Articles on Compliance Strategies

CMS to Block Payment in 2007 for 'Medically Unbelievable' Services

Reprinted from the April 10, 2006, issue of REPORT ON MEDICARE COMPLIANCE, the nation's leading source of news and strategic information on false claims, overpayments, compliance programs, billing errors and other Medicare compliance issues.

Providers should prepare for a new breed of edit — for "medically unbelievable" services — and consider testing their systems to check whether they would catch them.

CMS will deploy the plan to implement medically unbelievable edits (MUEs) no later than Jan. 1, 2007. They block payment for services that make no sense based on "anatomic considerations" or medical reasonableness when it involves the same patient, same date of service, same HCPCS code and same provider.

Unlike other National Correct Coding Initiative (NCCI) edits, MUEs can't be overridden by a modifier. Presumably that's because there will never be a scenario where the physician had a good reason to submit a claim for removing a second appendix from the same person. CMS unveiled this edit before, but rescinded it, and this time around is getting provider input before deployment.

"It's neat CMS is doing this because they are helping providers identify (in advance of submitting a claim) a new set of errors that could result in denial or RTPs," says Barbara Aubry, healthcare policy specialist, 3M Health Information Systems in Rockleigh, N.J. (RTP — "return to provider" — asks the provider to correct claims before resubmitting them.) "I also like it that they are involving the provider community in creating the data that drives the edits. Clinical providers can tell CMS what they believe is unlikely utilization or impossible clinical services on the same date of service."

Existing edits block claims with frequency and gender errors — services billed for a test that exceeds Medicare frequency limits (e.g., Medicare pays for only one diagnostic mammogram per year) or a claim for a hysterectomy performed on a male.

MUEs were created to help lower the fee-for-service claims paid error rate, according to the NCCI Policy Manual for Medicare Services (Chapter 1, Version 11.3). The edit tests claims for the same beneficiary, HCPCS code, date of service and provider against a number of units of service. Not all services have MUEs associated with them. For example, codes associated with drugs, biologicals and anesthesia don't have units of service edits, such as MUEs, applied.

CMS says MUEs are based on two criteria:

(1) Edits based on anatomic consideration/code descriptor. "These edits are straightforward. Edits based on anatomic consideration are set at the quantity of anatomic sites on the human body. Performance of these procedures greater than the set limit would be anatomically impossible. An example of an edit based on anatomic consideration with a maximum quantity of one is: 44950 Appendectomy; Edits based on code descriptor are limited to the quantity as described in the HCSPCS/CPT code descriptor. The narrative of the code defines the number of times the procedure can be performed in straightforward text. An example of an edit based on coding instruction set at a maximum quantity of one is: 15786 Abrasion; single lesion (e.g., keratosis, scar)."

(2) Edits based on medically reasonable expectations. "Edits based on medically reasonable expectations are set at the maximum number of times the procedure should be performed on one beneficiary in one day by the same provider. The reporting of a specific frequency of certain codes would be considered medically unreasonable for the same date of service by the same provider. Therefore a set limit has been assigned according to what is medically reasonable. An example of an edit based on medically reasonable expectations set at a maximum quantity of one is: 33200 Insertion of permanent pacemaker with epicardial electrode(s); by thoracotomy."

In a recent statement, CMS addressed MUEs, saying they are designed to stop "payment of obviously erroneous Medicare claims submissions." That would also include edits to "prevent payment for milliliters of a medical product when the unit of billing is liters or billing for 60 services when the provider meant to bill for 6 services."

CMS originally issued Transmittal R105PI, which explained MUEs and announced an implementation date of July 5, 2005. But CMS rescinded it Feb. 18, 2005, after complaints from the industry, and it's no longer available. Then in January 2006, its NCCI contractor, Correct Coding Solutions LLC, distributed a list of MUEs to national provider groups, soliciting their feedback. Comments were due March 20, but CMS extended the deadline. The exact date of the extension was never specified by CMS.

Implementation will be under way by January, CMS promised in a statement. "CMS and Correct Coding Solutions LLC will work closely with the provider community to [ensure] that these requirements are in line with current medical practice and are used only as intended, to detect errors in claims submissions," CMS said in a recent statement.

Hospitals should consider testing their own claim scrubbers to check whether they will catch the sort of errors that MUEs will catch. Medicare will rely on historical data to know whether some of the claims make no sense. For example, the payer will know an appendectomy is ridiculous only if it knows the patient already had it removed two years ago. "It's important for hospitals to have a claims scrubber that looks at history. Some only look at codes — like whether the HCPCS or ICD code is valid, but that's not enough," Aubry says. Hospitals want claims scrubbers with CCI edits built in. And now it turns out that edits for mutually exclusive and bundled codes — the traditional CCI edits — won't be enough. Now MUEs will have to be part of the package, she says.

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