The medications, linked to dozens of deaths, are decades old. The Food and Drug Administration had less restrictive measures then and has tried, to no avail, to eliminate them from the market.

Click here to read more.

A federal judge ruled Medicare’s refusal to pay reimbursement to companies suspected of overcharging for diabetic and other services, which began in October, is reasonable and appropriate.

A home healthcare company sued Medicare following the initial announcement claiming that the program was beyond Medicare’s scope of authority.

According to the article, Medicare estimates it spends $1.3 billion of its $16.5 billion national home healthcare budget on companies based in Miami-Dade County.

Click here to read the Miami Herald article.

Insurance companies such as Blue Cross Blue Shield of Massachusetts and Harvard Pilgrim Health Care pay certain facilities 15% to 60% more than other hospitals on average, and sometimes even twice or three times as much for individual procedures, such as an angioplasty.

For example, Anna Jaques Hospital in Newburyport, MA, earns $75 for a chest x-ray while Massachusetts General Hospital in Boston earns $160 for the same.

The Globe says this process is usually kept under wraps because of confidentiality agreements between hospitals and payers. The newspaper called for more regulated healthcare policies to prevent reimbursement disparities from happening further.

Source: The Boston Globe

This week, CMS announced National Heritage Insurance Company (NHIC) as the A/B MAC for the New England jurisdiction (Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont). NHIC was primarily a Part B carrier prior to its selection as an A/B MAC for the northwest (Washington, Oregon, Idaho and Alaska), and now for New England. Many former students have discussed with me the difficulties they have experienced transitioning to a new contractor. This difficulty has been exaggerated in locations where the new contractor was formerly Part B carrier focused. This is presumably due to the very different coding, reimbursement, and even coverage environments of the services provided by suppliers (formerly billed to carriers) and those provided by institutional providers, such as hospitals.

I encourage everyone in these states, and anyone affected by a MAC transition, to review the Special Edition MLN Matters Article SE0837. It discusses steps providers can take to minimize problems during the transition, what to expect for process changes and possible disruptions to cash flow, and how to avoid them. I encourage everyone to pay particular attention to the possible changes to the local coverage determinations, including determinations of self-administered drugs. These may change under a new MAC, and the effective dates of changes can be confusing and have to be monitored closely to ensure you are notifying your patients appropriately of noncovered services.

View the CY 2009 OPPS final rule.

Comment on the final rule.

On November 17, CMS rescinded and replaced its November 7 transmittal updating the Medicare deductible, coinsurance, and premium rates for 2009. The new transmittal adds information inadvertently left out in section 20.6 of the manual. The 2009 income parameters for determining the Part B premium were not complete. All other information remains the same.

Effective date: January 1, 2009
Implementation date: January 5, 2009

View the transmittal.

On November 21, CMS issued 41 new/updated frequently asked questions related to Medicare fee-for-service payment.

View the frequently asked questions.

CMS selects A/B Medicare administrative contractor (MAC) for New England

On November 19, CMS announced its selection of National Heritage Insurance Corporation (NHIC) as the A/B MAC for Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. As the A/B MAC contractor, NHIC will immediately begin implementation activities and will assume full responsibility for the claims processing work in its five-state jurisdiction no later than May 2009.

View the CMS press release.

OIG issues report on Medicare billing for oxaliplatin at Franklin Memorial Hospital during calendar years (CY) 2004 and 2005

On November 19, the OIG issued a report in which it determined that Franklin Memorial billed Medicare incorrectly for oxaliplatin in CY 2004. These erroneous claims resulted in a net overbilling to Medicare of $97,968 for oxaliplatin furnished to hospital outpatients during CY 2004.

View the OIG report.

CMS issues proposed decision memo on surgery for diabetes

On November 17, CMS issued a proposed decision memo in which it proposed that type 2 diabetes mellitus is a comorbid condition related to obesity, as defined in NCD Manual 100.1 (Bariatric Surgery for Treatment of Morbid Obesity).

View the proposed decision memo.

View a related press release.

A: Yes. When you contact the RAC, they are required to return a phone call within one business day. In the permanent program, if a provider calls during the second period—or at any time—to discuss a determination, the RAC is required to let the provider speak to the medical director or the person that reviewed the claim.

Editor’s note: This Q&A was adapted from the November 13 RAC Open Door Forum. A CMS representative answered this question.

For more information on the medical request limits, click here.

To view the article, click here.

To read the report, click here.

In addition, Montana Senator Max Baucus, chairman of the finance committee, which oversees taxes and about 50% of government spending, released a healthcare model similar to that proposed by Obama during his presidential campaign.

To read the story in the Wall Street Journal, click here.

More than 60% of patients who took a Medco Health Solutions survey do not fully understand the gap that forces patients to pay the entire cost of their prescription drugs, the Associated Press reports. And nearly 30% do not understand it at all, the survey says.

To read the full story in the Associated Press, click here.

• The hospital bill for laboratory services only after they are performed
• The hospital bill only for medically necessary services
• The hospital bill only for tests actually ordered by a physician and provided by the hospital laboratory
• The CPT or HCPCS code used by the billing staff accurately describe the service ordered
• The coding staff only submit diagnostic information obtained from qualified personnel
• The coding staff contact the appropriate personnel to obtain diagnostic information when the individual who ordered the test has failed to provide such information
• The hospital document receipt of diagnostic information obtained from a physician or the physician’s staff after receiving the specimen and request for services
• The hospital conduct routine audits to assess billing compliance with the regulations

When facing a denied claim, organizations have two options if they believe the denial is wrong: file an appeal or ask for a reopening. A reopening can be used instead of an appeal if there is a minor clerical error on the claim. The basis of a reopening is to correct the minor clerical error or omission that resulted in the initial claim denial. If there were no clerical errors, and you disagree with a Medicare decision or policy, then an appeal must be made.

If you are unsure whether the issue on your claim is based on a minor error, it’s best to file initially for a reopening. You have the right to file for an appeal if your reopening request is denied. Do not file for both a reopening and an appeal at the same time; doing so will cause your request for a reopening to be considered null and void.

Valid reopening errors include:

• Mathematical or computational mistakes
• Transposed procedure or diagnostic codes
• Inaccurate data entry
• Misapplication of a fee schedule
• Computer error
• Denial of claims as duplicates, which the party believes were incorrectly identified as a duplicate
• Incorrect data items, such as provider number, use of a modifier, or date of service

By now, many of you may have started to look over the display copy of the 2009 OPPS final rule. Personally, I find the display copy somewhat hard to use because of the way it is formatted (i.e., triple line spacing, etc.). At 1,827 pages, printing the display copy produces a huge volume of paper, even when printed double sided.

The good news is that the “official” Federal Register copy is scheduled for publication in today’s (November 18) Federal Register. To access today’s Federal Register, visit www.gpoaccess.gov/fr/index.html and click on one of the links embedded in “Browse the Table of Contents from today’s issue in HTML or PDF formats.” The official copy should be less than half the size of the display copy due to differences in formatting between the two versions.

A good way to tackle the final rule is to start by browsing the table of contents to get a feel for the big picture. After reviewing the table of contents, I usually read the new and revised regulations, which appear at the end of the “preamble.” The preamble is CMS’ detailed discussion of the rule, including CMS’ response to comments on the proposed rule submitted by the public. To quickly access the regulations section of the final rule, search for the text “List of Subjects.” After I’ve reviewed the new and revised regulations, I then go back and read the preamble (or at least the sections of the preamble that are relevant to my work). Although the preamble is merely interpretative guidance (rather than law), it typically provides a treasure trove of important details relating to hospital compliance and revenue cycle management.

On November 14, CMS issued two transmittals adding certain entities as originating sites for payment of telehealth services, pursuant to Section 149 of MIPPA. Eligible originating sites will also include hospital-based or critical access hospital-based renal dialysis facilities (including satellites), skilled nursing facilities, and community mental health centers.

Effective date: January 1, 2009
Implementation date: January 5, 2009

View the first transmittal.

View the second transmittal.

CMS updates the initial preventive physical examination (IPPE) benefit

On October 31, CMS re-communicated an October 17 transmittal expanding the IPPE benefit under Medicare Part B.

Effective date: January 1, 2009
Implementation date: January 5, 2009 (unless otherwise specified by the individual business requirement)

View the transmittal.

View a related MLN Matters article.

CMS releases MLN Matters articles

CMS released two MLN Matters articles last week related to transmittals previously announced in Medicare Weekly Update.

• Update to Medicare Deductible, Coinsurance and Premium Rates for 2009
• Compendia as Authoritative Sources for Use in the Determination of a "Medically Accepted Indication" of Drugs and Biologicals Used Off-Label in an Anti-Cancer Chemotherapeutic Regimen

CMS also released a special edition MLN Matters article last week.

• Preparing for a Transition from an FI/Carrier to a Medicare Administrative Contractor (MAC)