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Approved RAC issues posted this week by both RAC Region A Performant and RAC Region D HDI, highlight the importance of knowing your Local Coverage Determination (LCDs) policies. Performant posted two approved issues based on LCDs: both Magnetic Resonance Angiography and Filgrastim audit issues for incorrect billing using ICD-9-CM codes that are not listed in the policies. HDI will be targeting DME providers billing more than one spring powered device (A4258) per 6 months. HCPCS code A4258 is listed directly in the DME LCD, Glucose Monitors and Testing Supplies, as being allowed 1 per every 6 months.

As a provider, knowing your LCDs should be the starting point to Medicare patient encounters – from what is covered and what is not, to documentation required, code combinations and utilization. Providing products and services that are not covered by Medicare and not securing a signed Advance Beneficiary Notice (ABN) before patient encounters will leave you unable to bill for your charges. Billing incorrect code combinations and overutilization will leave you open to audits.

Most automated RAC issues reference LCD polices where code combinations for medical necessity and utilization are spelled out. However,deciphering an LCD policy is not easy and may be a time consuming task. Building system edits for billing and practice management software could also get complicated. Most providers turn to software vendors to do this for them. Vendors will keep up with the numerous monthly changes in LCDs that may occur. Vendors can build edits such as alerts for providers to obtain signed ABNs for non-covered items, avoid overutilization and bill with allowed CPT/HCPCS/ICD combinations. Complex edits can also check for patient billing history to avoid providing services or dispensing items that are only covered on certain time frames. For example the spring powered device that can only be billed every 6 months and is listed as an approved DME RAC issue for this week.

Web-based look-up tools from vendors allow for medical necessity checks to be done quickly and before a patient encounter or item is dispensed. Entering a code combination and finding out if those are listed in an LCD can be done in seconds rather than spending time trying to locate the correct policy on CMS’ website.

Other RAC issues for the week of May 27th – May 31st, 2013:

RAC Region A Performant

Physician /Non-Physician Practitioner Claim Types                     

  • Evaluation and Management (E/M) Facility vs. Non-facility – Incorrect Place of Service (POS) – J13 – Medicare Part B reimburses physicians at higher rate for certain services performed in their offices to account for the increased expenses (e.g., overhead) that they incur by performing services in their offices. However, when physicians perform these services in facility settings such as an inpatient facility, Medicare reimburses the overhead expenses to the facilities and the physicians receive a lower reimbursement rate than if the services were performed in the physicians’ offices. An improver payment exists when physicians bill these services with the physician-office place of service (POS 11) rather than the facility POS in which the services were rendered.                                   
  • Magnetic Resonance Angiography (MRA) – J13 – Incorrect billing occurred for claims billed with ICD-9-CM codes that are not listed by National Government Services (NGS) Local Coverage Determination (LCD) L25367 as medically necessary.                             
  • Filgrastim Billed without a Medically Necessary Diagnosis – J13 – Potential incorrect billing occurred for claims with ICD-9-CM codes that are not listed in the National Government Services (NGS) Article A48208 (related to the NGS Local Coverage Determination [LCD] L25820) as diagnoses codes that support medical necessity.               

Outpatient Hospital Claim Types

  • Panretinal (Scatter) Laser Photocoagulation Excess Frequency – J13 – Potential incorrect billing occurred for Panretinal Laser Photocoagulation services (CPT code 67228) paid more than once, per eye, within a 90 day global period.  

RAC Region C Connolly

SNF Claim Types       

  • Units in Excess of PPS Assessment Maximum – Medicare assigns standard scheduled payment periods for SNF assessments. Overpayment occurs when additional units in excess of assessment maximums are billed.

RAC Region D HDI

DME Non-Physician Claim Types

  • Excessive Units of Spring Powered Device – More than one spring powered device (A4258) per 6 months is not reasonable and necessary.

Professional Services (Physician/Non-Physician Practitioner) Claim Types

  • External Breast Prosthesis Garment Dispensed after Mastectomy Bra and Prosthesis – An external breast prosthesis garment with mastectomy form (camisole) is covered for use in the postoperative period prior to permanent breast prosthesis or as an alternative to mastectomy bra and breast prosthesis. The camisole is covered prior to a permanent breast prosthesis being dispensed or as an alternative to a breast prosthesis and mastectomy bra. Once the breast prosthesis and bras are dispensed, Medicare no longer covers the camisole.

About the Author

Dr. Margaret Klasa is the medical director for Context4 Healthcare. She is responsible for the company’s business knowledge discovery unit for medical context as it relates to the daily development of data products and software for medical claims editing and coding, with an emphasis on clinical and regulatory guidelines for Medicare, Medicaid and commercial payors.

Contact the Author


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