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Total Knee Procedures (CPT 27447) were removed from the Medicare Inpatient Only List Effective January 1, 2018. CMS also finalized prohibiting RAC “reviews for patient status for TKA procedures performed in the inpatient setting for a period of 2 years to allow time and experience for these procedures under this setting.” However, these procedures remain “fair game” for review for medical necessity of the surgical procedure regardless of patient status.

CMS’s January 11, 2018 edition of MLN Connects included a new Medicare Learning Network (MLN) publication titled Major Joint Replacement (Hip or Knee) Booklet (ICN 909065).  This booklet provides guidance on how to document medical necessity; ensure a complete and accurate medical record; key points for billing codes; and aids to correct billing.

CMS Focuses on Major Joint Replacement or Reattachment

Before the “how to,” it is important to understand “why” the focus on Major Joint Replacements. 

Major Joint Replacement or Reattachment (MS-DRGs 469 and 470) are high volume, high cost procedures for Medicare. CMS has had Recovery Auditors, Comprehensive Error Rate Testing (CERT) Contractors, and Medicare Administrative Contractors (MACs) review claims for these MS-DRGs. “Their findings have demonstrated very high paid claim error rates among both hospital and professional claims associated with major joint replacement surgery.”

MS-DRG 470 is consistently the top surgical MS-DRG by volume for hospitals. To illustrate the volume and cost, the following table details the Jurisdiction J (JJ) MAC paid claims data for MS-DRG 470 for dates of service from July 1, 2016 through June 30, 2017.

‍Document Medical Necessity

CMS notes that “to avoid denial of claims…the medical records should contain enough detailed information to support the determination that major joint replacement surgery was reasonable and necessary for the patient. Progress notes should consist of more than just conclusive statements. Therefore, the medical record of the joint replacement surgical patient must specifically document a complete description of the patient’s historical and clinical findings.”

The Patient’s Medical Record

The following information should be included in a patient’s Medical Record to support that surgery was reasonable and necessary for the patient.

Patient History

The history should include information such as:

• A description of pain (onset, duration, character, aggravating, and relieving factors),
• Any limitations of specific Activities of ADLs (e.g., unable to climb steps),
• Safety issues (e.g. any falls),
• Contraindications to non-surgical treatments,
• Failed non-surgical treatments (e.g., NSAIDs, weight loss, intra-articular injections).

Physical Exam

Detailed objective findings of the joint examination should be included in the physical exam. Examples of findings include:

• Any deformity,
• Range of motion limitations,
• Crepitus,
• Effusions,
• Tenderness, and
• Gait description.

Investigations

The medical record should include the results of any applicable tests (i.e. plain radiographs and pre-operative imaging studies).

The Patient’s Hospital Record

Pre-operatively, the record should include documentation of the specific condition necessitating surgery such as osteoarthritis (mild, moderate, severe), avascular necrosis of the knee, or fractures).

Post-Operatively, the record should include the operative report (including observed pathology), daily progress notes for an inpatient, the discharge plan and discharge orders.

The booklet goes on to provide examples of a medical record that may result in a denied claim and a claim with more detail and support of medical necessity. CMS also provides a link to MLN SE1236 - Documenting Medical Necessity for Major Joint Replacement (https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/se1236.pdf) as a resource for providing guidance on documenting medical necessity for major joint replacement procedures.

MMP encourages you to carefully read the MLN Booklet and MLN SE1236 and share this information with your surgeons as CMS notes that “both physicians and hospitals are responsible for ensuring a complete and accurate record.”

Reviewed in a previous article, published August 2017, was information from an Office of Inspector General (OIG) Report about outpatient services provided shortly before or during inpatient stays. This report and the associated article focused on issues of non-compliance with the 3-day window rule and outpatient services billed separately when the Medicare beneficiary was an inpatient at the same or another acute-care hospital. The OIG review did not cover outpatient services provided to beneficiaries who were inpatients of other types of facilities. A recent OIG report remedies that and examines outpatient payments for patients who were inpatients of long-term-care hospitals (LTCHs), inpatient rehabilitation facilities (IRFs), inpatient psychiatric facilities (IPFs), and critical access hospitals (CAHs).  The bad news is that none of the almost 130,000 claims totaling $51,640,727 in Medicare outpatient payments that were reviewed by the OIG should have been paid.

Medicare pays LTCHs, IRFs, and IPFs under a prospective payment system (PPS) specific to the particular type of facility.  CAHs are paid on a reasonable cost basis. These types of facilities must provide all services furnished during an inpatient stay directly or under arrangements. This includes surgeries, diagnostic testing, emergency department visits, infusions, and ambulance transportation.  If an inpatient of one of these facilities receives outpatient services from an acute-care hospital under arrangements, then the inpatient facility must include those outpatient services on its inpatient Medicare claim. The acute-care hospital should receive payment from the patient’s inpatient facility and must not submit an outpatient claim to Medicare.

Here are some statistics on the overpayments by type of inpatient facility and type of service.

The purpose of OIG audits is to identify problems and correct processes going forward. The end result of correctly billed and paid claims is a good thing, but the immediate recoupment of overpayments causes pain for the involved providers. This audit recommends CMS recover the $51 M in overpayments as well as having the hospitals refund approximately $14 M to beneficiaries.

There is also some pain, or at least some embarrassment, for Medicare as well since they should have caught these duplicate claims to begin with and not made the improper payments. However, Medicare’s edits were not working properly – edits alerted when the inpatient claim was received after an overlapping outpatient claim was paid, but the contractors did not understand the alert required them to take the action of recovering the outpatient overpayment – both claims were paid. When the outpatient claim was received after the inpatient claim was paid, the edits failed to deny the outpatient claim and again, both claims were paid.  To make matters even worse, the OIG estimates that, “If the Common Working File (CWF) edits had been working properly since CY 2006, Medicare could have saved $99,149,320, and beneficiaries could have saved $28,899,632 in deductibles and coinsurance that may have been incorrectly collected from them or someone on their behalf.” This may result in more pain for providers as the OIG recommended Medicare contractors identify improper payments after the OIG audit period, recover overpayments and have hospitals refund associated co-payments.

Other recommendations from the OIG are for CMS to correct the CWF edits to prevent future overpayments related to this issue and for “Medicare contractors to more effectively educate acute-care hospitals not to bill Medicare for outpatient services they provided to beneficiaries who were inpatients of other facilities, but rather to provide those services under arrangements and look to the inpatient facilities for payment.”  To that end, CMS has already reissued Special Edition MLN Article SE17033.

Maybe proper processing edits and correct claim submissions will save everyone some pain and embarrassment.

If your job involves keeping up with Medicare regulations, you know that sometimes there is so much information it can be overwhelming. You may also notice the same information appearing again and again. That is not a bad thing – repetition promotes learning and if you missed it one place, chances are you will see it again.

The guidelines we follow for Medicare come from laws, rules and regulations, and the sub-regulatory guidance of instructions, policies, and procedures. What is the difference in a law versus Medicare manual instructions? Laws come from Congressional actions signed into law by the President. Then a government department, such as the Centers for Medicare and Medicaid Services (CMS) issues rules in The Federal Register which become codified in the Code of Federal Regulations (CFR) to implement, interpret, or prescribe law or policy. From Medicare final rules, CMS issues sub-regulatory guidelines, such as in the form of Medicare transmittals to communicate new or changed policies or procedures that will be incorporated into Medicare manuals. And even beyond that CMS and the individual Medicare Administrative Contractors (MACs) offer instructions and numerous educational opportunities. With all of this communication, it would be hard for a provider to ever claim they were not aware of the Medicare requirements.

Like Medicare, you will see topics repeated in our Wednesday@One newsletter articles. For example, we have already written several articles based on the Outpatient Prospective Payment System (OPPS) Final Rule (FR). This article summarizes the January 2018 OPPS Update transmittal which addresses the changes from the FR to be implemented in January plus other January updates. Therefore, you will see topics again that you have seen in recent articles, but remember, repetition promotes learning.

• There are no new device categories eligible for pass-through payment for January 2018,
• Two additional New Technology APCs (1907 and 1908) are created and existing New Technology APC payment rates adjusted (see table in the transmittal).
• Effective January 1, 2017, X-rays taken using film must be reported with modifier “FX.” This results in a payment reduction of 20%.
• Effective January 1, 2018, hospitals must report modifier “FY” for X-rays taken using computed radiography technology. Use of this modifier results in a 7% payment reduction from January 1, 2018, through December 31, 2022, and a 10% reduction beginning January 1, 2023 and after.
• Modifier “CP” used to identify adjunctive services on a claim related to a procedure assigned to a Comprehensive APC (generally for Stereotactic Radio Surgery (SRS)) was deleted after December 31, 2017. Medicare will continue to make separate payments for the 10 planning and preparation services adjunctive to the delivery of the SRS treatment when furnished within 30 days of the SRS treatment. See the transmittal for more details and a list of the 10 planning and prep codes.
• CMS removed 6 procedures from the inpatient-only list (IPO) for CY 2018 – CPT 43282, laparoscopic repair of para-esophageal hernia; CPTs 43772-43774, laparoscopic gastric restrictive procedures; CPT 55866, laparoscopic prostatectomy; and creating the most discussion CPT 27447, total knee arthroplasty. CPT 92941, percutaneous transluminal revascularization during an AMI is being added to the IPO.
• CMS revised the laboratory date of service policy so that the date of service for molecular pathology tests and Advanced Diagnostic Laboratory Tests (ADLTs) that are not packaged under OPPS, that are collected from a hospital outpatient during a hospital outpatient encounter and the test is performed following the patient’s discharge from the hospital outpatient department, is the date the testing is performed. This means for tests meeting these criteria the testing lab must bill Medicare directly and the hospital laboratory should not bill Medicare. There are currently no ADLTs. Molecular pathology codes not packaged under OPPS can be identified on the OPPS Addendum B with a status indicator of “A.”
• For 2018, separately payable drugs with an OPPS status indicator of “K” purchased through the 340B program will be paid at ASP-22.5%. Hospitals to which this rule applies must report modifier “JG” on the claim to trigger the appropriate payment. Excepted hospitals (rural sole community hospitals, children’s hospitals, and OPPS-exempt cancer hospitals) will continue to be paid at ASP+6%, but should report informational modifier “TB” to identify drugs purchased through the 340B program.
• Effective January 1, 2018, newly approved biosimilar biological products with a common reference product will no longer be grouped into the same billing code with other biosimilars. CMS will be issuing new codes, but until then, continue to use existing codes and modifiers.
• See the January 2018 OPPS update (page 14) for a list of the assignment of Skin Substitute product codes as low- or high-cost.
• Medicare will be making available during CY 2018 a public searchable Internet website comparing estimated payments as required by the 21st Century Cure Acts.

This is a summary of some of the topics covered in the January 2018 OPPS Update transmittal. I encourage providers billing Medicare to read the entire transmittal for complete information.  The transmittal also includes new and revised codes.

Q:

Would you code acute blood loss anemia if the surgeon specifies that acute blood loss anemia is expected after surgery?  Also, acute blood loss anemia was documented after surgery.

A:

Since acute blood loss anemia was documented after surgery, code (D62) for the acute blood loss anemia even though the surgeon said that blood loss was expected.  However, if acute blood loss anemia is not documented after surgery but there are clinical signs and symptoms of blood loss, do not code the acute blood loss anemia.  If anemia is documented after surgery with no further specificity, query the physician for clarification.

References

Coding Clinic, Third Quarter, 2004, page 4
Coding clinic, Second Quarter, 1992, pages 15-16

Medicare Transmittals

2018 Annual Update to the Therapy Code List

Updates the list of “sometimes therapy” and “always therapy” codes with new codes for 2018.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10303.pdf

Hyperbaric Oxygen (HBO) Therapy (Section C, Topical Application of Oxygen)

Effective April 3, 2017, coverage of topical oxygen for the treatment of chronic wounds will be determined by the MACs.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10220.pdf

Replacement of Mammography HCPCS Codes, Waiver of Coinsurance and Deductible for Preventive and Other Services, and Addition of Anesthesia and Prolonged Preventive Services

Describes replacement of HCPCS codes G0202, G0204, and G0206 with CPT codes 77067, 77066, and 77065, effective January 1, 2018. Also applies the waiver of deductible and coinsurance to 76706, 77067, prolonged preventive services, and anesthesia services furnished in conjunction with and in support of colorectal cancer services.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10181.pdf

Payment Reduction for X-Rays Taken Using Computed Radiography

Announces a 7% payment reduction for computed radiography x-rays for CY 2018 – CY 2020 and a 10% reduction for CY2023 and beyond.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10188.pdf

Calendar Year (CY) 2018 Annual Update for Clinical Laboratory Fee Schedule (CLFS) and Laboratory Services Subject to Reasonable Charge Payment

The Calendar Year (CY) 2018 clinical laboratory fee schedule, mapping for new codes for clinical laboratory tests and updates for laboratory costs subject to the reasonable charge payment.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10409.pdf

January 2018 Integrated Outpatient Code Editor (I/OCE) Specifications Version 19.0

Updates to the Integrated Outpatient Code Editor (I/OCE) instructions and specifications that Medicare uses under the Outpatient Perspective Payment (OPPS) and Non-OPPS for hospital outpatient departments, and other select providers.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10385.pdf

January 2018 Update of the Hospital Outpatient Prospective Payment System (OPPS)

Changes to the OPPS to be implemented in the January 2018 update.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10417.pdf

Summary of Policies in the Calendar Year (CY) 2018 Medicare Physician Fee Schedule (MPFS) Final Rule, Telehealth Originating Site Facility Fee Payment Amount and Telehealth Services List, and CT Modifier Reduction List

A summary of policies in the Calendar Year (CY) 2018 MPFS Final Rule and announces the Telehealth Originating Site Facility Fee payment amount and makes other policy changes related to Medicare Part B payment. These changes are applicable to services furnished in CY 2018.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10393.pdf

Medicare Special Edition Articles

Prohibition on Billing Dually Eligible Individuals Enrolled in the Qualified Medicare Beneficiary (QMB) Program – REVISED

Revisions concerning Remittance Advice and MSN modifications, implementation of HETS QMB, and clarification that QMBs cannot elect to pay Medicare cost-sharing but may need to pay a small Medicaid copay in certain circumstances.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE1128.pdf

Medicare Does Not Pay Acute-Care Hospitals for Outpatient Services They Provide to Beneficiaries in a Covered Part A Inpatient Stay at Other Facilities – REVISED

Revised to include information from OIG report.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE17033.pdf

Inpatient Rehabilitation Facility (IRF) Medical Review Changes

In order for IRF services to be covered, submitted documentation must sufficiently demonstrate that a beneficiary’s admission to an IRF was reasonable and necessary, according to Medicare guidelines.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE17036.pdf

Medicare Coverage Updates

Proposed Decision Memo for Implantable Cardioverter Defibrillators (CAG-00157R4)

Proposed changes to NCD 20.4 for ICDs.

https://www.cms.gov/medicare-coverage-database/details/nca-proposed-decision-memo.aspx?NCAId=288&TimeFrame=90&DocType=All&bc=AgAAYAAACAAAAA%3d%3d&

Medicare Press Releases

First Breakthrough-Designated Test to Detect Extensive Number of Cancer Biomarkers

On November 30, FDA approved the FoundationOne CDx (F1CDx), the first breakthrough-designated, Next Generation Sequencing (NGS)-based In Vitro Diagnostic (IVD) test that can detect genetic mutations in 324 genes and two genomic signatures in any solid tumor type. CMS at the same time proposed coverage of the F1CDx.

https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2017-Press-releases-items/2017-11-30-2.html?DLPage=1&DLEntries=10&DLSort=0&DLSortDir=descending

CMS Finalizes Comprehensive Care for Joint Replacement Model Changes, Cancels Episode Payment Models & Cardiac Rehabilitation Incentive Payment Model

On November 30, CMS finalized the cancellation of the mandatory hip fracture and cardiac bundled payment models and implemented changes to the Comprehensive Care for Joint Replacement (CJR) Model.

https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2017-Press-releases-items/2017-11-30.html?DLPage=1&DLEntries=10&DLSort=0&DLSortDir=descending

Medicare Educational Resources

Inpatient Rehabilitation Facility Reference Booklet

This guide provides education about common documentation errors, scenarios and solutions for IRF services identified by Medicare Administrative Contractors and the Comprehensive Error Rate Testing (CERT) program.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/IRF-Reference-Booklet-909337.pdf

Medicare Overpayments

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/OverpaymentBrochure508-09.pdf

Q:

Is there any additional guidance on the use of modifiers for the payment reduction of drugs purchased through the 340B program?

A:

Yes.  On December 13, 2017, CMS released a list of Frequently Asked Questions (FAQs) concerning “Billing 340B Modifiers under the Hospital Outpatient Prospective Payment System (OPPS).”  There are 17 FAQs that contain information on the policy, definitions of types of hospitals, which types of providers have to report which modifiers, and more.

Some of the more surprising answers are:

• Hospitals must report modifier ‘TB’ for pass-through drugs (status indicator of “G”). Pass-through drugs are exempt from the 340B payment reduction and will continue to be paid at ASP+6%. The ‘TB’ modifier is informational to allow CMS to understand the scope of the 340B drug discount program.
• Discarded (wasted) drug amounts of drugs purchased through the 340B drug discount program for applicable entities should be billed on a separate claim line with the JW modifier and the appropriate 340B modifier.
• Non-excepted off-campus provider based departments (those PBDs that are paid under the Medicare Physician Fee Schedule) must report the ‘TB’ modifier for drugs purchased through the 340B program. The payment reduction does not apply to these types of PBDs since they are not paid under OPPS, but they must report the ‘TB’ modifier in addition to modifier “PN” (Nonexcepted service provided at an off-campus, outpatient, provider-based department of a hospital).
• Modifiers ‘JG’ or ‘TB’ can be optionally reported on packaged drugs with a status indicator of “N.” Packaged drugs with a status indicator of “N” do not require either modifier to be reported, but a provider may voluntarily report a modifier with these drugs.

When Medicare is either the primary or secondary payer, the appropriate 340B modifier is required in accordance with the OPPS 340B payment policy.

What comes to mind when you hear the word PEPPER. For me, it takes me back to my childhood and the lyrics from the 1970’s Dr. Pepper commercial that invited you to join the Dr. Pepper “crowd” with the jingle:

“I’m a Pepper, he’s a Pepper,
She’s a Pepper, we’re a Pepper,
Wouldn’t you like to be a Pepper, too?
Be a Pepper. Drink Dr. Pepper.”

Fast forward a few decades to 2002 and PEPPER takes on a whole new meaning. This is when the TMF Health Quality Institute developed the Program for Evaluating Payment Patterns Electronic Report (PEPPPER) for short-term acute care hospitals in support of the Center’s for Medicare and Medicaid Services (CMS) Hospital Payment Monitoring Program (HPMP).

In 2008 HPMP ended but just as the famous Dr. Pepper jingle lives on, TMF was once again contracted by CMS through the Office of Financial Management Provider Compliance Group to develop, produce and distribute PEPPERs to all short- and long-term hospitals in the nation.

This article focuses on the Short-Term Acute Care Hospitals PEPPER. Specifically, the changes in the recently released Fiscal Year (FY) 2017 Q3 Short-Term Acute Care PEPPER and the PEPPER User’s Guide 23rd Edition. But first, for those not familiar with the PEPPER, let’s take a look at what it is and why it is a valuable resource for hospitals.

Background

What is PEPPER?

The PEPPER contains statistics for specific “Target Areas” that have been identified as being “at risk for improper payment due to billing, coding and/or admission necessity issues.” The Centers for Medicare & Medicaid Services (CMS) approves the Short Term PEPPER target areas.

The PEPPER compares you to other hospitals in your state, Medicare Administrative Contractor (MAC) Jurisdiction and to the nation. “Comparisons enable a hospital to determine if it is an outlier, differing from other short-term acute care hospitals.” Reports are delivered to a hospital electronically, are hospital specific, and provide the most recent twelve federal fiscal quarters for each target area.

In addition to your hospital specific report, the PEPPER Resources National-level Data Reports webpage includes a Target Area Analysis that provides claims volume, average length of stay and average Medicare Payment for each of the target areas.

Why is this a Valuable Resource for your Hospital?

The PEPPER User’s Guide notes that the Office of Inspector General (OIG) “encourages hospitals to develop and implement a compliance program to protect operations from fraud and abuse. As part of a compliance program, a hospital should conduct regular audits to ensure charges for Medicare services are correctly documented and billed.”

It is important to understand that “PEPPER does not identify the presence of payment errors, but it can be used as a guide for auditing and monitoring efforts. A hospital can use PEPPER to compare its claims data over time to identify areas of potential concern:

• Significant changes in billing practices,
• Possible over- or under-coding,
• Changes in lengths of stay.”

PEPPER User’s Guide, 23rd Edition, Effective with Q3FY 2017 Release, What’s Changed?

Defibrillator Implant Target Area Discontinued

Defibrillators as a “Target Area” was initially added to the PEPPER with the release of the 3rd Quarter FY 2015 Report Release.

The 20th User’s Guide indicated that the Comprehensive Error Rate Testing (CERT) contractor had identified a high error rate (58%) for defibrillator implants (DGs 226-227) in the Supplementary Appendices for the Medicare Fee-for-Service 2014 Improper Payments Report. This “Target Area” was “structured to compare the number of defibrillator implants performed on an inpatient basis, as compared to all defibrillator implants performed at the hospital (inpatient or outpatient).”

Interestingly, the Department of Justice (DOJ) posted a notice on October 30, 2015 that they had reached settlements with 457 hospitals in 43 states for more than $250 million related to defibrillators being “implanted in Medicare patients in violation of Medicare coverage requirements.” Coincidence? I will leave that up to you to decide.

This target area has been discontinued due to a continued decrease in the number of hospitals with sufficient data to generate statistics.

Septicemia Target Area Denominator Revised

“In general, the target areas are constructed as ratios and expressed as percents, with the numerators representing discharges that have been identified as problematic… and the denominator includes these DRGs as well as DRGs to which the original DRG is frequently changed.”

The Septicemia target area has been revised to include the following DRGs in the denominator:

• DRG 193: Simple Pneumonia and Pleurisy with MCC,
• DRG 194: Simple Pneumonia and Pleurisy with CC,
• DRG 195: Simple Pneumonia and Pleurisy without CC/MCC,
• DRG 207: Respiratory System Diagnosis with Ventilator Support 96+ Hours, and
• DRG 208: Respiratory System Diagnosis with Ventilator Support <96 Hours.

“This change was made following an analysis of DRG changes for septicemia claims, which identified a relatively large number were changes to simple pneumonia and respiratory system diagnosis DRGs.”

“One-day Stays for Medical DRGs,” “One-Day Stays for Surgical DRGs,” Two-Day Stays for Medical DRGs” and “Two-Day Stays for Surgical DRGs” Revised

This group of target areas have all been revised to exclude claims with the following patient discharge status codes:

• 02: Discharged/Transferred to a Short-Term General Hospital for Inpatient Care,
• 82: Discharged/Transferred to a Short Term General Hospital for Inpatient Care with a Planned Acute Care Hospital Inpatient Readmission,
• 07: Left Against Medical Advice, and
• 20: Expired.

“This change was made to strengthen the statistics by excluding the same claims from the numerator and denominator, thereby focusing solely on the length of stay in the numerator.”

Short-Term Acute Care hospitals are part of the PEPPER crowd and PEPPER can be a valuable resource for your hospital. I encourage you to spend some time on the PEPPER Resources website where you can find a copy of the most recent User’s Guide, Training and Resources available to you including testimonials and training sessions.

Q:

Since the 340B Drug Payment Reduction does not apply to Critical Access Hospitals (CAHs), do CAHs have to report modifier TB for drugs purchased through the 340B program?

A:

No, CAHs do not have to report modifier TB. Critical Access Hospitals (CAHs) are not included in the 340B policy change because they are paid based on 101 percent of reasonable costs as required by section 1834(g) of the Act.

All other hospitals under the OPPS are currently paid the same rate for separately payable drugs (ASP+6 percent), regardless of whether the hospital purchased the drug at a discount through the 340B Program. The new rule decreases the payment for drugs purchased through the 340B program from ASP+6% to ASP-22.5% (for an overall decrease of 28.5%). Hospitals to which the reduction applies must report modifier JG on 340B drugs in order for the drug payment to be paid at the reduced amount.

There were concerns from commenters about the drug payment reduction being especially harmful to certain type of OPPS hospitals:

• Rural hospitals are in a “hospital closure crisis” (since 2010, 80 rural hospitals have closed and one-third of remaining rural hospitals are vulnerable to closure, with 41 percent operating at a financial loss)
• Children’s hospitals furnish services under Medicare to children with end-stage renal disease (ESRD). Pediatric ESRD patients require high levels of care and rely on life-saving pharmaceuticals that often come at a high cost.
• PPS-exempt cancer hospitals treat the most vulnerable and underserved patients and communities. Also, children’s and PPS-exempt cancer hospitals receive transitional outpatient payments which would likely offset any reduction in payment of 340B drugs.

For these reasons, CMS excepted rural sole community hospitals (SCHs), children’s hospitals and PPS-exempt cancer hospitals from the 340B payment adjustment. CMS still wants to collect information on which drugs being billed to Medicare are acquired under the 340B program. Therefore the 2018 OPPS Final Rule states, “Accordingly, these three types of hospitals (rural SCHs, children’s hospitals, and PPS-exempt cancer hospitals) will still be required to report an informational modifier “TB” for tracking and monitoring purposes.” The TB modifier does not trigger a payment reduction and drugs reported with a TB modifier will be paid at ASP+6%.

If your life is not hectic, I want to know where you live and how you manage that! In today’s busy world, as most of us balance numerous responsibilities at work and at home, we have to be able to multi-task. It is a great feeling to be able to accomplish several things with one action. This article about Medicare coverage updates addresses multiple lessons to learn from one LCD. 

Effective December 7, 2017, First Coast Service Options, the Medicare Administrative Contractor (MAC) for Jurisdiction N (JN) has a new LCD for Wound Care (L37166). As usual, with new LCDs, there is also an accompanying Article that reviews the comments received from the provider community in regards to the draft LCD and First Coast’s responses to those comments.  Here are the lessons to be learned from the First Coast Wound Care LCD and Article:

• Requirements for coverage of wound care services
• Documentation necessary to support coverage of wound care services
• Importance of commenting on draft policies
• Importance of reading LCD comments

Coverage Requirements

The LCD is lengthy and contains a lot of detailed information. This is a summary of some of the coverage highlights, so providers affected by this LCD should read it carefully for a complete understanding. Other than for palliative care covered in specific circumstances, Medicare coverage for wound care is contingent upon evidence that the wound is improving.  Wound care must also include all applicable adjunctive measures as part of comprehensive wound management in order to be medically reasonable and necessary. Debridement is not covered when the wound is without devitalized, fibrotic, nonviable tissue, infection, necrosis, foreign matter, or if the wound has pink to red granulated tissue.

Also per the First Coast LCD, “the following services are considered to be not reasonable and necessary wound debridement services:

• Removal of necrotic tissue by cleansing or dry-to-dry or wet-to-dry dressing.
• Washing bacterial or fungal debris from lesions.
• Removal of secretions and coagulation serum from normal skin surrounding an ulcer.
• Dressing of small or superficial lesions.
• Paring or cutting of corns or non-plantar calluses.
• Incision and drainage of abscess including paronychia, trimming or debridement of mycotic nails, avulsion of nail plates, acne surgery, or destruction of warts.
• Removal of non-tissue integrated fibrin exudates, crusts, or other materials from a wound without removal of tissue does not meet the definition of any debridement code and may not be reported as such.”

Documentation Requirements

Documentation has the same disclaimer as coverage – providers must read the entire LCD to understand all of the documentation requirements. Some key points to remember concerning documentation are that the documentation should include:

• The current status of the wound,
• A plan of care containing treatment goals and physician follow-up,
• Complicating factors for wound healing and the measures taken to control the complicating factors,
• An operative note or procedure note for the debridement services that among other requirements, describes the wound size and characteristics, the medical necessity for debridement, the level of tissue debrided, the material removed, the instrument used, goals and response to treatment, and follow-up instructions, and
• Evidence of the wound’s progress toward healing.

Commenting on Draft Policies

Medicare requires MACs provide a minimum comment period of 45 calendar days for draft LCDs and an additional 45-day notice period after final revisions based on the comments received before an LCD becomes effective. The comment period allows providers and the medical community to express their concerns and suggestions about the proposed LCD.

The benefit of reviewing and commenting on draft policies is twofold. Most importantly, the MAC may agree with your comments and revise the policy. Secondly, even if no changes are made, you become familiar with the policy and are better prepared when it is finalized. It is not unusual for the MAC to make revisions to a draft LCD based on comments. The following clarifications or revisions were some of the ones made by First Coast in response to the comments:

• Clarification is provided on judicious use and efficacy of wet-to-dry and dry-to-dry dressings.
• The limitations addressing ulcers which may arise after paring or cutting of corns or non-plantar calluses as not reasonable and necessary wound debridement services have been removed from the finalized LCD. 
• Photographic documentation for wounds has been amended to suggestions for best practices in wound care. (instead of a requirement)
• The final LCD was amended to remove the reference about podiatrists. 
• After consideration, some of the conditions which were referred to as dermatologic have been amended or removed.

Read LCD Comments

Do you ever read a coverage policy and wonder “what were they thinking?” The LCD Comments Article gives hints, at least on the issues addressed, as to what the MAC was thinking regarding the policy decisions. Here are a few examples from the First Coast Wound Care LCD Comments Article demonstrating this:

• The Contractor also recognizes studies show disposable Negative Pressure Wound Therapy (NPWT) may be just as effective as the traditional NPWT, and it has been determined that there will be access to coverage for NPWT utilizing durable medical equipment or non-durable medical equipment in appropriately selected patients. 
• Concerning the establishment of an appropriate non-skilled maintenance program: Medicare coverage is defined by reasonable and necessary criteria per Social Security Act section 1862 (a) 1(A). This statement is an expectation; it does not preclude a skilled maintenance program or palliative wound care when reasonable and necessary.
• Concerning the addition of biofilm or bioburden to Covered Indications for debridement: The contractor agrees that this statement is incorrect. There are active wound care management CPT® codes that reference removal of biofilm and may be reported for such debridement. Please reference CPT® and coding guidelines. 
• Concerning frequency limitations for debridement of muscle/fascia or bone: Debridement codes involving fascia or bone would be expected to lessen over a period of time as the wound heals. Data analysis illustrates that a minority of beneficiaries receiving wound care actually receive more than five debridements involving muscle/fascia or bone in a rolling 360-day period. Debridements of an unusually prolonged or excessive number should be accompanied by meticulous documentation illustrating that the service is both medical necessary and reasonable.

Once again, I remind everyone in the JN jurisdiction to read the complete LCD for all information about coverage and documentation requirements. I also encourage reading the Comments Article for additional understanding of the MAC’s reasoning on certain points.  For our readers in other jurisdictions, this would be a good time to review the wound care LCD that applies to your hospital. There are always lessons to be learned.

Q:

Can we report the NIHSS stroke score with our hemorrhagic strokes, code ranges I61 – I62?

A:

Only assign the NIHSS stroke scale score with category

I63 - Cerebral Infarction. The Inpatient ICD-10-CM Coding Guidelines, Coding Clinic 4th Qtr. 2016 page 61, and The AHA’s Coding Handbook FY 2018 all specify to use with category I63. The subcategory, NIHSS score, R29.7-, has an instructional note to code first the type of cerebral infarction (I63-), and does not include hemorrhagic infarctions.  The I63 subcategory also has an instruction note to add a code for the NIHSS score, if known, whereas, the subcategory for the hemorrhagic infarctions does not.

Resources:

FY 2018 Inpatient ICD-10-CM Coding Guidelines
Coding Clinic, 4th Quarter 2016, page 61
The AHA’s Coding Handbook FY 2018