Billing
The Balanced Budget Act (BBA) of 1996 amended the Social Security Act to require that, where diagnostic or other information may be required for payment to be made to an entity (e.g., laboratory, radiology), "The physician or practitioner will be required to provide diagnostic information to the entity at the time the service is ordered by the physician or practitioner." The most accurate way of providing this information is the use of ICD-9-CM coding at the highest level of specificity.
When the physician or practitioner orders multiple tests or services, the appropriate diagnosis (or diagnoses) should be linked to the tests being ordered for that diagnosis (or diagnoses).
If the test or service requested is subject to the limitation of liability provisions and may be denied due to lack of medical necessity, Medicare recommends that the physician or practitioner obtain a signed waiver of liability from the patient to protect the billing entity from liability.
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HCFA and the Office of the Inspector General (OIG) recognize that physicians and other authorized individuals must be able to order any tests that they believe are appropriate for the treatment or diagnosis of their patients. However, claims submitted for tests or services will only be paid if the service is covered, reasonable, and necessary for an individual patient given his or her clinical condition.
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Medicare Secondary Payer (MSP) refers to those instances in which Medicare does not have the primary responsibility for paying the medical expenses for a Medicare beneficiary. All providers and practitioners should screen Medicare patients to obtain correct health insurance information before submitting a primary claim to Medicare. Listed below are some questions that you may ask your patients during your confidential screening that will help you recognize circumstances where Medicare may be the secondary payer:
- Are you currently employed?
- Is your spouse currently employed?
- Are you covered under an employer or union health plan that should be primary to Medicare?
- Did you sustain an injury/illness while at work?
- Are your injuries accident related?
By using the above questions to initially screen your Medicare patients, you will help reduce costs to the Medicare Program as well as administrative costs to your practice.
Requisitions provided to the laboratory should reflect accurate patient insurance information, including screening for Medicare Secondary Payer. Laboratory Patient Service Center employees will provide Medicare Secondary Payer screening when performing phlebotomy on Medicare beneficiaries. Physician offices that are unable to provide Medicare Secondary Payer screening are encouraged to direct their patients to our Patient Service Centers for this vital requirement of the Medicare Program.
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The Omnibus Budget Reconciliation Act of 1986 (OBRA) included a limitation of liability (or waiver of liability) provision that provides beneficiaries with protection from liability when they, in good faith, receive services from a Medicare provider for which Medicare payment is subsequently denied as not reasonable and necessary." The beneficiary is not responsible for services that are not covered by Medicare until he or she has been notified in writing that the services are noncovered services. When an item or service is not covered, the Medicare beneficiary, or his or her representative, must be advised in writing prior to furnishing the item or service. Reasons for Noncoverage include:
- Laboratory tests that will be denied according to the Fiscal Intermediary or Carrier Local Medical Review Policies.
- Laboratory tests that are not yet FDA approved (investigational tests).
- Laboratory tests that are specifically excluded by the Medicare program. (General Health Panels, Cross-Linked N-Telopeptides)
- Routine or Screening Services. As a courtesy, please inform your patient these services are not covered by Medicare.
Please provide the laboratory with an Advance Beneficiary Notice (ABN) when you have reason to believe Medicare may deny a procedure as medically unnecessary.
For complete details on Medicare billing policies for clinical laboratory services please visit the CMS website at www.cms.hhs.gov/center/clinical.asp
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