CMS issuing National Coverage Determinations (NCDs) with ICD-10 translations

This week CMS issued NCD and Claims Manual transmittals on the coverage of extracorporeal photopheresis for the treatment of bronchiolitis obliterans syndrome (BOS) in certain circumstances under clinical research studies. The NCD and claims instructions are fairly self-explanatory, but I wanted to take the opportunity to talk about how CMS seems to be approaching the ICD-9 to ICD-10 transition in relationship to NCDs.

The title of these transmittals is “Extracorporeal Photopheresis (ICD-10).” From that title you might think CMS is addressing specifically the codes for extracorporeal photopheresis in ICD-10 or something similar. However, the transmittals are in fact announcing the coverage and billing policies related to new coverage of extracorporeal photopheresis.

The “(ICD-10)” at the end of the title seems to indicate that ICD-10 information and/or translations have been included in the transmittal, almost like an internal cue to their contractors that ICD-10 implementation information is included. I have seen this convention in a few other transmittals (e.g. screening and behavioral counseling for sexually transmitted infections (STIs)) that contained ICD-10 coding information in the business requirements for the contractors.  These two transmittals, however, contain full tables with the ICD-10 codes that correspond to the ICD-9 codes currently covered in the policy.

The transmittals make the coverage before and after the, now delayed, implementation of ICD-10 very clear. My concern is actually what the business requirements instruct the contractors to do with this information.  Similar to the other transmittals I’ve seen like this, the business requirements of the claims transmittal tells the contractors to track and add these code(s)/edit(s) to their own systems when applicable. It also states they will not receive a separate change request (transmittal) with further implementation instructions.

This onesie-twosie approach could spell trouble for providers. Some MACs may be very organized about tracking all these individual transmittals and implementing the ICD-10 covered codes and edits contained in them on time. But others may experience delays in implementing the codes or miss some because of this scattered approach. Additionally, this means providers and their contractors will have to be vigilant about cumulating these new policies as they are published rather than being able to count on a more systematic communication of the ICD-10 codes approved for each NCD.

It also brings up questions of how systematic CMS’ approach is for converting the NCDs from ICD-9 to ICD-10 codes.  For example, several other behavioral counseling NCDs (e.g. for obesity, cardiovascular disease, and alcohol misuse) were adopted at the same time as the one for STIs, however, they do not contain ICD-10 coding information.  It is unclear why one of this series contains ICD-10 information and the others do not. Additionally, how will the information be communicated not only for the others in this series of NCDs, but the multitude of other NCDs CMS maintains.

As providers prepare for ICD-10, they should monitor this conversion of ICD-9 codes to appropriately covered ICD-10 codes in NCDs, as well as LCDs. Problems with these policies could mean denied claims or processing delays, even when the provider is providing a covered service and billing with covered codes, simply because of implementation problems at the contractor level.

New CoP addresses patient self-administration of medications

CMS put on display two rules on May 9 designed to reduce the regulatory burden on providers and save hospitals nearly a billion dollars a year in administrative costs. But at least one provision in the new rules is aimed at saving costs for patients as well.

A change to the Conditions of Participation (CoP) for hospitals specifically allows patients to self-administered drugs. Many hospitals already have a program for self-administration of medications on the outpatient side, specifically because of the Medicare policy of non-coverage of these drugs along with their administration.

The new CoP is included under the nursing services section at 42 C.F.R. 482.23(c)(6). It allows for self-administration of hospital issued drugs as well as drugs brought from home. The latter is often a significant issue because the price for individual doses in the hospital outpatient setting is often substantially higher than the patient can obtain the drug through their pharmacy insurance plan.

The CoP requires the hospital have a policy allowing for patient self-administration. The requirements for the policy differ between hospital furnished drugs and drugs brought from home. For hospital-issued drugs the hospital’s policy must include/address:

• An order by the practitioner responsible for the patient’s care
• Assessment of the patient’s (or caregiver’s) capacity to self-administer
• Instruction in safe and accurate administration
• The security of medications for each patient
• Documentation of administration as reported by the patient

Additionally, for medications the patient brings from home, the policy must include/address:

• A specific order permitting the patient to take medication brought into the hospital
• A determination of the need for instruction in safe and accurate administration
• Identification of the medication and visual evaluation of its integrity

For hospitals that already have a policy for patient self-administration of medications, they should carefully review the requirements and the commentary in the final rule to ensure their policy meets the new requirements, especially in regard to assessment, teaching, and documentation. For hospitals that haven’t had a policy, now is the time to consider putting one in place to reduce the costs of these drugs to Medicare patients and reduce the number of concerns and complaints regarding these drugs.

In addition to the new CoP on self-administration of medications, there are a number of other provider friendly changes in the new rules. For example, removal of the requirement for signature of verbal orders within 48 hours, in some circumstances, as well as the reinstatement of the regulation to allow other practitioners acting in their scope of practice to sign those verbal orders. The new CoPs, as well as the commentary included at the beginning of the rule, are worth a thorough review because there are a number of provider friendly provisions like those on verbal orders that may require internal policy changes for the hospitals to fully realize the benefit from the change to the regulation.

CMS issues further guidance on outpatient therapy caps and the related exceptions process

In a recent transmittal, CMS issued guidance on Congress’ extension of limitations on certain therapy services, as well as the related exceptions process, through December 31, 2012.  Under the Balanced Budget Act of 1997, Congress initially imposed financial limitations on specific outpatient therapy services (physical, occupational and speech-language pathology) provided in all settings except hospital outpatient departments and clinics.  Subsequently, Congress enacted certain exceptions to these limitations.

Extension of Therapy Caps

Under the Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA), Congress generally extended the 2012 therapy caps — $1,880 for occupational therapy services (OT) and $1,880 for the combined services for physical therapy (PT) and speech-language pathology (SLP) – through December 31, 2012.  In addition, Congress specifically extended the application of these therapy rules, on a temporary basis, for therapy services provided in hospital outpatient settings, limited to dates of service on and after October 1, 2012 through December 31, 2012.

Related Claims Processing Changes

In addition to extending these therapy rules, Congress also made several changes affecting the processing of related claims.  Suppliers and providers should continue to use the -KX modifier to request an exception to the therapy cap on claims that exceed the 2012 cap amounts.  Use of the-KX modifier indicates that the services are reasonable and necessary and that there is documentation of medical necessity in the patient’s medical record.

Although claims processing requirements associated with the cap (e.g., the exceptions process using the -KX modifier or denying claims without the- KX modifier if the cap is exceeded) are only applicable to hospital outpatient settings for dates of service on/after October 1, 2012, claims paid for hospital outpatient therapy services for dates of service on/after January 1, 2012, will be included in calculating the cap, beginning October 1, 2012.

In addition, for dates of service on/after October 1, 2012, the MCTRJCA added two additional requirements:

• Suppliers and providers must report the National Provider Identifier (NPI) of the physician, or non-physician practitioner (NPP) where applicable, responsible for reviewing the therapy plan of care on the beneficiary’s claim for therapy services.

• Manual medical reviews will be required for exceptions where beneficiary therapy services for the year reach a threshold of $3,700. The separate thresholds triggering manual medical reviews are based upon the separate therapy caps — one for OT services and one for PT and SLP services combined.  Claims with a -KX modifier requesting an exception for services above either threshold will be subject to manual medical review.  Although the manual medical review process will not be implemented prior to October 1, 2012, the count of services to which these thresholds apply begins for dates of service on/after January 1, 2012.  Currently, the manual medical review requirement is set to expire, along with the general exceptions process, for dates of service after December 31, 2012.

Impact of Exceptions Denials

Claims for services at or above the therapy caps or exceptions thresholds for which an exception is not granted will be denied as a benefit category denial.  In that case, the beneficiary will be liable for the usual billed charges for the denied services.  Although suppliers and providers are not required to issue an Advance Beneficiary Notice of Noncoverage (ABN) in these circumstances, CMS strongly encourages them to do so voluntarily.

Changes to CMS’ website are not all good

CMS has done a lot of restructuring to their website recently. I can’t speak about all of the revisions they have made, but I can address the functionality of the Transmittals page. It is a change, to be sure, but I certainly would not call it an improvement. I read every transmittal that CMS releases, and trust me, there are a lot of them every year. I try to do this a couple times a month, but sometimes a whole month goes by before I can get to it. When that happens, I know it will take an entire day, or more, to read through the new list of transmittals.

So let’s say you want to see a list of the 2012 transmittals. When you get to that page by default, the CMS website will list the 10 most recent starting with the Special Edition (SEs) MLNs which may or may not be the most recent releases. The SEs used to be intermingled with the transmittals and appear in the list according to date order of their release which is far better than listing them all at the top as they do now. You also used to have an option to “show all” in order to get the entire list. Not anymore. Now your choices are 10, 25, 50 or 100. Since there are more than 10 Special Edition MLNs released already in 2012 and they are at the top of the list regardless of their release dates, the default of “show 10” is pretty much useless if you want to see the most recent transmittals.

So I always choose to show 100 entries. I scroll down to the transmittal that I haven’t read yet. Let’s say I have 40 transmittals to read since my last session. I click on the oldest one and begin reading. Then I read the accompanying MLN Matters document which is associated with it – and by the way, the fancy new red and pink border on the MLN? What purpose does that serve? It is not printer friendly, nor is it reader friendly when the text runs into the red and pink shades. Okay, done with that transmittal and MLN, now I want to read the next one on the list. Well guess what? The new functionality (or lack thereof) does not take me back to the list of 100. Instead it dumps me back to the default of 10 entries. So I continually have to keep telling it to show me 100 and then scroll back again to find the next transmittal. This is particularly problematic if you are trying to catch up on your reading at an airport or at a hotel where your internet connection may not be as fast as it is in your office and every click of the mouse means additional waiting time for the site to respond. So yes, it is obvious that CMS is restructuring their website, but changes implemented at least in regards to keeping up with the transmittals and MLN Matters Articles, have made researching Medicare’s website more burdensome.

CMS releases the IPPS Proposed Rule

It’s that time of the year again when some things are for certain – trees and flowers are in bloom creating havoc with allergies, the weather can’t make up its mind if its spring or winter and CMS announces its plans for the coming fiscal year regarding IPPS hospital payments.

Last week CMS released the inpatient prospective payment (IPPS) proposed rule for FY 2013, effective for discharges October 1, 2012.  Overall, CMS is projecting that payment rates to general acute care hospitals will increase by 2.3 percent – a net update after inflation, improvements in productivity, a statutory adjustment factor and adjustments for hospital documentation and coding changes.

Here is a summary of some of the CMS proposals:

• Documentation and coding adjustment (DCA): Proposing to complete the remaining -1.9% prospective adjustment while also making a +2.9%to remove the effect of the FY 2012 one-time recoupment adjustment; the adjustment of -0.8 to the standardized amount and a -0.8% adjustment to the hospital-specific rate would result in a total DCA of +0.2% (-1.9 plus +2.9 plus -0.8) to the standardized amount and a -1.3% (-0.5 plus -0.8) adjustment to the hospital-specific rate.
• Hospital-acquired conditions (HACs–): Proposing two new conditions which include surgical site infection (SSI) following cardiac implantable electronic device (CIED) procedures and pneumothorax with venous  catheterization.
• Graduate medical education (GME) and indirect medical education (IME): Proposing changes related to determining a hospital’s full-time equivalent (FTE) resident cap for GME and IME payments, applications of new teaching hospitals and FTE slots currently held by closed hospitals.
• Hospital inpatient quality reporting (IQR) program: Proposing that starting with the FY 2015 payment determination, an increase to the current validation sample of 18 cases per quarter to 27 cases per quarter to capture data for additional measures; proposing to reduce the total sample size of hospitals included in the annual validation sample from 800 eligible hospitals to 600 eligible hospitals;  proposing several quality measures to be suspended, removed and expanded during the coming fiscal years.
• Hospital inpatient value based purchasing (VBP) program: Several proposals including defining the term “base operating DRG payment amount” as the wage-adjusted DRG operating payment plus any applicable new technology add-on payments and excluding IME, DSH; proposing that in order to fund the VBP program, every eligible hospital would receive a 1% reduction to its base operating DRG payment amount for each discharge in a fiscal year, regardless if that hospital had been determined by CMS to have earned a value-based incentive payment for that fiscal year.
• Hospital readmissions reduction program: Since this program is not budget neutral, CMS is proposing that an applicable hospital’s base operating DRG payment amount be adjusted for each discharge by subtracting the product of the base operating DRG payment amount for such discharge by the hospital’s admission payment adjustment factor for the fiscal year from the base operating DRG payment amount for such discharge; proposing a process that would allow hospitals to review and submit corrections for their readmissions information prior to the information being posted on the Hospital Compare website.
• Other proposals also include various MS-DRG recalibrations, additions and deletions to the complications and comorbidities (CCs) and major complications and comorbidities (MCCs) list and four applications for consideration of new technology add-on payments.

This summary barely unearths the many nuggets that can be found in the display copy  as well as several fact sheets. IPPS hospitals should begin reviewing this document to assess the potential financial impacts and organizational implementation issues and submit comments by June 25. The proposed rule will be published in the Federal Register on May 11.

Note from the Instructor: ICD-10 Delay

This week CMS published a proposed date for the delay of ICD-10 implementation. They are proposing to delay from October 1, 2013 to October 1, 2014.  This is only a proposed rule and arguably the delay could be even longer if sufficient comments were submitted to convince CMS of the need for a longer delay. The timeframe is unlikely to shorten, however, because of the inpatient coding and payment systems, which are run on an annual cycle beginning in October of each year.

The delay of ICD-10 implementation has been somewhat controversial with provider groups. The delay was announced as part of another administrative simplification proposed rule related to unique identifiers for health plans. Recall that the implementation of ICD-10 is a part of the administrative simplification rules that specify which code sets are used for healthcare transactions.

The delay was originally announced in February, but no official delay timeframe or date was specified at that time. The delay had the support of the American Medical Association (AMA), who had been lobbying for some kind of delay for some time. However, others including the American Health Information Management Association (AHIMA) did not want any kind of delay because of the work and expenses already spent by larger organizations such as hospitals and health systems with the 2013 implementation date in mind.

This further delay puts us even further behind the rest of the world in diagnosis coding. While we are playing around implementing the ICD-10 in 2014, an ICD-11 alpha draft is already available and a beta version will be ready to use in 2014 with full implementation said to be in 2015 or 2016.  With so much preparation behind ICD-10, it’s hard to imagine a switch to ICD-11 at this point, but it seems that to not do so means we will be going through the same pain twice: once to implement ICD-1,0 and in the not so distant future, a second time to implement ICD-11. This seems like it would create a tremendous financial burden on health providers, just to ensure we catch up to where the rest of the world will already be.

Nevertheless, we are so far down the road of ICD-10 implementation it’s hard to imagine a switch at this point.  AHIMA recommends providers continue with their preparations as planned to ensure sufficient time to be fully prepared, although the intense education in the last few months before the implementation to get coders proficient will need to be changed. I would recommend that providers not change their ICD-10 plans until we see a final rule in the event CMS implements a longer delay.

One last thing: I am very excited about a new product HCPro is releasing called HCPro Comply for Revenue Cycle. I will be at the upcoming HCCA Annual Compliance Institute in Las Vegas later this month doing a Lunch and Learn showcasing the product. I’m so excited about Comply for Revenue Cycle. As a former compliance officer, auditor and chargemaster coordinator, I was able to sit with the developers and give them an idea of what we’d like to see in a product like this. They also worked with more than 50 hospitals around the country during development and it really shows. The product is so intuitive and puts all the right information at your fingertips – including coding information, state regs and of course all the Medicare information. I could go on and on – and I think the folks back at HCPro are tired of me raving on, but I really am that excited. If you want to learn more, you can sign up for the Lunch and Learns at the link at the end of this week’s Medicare Weekly Update. See you there!

CMS provides additional guidance on proper billing when the Medicare Secondary Payer Rules apply

In a recent Special Edition MLN Matters Article (SE1217), CMS reminded providers of their responsibilities under the Medicare Secondary Payer (MSP) Rules. Under the MSP Rules, Medicare is secondary to certain other payers in the following circumstances:

• Workers’ compensation (WC) plans, for employment-related injuries or diseases
• No fault (NF) insurance, if available, for non-employment related injuries, regardless of whether the insurance plan stipulates it is secondary to Medicare
• Third party liability (L) insurance (e.g., med pay) or self-insurance plans for covered illnesses or injuries
• Employer group health plans (GHPs) of employers with at least 20 employees, for employees who have Medicare by reason of age and are covered under that GHP based on their, or a spouse’s, current employment with that employer
• GHPs of employers with at least 100 employees, for employees who have Medicare by reason of disability and are covered under that GHP based on their, or another family member’s, current employment with that employer
• GHPs during the 30-month coordination of benefits period, for employees who have end stage renal disease (ESRD), and are either entitled to Medicare initially based on ESRD; or by reason of age or disability
• Government research programs, for services that are part of the research program
• The Department of Veterans’ Affairs, for services they authorize at a non-VA facility

Under the MSP Rules, the primary responsibility of providers is to determine whether other coverage is available for each visit or admission and, if so, whether Medicare is primary or secondary to that other coverage.  The model hospital admissions questionnaire, published by the CMS, may be used as a guide to collect this information from beneficiaries. This tool is available online in the Medicare Secondary Payer Manual (100-05), Chapter 3, Section 20.2.1. This questionnaire may also be used by physicians and suppliers to gather relevant MSP information.

Once these coverage determinations are made, providers should first bill the primary payer for related services. If a payer other than Medicare is primary, providers may bill Medicare as the secondary payer (if appropriate) after receiving the primary payer remittance advice.  If a patient is seen for multiple services, each service should be billed first to the primary payer, and then to any secondary payers, as appropriate.

When billing services subject to the MSP Rules, providers (hospitals, in particular) should be sure to report applicable MSP-related information using situation specific codes (primarily condition, occurrence and value codes) on the UB-04 and 837I claims formats.

CMS provided the following specific tips on billing for accident-related claims when a beneficiary has open MSP WC, NF, or L coverage and/or open GHP MSP coverage.

1. Providers should bill the WC, NF, or L, as primary insurer, first for related services. If the insurer denies the claim, then bill Medicare for payment, including all necessary MSP payment information, as found on the primary payer’s remittance advice (e.g., claim adjustment reason code specifying reason for denial), on the claim sent to Medicare. If the L, NF, or WC insurer did not make payment for the accident related services, Medicare will need this information to process the claim accordingly. If Providers follow these procedures, they do not need to wait 120 days to submit a claim to Medicare for payment.
2. If the beneficiary has both  GHP MSP coverage and WC, NF, or L coverage, providers are required to submit a claim to the GHP insurer and the WC, NF, or L insurer before submitting the claim to Medicare. Once they receive the GHP remittance advice, they should include the GHP information along with the remittance advice information from the WC, NF, or L insurer with the claim to Medicare. If the claim is sent to Medicare without the GHP information, and there is an open GHP MSP record on file, Medicare will deny the claim.
3. In situations where there is no WC, NF, or L accident or injury, but the beneficiary has employer GHP coverage that is primary to Medicare, providers must submit the claim to the GHP insurer first before submitting the claim to Medicare for secondary payment.

CMS offered additional guidance about what providers should do if they believe a claim was improperly denied.  They also encouraged providers to contact the Coordination of Benefits Contractor at 1-800-999-1118 to update a beneficiary’s MSP record.

If you have any additional questions that remain unanswered after reviewing the MLN Article, check the Medicare Secondary Payer Manual (100-05), which is available from the CMS website.

CMS clarifies regulations for outpatient rehabilitation and respiratory services

CMS  did not publish any major regulatory changes this week, which can be good news for providers who are so busy with other agenda items such as resolving 5010 conversion issues, addressing ICD-10 implementation delay concerns, and applying the various CMS incentive programs.

I will take this time to review a transmittal that came out several weeks ago about a topic that I learned  has been discussed in the provider community since last November. On March 23, CMS issued Transmittal 81 removing controversial language from Appendix A of the State Operations Manual for Hospitals. The Interpretive Guidelines and Survey Procedures language that was removed had stated that the ordering practitioner must have medical staff privileging to write the orders for rehabilitation and respiratory services. There had been concern in the provider community that this language limited the individuals that could order these services on an outpatient basis and thereby restrict the beneficiary’s access to them. The applicable regulations – §482.56(b) and §482.57(b)(3) – remain the same without further guidance.

During the February 22, Hospital Open Door Forum (ODF) call, CMS clarified that its May 2011 guidance was intended to expand the categories of practitioners who could order rehabilitation and respiratory care services to include nurse practitioners, physicians’ assistants, and clinical nurse specialists as long as the hospital grants “privileging” in a manner consistent with its policies and procedures. However, the way the language was written, it actually had the opposite effect and was interpreted by providers and surveyors to mean that the ordering physician had to be on the medical staff of the facility, which is not always the case for outpatient services.

During the ODF call, the CMS representative clarified that:

“outpatient services may be ordered by a practitioner who has medical staff privileges or alternatively may also be ordered by a practitioner who doesn’t have medical staff privileges but who is responsible for the care of the patients, licensed in or holds a license recognized by the jurisdiction where the practitioner sees the patient, is acting within his or her scope of practice under state law and is authorized by the hospital’s medical staff policy.”

For example, a patient is treated in one state and returns to the state where he lives with a referral for services ordered by the treating physician from the other state. CMS stated this was allowable as long as the written hospital policy addressed these types of scenarios and how the license of the ordering practitioner would be verified.

The Hospital State Operations Manual sections have not been updated as of yet; however, the language change was effective March 23.  You can also review the February 17 CMS Survey and Certification Letter for more discussion on this change.

March 2012 update to the Medicare Physician Fee Schedule

As expected, Congress finally passed legislation saving physicians from the drastic reduction in the Medicare Physician Fee Schedule conversion factor that was supposed to take place on January 1, 2012 and then postponed until March 1, 2012. Now that the Middle Class Tax Relief and Job Creation Act (MCTRJCA) of 2012 has been signed into law we can expect the conversion factor to remain at $34.0376 for the remainder of 2012.

In addition to the conversion factor, CMS also issued the Transmittal R1058OTN, “Emergency March 2012 Update (MCTRJCA) to the CY 2012 Medicare Physician Fee Schedule (MPFS) Database”, which includes other billing and payment information that providers should note.

Technical component of physician pathology services

The update includes a provision that allows certain pathologists and independent labs to bill for the technical component (TC) of physician pathology services furnished to hospital inpatients through June 30. For almost a decade, there has been discussion about letting this provision expire so that the program cannot pay twice for the TC of pathology services, but it has never been implemented.

Medicare therapy caps

With the passage of MCTRJCA, the exceptions process for Medicare therapy caps will continue. Providers of therapy services may report the KX modifier on claims when they know the services have exceeded the annual therapy cap but their medical record documentation supports the medical necessity of the services. CMS has indicated that we can expect to see additional changes this fall, such as the establishment of a monetary threshold that will require manual medical review of claims once the threshold is met and extra reporting requirements to include the NPI of the physician who is reviewing the therapy plan of care.

Medicare Physician Work Geographic Practice Cost Index

The Medicare Physician Work Geographic Practice Cost Index (GPCI) adjustment floor will remain at 1.0 for the remainder of 2012. That makes sense to me. I have to confess that I never understood the philosophy behind the GPCI adjustment for the physician work relative value units (RVUs). The purpose of the GPCI is to account for the differences in providing a service based upon geographic location of where the service is furnished. I understand there are differences in costs for practice expenses, overhead, and malpractice premiums, but I don’t understand why, based upon the 2010 data, the physician work RVUs would be adjusted by .986 for a service furnished in Indiana and 1.016 for the same service furnished in Philadelphia. Isn’t the physician work the same? There are still differences in 2012 for the physician work GPCIs, but the floor will not be less than 1.0.

Mental health add-on payments

The biggest surprise for me is the announcement that the 5% Mental Health Add-On Payments will be discontinued. Medicare pays for psychiatric therapeutic services differently than most other covered services. Medicare pays 80% of the allowance for most covered services and the patient is responsible for the remaining 20%. Historically, Medicare always paid 62.5% of 80% for psychiatric therapeutic services, which was a ridiculous way of saying that Medicare pays 50% and the patient pays 50%. Starting in 2010, Medicare increases their portion incrementally for psychiatric therapeutic services until finally in 2016 Medicare would pay 80% as they do for most other services.

The transition to increase Medicare’s cost for these services was to follow this schedule:

At this point I have not seen any further clarification from CMS other than “the MCTRJCA discontinues the 5 percent Mental Health Add-On Payments effective March 1, 2012.” Since the 2012 cost share increase was delayed until March 1 pending legislation, which as it turns out discontinues this stipulation, I am assuming that for covered psychiatric therapeutic services Medicare will reimburse 55% of the allowance and the patient will be responsible for the remaining 45%. To be certain though, we need additional clarification from CMS.

Practitioners are advised to review the transmittal in its entirety for issues that may affect their practice.

NCCI edits more user-friendly despite some modifier confusion

CMS has recently made a number of improvements to the usefulness of the NCCI edits including a new format to the files effective this month.  Additionally, there have been some changes to the modifiers used to override NCCI edits, which warrants discussion of the 76, 77, 78, and 79 modifiers.

CMS has consolidated the NCCI edit files available for hospitals from 24 separate files into a single file.  Previously, CMS maintained 11 separate files for the distinct sections of the CPT (e.g. Surgery: Integumentary, Radiology Services, etc.), as well as a file for the HCPCS codes.  For each of these areas, they also maintained two files: one for the column 1/column 2 (bundling edits) edits and one for the mutually exclusive edits.  This was perhaps because Excel, the program used to publish the edits, limits number of lines in a worksheet.

The April 1 version of the hospital edits is available as a single file with 784,900 lines/edits.   This number of lines exceeds the Excel 2003 limit of approximately 65,000 lines.  Therefore, providers with Excel 2003 may not be able to view all the lines of the file.  The file is available on a distinct site set up just to explain the change to the format.

Consolidating the multiple files into a single file makes searching for edits much easier. Formerly, you had to open potentially four files to determine if an NCCI edit applied to a pair of codes.  Now you can simply search this one file.

This change follows another recent helpful change, effective January 1. For that version of the files, CMS made the hospital version of the files current, rather than being one quarter behind as they had been since the implementation of the edits for hospitals in CY 2000.  Read my October 31, 2011 blog post for more detail on how the delayed NCCI implementation caused problems for hospitals.

New NCCI manual

Another change that providers should be aware of initially slipped past unnoticed.  With all the other changes, CMS published a new version of the NCCI Policy Manual for Medicare Services, effective January 1, 2012.  The manual is downloadable as a zip file of several PDFs of individual chapters at this website.

In Chapter 1 of that manual, titled “General Correct Coding Policies”, they note that modifiers 76 (“Repeat Procedure or Service by the Same Physician or Other Qualified Health Care Professional”) and 77 (“Repeat Procedure or Service by Another Physician or Other Qualified Health Care Professional”) do not bypass the NCCI edits.  In looking at the 2010 version of the manual, this statement is not new, however, it is in contrast to FAQ 3739, last updated April of 2011, that included these two modifiers in a list of modifiers that did override NCCI edits.  Interestingly, the apparently incorrect FAQ was removed from the CMS website at some point in the last year rather than being updated with the new information.

Although modifiers 76 and 77 no longer appear to bypass NCCI edits, modifiers 78 (“Unplanned Return to the Operating/Procedure Room…for a Related Procedure in the Post-Operative Procedure”) and 79 (“Unrelated Procedure or Service by the Same Physician During the Post-Operative Period”) are still listed.   These two modifiers have a dual use for hospitals paid under the OPPS.  They bypass NCCI edits, but they also turn off the multiple procedure reduction logic which is not applicable if the two procedures were provided in separate surgical encounters on the same day.

For hospitals, modifier 59 (“Distinct Procedure Services”) seems to be used as a default modifier for multiple surgical procedures, particularly in separate departments or encounters.  Modifier 59 bypasses NCCI edits but it does not turn off the multiple procedures reduction and therefore it is not the best modifier if the two procedures occurred in separate surgical sessions.  If modifier 79 is used when the services occur in separate encounters, it will not only turn off the NCCI edit allowing both codes to be paid,  as does modifier 59, but it also allows the two codes to be paid at 100% per the applicable multiple procedure reduction policy.

For example, a patient presents to a provider based clinic for a small mole removal (11400) and later that day presents to the emergency department with a wound requiring repair of subcutaneous tissue (12031).   There is an NCCI edit bundling 12031 into 11400 and therefore if these two codes are billed on the same claim they will hit an edit and only the mole removal (11400) will be paid at $309.46.  If modifier 59 is applied to 12031 indicating the wound repair is separate from the mole removal, the mole removal (11400) will be paid at $309.46 and the wound repair (12031) will be paid at $113.90. The wound repair is paid at half the applicable rate because of the multiple procedure reduction.  However if modifier 79 is used, the procedures will both be paid at 100% (i.e., $309.46 for the mole removal (11400) and $227.80 for the wound repair (12031)) as is appropriate under the multiple procedure reduction policy because these two procedures were performed in separate surgical encounters.

There may be some concern with using modifier 79 because of the term “same physician” in the description.  In relationship to CPT codes, CMS states in section 20.2 Chapter 4 of the Medicare Claims Processing Manual:

 “the usage of the term ‘physician’ does not restrict the reporting of the code…to physicians only, but applies to all practitioners, hospitals, providers or suppliers eligible to bill the relevant CPT codes”.

Additionally, use of modifier 79 for unrelated procedures or services ‘by the same hospital’ in the post-operative period is consistent with correct payment under the multiple procedure reduction policy, which allows for 100% payment when two procedures occur in separate surgical encounters.

I encourage hospitals to take a look at how they are using the NCCI edits and modifiers. For many hospitals the above changes will be built into systems you already use.  However, pay special attention to the information about the modifiers, because it is up to the coders to select the correct modifier as appropriate when systems indicate a modifier is necessary.