Humana published Policy Number CP2018009 on December 10, 2019. This policy applies to both Medicare Advantage and Commercial Coverage. Similar to CMS guidance, effective January 1, 2020 or later Humana requires providers to submit a “charge for an outpatient occupational or physical therapy service…with modifier CO or modifier CQ, as applicable standards in the Federal Register and relevant CMS guidance direct.”

You can find the entire policy on Humana’s website at https://www.humana.com/provider/medical-resources/claims-payments/claims-payment-policies.

CMS’ guidance for Medicare Fee-for-Service beneficiaries is available in the November 1, 2019 Transmittal 4440 at https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019downloads/R4440cp.pdf.

Q:

I recently read the MMP article New Modifiers for Therapy Assistant Services. Are you aware of any other payors adopting a similar policy?

A:

Humana published Policy Number CP2018009 on December 10, 2019. This policy applies to both Medicare Advantage and Commercial Coverage. Similar to CMS guidance, effective January 1, 2020 or later Humana requires providers to submit a “charge for an outpatient occupational or physical therapy service…with modifier CO or modifier CQ, as applicable standards in the Federal Register and relevant CMS guidance direct.”

You can find the entire policy on Humana’s website at https://www.humana.com/provider/medical-resources/claims-payments/claims-payment-policies.

CMS’ guidance for Medicare Fee-for-Service beneficiaries is available in the November 1, 2019 Transmittal 4440 at https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019downloads/R4440cp.pdf.

Fiscal Year 2019 Estimated Improper Payment Rates

In mid-November, CMS published a CMS.gov Fact Sheet detailing the estimated improper payment rates for CMS Programs for Fiscal Year (FY) 2019. Approximately 50,000 claims were sampled and included claims submitted from July 1, 2017 through June 30, 2018. The following tables highlights an improper payment rate compare of FY 2018 to FY 2019.

Audit findings are used to calculate a Medicare Fee-for-Service (FFS) program improper payment rate. “The CERT program considers any claim that was paid when it should have been denied or paid at another amount (including both overpayments and underpayments) to be an improper payment.”

CMS reminds the reader in the Fact Sheet that improper payment rates are not necessarily indicative of or are measures of fraud. Instead, improper payments are payments that did not meet statutory, regulatory, administrative, or other legally applicable requirements and may be overpayments or underpayments.”

Fiscal Year 2019 Supplemental Improper Payment Data

A month later on December 12, 2019, CMS released the Supplemental Improper Payment Data Report that delves into the details behind the final Improper Payment Rate and Improper Payments. This report includes a review of claims submitted from July 1, 2017 through June 30, 2018.

Common Causes of Improper Payments

Below is a table comparing the common causes of improper payments broken out by the type of error. The biggest shift from 2018 to 2019 was an increase in incorrect coding.  

‍“0 or 1 Day” LOS Claims Continued Outlier

The CERT Program has reported Projected Improper Payments by Length of Stay (LOS) since the 2014 Report. Unlike the past three years where the Improper Payment Rate dropped for “0 or 1 day” LOS claims, for 2019 the improper payment rate increased.  

‍Compliance with Short Stays

‍In addition to the CERT, the two Beneficiary and Family Centered Care Quality Improvement Organizations (BFCC-QIOs) (KEPRO and LIVANTA) have historically been tasked with performing Short Stay Reviews. However, on May 8, 2019 BFCC-QIO Short Stay Reviews were stopped while CMS took action to procure a new BFCC-QIO contractor to perform Short Stay Reviews on a national basis. CMS anticipated issuing a contract award by the 3rd quarter of calendar year 2019. To date, CMS has yet to announce a contract awardee. In the meantime, have you tracked your short stay volume overall, by MS-DRG or Physician over time? Do you know if your hospital is an outlier? Where can you look to find these answers?  
PEPPER

‍One resource available to hospitals is the Short-Term Acute Care PEPPER (Program for Evaluating Payment Patterns Electronic Report). The PEPPER is made available to hospitals on a quarterly basis and compares your hospital to your state, MAC Jurisdiction and the nation. One-day Stays for Medical and Surgical MS-DRGs are two of the “Target Areas” at risk for improper payments included in this report.
The PEPPER provides the following suggested interventions for high One-day Stays Hospitals: “This could indicate that there are unnecessary admissions related to inappropriate use of admission screening criteria or outpatient observation. A sample of same- and/or one-day stay cases should be reviewed to determine if inpatient admission was necessary or if care could have been provided more efficiently on an outpatient basis (e.g., outpatient observation). Hospitals may generate data profiles to identify same- and/or one-day stays sorted by DRG, physician or admission source to assist in identification of any patterns related to same- and/or one-day stays. Hospitals may also wish to identify whether patients admitted for same- and/or one- day stays were treated in outpatient, outpatient observation or the emergency department for one or more nights prior to the inpatient admission. Hospitals should not review same- and/or one- day stays that are associated with procedures designated by CMS as “inpatient only.”

‍RealTime Medicare Data

‍Another source that can help assist you is our sister company, RealTime Medicare Data (RTMD). RTMD collects over 800 million Medicare Fee-for-Service paid claims annually from 38 states and the District of Columbia, and allows for searching of over 9 billion historical claims. In response to the “Two-Midnight” Policy, RTMD has available in their suite of Inpatient Hospital reports a One Day Stay Report. To give you a true picture of your “at risk” volume, this report excludes claims with a discharge status for Expired (20), left against medical advice (07), hospice (50 & 51) and /or were transferred to another Acute care facility (02). This report enables a hospital to view one day stay paid claims data by DRG and Physician to direct where audits should be focused. For further information on all that RTMD has to offer you can visit their website at www.rtmd.org.

Q:

How is CMS responding to the Court ruling to immediately cease the clinic visit provided at excepted off-campus PBDs payment reduction for CY 2019?

A:

According to an announcement about Payment for Outpatient Clinic Visit Services at Excepted Off-Campus Provider-Based Departments in the December 12th edition of MLN Connects, “CMS installed a revised Hospital Outpatient Prospective Payment System Pricer to update the rates being applied to claim lines. The revised Pricer went into production on November 4, 2019, and applies to claims with a line item date of service of January 1, 2019, and after. Starting January 1, 2020, and over the next few months, the Medicare Administrative Contactors will automatically reprocess claims paid at the reduced rate; no provider action needed.”

In the 2019 OPPS Final Rule, CMS determined to pay for certain outpatient clinic visit services (HCPCS code G0463) provided at excepted off-campus Provider-Based Departments (PBDs) at the same rate that CMS uses to pay non-excepted off-campus PBDs for those services under the separate Physician Fee Schedule (PFS). The PFS payment rate for services in non-excepted off-campus PBDs is equal to 40% of the OPPS rate, a reduction of 60%. CMS phased in the payment reduction for clinic visits in excepted off-campus PBDs over 2 years, with a 30% reduction for 2019 (i.e. rates of 70% of OPPS rates) and the full 60% reduction planned for 2020.

Despite the court’s decision that CMS must pay 2019 clinic visits in excepted off-campus PBDs at the regular OPPS rate, CMS proceeded with the second year of the payment reduction in the 2020 OPPS Final Rule. See the prior Wednesday@One article for more information about this but here are some excerpts from that article:

“CMS claims they are ‘removing the payment differential that drives the site-of-service decision and, as a result, unnecessarily increases service volume.’ They further claim they are doing this under authority of a certain section of the Social Security Act that gives them power ‘to adopt a method to control unnecessary increases in the volume of covered outpatient department services.’ … CMS states they have appeal rights and are still considering whether to appeal the final judgement or not.”

MEDICARE TRANSMITTALS – RECURRING UPDATES

Quarterly Update to the National Correct Coding Initiative (NCCI) Procedure-to-Procedure (PTP) Edits, Version 26.0, Effective January 1, 2020

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11523.pdf

International Classification of Diseases, 10th Revision (ICD-10) and Other Coding Revisions to National Coverage Determination (NCDs)--April 2020 Update

A maintenance update of ICD-10 conversions and other coding updates specific to National Coverage Determinations (NCDs). These NCD coding changes are the result of newly available codes, coding revisions to NCDs released separately, or coding feedback received.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11491.pdf

2020 Annual Update to the Therapy Code List

Updates the list of codes that sometimes or always describe therapy services.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11501.pdf

2020 Annual Update of Per-Beneficiary Threshold Amounts

Updates the annual per-beneficiary incurred expenses amounts now called the KX modifier thresholds and related policy for CY 2020.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11532.pdf

Claim Status Category and Claim Status Codes Update

https://www.cms.gov/files/document/mm11467

Remittance Advice Remark Code (RARC), Claims Adjustment Reason Code (CARC), Medicare Remit Easy Print (MREP) and PC Print Update

https://www.cms.gov/files/document/mm11489

Update to Medicare Deductible, Coinsurance and Premium Rates for Calendar Year (CY) 2020

https://www.cms.gov/files/document/MM11542

OTHER MEDICARE TRANSMITTALS

Addition of Medical Severity Diagnosis Related Groups (MS-DRG) Subject to Inpatient Prospective Payment System (IPPS) Replaced Devices Offered Without Cost or With a Credit Policy

Medicare Severity Diagnosis-Related Groups (MS-DRGs) 319 and 320 (Other Endovascular Cardiac Valve Procedures with and without major complications and comorbidities (MCC), respectively) added to the list of MS-DRGs subject to the policy for replaced devices offered without cost or with a credit.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11508.pdf

Medicare Physician Fee Schedule Database (MPFSDB) Update to Status Indicators

Status Indicator Q (therapy functional information code) is no longer effective with the 2020 MPFSDB beginning January 1, 2020. Medicare no longer requires functional therapy reporting.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11453.pdf

Positron Emission Tomography (PET) Scan - Allow Tracer Codes Q9982 and Q9983 in the Fiscal Intermediary Shared System (FISS)

Currently, the system does not recognize HCPCS Q9982 and Q9983 as valid radiopharmaceutical tracer codes and claims are incorrectly returned to the provider as unprocessed or rejected.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11537.pdf

Updating FISS Editing for Practice Locations to Bypass Mobile Facility and/or Portable Units and Services Rendered in the Patient's Home

Implements the newly approved National Uniform Billing Committee (NUBC) Condition Code “A7” and improved edit criteria in Medicare systems to bypass edits that match service facility location on certain hospital claims.

https://www.cms.gov/files/document/mm11470

Summary of Policies in the Calendar Year (CY) 2020 Medicare Physician Fee Schedule (MPFS) Final Rule, Telehealth Originating Site Facility Fee Payment Amount and Telehealth Services List, CT Modifier Reduction List, and Preventive Services List

A summary of the policies in the CY 2020 MPFS Final Rule, announces the Telehealth Originating Site Facility Fee payment amount and makes other policy changes related to Medicare Part B payment.

https://www.cms.gov/files/document/mm11560

Medicare Claims Processing Manual Chapter 23 - Fee Schedule Administration and Coding Requirements

Updates language pertaining to the National Correct Coding Initiative (NCCI).

https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2019Downloads/R4465CP.pdf

Update to Medicare Claims Processing Manual, Chapters 1, 23 and 35

New Global Billing and Separate TC/PC billing instructions. For both paper and electronic claims, when a global diagnostic service code is billed (for example, no modifier TC and no modifier -26), the address where the TC was performed must be reported on the claim.

https://www.cms.gov/files/document/mm10882

REVISED MEDICARE TRANSMITTALS

April 2019 Update of the Hospital Outpatient Prospective Payment System (OPPS)

Revision - Reference added to a related article SE19009 which replaces Section 6 - Chimeric Antigen Receptor (CAR) T- Cell Therapy - instructions on pages 5-7 of this article.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11216.pdf

Implementation to Exchange the List of Electronic Medical Documentation Requests (eMDR) for Registered Providers via the Electronic Submission of Medical Documentation (esMD) System

Revision - Updates and clarifies information regarding the eMDR registration/enrollment to indicate the provider and the HIH roles with more detail.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11003.pdf

Appropriate Use Criteria (AUC) for Advanced Diagnostic Imaging – Educational and Operations Testing Period - Claims Processing Requirements

Revision - Removes codes that are not available for 2020.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/MM11268.pdf

MEDICARE COVERAGE UPDATES

Proposed Decision Memo for Next Generation Sequencing (NGS) for Medicare Beneficiaries with Advanced Cancer

Expands coverage of  Next Generation Sequencing (NGS) as a diagnostic laboratory test when performed in a CLIA-certified laboratory, when ordered by a treating physician and when specified requirements are met.

https://www.cms.gov/medicare-coverage-database/details/nca-proposed-decision-memo.aspx?NCAId=296&TimeFrame=7&DocType=All&bc=AgAAYAAAQAAA&

MEDICARE PRESS RELEASES AND FACT SHEETS

CMS Hospital Value-Based Purchasing Program Results for Fiscal Year 2020

The Hospital VBP Program works by adjusting what Medicare pays hospitals under the Inpatient Prospective Payment System (IPPS) based on the quality and cost of inpatient care the hospitals provide to patients.

https://www.cms.gov/newsroom/fact-sheets/cms-hospital-value-based-purchasing-program-results-fiscal-year-2020

MEDICARE EDUCATIONAL RESOURCES

Palmetto GBA 2020 Medical Review (MR) Hot Topic Targeted Probe and Educate (TPE) Teleconference Schedule

Palmetto GBA will host a series of Medical Review Hot Topic Targeted Probe and Educate (TPE) Teleconferences in 2020.

https://www.palmettogba.com/palmetto/providers.nsf/ls/JJ%20Part%20A"BGQT2X1030?opendocument

Medicare Fast Facts

Medicare Fast Facts resources this month include:

• Bill Correctly for Medicare Telehealth Services

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Fast-Facts.html?DLSort=1&DLEntries=10&DLPage=1&DLSortDir=descending

OTHER MEDICARE UPDATES

Extension of Detailed Notice of Discharge Beyond Expiration Date

The currently available Detailed Notice of Discharge (hospital notice) has an expiration date of October 31, 2019. The current notice is covered under an extension and hospitals should continue using it until CMS publishes the updated notice.

https://www.cms.gov/Medicare/Medicare-General-Information/BNI/HospitalDischargeAppealNotices

2020 Outpatient Prospective Payment System/Ambulatory Surgical Center Final Rule

This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for Calendar Year 2020.

https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-24138.pdf

2020 Medicare Physician Fee Schedule Final Rule

This major final rule addresses: changes to the physician fee schedule (PFS); other changes to Medicare Part B payment policies to ensure that payment systems are updated to reflect changes in medical practice, relative value of services, and changes in the statute; and other topics.

https://s3.amazonaws.com/public-inspection.federalregister.gov/2019-24086.pdf

Patients over Paperwork Newsletter November 2019

Through “Patients over Paperwork,” CMS established an internal process to evaluate and streamline regulations with a goal to reduce unnecessary burden, to increase efficiencies, and to improve the beneficiary experience. 

https://www.cms.gov/files/document/november-2019-patients-over-paperwork-newsletter

KEPRO Case Review Connections Winter 2020 – Acute Care Edition

KEPRO is the Beneficiary and Family Centered Care QIO (BFCC-QIO) for 29 states. Case Review Connections is a quarterly newsletter that provides a glimpse into KEPRO and the services provided, along with success stories and updates from the Centers for Medicare & Medicaid Services (CMS).

https://keproqio.com/bene/newsletter/2020winteracute/

Hospital Price Transparency Requirements Final Rule

Establishes requirements for hospitals operating in the United States to establish, update, and make public a list of their standard charges for the items and services that they provide.

https://www.hhs.gov/sites/default/files/cms-1717-f2.pdf

Transparency in Coverage Proposed Rule

Sets forth proposed requirements for group health plans and health insurance issuers in the individual and group markets to disclose cost-sharing information upon request, to a participant, beneficiary, or enrollee (or his or her authorized representative), including an estimate of such individual’s cost-sharing liability for covered items or services furnished by a particular provider.

https://www.hhs.gov/sites/default/files/cms-9915-p.pdf

CY 2020 - Clinical Laboratory Fee Schedule Test Codes Final Determinations

In November of each year, CMS finalizes the basis of payment for new and substantially revised test codes and the amount of payment through the annual CMS instruction implementing the updated CLFS for the next CY.

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ClinicalLabFeeSched/Laboratory_Public_Meetings

Payment for Outpatient Clinic Visit Services at Excepted Off-Campus Provider-Based Departments

Revised Hospital Outpatient Prospective Payment System Pricer to update the rates being applied to claim lines for clinic visit services at excepted off-campus PBDs for 2019.

https://www.cms.gov/outreach-and-educationoutreachffsprovpartprogprovider-partnership-email-archive/2012-12-12-enews#_Toc26953011

Extension of the MOON Beyond Expiration Date

The currently available Medicare Outpatient Observation Notice (MOON) has an expiration date of December 31, 2019. The currently available MOON is covered under an extension and hospitals should continue using the current notice until CMS publishes the updated notice.

https://www.cms.gov/Medicare/Medicare-General-Information/BNI/MOON

Does it seem that people are less willing to make concessions these days than in the past? I am not sure if this is generally true, but if you look at our governments, it certainly seems so. In Britain, the government cannot agree or compromise to accomplish Brexit, and in our own country, the political parties cannot seem to agree on anything. They also seem completely unwilling to compromise or offer any concessions to the opposing viewpoint. Due to my cynicism from such an environment, I was a bit surprised to read in the 2020 Physician Fee Schedule (PFS) Final Rule  that CMS made 3 significant concessions concerning the requirements for the new modifiers for therapy services provided in whole or in part by a therapy assistant.

These new modifiers are mandated by the Balanced Budget Act (BBA) of 2018 which required that these modifiers:

• Be established by January 1, 2019;
• Be applied to claims lines for outpatient therapy services being furnished in whole or in part by a therapy assistant for dates of services beginning on January 1, 2020; and
• Effectuate a payment reduction for services furnished on and after January 1, 2022.

This is all in keeping with the major intent of the BBA provision that “for services furnished on or after January 1, 2022, payment for outpatient physical and occupational therapy services for which payment is made under sections 1848 or 1834(k) of the Act which are furnished in whole or in part by a therapy assistant must be paid at 85 percent of the amount that is otherwise applicable.”

This means beginning in 2022, therapy services furnished by physical or occupational therapy assistants will be paid less than services provided by therapists – 15% less to be specific. These services will be paid 85% of the usual applicable payment rate. For example, if a unit of therapeutic exercise (CPT 97110) is normally paid $35, when billed with one of the assistant modifiers, the payment would be $29.75. Remember the PFS therapy rates are dependent on your carrier jurisdiction and the multiple procedure payment reductions (MPPR) continue to apply also.

The modifiers that are required to be reported on therapy line items when the services are furnished in whole or in part by a therapy assistant beginning in 2020 are:

• CQ Modifier: Outpatient physical therapy services furnished in whole or in part by a physical therapist assistant.
• CO Modifier: Outpatient occupational therapy services furnished in whole or in part by an occupational therapy assistant.

These new modifiers will be reported alongside the GP and GO modifiers used to identify services furnished under a PT or OT plan of care, respectively. Other modifiers used for therapy services, such as the KX and 59 modifiers, should also continue to be reported. Thank goodness the functional limitation reporting modifiers are no longer required.

In the 2019 PFS Final Rule, CMS finalized a de minimis standard under which a service is considered to be furnished in whole or in part by a PTA or OTA when more than 10% of the service is furnished by the PTA or OTA. For example, for therapy services of 60 minutes, 10% would be 6 minutes and for the assistant to furnish more than 10% would be 7 minutes or more. This means once the PTA/OTA furnishes at least 7 minutes of the service, the CQ/CO modifier would be required to be added to the claim for that service. Untimed codes include services such as evaluative services, group therapy, and supervised modalities. Although assistants cannot perform an evaluation or re-evaluation, they can assist the therapists by performing clinical labor tasks such as obtaining vital signs, providing self-assessment tools to the patient and verifying their completion.

So, what are the concessions CMS made concerning the new therapy modifiers?

• CMS agreed with commenters that the time when a therapist and a therapist assistant furnish services to the same patient at the same time should not be counted as part of the assistant time. This means the time spent by a PTA/OTA furnishing a therapeutic service “concurrently,” or at the same time, with the therapist will not count for purposes of assessing whether the 10 percent standard has been met. The final policy is that only the minutes that the PTA/OTA spends independent of the therapist will count towards the 10 percent de minimis standard.

• CMS proposed, for billing purposes, that each outpatient therapy service that is subject to the 10 percent de minimis standard would be identified on the claim by a single procedure code, for both untimed codes and codes described in 15-minute-unit increments. Commenters pointed out the 15-minute code issue, so CMS finalized a revised definition of a service to which the de minimis standard is applied to include untimed codes and each 15-minute unit of codes described in 15-minute increments as a service. This revised definition will allow the separate reporting, on two different claim lines, of the number of 15-minute units of a code to which the therapy assistant modifiers do not apply, and the number of 15-minute units of a code to which the therapy assistant modifiers do apply.

For a 15-minute increment that equals 1 unit of a timed code, the assistant would have to furnish 3 or more minutes of the treatment to meet the 10% de minimis standard. If a PTA independently furnishes 8 consecutive minutes of therapeutic exercises to a patient who receives a total of 45 minutes of ther ex (therapist provides the other 37 minutes of ther ex), then the hospital would bill 2 units of CPT 97110 without the CQ modifier and 1 unit of CPT 97110 with the CQ modifier.

• CMS proposed to add a requirement that the treatment notes explain, via a short phrase or statement, the application or non-application of the CQ/CO modifier for each service furnished that day. CMS agreed that the addition of narrative phrases for each service could be duplicative of existing documentation requirements so they did not finalize this requirement. Neither does the documentation have to specify therapist and therapy assistant minutes.

However, CMS does expect the documentation in the medical record to be sufficient to know whether a specific service was furnished independently by a therapist or a therapist assistant, or was furnished “in part” by a therapist assistant, in sufficient detail to permit the determination of whether the 10% standard was exceeded.

Particularly related to number 1 and 2 above, CMS intends to provide further detail regarding examples of clinical scenarios to illustrate their final policies regarding the applicability of the therapy assistant modifiers through information that will be posted on the cms.gov website. Check the CMS therapy website at https://www.cms.gov/Medicare/billing/therapyServices/index for updates.

The modifier reporting and future payment reductions do not apply to critical access hospitals (CAHs) or to other providers that are not paid based on PFS rates. It also does not apply to outpatient therapy services that are furnished by, or incident to the services of, physicians or nonphysician practitioners (NPPs). This is because only therapists and not therapy assistants can furnish outpatient therapy services incident to the services of a physician or NPP.

Bottom line for hospitals – be sure to have the new therapy assistant modifiers set up and processes in place to get them appended to line item therapy services. Apply the modifiers:

• To all therapy services’ billing codes that are furnished in whole by therapy assistants,
• To untimed therapy services’ billing codes when an assistant independently furnishes more than 10% of the service (time of service divided by 10, rounded to the nearest whole integer, plus one minute)
• To timed 15-minute increments of a timed-code service when the assistant independently furnishes 3 minutes or more of a 15-minute service (for services > 8 minutes, but < 23, determine 10% as described above for untimed codes, i.e. 8-14 minutes – 2 minutes Assistant time; 15-23 minutes – 3 minutes Assistant time).

This last explanation of assistant time for timed codes is my understanding from the discussion in the final rule. I will be looking for more examples from CMS as promised to verify my understanding is correct. I definitely concede that Medicare rules can be difficult to understand and follow.

In an October 21, 2019 CMS Blog, Seema Verma, Administrator for the Centers of Medicare and Medicaid Services, outlined CMS’s vision to modernize “program integrity methods to better protect taxpayers from fraud, waste and abuse in Medicare.” In the blog, program integrity is defined as “pay it right.”

Government watchdog, “the Government Accountability Office (GAO) has designated Medicare as a High Risk program since 1990 because of its size, complexity and susceptibility to improper payments.” One recommendation by the GAO has been for Congress to expand prior authorization in Fee-For-Service (FFS).

Outpatient Department Prior Authorization Requirement

A step in this direction can be found in the CY 2020 OPPS Final Rule in which CMS states that, “as part of our responsibility to protect the Medicare Trust Funds, we routinely analyze data associated with all facets of the Medicare program.” Analysis of 1.1 billion outpatient claims over an 11-year period of data from 2007 through 2011 identified a significant increase in the utilization volume of some covered Outpatient Department services. Most of these services fell within the following five categories:

• Blepharoplasty,
• Botulinum toxin injections,
• Panniculectomy,
• Rhinoplasty, and
• Vein ablation.

Procedures in these categories are often considered cosmetic and would not be covered by Medicare. CMS indicates “we are unaware of other factors that might contribute to clinically valid increased in volume. Therefore, these above-average increases in volume suggest an increase in unnecessary utilization.”  In the Final Rule CMS implemented prior authorization requirements for these five services when performed in an outpatient department. This new requirement has an implementation date of July 1, 2020.  You can learn more about this new requirement in a related article in next week’s Wednesday@One.

CMS Modernizing Their Approach to Program Integrity

Although Medicare’s improper payment rates have declined, Administrator Verma notes they remain too high. In response, CMS “is developing a five-pillar program integrity strategy to modernize out approach and protect Medicare for future generations.”

Pillar 1: Stopping Bad Actors

CMS partners with the Office of Inspector General (OIG), Department of Justice (DOJ) and the Unified Program Integrity Contractors (UPICs) to “deliberate on potential healthcare fraud cases, quickly direct them to law enforcement, and take appropriate administrative action such as payment suspensions and revocations.”

Pillar 2: Preventing Fraud

CMS is focused on moving away from the “pay and chase” model by “improving infrastructure that prevents fraud, waste and abuse on the front end.” Once a bad actor and his or her scheme is identified system changes are made to avoid future activities. One example cited by Administrator Verma was the September 2019 takedown of defendants in an orthotic braces scam.

Pillar 3: Mitigating Emerging Programmatic Risks

Administrator Verma likens mitigating risk to “playing the world’s largest game of whack-a-mole.” In keeping with this theme, the prior authorization requirement for a list of high-risk durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) items, is “whacking” one mole in the game.

Pillar 4: Reducing Provider Burden

Provider education is a large part of the Targeted Probe and Educate (TPE) program. “Since its inception in 2009, the program has played a major role in reducing improper payments, recouping more than $10 billion for the Medicare program.”

The TPE program has also highlighted provider burden and confusing policies. In response CMS is working on developing a prototype Medicare FFS Documentation Requirement Lookup Service. You can read more about this effort on the CMS Documentation Requirement Lookup Service Initiative webpage. 

Administrator Verma described additional ways that CMS is focusing on reducing provider burden and noted “cumulatively, these efforts are defining a new approach to program integrity that reduces burden and increased education to achieve a better shared understanding of how the programs operate.”

Pillar 5: Leveraging New Technology

CMS looks to adopt cutting edge technology – “such as AI and machine learning tools,” to save taxpayers more money and enable them to review more claims.  

The Future of Medicare Program Integrity

Administrator Verma aptly summarizes the vision for the future of program integrity in one sentence. “CMS must elevate program integrity, unleash the power of modern private sector innovation, prevent rather than chase fraud waste and abuse through smart, proactive measures, and unburden our provider partners so they can do what they do best – put patients first.”

My youngest son got married earlier this month, and I have already conveyed to him and his bride my desire for more grandchildren. Grandkids are such fun because you can love on them and spoil them, then turn them back over to their parents for the serious stuff. A friend of mine has a one-year old granddaughter and I love to spend time with her. She is currently learning the word “no,” and I get to sit back and smile as it is obvious that she knows what it means but pretends she doesn’t. That slight hesitation and determined expression are “cute” from my perspective, but frustrating for her parents as she proceeds with her actions, undeterred by their instruction of “No!”

Do you think the judicial system and affected parties are frustrated by CMS’s decisions to go forward with certain actions when the judicial system has given the instruction of “no?” Maybe CMS is more like teenagers than babies, because they are old enough to argue, and are putting forth appeals, the potential to appeal, and alternative options as they proceed with their original actions. The 2020 Outpatient Prospective Payment System (OPPS) Final Rule was released Friday, November 1, 2019 and CMS is continuing for 2020 a couple of policies the courts have already found to be inappropriate.

First is the reduction in payment for clinic visits performed in excepted off-campus provider-based departments (PBDs). A little history here – in November 2015, Congress passed a law to pay “new” off-campus hospital provider-based departments that began furnishing and billing for services on or after November 2, 2015 at a different, lower payment rate than that of OPPS. This was done to address concerns about higher payments for services provided in hospital outpatient departments than the lower payments for the same services provided in a physician office setting. Hospitals were instructed to report the services in these non-excepted off-campus PBDs with a PN modifier and CMS determined to pay these under the physician fee schedule at 40% of the OPPS rate (a payment reduction of 60%). Services provided in excepted off-campus PBDs and reported with the PO modifier continued to be paid at OPPS rates at that time. That is until 2019, when CMS decided to expand site-neutrality payments further to include clinic visits (HCPCS code G0463) provided in excepted off-campus PBDs. They phased in the 60% payment reduction over two years, with a 30% reduction for 2019 and the full 60% reduction in 2020 – this makes the payment for clinic visits at all off-campus PBDs the same as the physician fee schedule payment for non-excepted PBD services of 40% of OPPS payment rates.

CMS claims they are “removing the payment differential that drives the site-of-service decision and, as a result, unnecessarily increases service volume.” They further claim they are doing this under authority of a certain section of the Social Security Act that gives them power “to adopt a method to control unnecessary increases in the volume of covered outpatient department services.” They are also implementing this payment reduction in a “non-budget neutral manner” which means the costs savings to the Medicare program will not be redistributed back to hospitals. So far, the courts have not agreed with CMS on their authority to implement this payment reduction policy.

On September 17, 2019, the United States District Court for the District of Columbia entered an order vacating the portion of the CY 2019 OPPS/ASC final rule that adopted the payment reduction for clinic visit services furnished by excepted off-campus PBDs. In October, the district court denied CMS’s request for stay and entered final judgment. CMS acknowledges the court’s decision and states they are “working to ensure affected 2019 claims for clinic visits are paid consistent with the court’s order.” Despite these statements, CMS chose to proceed with the second year of the two-year phase-in of the clinic visit policy for 2020. This means for CY 2020, clinic visits (G0463) provided in excepted off-campus PBDs and billed with the PO modifier will be paid at 40% of the OPPS payment rate. CMS states they have appeal rights and are still considering whether to appeal the final judgement or not.

The second policy for which the courts have issued a negative opinion is the payment of drugs purchased through the 340B program at Average Sales Price (ASP) minus 22.5%. The district courts have found that for both the 2018 and 2019 payment reductions, CMS exceeded their statutory authority by making such a large adjustment in payment rate. The case is currently under appeal from CMS and although they are requesting comments on options to remedy the underpayments of those years, they are also proceeding for 2020 with the same reduced payment amount of ASP-22.5% for drugs purchased through the 340B program including such drugs in a non-excepted off-campus PBD.

Since this policy was implemented in a budget-neutral manner (money saved was redistributed to all OPPS hospitals) and a remedy is “no easy task, given Medicare’s complexity,” the courts have remanded the issue to HHS to devise an appropriate remedy while also retaining jurisdiction. There is abundant discussion, comments and responses in the Final Rule about possible options to address the underpayments. As part of one such remedy, CMS is conducting a 340B hospital survey to collect drug acquisition cost data for CY 2018 and 2019. Since the district court has acknowledged that CMS may base the Medicare payment amount on average acquisition cost when survey data are available, it is obvious in the FR that CMS expects the survey data to show that ASP minus 22.5% was a conservative adjustment that overcompensates hospitals. If so, this remedy would get CMS out of their bind and possibly allow the current reduced payment rate to stand. The Final Rule does offer other options for consideration.

For other drugs and biologicals, CMS finalized the following policies:

• A packaging threshold of $130 – this means Medicare will package items with a per day cost less than or equal to $130, and identify items with a per day cost greater than $130 as separately payable unless they are policy-packaged (such as anesthesia, intraoperative items, and drugs that function as supplies, etc.)
• A payment rate of ASP plus 6% for pass-through and separately payable non-pass-through drugs other than those purchased through the 340B program
• Payment rate of Wholesale Acquisition Costs (WAC) plus 3% for drugs paid under WAC (such as when ASP data is not available)

Like stubborn children, the policies of the OPPS Final Rule show that just because CMS has been told “no” does not mean they plan to change their ways. We will be addressing other policies and decisions from the OPPS Final Rule in future articles in this newsletter.

The holiday season is upon us and I hope that everyone had a Happy Thanksgiving. It is the time of year when certain things expand. If you believe the hype from Hallmark Christmas movies, our hearts expand with more kindness and joy at this time of year; our waistlines usually expand from all the holiday meals and sweet treats; and our Christmas list and associated budget seem to expand as it gets closer to Christmas (which reversely causes our wallets to shrink). Evidently, CMS thought it was a good time to expand on the requirements associated with hospital price transparency.  They also gave an early Christmas present however by delaying the new requirements until January 1, 2021. This means for now and until January 2021, hospitals are to continue to comply with the existing guidance which requires hospitals to make public their chargemaster charges (gross charges) online in a machine-readable format.

As a reminder, this requirement comes from the Health Care and Education Reconciliation Act of 2010 that “requires each hospital operating in the United States for each year to establish (and update) and make public a list of the hospital’s standard charges for items and services provided by the hospital, including for diagnosis related groups (DRGs)…”  The 2019 Outpatient Prospective Payment System (OPPS) proposed and final rules updated guidelines to require hospitals to make available a list of their current standard charges via the Internet in machine-readable format and to update this information at least annually, or more often as appropriate. CMS further clarified in these rules that this requirement applies to all hospitals operating within the United States and to all items and services provided by the hospital. CMS’s reasoning for the requirements is that they believe there is a direct connection between hospital charge transparency and more affordable, lower cost healthcare.

The expansion of the requirements was originally discussed in the 2020 OPPS Proposed Rule and made final in a separate Final Rule for Price Transparency Requirements for Hospitals to Make Standard Charges Public. The new requirements are based on feedback from the 2019 revised guidelines and from an Executive Order on “Improving Price and Quality Transparency in American Healthcare to Put Patients First” (June 24, 2019). I refer readers to the actual rule for all the reasons CMS believes these new requirements are necessary. Below is a summary of what the new requirements are, including many new definitions for clarification. At the same time as the release of this final rule, CMS also released a proposed rule entitled Transparency in Coverage that would place complementary transparency requirements on most individual and group market health insurance issuers and group health plans.

“Hospital” Definition

The requirements apply to hospitals which are defined in the new Final Rule (FR) as all institutions recognized, licensed and/or approved as a hospital by State or applicable local laws. This includes:

• All Medicare-enrolled hospitals plus hospitals that do not participate in Medicare,
• Hospitals in all States, the District of Columbia, and US territories as listed in the FR (Puerto Rico, Virgin Islands, Guam, etc.),
• Critical access hospitals (CAHs), inpatient psychiatric facilities (IPFs), sole community hospitals (SCHs), and inpatient rehabilitation facilities (IRFs),
• Each hospital location operating under a single license or approval that has a different set of standard charges, such as a hospital outpatient department located at an off-campus location.

It does not include entities such as ambulatory surgical centers (ASCs) or other non-hospital sites-of-care from which consumers may seek healthcare items or services, although CMS encourages such entities to make public their standard charges. It also does not apply to federally-owned or operated hospitals, such as Indian Health Service (IHS) facilities, Veterans (VA), and Department of Defense (DOD) hospitals because these hospitals generally do not provide services to the general public and their payment rates are not subject to negotiation.

“Items and Services” Definition

“Items and services” provided by the hospital are “all items and services, including individual items and services and service packages, that could be provided by a hospital to a patient in connection with an inpatient admission or an outpatient department visit for which the hospital has established a standard charge.” This includes:

• Supplies, procedures, room and board, facility use, and facility fees;
• Service packages which mean an aggregation of individual items and services into a single service with a single charge (such as DRG or APC charges);
• Services of employed physicians and non-physician practitioners; and
• Any other items or services for which a hospital has established a charge.

Disclaimer – Please do not shoot the messenger if some of the new requirements do not seem to make sense. CMS is convinced that hospitals routinely contract payer-specific rates for service packages. They also clarify that the word “charges” is equivalent to “payment rates” whether for an individual item/service or a service package.

“Standard Charges” Definition

This is the big definition that is significantly expanded from the current requirements. Under the new requirements the following are considered standard charges and must be included in both the Internet-posted machine-readable format and shoppable services postings (discussed in more detail below) when the new requirements become effective in 2021.

• Gross charges – charges as recorded in the chargemaster, absent any discounts.
• Payer-specific negotiated charges – charges the hospital has negotiated with a third party payer for an item or service.
• “Third party payer” is “an entity that, by statute, contract, or agreement, is legally responsible for payment of a claim for a healthcare item or service.”
• Hospitals should display all negotiated charges, including, for example, charges negotiated with Medicare Advantage plans, Medicaid MCOs, and other Medicaid managed care plans.
• Payer-specific negotiated charges would not include non-negotiated payment rates (such as those payment rates for FFS Medicare or Medicaid).
• CMS states that hospital payer-specific negotiated charges or rates can be found within the in-network contracts that hospitals have signed with third party payers. Per CMS, such contracts often include rates sheets that contain a list of hospital items and services (including service packages) and the corresponding negotiated rates. CMS recommends hospitals request an electronic copy of their contract and corresponding rate sheet from the third party payer if it is not already available in that format.
• Discounted Cash Price – the price the hospital would charge individuals who pay cash (or cash equivalent) for an individual item or service or service package.
• Groups that would benefit from knowing the discount cash price would be the uninsured and those who may have some healthcare coverage but who still bear the full cost of at least certain healthcare services.
• The “discounted cash price” would reflect the discounted rate published by the hospital, unrelated to any charity care or bill forgiveness that a hospital may choose or be required to apply to a particular individual’s bill.
• The discounted cash price may be generally analogous to the “walk-in” rate but would apply to all self-pay individuals, regardless of insurance status.
• For hospitals that have not determined a discounted cash price for self-pay consumers the hospital’s discounted cash price would simply be its gross charges as reflected in the chargemaster.
• De-identified Minimum Negotiated Charge – the lowest charge that a hospital has negotiated with all third party payers for an item or service.
• To determine the de-identified negotiated charges, hospitals consider the distribution of all negotiated charges across all third party payer plans and products for each hospital item or service and then selects the lowest and highest rates.
• The distribution would not include non-negotiated charges with third party payers
• The third party payer with which these rates are negotiated is not identified.
• De-identified Maximum Negotiated Charge - the highest charge that a hospital has negotiated with all third party payers for an item or service.
• Bullets for de-identified minimum negotiated charge listed above also apply to the de-identified maximum negotiated charge.

HOSPITALS MUST MAKE PUBLIC THEIR STANDARD CHARGES IN TWO WAYS:

• a comprehensive machine-readable file that makes public all standard charge information for all hospital items and services, and
• a consumer-friendly display of common “shoppable” services derived from the machine-readable file.

Comprehensive Machine-Readable File

• The machine-readable list of hospital items and services is required to include the following charges, as applicable, for each item and service: – the gross charge, the payer-specific negotiated charges, the discounted cash price, de-identified minimum negotiated charge, and de-identified maximum negotiated charge
• In addition to the above charges, the listing must include:
• A description of each item or service (including both individual items and services and service packages).
• Any code used by the hospital for purposes of accounting or billing for the item or service, including, but not limited to, the CPT code, HCPCS code, DRG, NDC, or other common payer identifier.
• Hospitals must post their standard charge information in a single digital file in a machine-readable format.
• A machine-readable format is a digital representation of data or information in a file that can be imported or read into a computer system for further processing.
• Examples of machine-readable formats include, but are not limited to, .XML, .JSON and .CSV formats.
• A PDF would not meet this definition because the data contained within the PDF file cannot be easily extracted without further processing or formatting.
• CMS requires that hospitals use a CMS-specified naming convention for the file (§ 180.50(d)(5)).
• The naming convention for the file must be:
  <ein>_<hospital-name>_standardcharges.[json|xml|csv]
• Hospitals have discretion to choose the Internet location they use to post their files as long as
• They are displayed on a publicly-available website,
• Are displayed prominently and
• Clearly identify the hospital location with which the standard charges information is associated
• The data must be easily accessible and without barriers, which means the data can be accessed free of charge, without having to establish a user account or password, and without having to submit personal identifiable information (PII)
• The data must be able to be digitally searched
• Files must be updated annually
• This means such updates must occur at least once in a 12-month period.
• Hospitals must clearly indicate the date of the last update to the standard charge data either within the file or otherwise clearly associated with the file.
• These requirements apply to each hospital location so that each location with separate charges makes a list public

Shoppable Services

A “shoppable service” is a service package that can be scheduled by a healthcare consumer in advance. Shoppable services are typically provided in non-urgent situations, which allows patients to price shop and schedule a service at a time that is convenient for them.

• Hospitals must make public the following prescribed standard charges for at least 300 shoppable services in a consumer-friendly manner.
• This includes 70 shoppable services specified by CMS that are provided by the hospital, plus as many additional shoppable services as would be necessary to reach a total of at least 300 shoppable services
• If a hospital does not provide some of the 70 CMS-specified services, then the hospital would identify enough shoppable services so that the total number of shoppable services is at least 300.
• Hospitals should select services based on the utilization or billing rate of the services in the past year. In other words, the shoppable services selected for display by the hospital should be commonly provided to the hospital’s patient population.
• If a hospital does not provide 300 shoppable services, the hospital must list as many shoppable services as they provide.
• The 70 CMS-specified shoppable services are found in Table 3of the FR and are divided into four broad categories: E&M Services, Laboratory and Pathology Services, Radiology Services, Medicine and Surgery Services.
• The hospital must display the following types of standard charges described above that apply to each shoppable service (and corresponding ancillary services, as applicable)– the payer-specific negotiated charges, the discounted cash price, de-identified minimum negotiated charge, and de-identified maximum negotiated charge.
• The shoppable services list must also include:
• A plain-language description of each shoppable service.
• An indicator when one or more of the CMS-specified shoppable services are not offered by the hospital.
• The location at which the shoppable service is provided, including whether the charges at that location apply to the inpatient setting, the outpatient department setting, or both.
• Any primary code used by the hospital for purposes of accounting or billing for the shoppable service, including, as applicable, the CPT code, the HCPCS code, the DRG, or other common service billing code.
• Hospitals may use, as applicable, an appropriate payer-specific billing code (for example, an APR-DRG code) in place of the MS-DRG code indicated for the five procedures in the list of 70 CMS-specified shoppable services that are identified by MS-DRG codes 216, 460, 470, 473, and 743.
• When the shoppable service is customarily accompanied by the provision of ancillary services, the hospital must present the shoppable service as a grouping of related services, meaning that the charge for the primary shoppable service (whether an individual item or service or service package) is displayed along with charges for ancillary services.
• An “ancillary service” is an item or service a hospital customarily provides as part of or in conjunction with a shoppable primary service.
• Ancillary items and services may include laboratory, radiology, drugs, delivery room (including maternity labor room), operating room (including post-anesthesia and postoperative recovery rooms), therapy services (physical, speech, occupational), hospital fees, room and board charges, and charges for employed professional services.
• They may also include additional services that are provided by the hospital, for example, local and/or global anesthesia, services of employed professionals, supplies, facility and/or ancillary facility fees, imaging services, lab services, and pre- and post-op follow up.
• A hospital must select an appropriate publicly available Internet location for purposes of making public the standard charge information for shoppable services in a consumer-friendly format.
• The information must be displayed in a prominent manner that identifies the hospital location with which the standard charge information is associated.
• The shoppable services information must be easily accessible, without barriers, including, but not limited to, ensuring the information is: (i) free of charge; (ii) accessible without having to register or establish a user account or password; (iii) accessible without having to submit PII; (iv) searchable by service description, billing code, and payer.
• Standard charge information must be updated at least once annually and the date must be indicated with the information.
• CMS did not finalize the requirement to provide a paper copy of information on consumer-friendly shoppable services.

Price Transparency Tool

CMS encourages, but does not require, that hospitals develop a price comparison tool to make standard charges available in a machine-readable format to third-party tool developers as well as the general public. They also determined that having a price transparency tool might meet the price transparency requirements for shoppable services.

“A hospital that maintains an Internet-based price estimator that meets certain criteria is deemed to have met our requirements at 45 CFR 180.60. The price estimator tool must:

• Allow healthcare consumers to, at the time they use the tool, obtain an estimate of the amount they will be obligated to pay the hospital for the shoppable service.
• Provide estimates for as many of the 70 CMS-specified shoppable services that are provided by the hospital, and as many additional hospital-selected shoppable services as is necessary for a combined total of at least 300 shoppable services.
• Is prominently displayed on the hospital’s website and be accessible without charge and without having to register or establish a user account or password.”

Like our hearts, waistlines, and these price transparency requirements, the length of my article has expanded beyond what I originally planned. I think that is enough information for this week’s article. Next week, I will address CMS’s plans for monitoring, penalties, and appeals.