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At this time of year, do you try to get your children or grandchildren to behave better by telling them “Santa Claus is watching?” Santa is watching the kids, but for medical coders, Medicare is watching and not just at Christmas time.

Medicare medical review activity is often the subject of the articles in this newsletter. A lot of the audits and their associated denials focus on the medical necessity of services and documentation to support that. But coders and Medicare reviewers also know that inaccurate coding can often result in improper payments for Medicare services. In November, the Office of Inspector General (OIG) added a new topic to their Work Plan that will examine hospital inpatient coding - Assessing Inpatient Hospital Billing for Medicare Beneficiaries.  Here is the OIG’s description of the new Work Plan item:

“In 2016, hospitals billed Medicare $114 billion for inpatient hospital stays, accounting for 17 percent of all Medicare payments. The Centers for Medicare & Medicaid Services and the Office of Inspector General have identified problems with upcoding in hospital billing: the practice of mis- or over-coding to increase payment. We will conduct a two-part study to assess inpatient hospital billing. The first part will analyze Medicare claims data to provide landscape information about hospital billing. We will determine how inpatient hospital billing has changed over time and describe how inpatient billing varied among hospitals. We will then use the results of this analysis to target certain hospitals or codes for a medical review to determine the extent to which the hospitals billed incorrect codes.”

Although this description uses the phrase “the practice of mis- or over-coding to increase payment,” healthcare providers and coders know that usually increased payment from coding errors is just that – an error, without intent to defraud anyone. That is why hospitals need to make sure their coders are knowledgeable, well-trained, and receive appropriate on-going education. They also need to have processes in place for over-sight such as routine internal and/or external audits of coding.

The OIG is not the only Medicare reviewer currently looking at hospital inpatient coding accuracy. All four of the Recovery Auditors (RACs) have an approved issue for MS-DRG Validation audits:

“MS-DRG Coding requires that diagnostic and procedural information and the discharge status of the beneficiary, as coded and reported by the hospital on its claim, matches both the attending physician description and the information contained in the beneficiary's medical record. Reviewers will validate MS-DRGs for principal and secondary diagnosis and procedures affecting or potentially affecting the MS-DRG assignment.”

Medicare Administrative Contractors (MACs) Novitas (Jurisdictions H and L) and WPS (J5 and J8) also have DRG Validation listed as one of their Targeted Probe and Educate (TPE) medical review topics. Palmetto JJ and JM have TPE DRG Validation (coding) reviews for Heart Failure and Shock with MCC or CC (MS-DRGs 291 and 292). The guidelines for inpatient diagnosis coding are found in the ICD-10-CM Official Guidelines for Coding and Reporting and for procedure coding in the ICD-10-PCS Official Guidelines for Coding and Reporting. On-going guidance is provided through updates in the American Hospital Association (AHA)’s Coding Clinic.

Medicare reviewers also examine coding accuracy for outpatient claims. For outpatient diagnosis coding, coders follow the guidance of Diagnostic Coding and Reporting Guidelines for Outpatient Services. Since outpatient claims are paid based on procedure codes, this area is also ripe for audit. Specifically, all four RACs have APC Validation approved audits – “APC coding requires that procedural information, as coded and reported by the hospital on its claim, match both the attending physician description and the information contained in the beneficiary's medical record. Reviewers will validate the APC by reviewing the procedures affecting or potentially affecting the APC assignment.”

Outpatient procedures are reported with CPT and HCPCS codes. The American Medical Association (AMA) CPT Manual, CPT Assistant and the AHA’s Coding Clinic for HCPCS provide guidance on appropriate CPT coding. CMS creates and maintains alpha-numeric HCPCS codes and often provides guidance on their usage through transmittals and manual instructions. In addition, CMS follows the guidance of the National Correct Coding Initiative (NCCI) so coders also have to be aware of these instructions. NCCI instructions may or may not be consistent with CPT instructions making the coder’s job even harder. There are numerous audit issues that look at individual coding requirements from CPT and/or NCCI as evidenced by these RAC issues:

• Shoulder arthroscopy procedures include a limited debridement (e.g., CPT code 29822).
• Reporting multiple cataract removal codes for the same eye.
• Coding right heart catheterization with an endomyocardial biopsy.
• Add-on codes reported without primary code.
• A diagnostic endoscopy HCPCS/CPT code shall not be reported with a surgical endoscopy code. (recently added RAC issue)

As you can see, coders have a lot to keep up with to ensure accurate coding. Santa may be watching all the children to see if they are naughty or nice, but Medicare is watching coders to see if they are coding correctly.

It’s hard to believe that Thanksgiving is almost two weeks ago now and there are only nineteen shopping days left until Christmas. CMS provided what one could potentially call a gift depending on your point of view when they finally published Change Request (CR) 10865 on November 21st related to the ICD Final Decision Memo published early this year.  

Background

CMS posted a Final Decision Memo on February 15, 2018 for the National Coverage Determination (NCD) for Implantable Automatic Defibrillators (20.4). The Decision Memo finalized what CMS described as “minimal changes” to the ICD NCD from the 2005 reconsideration.

Decision Memo: Summary of the Changes

Patient Criteria

• Add cardiac magnetic resonance imaging (MRI) to the list of diagnostic imaging studies that can evaluate left ventricular ejection fraction (LVEF).
• Note: Prior approved diagnostic imaging studies included echocardiography, radionuclide (nuclear medicine) imaging, and catheter angiography.
• Require patients who have severe non-ischemic dilated cardiomyopathy but no personal history of sustained ventricular tachyarrhythmia or cardiac arrest due to ventricular fibrillation to have been on optimal medical therapy (OMT) for at least 3 months.
• Require a patient shared decision making (SDM) interaction prior to ICD implementation for certain patients.
• Note: This includes all patient’s receiving an ICD for primary prevention.

Additional Patient Criteria

• Remove the Class IV heart failure requirement for cardiac resynchronization therapy (CRT)

Exceptions to Waiting Periods

• Add an exception for patients meeting CMS coverage requirements for cardiac pacemakers, and who meet the criteria for an ICD;
• Add an exception for patients with an existing ICD and qualifying replacement
• End the data collection requirement

November 21, 2018: CMS Releases Change Request (CR) 10865

Chapter 13, section 13.1.1 of the Medicare Program Integrity Manual indicates “the decision outlined in the Coverage Decision Memo will be implemented in a CMS- issued program guidance instruction within 180 days of the end of the calendar quarter in which the memo was posted on the Web site.” The end of September came and went with no program guidance.

CMS finally published CR 10865 on November 21, 2018. This CR includes updates made to the Medicare National Coverage Determinations Manual, Chapter 1, Part 1 for NCD 20.4 Implantable Cardioverter Defibrillators (ICDs).

It is important to note that “a subsequent CR will be released at a later date that contains a Pub.100-04 Claims Processing Manual update with accompanying instructions. Until that time, the Medicare Administrative Contractors (MACs) shall be responsible for implementing NCD 20.4.”

Shared Decision Making, a Deeper Dive

A significant portion of the February Decision Memo was dedicated to detailing public comments received and CMS responses. The following table highlights comments and responses specific to the new SDM criteria.   

In addition to the example SDM tool for ICDs, CMS made note of a website for patients with heart failure designed to lead them through information on ICDs to increase knowledge of their medical condition, the risks and benefits of available treatments and to empower the patient to become more involved in the decision-making process. https://patientdecisionaid.org/icd/.

Considerations Moving Forward

All patients receiving an ICD for primary prevention must be provided SDM. “For these patients…a formal shared decision making encounter must occur between the patient and a physician (as defined in Section 1861(r)(1)) or qualified non-physician practitioner (meaning a physician assistant, nurse practitioner, or clinical nurse specialist as defined in §1861(aa)(5)) using an evidence-based decision tool on ICDs prior to initial ICD implantation.  The shared decision making encounter may occur at a separate visit.”

Questions to Consider:

• Who will be the healthcare provider to provide the SDM encounter?
• What tool will you utilize?
• When will this SDM be done? For example, the patient meeting Pacemaker and ICD indications that has been admitted for an AMI, Stent or CABG and placement is advised prior to the patient’s discharge.
• Since the SDM encounter can occur at a separate visit, what will be your process to make sure this information makes it into the medical record for the patient undergoing an ICD placement?

Optimal Medical Therapy, a Deeper Dive

Patients who have severe non-ischemic dilated cardiomyopathy but no personal history of sustained ventricular tachyarrhythmia or cardiac arrest due to ventricular fibrillation must have been on optimal medical therapy (OMT) for at least 3 months prior to ICD placement. The following table highlights comments and responses specific to the new OMT criteria. 

‍Questions to Consider:

• Who is the healthcare provider providing optimal medical therapy? Is it a patient’s Internal Medicine Doctor, Cardiologist, Electrophysiologist?
• Similar to SDM, what will be your process to make sure this information makes it into the medical record when the patient receives an ICD?

CR Implementation Date: February 26, 2019

It is up to you to decide if the 2019 implementation date is an early gift from CMS or a potential lump of coal for those that have not begun to prepare for the changes. Either way, MMP will be on the lookout for the subsequent Change Request specific to the Medicare Claims Processing Manual and accompanying instructions and encourages key stakeholders to put processes in place now to meet the new NCD requirements.  

Q:

I have heard there are a lot of changes for CPT codes for fine needle aspiration (FNA) for 2019. What are those changes?

A:

Currently there are only two CPT codes for fine needle aspiration (FNA):

• 10021 – FNA without imaging guidance
• 10022 – FNA with imaging guidance

In 2019, there will be a total of 10 codes for FNA, based on the specific type of imaging guidance used (i.e., ultrasound, fluoroscopy, CT, MRI), and differentiated by initial lesion and each additional lesion.

The descriptions have also been revised to include the word “biopsy”, for a biopsy performed with fine needle technique.

Since the new codes include imaging guidance, a separate CPT code for imaging guidance cannot be reported. This has major implications for Radiology if they have been entering a charge for the procedure plus a separate charge for the guidance – in 2019, the radiology / imaging component is “bundled” into the main procedure.  Ultrasound guidance (76942) is the most common type of guidance used.

In most cases, only one lesion is aspirated. However, when a needle core biopsy is performed in addition to an FNA biopsy, CPT guidelines describe how these should be reported, even breaking it down to specific information about:

• same lesion,
• separate lesion(s),
• same imaging modality,
• different modality(ies)
• and instructions on when to use modifier 59.

For Coding / HIM staff who code these procedures:

Keep in mind that in order to report a CPT code that includes imaging guidance, permanently recorded images should be obtained. As you know….whether permanently recorded images are obtained is rarely documented in the procedure note. To confirm this, check with the radiology department to find out if this is their standard procedure.

Example: If an FNA was performed using ultrasound guidance, but permanent images were not recorded, in 2019 you will report revised CPT code 10021 = FNA “without imaging guidance” first lesion. 

One of my grandchildren’s favorite books is “It Could Be Worse.” This book follows the trip home of a young mouse from visiting friends. The mouse experiences one calamity after another – he falls in a hole, tumbles down a bank, falls into a stream, etc. The young mouse believes he is having a very bad day, but the illustrations show that he is actually narrowly escaping real disasters due to his minor mishaps. He falls in the hole just as a large predatory bird swoops down to grab him, for example. Sometimes we think things are bad, but generally they could always be worse.

Over the past couple of weeks, we have included articles in the Wednesday@One about the Outpatient Prospective Payment System (OPPS) Final Rule. For most of our hospital clients and readers, your outpatient services are paid under OPPS. There are some services however that, even for OPPS hospitals, are paid under a fee schedule other than OPPS. These services are identified on the OPPS Addendum B with a status indicator (SI) of “A” – “Not paid under OPPS.  Paid by MACs under a fee schedule or payment system other than OPPS.” Along with the payment systems often come payment rules for these services that also apply to hospital billing. Hospitals have to look to the Medicare Physician Fee Schedule (MPFS) Final Rule for some of these additional requirements. This week we examine some of the rule changes from the MPFS rule for 2019 that affect hospitals, including some changes that will not become effective until next year.

Off-Campus Provider Based Departments

Non-excepted off-campus provider-based departments (PBDs), that is those off-campus PBDs that began billing and furnishing services on or after November 2, 2015, are paid under the MPFS instead of under OPPS due to Section 603 of the Bipartisan Budget Act of 2015. Currently Medicare sets the MPFS rates for non-excepted off-campus PBDs annually in the MPFS final rule. This year, CMS finalized their “proposal to maintain the PFS Relativity Adjuster at 40 percent for CY 2019 and beyond until there is an appropriate reason and process for implementing an alternative to our current policy, at which time we will make a proposal through notice and comment rulemaking.” This means services in a non-excepted off-campus PBD will be paid at 40% of the OPPS payment rate for 2019 and beyond until Medicare elects to use a different payment policy for these services. Currently, OPPS packaging and payment rules also apply, including this year the reduced payment of ASP minus 22.5% for separately payable outpatient drugs (SI=”K”) purchased through the 340B program.

Therapy Services

Medicare is ending the requirements for reporting and documentation of functional limitation G codes (HCPCS codes G8978 through G8999 and G9158 through G9186) and severity modifiers (in the range CH through CN) for outpatient therapy claims with dates of service on and after January 1, 2019. This means physical therapy (PT), occupational therapy (OT), and speech language pathology (SLP) no longer have to report the functional limitation codes and modifiers beginning the first of the new year. CMS is not deleting these G codes until 2020 so that claims will not return or reject if they inadvertently contain these codes.

The Bipartisan Budget Act of 2018 contained requirements for reduced payments for therapy services furnished in whole or in part by therapy assistants. The payment reductions do not begin until 2022 and reporting requirements to identify such services do not begin until 2020. There is nothing to deal with this year, but here are some points to be aware of for the future.

• Reporting and payment reduction will apply to hospital outpatient therapy services (except for critical access hospitals).
• Payment for therapy services furnished on or after January 1, 2022, in whole or in part by a therapy assistant, will be paid at 85% of the otherwise applicable Part B payment amount for the service.
• Since there are no therapy assistants for Speech Language Pathology (SLP) services, this only applies to physical therapy assistants and occupational therapy assistants.
• CMS is creating two new modifiers to be appended to PT and OT line items furnished in whole or in part by a therapy assistant beginning with dates of service on and after January 1. 2020 (although payment reduction will not occur until 2022). The new modifiers, PTA modifier CQ and OTA modifier CO, will be reported alongside of the existing GP and GO modifiers.
• CMS considers a service 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.

Laboratory Services

Most laboratory services on OPPS Addendum B have an SI of “Q4” due to the OPPS packaging requirements. However, when lab services meet the criteria for separate payment (i.e. they are the only type of service billed on the claim), they are paid separately under the Clinical Lab Fee Schedule (CLFS). The Protecting Access to Medicare Act of 2014 (PAMA), made significant changes to how Medicare pays for clinical diagnostic laboratory tests under the CLFS. Beginning January 1, 2018, CLFS rates are based on private payor rates reported to CMS by applicable laboratories. Not many hospital laboratories met the definition of an applicable reporting laboratory because it was defined as an entity that receives more than 50 percent of its Medicare revenues during a data collection period from the CLFS and/or the Physician Fee Schedule (PFS). Unless a hospital lab had its own NPI separate from the hospital NPI, it was unlikely the percent of CLFS/MPFS revenues was enough to meet the definition.

This year, Medicare is changing the definition to use Form CMS-1450 14x type of bill (TOB) to define applicable laboratories for the next data collection period (January 1, 2019, through June 30, 2019) and the next data reporting period (January 1, 2020, and ends March 31, 2020), subject to other regulatory and subregulatory requirements, such as the regulatory low expenditure threshold. Hospital outreach laboratories that do not receive at least $12,500 in CLFS revenues on the 14X TOB during a data collection period (6 months) would be exempt from the reporting requirements. This means more hospital laboratories will now be required to report private payor lab rates to CMS, specifically those hospital outreach labs with more than $12,500 in CLFS revenues per six months.  Hospitals need to evaluate whether they meet the new criteria for reporting and if so, be prepared to report by 2020.

Appropriate Use Criteria for Advanced Imaging

Imaging services are paid under OPPS, but there are new rules coming for 2020 that affect hospitals also. PAMA also directed CMS to establish a program to promote the use of appropriate use criteria (AUC) for advanced diagnostic imaging services. Under the program, ordering professionals must consult specified applicable appropriate use criteria (AUC) using a qualified clinical decision support mechanism (CDSM) when ordering applicable imaging services, and furnishing professionals must report AUC consultation information on the Medicare claim. Reporting is required beginning January 1, 2020. Year 2020 is an educational and operations testing period during which AUC consultation information is expected to be reported on claims, but claims will not be denied for failure to include the information. Reporting is required across claim types and by both the furnishing professional and furnishing facility, including hospital outpatient facilities (inpatient services paid under Part A are exempted). A lot more details on AUC can be found in the MPFS Final Rule. Since reporting is not required until 2020, hospitals have time to prepare. We will provide more details prior to the 2020 reporting requirement.

That is a summary of some changes from the MPFS Final Rule that affects hospitals. A couple of issues that you do not have to worry about until next year – reporting new modifiers for therapy assistants and reporting AUC information for advanced imaging services. This year your non-excepted off-campus PBDs will continue to be paid at 40% of OPPS rates, functional limitation reporting for therapy services goes away, and you need to decide if your outreach laboratory meets the definition of an applicable lab for reporting private payor lab rates to Medicare. Not a lot of things from the MPFS to consider, …yet – it could be worse.

 

MEDICARE TRANSMITTALS – RECURRING UPDATES

 

 

January 2019 Quarterly Average Sales Price (ASP) Medicare Part B Drug Pricing Files and Revisions to Prior Quarterly Pricing Files

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM11016.pdf

 

Update to Medicare Deductible, Coinsurance and Premium Rates for 2019

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM11025.pdf

 

International Classification of Diseases, Tenth Revision (ICD-10) and Other Coding Revisions to National Coverage Determinations (NCDs) – REVISED

A maintenance update of ICD-10 conversions and other coding updates specific to national coverage determinations (NCDs) as a 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/MM10859.pdf

 

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

https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R2202OTN.pdf

 

OTHER MEDICARE TRANSMITTALS

 

Incomplete Colonoscopies Billed with Modifier 53 for Critical Access Hospital (CAH) Method II Providers

Implements the payment methodology for incomplete colonoscopy procedures (Healthcare Common Procedure Coding System (HCPCS) codes 44388, 45378, G0105, and G0121 with a modifier 53) for CAH Method II providers.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10937.pdf

 

Correction to Common Working File (CWF) Informational Unsolicited Response (IUR) 7272 for Intervening Stay

Correction to edit for IPPS hospital claim with patient discharge status code ‘61’ (Discharged/transferred within this institution to a hospital-based Medicare approved swing bed) and a home health claim is received with an admission date equal to or within 3 days of the history IPPS claim’s discharge date and there is an intervening swing bed claim in history.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10960.pdf

 

Hospital and Critical Access Hospital (CAH) Swing-Bed Manual Revisions

Clarifies policies related to hospitals and CAHs with respect to services furnished to swing-bed patients, including policies related to pass-through reimbursement for Certified Registered Nurse Anesthetist (CRNA) services.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10962.pdf

 

Update to Bone Mass Measurements (BMM) Code 77085 Deductible and Coinsurance

Instructs contractors to waive deductible and coinsurance for BMM code 77085.

https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R4150CP.pdf

 

Removal of the Provider Requirement for Reporting on an Institutional Claim a Value Code (VC) 05 - Professional Component-Split Implementation

Removes editing for the requirement of value code 05 on an institutional claim.

https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R2178OTN.pdf

 

User CR: Fiscal Intermediary Shared System (FISS) - Implementation of the Molecular Diagnostic Services (MolDX)

Adds a MolDX test identification (ID) field to FISS so providers will be able to input a unique test ID into their claims at the detail line level.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10760.pdf

 

Common Working File (CWF) Provider Queries National Provider Identifier (NPI) and Submitter Identification (ID) Verification

The Common Working File (CWF) will require verification of the National Provider Identifier (NPI) and Submitter Identification (ID) when Medicare Part A providers request Medicare beneficiary eligibility and entitlement data via the CWF provider inquiry screens.

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM10983.pdf

 

MEDICARE PRESS RELEASES

 

CMS finalizes Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System changes for 2019 (CMS-1695-FC)

https://www.cms.gov/newsroom/fact-sheets/cms-finalizes-medicare-hospital-outpatient-prospective-payment-system-and-ambulatory-surgical-center

 

Final Policy, Payment, and Quality Provisions Changes to the Medicare Physician Fee Schedule for Calendar Year 2019

https://www.cms.gov/newsroom/fact-sheets/final-policy-payment-and-quality-provisions-changes-medicare-physician-fee-schedule-calendar-year

 

MEDICARE EDUCATIONAL RESOURCES

 

Medicare Fast Facts

Medicare Fast Facts resources this month include:

• Cochlear Devices Replaced Without Cost
• Reporting Changes in Ownership
• Ophthalmology Services: Questionable Billing and Improper Payments

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

 

November Patients Over Paperwork Newsletter

Updates on the Administration’s ongoing work to reduce administrative burden and improve the customer experience for beneficiaries.

https://www.cms.gov/Outreach-and-Education/Outreach/Partnerships/Downloads/PoPNovember2018.pdf

 

Medicare Billing: Form CMS-1450 and the 837 Institutional Educational Booklet

https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/837I-FormCMS-1450-ICN006926.pdf

 

CERT Article on Patient Discharge Codes

https://www.cms.gov/Medicare/Medicare-Contracting/FFSProvCustSvcGen/Downloads/Patient-discharge-status-codes-matter.pdf

 

OTHER MEDICARE UPDATES

 

Medicare Letter to Clinicians

Outlines how the agency is reducing burden through reform of documentation and coding requirements.

https://www.cms.gov/About-CMS/Story-Page/Clinician-Letter-Reducing-Burden-Documentation-and-Coding-Reform-.pdf

 

Contract Award for A/B MAC Jurisdiction 8

On November 1, 2018, CMS awarded Wisconsin Physicians Service Government Health Administrators (WPS) (the incumbent contractor for this A/B MAC jurisdiction) a new contract for the administration of Medicare Part A and Part B Fee-for-Service (FFS) claims in the states of Indiana and Michigan.

https://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/Whats-New-.html

We at MMP want to wish everyone a Happy Thanksgiving. We are indeed thankful for our clients and our readers. And even though I often complain about the complexities and frustrations of dealing with Medicare, I am thankful for this government health care program that provides coverage of services for elderly and disabled Americans. I see firsthand the tremendous benefit of this program for my parents and in a few years for myself also. Our country is far from perfect, but as Americans we have a lot for which to be thankful.

Since tomorrow is Thanksgiving, many of us are distracted today with thoughts of cooking, spending time with family, Christmas shopping, and of course, eating! With that in mind, this week’s newsletter is intentionally short and to the point. Last week, I addressed some of the changes from the 2019 OPPS Final Rule and promised updates this week on changes in that rule related to off-campus provider-based departments (PBDs). For more background on the PBD issues and what was proposed, please refer to our prior Wednesday@One article. Pulling from that article, here are the proposals and what CMS decided to finalize in the end – some good, some bad, and some in between.

As a reminder, non-excepted off-campus PBDs are those off-campus provider-based departments of a hospital that were not furnishing and billing for services before November 2, 2015. Non-excepted off-campus PBDs are paid under the physician fee schedule (PFS) instead of under OPPS at a rate equal to 40% of the OPPS. Non-excepted services are reported with a PN modifier to trigger the reduced payment. Excepted off-campus PBDs report modifier PO to allow CMS to gather data and monitor billing patterns but continue to be paid under OPPS at regular OPPS payment rates.

The Good

CMS proposed to limit the expansion of services in excepted off-campus PBDs. If an excepted off-campus PBD furnishes services from a clinical family of services that it did not furnish in a baseline period, those new services would be non-excepted and paid at the non-excepted reduced PFS payment rate effective January 1, 2019.

CMS is not finalizing this proposal at this time. CMS did add the following statement – “However, we intend to monitor expansion of services in off-campus PBDs and, if appropriate, may propose to adopt a limitation on the expansion of excepted services in future rulemaking.”

The Bad

CMS proposed to expand the reduced payments for drugs purchased through the 340B Program to non-excepted off-campus PBDs. Separately payable drugs with an OPPS status indicator of “K” furnished and billed by non-excepted off-campus PBDs and purchased through the 340B program would be paid at ASP-22.5% for 2019 instead of the current payment of ASP+6%.

CMS finalized this proposal and beginning January 1, 2019, nonexcepted off-campus PBDs of a hospital paid under the PFS, are required to report modifier “JG” on the same claim line as the drug or biological HCPCS code to identify a 340B-acquired drug or biological.

The In-Between

CMS proposed capping the OPPS payment for clinic evaluation and management (E&M) visits for excepted off-campus PBDs at the PFS-equivalent rate. This means clinic visits (HCPCS code G0463) provided in excepted off-campus PBDs and currently billed with the PO modifier would be paid at the same reduced OPPS rate as those currently billed with the PN modifier by non-excepted PBDs.

CMS will be phasing in the application of the reduction in payment for HCPCS code G0463 in excepted off-campus PBDs over 2 years. These departments will be paid approximately 70% of the OPPS rate for the clinic visit service in CY 2019. In CY 2020, these departments will be paid the site-specific PFS rate for the clinic visit service (currently 40% of OPPS rates). This policy is not budget-neutral and results in an estimated CY 2019 savings of approximately $380 million, with approximately $300 million of the savings accruing to Medicare, and approximately $80 million saved by Medicare beneficiaries in the form of reduced copayments.

There was an announcement in the OPPS Proposed Rule (and restated in the Final Rule) about the creation of a HCPCS modifier (modifier “ER”) to be reported for outpatient hospital services furnished in an off-campus provider-based emergency department. Critical access hospitals (CAHs) would not be required to report this modifier. This modifier is to allow CMS to develop data to assess the extent to which OPPS services are shifting to off-campus provider-based emergency departments.

Again, Happy Thanksgiving and enjoy lots of turkey tomorrow! 

CMS utilizes five criteria to determine whether or not a procedure should be removed from the Inpatient Only (IPO) List and assigned to an Ambulatory Payment Category (APC) group for payment under the OPPS when provided in the hospital outpatient setting. They do not require that all five criteria be met to remove a procedure from the IPO list. The five criteria includes the following: 

1. Most outpatient departments are equipped to provide the services to the Medicare population.
2. The simplest procedure described by the code may be performed in most outpatient departments.
3. The procedure is related to codes that we have already removed from the IPO list.
4. A determination is made that the procedure is being performed in numerous hospitals on an outpatient basis.
5. A determination is made that the procedure can be appropriately and safely performed in an ASC, and is on the list of approved ASC procedures or has been proposed by us for addition to the ASC list.

Procedures Proposed for Removal

CMS proposed removing CPT code 31241 (Nasal/sinus endoscopy, surgical; with ligation of sphenopalatine artery) and CPT code 01402 (Anesthesia for open or surgical arthroscopic procedures of knee joint; total knee arthroplasty). In general, commenters supported the proposals and CMS adopted as final without modification the removal of both codes from the IPO list for CY 2019.

Procedure Proposed for Adding to the IPO List

CMS proposed to add HCPCS code C9606 to the IPO list.  They “believe that the procedure should be added to the IPO list because this procedure is performed during acute myocardial infarction and it is similar to the procedure described by CPT code 92941 (Percutaneous transluminal revascularization of acute total/subtotal occlusion during acute myocardial infarction, coronary artery or coronary artery bypass graft, any combination of intracoronary stent, artherectomy and angioplasty, including aspiration thrombectomy when performed, single vessel), which was added to the IPO list for CY 2018 (82 FR 52526).” Commenters supported this proposal and CMS adopted as final without modification the addition of this code to the IPO list for CY 2019.

Solicitation of Comments for Potential Removal of Procedure from IPO List

In the Proposed Rule, CMS sought comments on whether or not CPT code 0266T meets any criteria for removal from the IPO list and the APC assignment and Status Indicator for this code. This code describes the implantation or replacement of carotid sinus baroreflex activation device; total system (includes generator placement, unilateral or bilateral lead placement, intra-operative interrogation, programming, and repositioning, when performed).

Commenters referenced personal experience with this procedure, advancements and safety of the procedure, and patients’ experience after undergoing the procedure. They argued that procedures related to CPT 0266T are “commonly being performed safely in the hospital outpatient department.”

CMS determined that this procedure is similar to another procedure already being performed in numerous hospitals on an outpatient basis and therefor finalized the removal of this code from the CY 2019 IPO list.

Public Requests for Removal of Procedures on the IPO List

Commenters recommend the removal of several procedures not proposed by CMS but were related to other procedures recently removed from the IPO list. “In addition, several commenters recommended the removal of all orthopaedic, arthroplasty, and joint replacement procedures from the IPO list.” Specific procedure codes requested to be removed are listed in the table below.   

CMS agreed with commenters that CPT Code 00670 is appropriate for removal and are removing this procedure. CMS notes “because this spine procedure code is an add-on code, in accordance with the regulations at 42 CFR 419.2(b)(18), under the OPPS, this procedure is packaged with the associated procedure and assigned status indicator “N” (Items and Services Packaged into APC Rates) for CY 2019.”

As for the remaining four laminectomy procedure codes (63265, 63266, 63267, and 63268), CMS plans to continue to review the appropriateness of potential removal from the IPO list for subsequent rulemaking.

CMS does not believe they have sufficient data to support removing all orthopaedic, arthroplasty, and joint replacement procedures from the IPO list. They “encourage stakeholders to submit specific procedures, along with evidence, to support their requests for removal from the IPO list.”

Codes Finalized for “Removal from” or “Addition to” the IPO List for CY 2091

The following table details the finalized changes to the CY 2019 IPO List.

‍Where to Find the CY 2019 Inpatient Only Procedure List

The complete list of procedures codes that Medicare will pay as inpatient only procedures in CY 2019 can be found in Addendum E to the CY 2019 OPPS/ASC final rule at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices-Items/CMS-1695-FC.html.

Ambulatory Surgical Center (ASC) – CMS’s definition of “Surgery” Revised

“Covered surgical procedures in an ASC are surgical procedures that are separately paid under the OPPS, that would not be expected to pose a significant risk to beneficiary safety when performed in an ASC, and for which standard medical practice dictates that the beneficiary would not typically be expected to require active medical monitoring and care at midnight following the procedure (“overnight stay”).”

Annually, CMS updates the ASC list and payment rates for covered surgical procedures and covered ancillary services in ASCs. This process includes a review of excluded surgical procedures (including all procedures newly proposed for removal from the OPPS inpatient list), new codes, and codes with revised descriptors, to identify any believed to meet criteria for designation as an ASC covered procedure or covered ancillary service.

Historically, CMS’s definition of a covered surgical procedure has excluded from ASC payment “certain invasive, “surgery-like” procedures, such as cardiac catheterization.” In the CY 2018 OPPS/ASC final rule CMS noted that some stakeholders suggested that certain procedures outside the CPT surgical range but that are similar to surgical procedures currently covered in an ASC setting should be ASC covered surgical procedures. Certain cardiovascular procedures were recommended due to their similarity to currently-covered peripheral endovascular procedures in the surgical code range for surgery and cardiovascular system.

In the CY 2019 OPPS Final Rule, CMS finalized the “proposal to define a surgical procedure under the ASC payment system as any procedure described within the range of Category I CPT codes that the CPT Editorial Panel of the American Medical Association (AMA) defines as “surgery” (CPT codes 10000 through 69999) (72 FR 42478), as well as procedures that are described by Level II HCPCS codes or by Category I CPT codes or by Category III CPT codes that directly crosswalk or are clinically similar to procedures in the CPT surgical range that we have determined are not expected to pose a significant risk to beneficiary safety when performed in an ASC, for which standard medical practice dictates that the beneficiary would not typically be expected to require an overnight stay following the procedure, and are separately paid under the OPPS.”

Finalized Updates to the ASC Covered Surgical Procedures List

With the change in the definition of “surgery” to account for “surgery-like” procedures CMS proposed and finalized the addition of twelve cardiac catheterization procedures to the list for CY 2019. Based on public comments, CMS also finalized the addition of five procedures performed during cardiac catheterization procedures to the list of ASC covered surgical procedures (CPT codes 93566, 93567, 93568, 93571, and 93572). The following table includes the HCPCS code, long code descriptors and payment indicators as displayed in Table 60 of the Final Rule.

‍Resources

CMS-1695-FC: Hospital Outpatient Prospective Payment – Notice of Final Rulemaking with Comment for CY 2019: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices-Items/CMS-1695-FC.html?DLPage=1&DLEntries=10&DLSort=2&DLSortDir=descending

Link to CMS Fact Sheet: https://www.cms.gov/newsroom/fact-sheets/cms-finalizes-medicare-hospital-outpatient-prospective-payment-system-and-ambulatory-surgical-center

I know this story is an indication of my age but I often mention my grandchildren in my articles, so everyone already knows I am no longer “young.” My grandmother had one of those washing machines with a wringer on top. After the clothes washed, you put them through the two turning rollers (the wringer) to squeeze out excess water before hanging them outside on a clothesline. As a Medicare provider, do you sometimes feel like Medicare is putting hospitals and other providers through the “wringer” to squeeze out additional revenues that we used to get? This article examines the latest squeeze for hospitals from the 2019 Outpatient Prospective Payment System (OPPS) Final Rule.

Comprehensive APCs

One such squeeze in recent years is Comprehensive APCs (C-APCs) where payment for all other services on a claim (with only rare exceptions) is packaged into the payment of the most-costly primary procedure on the claim. CMS’s reasoning is that these other services are adjunctive to the primary service and making one payment for the entire episode of care is in keeping with the prospective payment strategy of OPPS. Primary procedures are designated by a status indicator (SI) of “J1” in OPPS Addendum B. For 2019, CMS is adding three new C-APCs – Level 3 ENT Procedures (levels 4 and 5 ENT procedures were already C-APCs) and Level 3 and 4 Vascular Procedures (a new type of APC group for C-APCs). This brings the total number of C-APCs to 65 involving over 2,900 CPT/HCPCS codes, of which 183 codes are 2019 additions for the APCs noted above.

Some good news is that CMS finalized the proposal to exclude payment for any procedure assigned to a New Technology APC from being packaged when included on a claim with a “J1” service assigned to a C-APC. For more background information on C-APCs, please read the Wednesday@One article about the 2019 OPPS Proposed Rule.

Medicare also pays observation services as a comprehensive APC when reported with visit codes with an SI of “J2” and when certain criteria are met.

Composite APCs

CMS is continuing their composite APC payment policies for mental health services and multiple imaging services for 2019. The mental health composite policy applies when the total payments for specified mental health services for one patient for one day exceed the maximum partial hospitalization (PHP) per diem rate. When this occurs, the services will be paid through a composite APC with a rate set at the maximum PHP per diem payment rate. In other words, the payment for individual mental health services for one day will not be more than the PHP daily rate.

For the imaging composite policy, Medicare makes one payment when more than one imaging procedure within certain imaging families is performed on the same date of service. CMS states these imaging composites “reflect and promote the efficiencies hospitals can achieve when performing multiple imaging procedures during a single session.” There are five multiple imaging composite APCs for CT/CTA with contrast, CT/CTA without contrast, MRI/MRA with contrast, MRI/MRA without contrast and ultrasound services. You can find a listing of the composite CPT codes in the final rule or they are identified on Addendum B with an SI of “Q3.”

Drug/Biological Payments

Currently and continuing for 2019, separately payable drugs, including pass-through drugs, are generally paid at a rate of the average sales price (ASP) plus 6%. The biggest financial hit lately for hospital drug payments was the reduction in payment for drugs purchased through the 340B program beginning in 2018. Drugs purchased at discounted rates through the 340B program will continue to be paid the reduced rate of ASP minus 22.5% (an overall reduction of -28.5%) for 2019. Also, for 2019 CMS expanded the 340B payment reduction to apply to non-excepted, off-campus, provider-based departments (PBDs) of a hospital. The 340B reduced payment applies to drugs with an SI of “K.” These drugs are identified on a claim by the addition of the JG modifier. There are some exceptions to the reduction – vaccines, pass-through drugs, and drugs purchased by rural sole community hospitals (SCHs), children’s hospitals, and PPS-exempt cancer hospitals will be paid at ASP+6%.

CMS did increase the packaging threshold for separately payable drugs from $120 in 2018 to $125 for 2019. This means the payment for drugs, biologicals, and therapeutic radiopharmaceuticals with a per day cost of $125 or less will be packaged and the HCPCS code assigned a status indicator of “N.”

Device-Intensive Procedures

Currently, device-intensive procedures are those procedures that involve surgically inserted or implanted devices that remain in the patient’s body after surgery and for which the portion of the APC payment attributed to the device (device off-set amount) exceeds 40%. Device-intensive procedures require the reporting of a device HCPCS code on the same claim with the procedure. Any device code will satisfy this requirement. Also, device-intensive procedures are subject to the no cost/full credit and partial credit device policy which requires the reporting of value code FD and the dollar amount of the credit when the hospital receives a credit for a replaced device that is 50% or greater than the cost of the device. In this case, the payment is decreased by the credit amount on both inpatient and outpatient claims.

For 2019, CMS finalized their proposals to change the definition of device-intensive procedures to include “procedures that involve surgically inserted or implanted, single-use devices that meet the device offset percentage threshold to qualify as device-intensive procedures, regardless of whether the device remains in the patient’s body after the conclusion of the procedure and to modify criteria to lower the device offset percentage threshold from 40 percent to 30 percent.” This means there will be more procedure codes that require the reporting of a device HCPCS code and to which the device credit policy applies. The larger impact on hospitals may be a decrease in volume of these types of procedures as this policy change will encourage migration of services from the hospital outpatient department into the ambulatory surgery center (ASC) setting. Medicare rates for procedures performed in the ASC setting are generally less than hospital rates, resulting in cost savings to the Medicare program and Medicare beneficiaries.

Speaking of ASC’s, Medicare approved the addition of 12 cardiac catheterization procedures (CPT codes 93451-93462) and five procedures performed during cardiac catheterization procedures (CPT codes 93566, 93567, 93568, 93571, and 93572) to the list of ASC covered surgical procedures.

Other significant changes from the 2019 OPPS Final Rule relate to provider-based departments. We will address those in an article in next week’s newsletter but here is a hint – more squeezing of revenues but some less than proposed and others phased in over time.

A few years ago, my husband and I determined we were stuck in a rut in our social life. We decided to expand our horizons by traveling more and trying new and different activities and adventures. Even simple things like trying different types of restaurants and reading varying genres of books proved to be fun. It is often hard for people to try new things because of fears and habits. This applies in our personal and work environments. Here at MMP, our focus is traditional Medicare rules for acute-care hospitals, but when reading through the various list serves and newsletters I receive daily, I read about a variety of issues, not just hospital issues. There are benefits to this – it expands my horizons mentally and often the information does relate directly or indirectly to hospitals. A perfect example is audit reports from the Office of Inspector General (OIG). Here are some recent audit reports that were not specific to hospitals, but which contain learnings for hospital providers.

Medicare Improperly Paid Providers for Specimen Validity Tests Billed in Combination with Urine Drug Tests - https://oig.hhs.gov/oas/reports/region9/91602034.pdf

This report was directed toward Medicare Part B claims (independent clinical laboratories and physicians’ offices). Many hospitals also bill for urine drug tests and in a hospital setting the reporting of the types of tests used for specimen validity would be common. Specimen validity tests are those lab tests used to ensure a sample for urine drug testing has not been tampered with or altered. The OIG report states, “Specimen validity testing includes tests for urinary pH, specific gravity, creatinine, and oxidants. For example, a urinary pH test determines the degree of acidity or alkalinity of a urine sample. If the pH levels are outside the normal range, the sample may have been altered.”

When these tests are used for validity testing, they are considered part of the drug testing service and are not separately billable to Medicare. If these tests are ordered for the diagnosis, treatment, or management of a patient’s medical condition, such as a urinary tract infection or kidney stones, they should be covered by Medicare as medically necessary services. When used for medical management, these tests should be reported separately on the claim even when urine drug tests are also performed and reported.

In order to prevent inappropriate reporting of such tests, Medicare has National Correct Coding Initiative (NCCI) procedure-to-procedure (PTP) coding edits for code pairs involving urine drug testing and urinalysis. When a urinalysis is performed to manage a patient’s specific medical condition, the provider would have to append a modifier to the column two code of the CCI pair to by-pass the edit and receive separate payment for the test. For example, the urinalysis codes 81000-81005 require modifiers to allow separate payment when billed on the same date of service with urine drug testing CPT codes 80305-80307. Although I understand Medicare’s intent to prevent inappropriate billing and payment with these edits, this places an additional burden on providers to evaluate and modify the claim to receive payment for a medically necessary test that pays around $3 - $4.

Hospital providers should read this OIG report and verify they are billing correctly for urine drug screens and urinalysis testing.

Medicare Advantage Appeal Outcomes and Audit Findings Raise Concerns About Service and Payment Denials - https://oig.hhs.gov/oei/reports/oei-09-16-00410.pdf

In this September 2018 OIG report, the OIG concludes that Medicare Advantage plans may be inappropriately denying payment for services in an attempt to increase their profits. They based their conclusion on the fact that Medicare Advantage Organizations (MAOs) are paid under a capitated payment model, overturned 75% of their own denials upon appeal during 2014–16, with even more overturns by independent reviewers, and CMS audits identified widespread and persistent MAO performance problems related to denials of care and payment. The bad part and what hospitals should really pay attention to is that during 2014-16, beneficiaries and providers appealed only 1% of denials to the first level of appeal.

This means hospitals are likely being inappropriately denied for services provided to patients covered by a Medicare Advantage plan. I know, if you work in a hospital, this is not news to you. The lesson here for hospital providers is to appeal, appeal, appeal your denied MAO claims if you believe the services were appropriately provided and should be covered by the MAO.

The OIG recommended and CMS concurred to:

• Enhance its oversight of MAO contracts, including those with extremely high overturn rates and/or low appeal rates, and take corrective action as appropriate;
• Address persistent problems related to inappropriate denials and insufficient denial letters in Medicare Advantage; and
• Provide beneficiaries with clear, easily accessible information about serious violations by MAOs.

Until CMS gets better control over the MAO denials, the onus is on providers and beneficiaries to appeal inappropriate denials.

London Cardiologist Sentenced to 42 Months for Health Care Fraud - https://www.justice.gov/usao-edky/pr/london-cardiologist-sentenced-42-months-health-care-fraud

And when reviewing OIG information, do not forget to read enforcement actions reported on the OIG list serve. These often include important lessons also. This particular item describes a guilty verdict for a physician who implanted dozens of pacemakers into patients that were medically unnecessary, under well-established national guidelines and Medicare coverage rules. 

Though not mentioned in the DOJ release, some hospital also billed for and was paid for these pacemaker implantations. Hospitals bear responsibility to ensure the services they provide and bill for meet Medicare coverage guidelines. Also, under Medicare’s Hospital Conditions of Participation, a hospital’s “governing body must ensure that the medical staff is accountable to the governing body for the quality of care provided to patients.”

Other types of services addressed by the OIG that might affect some hospitals either directly or indirectly include:

• Inpatient Rehabilitation Facilities - https://oig.hhs.gov/oas/reports/region1/11500500.asp
• Ambulance Services - https://oig.hhs.gov/oas/reports/region9/91703017.asp
• CPAP Devices - https://oig.hhs.gov/oas/reports/region4/41704056.asp
• Nursing Homes - https://oig.hhs.gov/oas/reports/region7/71703224.asp

As you can see, there are lots of reasons to read OIG reports other than those specifically targeted to hospitals. It is one small way you should be expanding your horizons.

CMS published Transmittal 825 on September 1, 2018. The purpose of this transmittal was to instruct Contractors on which healthcare professionals should be performing medical record reviews for the purpose of making coverage determinations. Guidance in this transmittal had an effective and implementation date of October 22, 2018.

Background

The Medicare Administrative Contractor (MAC) Medical Review Program performs reviews to carry out the goal of reducing “payment error by preventing the initial payment of claims that do not comply with Medicare’s coverage, coding, payment, and billing policies.” To accomplish this goal, MACs identify noncompliance through:

• Analysis of data (e.g., profiling providers, services, or beneficiary utilization), and
• Evaluation of other information (e.g., complaints, enrollment and/or cost report data).
  

Credentials of Medical Reviewers 

This Transmittal instructs MACs, the Medical Review Accuracy Contractor (MRAC) and the Comprehensive Error Rate Testing (CERT) Contractor that record reviews for the purpose of making coverage determinations must be performed by RNs, therapists or physicians. Current Licensed Practical Nurses (LPNs) performing medical reviews can be grandfathered in and continue to perform reviews. However, Contractors are to no longer hire new LPNs to perform reviews.

Zone Program Integrity Contractor (ZPIC)/Unified Program Integrity Contractor (UPIC), Recovery Auditors (RACs) and the Supplemental Medical Review Contractor (SMRC) must ensure reviewer credentials are consistent with the requirements in their respective Statements of Work (SOWs).

Advice from Other Health Care Professionals

In addition to advising who can perform the reviews, this transmittal adds the following new guidance to Chapter 3, Section 3.3.1.1 of the Medicare Program Integrity Manual:  

• “The MACs, MRAC, and CERT, shall ensure that services reviewed by other licensed health care professionals are within their scope of practice and that their MR strategy supports the need for their specialized expertise in the adjudication of particular claim type (i.e., speech therapy claim, physical therapy).”
  

Who are Your Contractors?

For those not closely involved with Medicare Medical Reviews, you can see from this Transmittal there are a lot of Contractors requesting and reviewing records. To find out the specific Contractors that could be requesting records, you can go to the Review Contractor Directory Interactive Map on the CMS website. https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Review-Contractor-Directory-Interactive-Map/.