Archive for June, 2010|Monthly archive page

Medicare Claims Processing (For Dates Of Service Post-June 1st) On Hold Again

In Uncategorized on June 25, 2010 at 5:34 pm

As mentioned in our last post, the House approved legislation last night rescinding the 21.3% SGR cut and replacing it with a 2.2% increase. This increase is retroactive to claims for services provided on or after June 1, 2010 and will be in place for services provided through November 30, 2010.

The Centers for Medicare & Medicaid Services (CMS) has directed Medicare claims contractors to discontinue processing claims at the negative update rates and to temporarily hold all June 1 or later claims for services until the new 2.2 percent update rates are tested and loaded into the Medicare contractors’ claims processing systems.  According to a statement from CMS, “We expect to begin processing claims at the new rates no later than July 1, 2010.”  Claims for services rendered prior to June 1, 2010, will not reflect the 2.2% increase but will continue to be processed.

CMS has also announced that claims containing June 2010 dates of service which have already been paid at the negative update rates will be reprocessed as soon as possible.  Under current law, Medicare payments to physicians and other providers paid under the MPFS are based upon the lesser of the submitted charge on the claim or the MPFS amount. 

Please take note that claims containing June dates of service that were submitted with charges greater than or equal to the new 2.2 percent update rates will be automatically reprocessed.  Providers who submitted claims containing June dates of service with charges less than the 2.2 percent update amount will need to contact their local Medicare contractor to request an adjustment.  According to CMS, “Providers should not resubmit claims already submitted to their Medicare contractor.”

While we appreciate the steps Congress has taken to address the SGR problem, this is still only a temporary solution and the Congress must enact a permanent fix to the SGR.  Because this fix is only for 6 months, providers will be facing a reinstatement of the 21.3% cut on December 1, 2010.  Then, a SGR second cut, estimated at 25%, will occur on January 1 unless Congress takes steps to prevent these cuts from occurring.

We’ll keep you posted…

SGR Update – Bill “Fixing” SGR Before The President

In Uncategorized on June 25, 2010 at 2:46 am

Following last week’s action by the Senate, the House has just passed legislation, H.R. 3962, which would “fix” the SGR problem (and table the Medicare Physician Fee Schedule cut) for the next 6 months.  Retroactive to services delivered on or after June 1, the Medicare Conversion Factor will be raised by 2.2%.  This will be in place for services provided between June 1, 2010 and November 30, 2010.  The bill has been sent to the President for his signature.

However, unless Congress takes steps between now and November 30th, the 2.2% increase will cease on December 1, 2010 and the 21.3% reduction will be restored.

Senate Finally Passes 6-month SGR “Fix” – Sent To House For Vote

In Uncategorized on June 18, 2010 at 9:06 pm

The Senate, via unanimous consent, has passed a 6 month SGR “fix”.  The legislation was broken out from the larger tax extenders/unemployment legislation to which it had been attached.  Here is a summary of the proposal passed by the Senate:

Medicare Physician Payment: Provides a 2.2% increase in reimbursement levels for June-November of 2010. Spends $6.4 billion over five and ten years.

Hospital Payments: Prohibits Medicare from reopening or adjusting claims made by hospitals during the three days preceding a patient’s inpatient admission.

Pension Relief: Offers the same relief from pension funding obligations for companies that will result in fewer tax-preferred contributions to pension plans and therefore more taxable income for the firms, and generates $675 million in outlay savings due to lower than expected payments by the Pension Benefit Guarantee Corporation (PBGC).  Saves $2.8 billion over ten years.

IRS Data Match: Includes provisions allowing the IRS and CMS to coordinate data matching efforts with regard to delinquent tax debts owed by Medicare providers, and to take such information into account when releasing reimbursement payments and accepting new providers.  Saves $175 million over five years and $425 million over ten.

The legislation has been sent to the House for consideration but the House has adjourned for the day.  The soonest the House will be able to take up this proposal – assuming they can get the votes – would be Monday or Tuesday.

CMS Directs Payments With 21.2% MPFS Cut

In Uncategorized on June 18, 2010 at 7:49 pm

The CMS has confirmed that it has directed Medicare contractors to begin processing physician reimbursements for the month of June with the scheduled 21.2% cut mandated by law…

21% Cut To Medicare Pysician Fee Schedule Implemented

In Uncategorized on June 18, 2010 at 4:48 pm

Sadly, the Senate failed to pass a bill Thursday that would stall a 21 percent Medicare physician pay cut.   

As the Senate struggles to pass the Jobs and Closing Tax Loopholes Act of 2010 (potentially up for a vote next week), which contains a six-month delay of the pay cut, physicians face uncertainty on reimbursement.  Current law mandates a 21 percent Medicare pay cut as of June 1, 2010. 

Meanwhile, the Centers for Medicare and Medicaid Services had placed a hold on claims submitted for dates of service of June 1st or later.  That hold expired Thursday and CMS contractors will begin processing claims according to the mandated 21 percent cut today.  In the event that the Medicare Physician Fee Schedule cut is repealed retroactively to June 1st (which is ultimately expected), CMS contractors will automatically reprocess all claims with dates of service on June 1, 2010 or later (and thus subject to the fee cut) to capture that additional payment. 

Needless to say, let the administrative bookkeeping games begin!

SGR Update (one of what are undoubtedly going to have been many over the past few weeks)

In Uncategorized on June 18, 2010 at 2:06 pm

SGR situation as of the afternoon of Thursday, June 17th :

The Senate has been unable to muster enough votes to pass an SGR “fix”.  Although broad bi-partisan support for fixing the SGR problems remains, finding enough votes around a single solution has been elusive.  For some, support for fixing the SGR problem is predicated on paying for the fix.  Other Senators argue that the SGR problem is an emergency and paying for the “fix” through deficit spending is appropriate.  The end result is a stalemate.

The latest proposal put forward in the Senate by Finance Committee Chairman Max Baucus (D-MT) would provide a 2.2 percent increase in the physician fee schedule Conversion Factor between June 1, 2010 and November 30, 2010.  Effective December 1, 2010, this increase would be rescinded and the 21.3 percent SGR cut would take effect.  This would then be followed by another cut (on top of the 21.3 percent cut) in the Medicare physician fee schedule Conversion Factor that is slated to take effect on January 1, 2011.

At this time, there are not enough votes to pass this latest proposal.  There has also been nothing out of CMS indicating that Contractors will continue to hold claims.  Therefore, providers and billing companies should expect Contractors to begin making providers payments reflecting the the 21.3% SGR cut. 

Adopting this particular Baucus proposal, would require some Congressional intervention in November, 2010 to prevent both the 21.3% cut on December 1, as well as another cut on January 1.  This would have to occur during what is largely exptected to be a lame duck session of Congress that would be convened AFTER the November Congressional elections (given the wide belief that the number of Republicans serving in Congress will be going up and the number of Democrats in Congress will go down).

Hoping For Resolution To The SGR, CMS Delays Payments Again

In Uncategorized on June 16, 2010 at 7:59 pm

As I am sure everyone is aware, no action was taken by Congress with regard to enacting a fix (temporary or otherwise) to the SGR problem by the June 14th deadline.

If you recall, CMS had instructed its contractors on May 27th to hold claims for services paid (for claims with dates of services June 1. 2010 or later) under the MPFS for the first 10 business days of June (i.e., through June 14, 2010) in order to avoid disruption in the delivery of health care services to beneficiaries and payment of claims for physicians, non-physician practitioners, and other providers paid under the MPFS.  Given the possibility of Congressional action in the very near future, CMS is now directing its contractors to continue holding June 1 and later claims through Thursday, June 17, lifting the hold on Friday, June 18.  This action will facilitate accurate claims processing at the outset and minimize the need for claims reprocessing if Congressional action changes the negative update.  It also should minimize the provider and beneficiary burdens and costs associated with reprocessing claims.  We understand that the delayed processing of Medicare claims may present cash flow problems for some Medicare providers.  However, we expect that the delay, if any, beyond the normal processing period will be only a few days.  Be on the alert for more information regarding the 2010 Medicare Physician Fee Schedule Update. 
The House and Senate continue to work on legislation providing an 18 – 24 month SGR fix.  And, although it is fully anticipated that Congress will eventually enact legislation restoring the full payments for all claims subject to the SGR cut, it is not clear exactly when that might occur.  All Congressional action is currently focused on enacting an SGR fix that is at least 18 months long rather than the 30 or 60 days “fixes” that have become the norm this year.  Once Congress enacts an SGR fix, it is also not clear whether providers will be asked to resubmit claims or whether Contractors will automatically reprocess the previously submitted claims and remit the additional payments to the providers with no additional action required by the provider to obtain full payment.

There is broad bi-partisan support for fixing the SGR problem in both the House and Senate, and various proposals for fixing the SGR problem have been put forward by Members of both parties. Unfortunately, there are significant policy differences over how to “pay for” the SGR fix as well as differences on just what the new policy should be that would replace the current Sustainable Growth Rate formula.

Stay tuned….

Be Sure To Enroll/Update PECOS Database ASAP!!!

In Uncategorized on June 8, 2010 at 7:00 pm

The Centers for Medicare & Medicaid Services (CMS) requires physicians and non-physician practitioners to enroll and maintain Medicare program enrollment to be eligible to receive Medicare payments for covered services furnished under Medicare.  Similarly, all Medicare providers must be enrolled in PECOS (Medicare’s Provider Enrollment, Chain, and Ownership System), the system which supports the Medicare provider and supplier enrollment process by capturing provider/supplier information from the CMS-855 family of forms.  PECOS manages, tracks, and validates enrollment data collected in both paper form and electronically via the Internet.

It is important to note that although some providers may be enrolled in Medicare, those enrollment records might not be in PECOS.  Generally, the lack of a current enrollment record in the PECOS (i.e., one that is in the PECOS and also contains the National Provider Identifier (NPI)) is a result of not having submitted any enrollment information updates since November 2003.  Such providers must update their enrollment record now.

Why all the fuss?  The Protection and Affordable Care Act, which finally passed in March of this year, provides for the verification of a referral source’s Medicare enrollment.  Under the Medicare edits in question, if an ordering/referring physician or other non-physician practitioner listed on DMEPOS claims are not in PECOS, those claims will reject.  Note that I write “DMEPOS claims” – durable medical equipment suppliers’ claims were the first categpory of claims to be targeted by this new Medicare edit, however, it is foreseeable that this edit will in fact apply to all of the following:  DME, orthotics, prosthetics, supplies, home health items/services, laboratory services, imaging services, specialist services.  Further, there is rumor of CMS’s extending the provision to Part B drugs within the next year.

CMS had originally set Jan. 4, 2010, as the effective date for the system edits, but later pushed that date out to April 5 and then to Jan. 3, 2011.  Following the recent passage of the new health care reform law, however, CMS published an interim final rule stipulating that physicians and other eligible professionals who order items and/or services (ex: durable medical equipment, tests, etc…) for Medicare beneficiaries must have an approved enrollment in PECOS by July 6, 2010 – effectively advancing the compliance date by 6 months.

NOTE – Providers who do not participate in Medicare also need to be enrolled in PECOS or any DME/tests that they order will not be reimbursed.

What Can You Do?  Basically just ensure that you and all providers referring to you have a current PECOS enrollment record.  To determine if you have a current enrollment record in the PECOS, you can utilize the national file of Medicare physicians and non-physician practitioners who are eligible to order/refer and have current enrollment records in the PECOS (  This file is made available by the Centers for Medicare & Medicaid Services’ (CMS) and contains the provider’s NPI and his/her legal name (from the PECOS enrollment record). 

If you do not have a current enrollment record in the PECOS and will be ordering or referring services, particularly items of durable medical equipment (e.g., oxygen, diabetic supplies, and wheelchairs), you should use Internet-based PECOS to complete and send your enrollment application.  For more information regarding submissions via Internet-based PECOS, you can refer to the CMS website (

Once Again, Identity Theft/Red Flag Rules Enforcement Deadline Delayed By FTC

In Uncategorized on June 3, 2010 at 4:24 pm

Once again, the Federal Trade Commission (FTC) has delayed the deadline for enforcement of the Red Flag Rules until Dec. 31, 2010 at the request of several members of Congress. This was done in part in response to the efforts of several national medical societies to block the rule by filing a lawsuit in federal court.  More specifically, the American Medical Association (AMA), American Osteopathic Association (AOA) and the Medical Society of the District of Columbia (MSDC) filed a suit in federal court on May 21, 2010, seeking to prevent the Federal Trade Commission (FTC) from extending identity theft regulations to physicians.

The rule was developed under the Fair and Accurate Credit Transactions Act in which Congress directed the FTC and other agencies to develop regulations requiring “creditors” and “financial institutions” that have “covered accounts” to develop and implement written identity theft prevention programs to help identify, detect, and respond to patterns, practices, or specific activities – known as “red flags” – that could indicate identity theft.  The result – perhaps unintended – is that by the letter of the law, by establishing an account that allows a patient to make multiple payments, a health care provider is considered a “creditor” maintaining “covered accounts,” and thus is subject to certain provisions of the Red Flag Rules.  The AMA, et al.  argue that the rule should not apply to doctors simply because they do not require payment at the time they provide the service, and that the FTC’s rule exceeds the powers delegated to it by Congress and that its application to physicians is “arbitrary, capricious and contrary to the law.”

The suit follows two years of communications to the FTC from the AMA and AOA regarding the unintended consequences of the red flags rule.  On January 27, the AMA and AOA joined other groups to petition the FTC to exclude physicians from the red flags rule. The FTC responded on March 25 saying it could not accommodate the request.

The Red Flag Rules have been issued enforcement extensions multiple times since its original deadline for compliance by Nov. 1, 2008.  Health care providers will now have until Dec.31, 2010 to implement a written medical identity theft program.  However, if Congress passes legislation limiting the scope of the rule with an effective date earlier than Dec. 31, the Commission will begin enforcement as of that date.   Also, providers should note that the FTC’s announcement and the release of an Enforcement Policy Statement do not affect other federal agencies’ enforcement of the original November 1, 2008 deadline for institutions subject to their oversight to be in compliance.

To read the recent FTC’s News Release, access this link:

CMS Orders Medicare Contractors To Hold Claims Beginning June 1st

In Uncategorized on June 1, 2010 at 2:39 pm

Congress has failed to adopt another extension of the freeze of the Medicare physician fee schedule Conversion Factor.  This means that effective for services provided on or after June 1, there is currently slated a 21.3% cut in the Medicare fee schedule payments. 
The Congress will not be in session next week due to the Memorial Day Recess, meaning that the earliest it could consider legislation reinstating the freeze (or enacting a replacement to the SGR) would be June 7th.  

Because Medicare claims are not paid any sooner than 14 days after receipt, technically Congress has until June 13th to adopt legislation avoiding the 21.3% cut.  In an effort to avoid the administrative confusion and ugliness that stems from this waffling of the Physician Fee Schedule, CMS has once again instructed its contractors to hold claims containing dates of services as of June 1st to paid under the Medicare physician fee schedule for the first 10 business days of June.  One can only hope that the SGR issue will be resolved by then!

Congressional leaders are trying to avert a 21 percent payment cut scheduled to take effect June 1 under the current fee schedule.

The 10-day hold applies to claims with dates of service of June 1 and later. According to CMS officials, the hold should have little impact on provider cash flow because electronic claims are not paid until at least 14 calendar days after receipt.