Understanding Medicare Secondary
Payer (MSP)
Part A Provider Outreach and Education Department
April 2017
Objective
• Provide knowledge and understanding of
the MSP regulations and to help
understand secondary payments and the
billing guidelines
2
DISCLAIMER
This information release is the property of Noridian Healthcare Solutions, LLC. It may
be freely distributed in its entirety but may not be modified, sold for profit or used in
commercial documents.
The information is provided “as is” without any expressed or implied warranty. While
all information in this document is believed to be correct at the time of writing, this
document is for educational purposes only and does not purport to provide legal
advice.
All models, methodologies and guidelines are undergoing continuous improvement
and modification by Noridian and CMS. The most current edition of the information
contained in this release can be found on the Noridian website at
https://med.noridianmedicare.com and the CMS website at https://www.cms.gov
The identification of an organization or product in this information does not imply any
form of endorsement.
CPT codes, descriptors, and other data only are copyright 2017 American Medical
Association. All rights reserved. Applicable FARS/DFARS apply.
3
Agenda
• What is Medicare Secondary Payer?
• MSP Types
• Benefits Coordination & Recovery Center
process
• Medicare Secondary billing guidelines and
conditional payments
• When and how to bill Medicare tertiary claims
• MSP Reason Code Guidance
4
Helpful Acronyms
Acronym
Description
CARC
Claim Adjustment Reason Code
BCRC
Benefits Coordination & Recovery Center
CWF
Common Working File
ECRS
Electronic Correspondence Referral System
ERA
Electronic Remittance Advice
MSP
Medicare Secondary Payer
MSPRP
Medicare Secondary Payer Recovery Portal
OTAF
Obligated To Accept Payment in Full
PTAN
Provider Transaction Access Number
VC
Value Code
WCSA
Worker’s Compensation Set-Aside
5
Medicare Secondary Payer
(MSP)
MSP
• Term used when Medicare is not
responsible for paying primary
– Primary insurance’s speak of "Coordination of
Benefits" when assigning responsibility for
first and second payment
• Medicare is not a supplemental insurance,
even when secondary
7
MSP
• MSP sometimes confused with Medicare
supplement
– A Medicare supplement (Medigap) policy is a
private health insurance policy designed
specifically to fill in some "gaps" in Medicare's
coverage when Medicare is primary (ex. AARP,
BCBS, Medicaid, Aetna)
• Provider’s responsibility to determine who is
primary
– Request updated insurance profiles from
beneficiary frequently
8
Patient’s Coverage Determines Who
Pays First
• Different conditions determine if Medicare
is Primary
– Age of beneficiary
– Is the beneficiary employed or spouse
employed?
– Size of the employer
– Have certain medical conditions
9
Responsibilities of Providers under
MSP
• Inquire with beneficiary at each visit about
insurance coverage
• Follow rules to obtain MSP information
– Group health coverage through employment
– Non-group health coverage from injury or
illness
• Submit correct MSP coding on your claims
– MSP Type, Value Codes, Occurrence Codes,
CARCs and dollar amounts
10
MSP Questionnaire
• Admission Questions to Ask Medicare
Beneficiaries
– Contains questions to ask beneficiaries upon each
inpatient and outpatient admission
• JE: https://med.noridianmedicare.com/web/jea/forms#msp
• JF: https://med.noridianmedicare.com/web/jfa/forms#msp
• Internet Only Manual (IOM) Medicare Secondary
Payer Manual, Publication 100-5, Chapter 3,
Section 20.21
– http://www.cms.gov/manuals/downloads/msp105c03.
pdf
11
MSP Guidelines –
Payable vs. Not Payable
• Payable
– Meets Medicare coverage requirements
– When a primary plan’s payment is less than
charges for those services and less than allowed
amount payable by Medicare, and provider does
not accept and is not obligated to accept primary
plan’s payment as full payment
• Not payable
– If provider accepts or is obligated to accept
payment in full (OTAF), the primary payment is
full payment or full satisfaction of patient’s
responsibility
12
MSP Types
Description
Payer Code
Value Code
Working Aged
A
12
End Stage Renal Disease
(ESRD)
B
13
Conditional Payment
C
Appropriate Value Code for
Primary Payer
Auto/No- Fault
D
14
Worker’s Comp / Worker’s
Comp Set Aside
E/W
15
Disability
G
43
Federal Black Lung
H
41
Liability
L
47
13
MSP Types
• A – Working Aged (VC 12) - Tax Equity and Fiscal Responsibility
Act (TEFRA)
–
–
–
–
Employer has 20 or more employees
Covered by multi-employer plan employing 20 or more PTE/FTE
Covered by Employer Group Health Plan (EGHP)
Must be 65 or older and enrolled in Part A
• A – Working Aged (VC 12) - Deficit Financial Reduction Act of
1984 (DEFRA)
–
–
–
–
–
•
Working spouse of any age
Spouse works for company with 20 or more employees
Spouse covered under an EGHP
Covers husband/wife on working plan
Must be 65 or older and enrolled in Part A
Medicare is primary to retirement plans and secondary to working plans
14
MSP Types
• G – Disability (VC 43) - Omnibus Reconciliation
Act (OBRA)
– Disabled under age 65
– Still actively working
– 100 or more employees in company
– Multi-employer plan with one employer over
100 employees
– Covered by a Large Group Health Plan
(LGHP)
15
MSP Types
• B – End Stage Renal Disease (ESRD) (VC 13)
– Entitled to Medicare solely on basis of ESRD
– Covered by an Employee Group Health Plan (EGHP)
(current, former, spouse, parent)
– EGHP is primary for the first 30 months coordination
period of entitlement, Medicare is secondary
• H – Federal Black Lung (VC 41)
– Black Lung disease
– Submit claims to: Federal Black Lung Program, PO
Box 470, Lanham MD 20706
– Services not covered by Federal Black Lung, send to
Medicare contractor with Department of Labor denial
details
16
MSP Types
• E – Workers Compensation (VC 15)
– Must file claim with Worker’s Compensation if related to
injury
– In contested cases, Medicare may pay conditional benefits
• W – Workers Compensation Set-Aside (WCSA) (VC
15)
– Allocates portion of WC settlement for future medical
expenses
– Set aside amount determined case-by-case and should be
reviewed by CMS, when appropriate
• Once amount is exhausted/accurately accounted for, Medicare
will pay primary for future Medicare covered expenses related to
WC injury once CWF file has a term date
17
MSP Types
• D – No Fault/Auto Accident (VC 14)
– Must bill insurance company primary if related
to accident (Auto, Liability)
– Must refund Medicare if payment received
from primary insurance
– Each state and individual coverage plans
differ
18
MSP Types
• L – Liability (VC 47)
– All other injuries
– Claims submitted to the other insurer primary
if related
– If no payment from primary within 120 days,
file to Medicare
19
Benefits Coordination &
Recovery Center (BCRC)
Who is the BCRC?
• Consolidates the activities that support the
collection, management, and reporting
• Take actions to identify health benefits
available to a beneficiary and coordinate
payment processes to prevent mistaken
Medicare payments
• Maintains MSP records and handles the
updates to the records
• Sign up for BCRC updates at:
https://www.cms.gov/Medicare/Coordinationof-Benefits-and-Recovery/Coordination-ofBenefits-and-RecoveryOverview/Overview.html
.
21
What tasks are done by the BCRC?
• Initiating an investigation when it learns a
person has other insurance
• Collecting info on Employer Group Health
Plans and Non-Group Health Plans
• Establishing MSP occurrence records on
CWF to keep Medicare from paying when
another party is responsible first
• Recovery of Non-Group Health Plan
related mistaken payments
22
When to Contact the BCRC?
• To report employment changes, or any other
insurance coverage info
• To report a liability, auto/no-fault, or worker’s comp
case
• To ask a question regarding the MSP letters and
questionnaires (Secondary Claim Development)
– Toll Free: 855-798-2627
– Mailing information can be found at:
http://www.cms.gov/Medicare/Coordination-ofBenefits-and-Recovery/Coordination-of-Benefits-andRecovery-Overview/Contacts/Contacts-page.html
23
What the BCRC Cannot Do
• COBC/BCRC cannot give out the following
information:
– Information concerning how to bill for payment
(ex: value codes, occurrence codes, etc.)
– Information regarding beneficiary entitlement data
– They are permitted to state whether Medicare is
primary or secondary but cannot provide name of
other insurer
• Providers must obtain this information from beneficiary
24
Provider Action
• Process
– Provider submits MSP information
– If all appropriate info is received, MSP initiates
request to BCRC
– Claim is held in SMECRS location until further
completion of the ECRS
– If more documentation is needed, BCRC
sends a letter to Beneficiary/POA to verify and
respond
25
Noridian Action
• Noridian does not have access to directly
update the Common Working File (CWF)
• Actual changes must be made by the
BCRC
26
Who Can Update MSP Records?
Type
Contractor
Providers
Beneficiaries
Working Aged - 12
Yes
Yes
Yes
ESRD - 13
Yes
Yes
Yes
No Fault - 14
Initiate new record
only
Initiate new
record only
Initiate new record
only
Workers Comp - 15
Initiate new record
only
Initiate new
record only
Initiate new record
only
Federal - 16
Yes
Yes
Yes
WCMSA
No
No
Yes
Disability - 43
Yes
Yes
Yes
Liability – 47
Initiate new record
only
Initiate new
record only
Initiate new record
only
27
Medicare Secondary Payer
Recovery
Medicare Secondary Payer Recovery
• All GHP recovery related refunds,
correspondence and telephone inquiries
should be directed to the Commercial
Recovery Center (CRC)
• All NGHP recovery related refunds,
correspondence and telephone inquiries
should be directed to the Benefits
Coordination & Recovery Center (BCRC)
29
MSP Recovery Portal (MSPRP)
• The MSPRP is a web-based tool designed
to assist beneficiaries and attorneys in the
resolution of Liability, No-Fault and
Worker’s Comp insurance recovery cases.
– Allows them to access and update case
information online
30
MSPRP Features & Benefits
• Submit Proof of Representation or
Consent to Release documentation
• Conditional Payment info
• Dispute claims from a conditional payment
letter
• Submit settlement info
31
Actions That Can Help You
Actions That Can Help You Submit
MSP Claims
• Verify that Medicare is truly secondary
• Review documentation from primary insurer
• Verify matching record on CWF – number
issue we see is wrong value codes
• Contact BCRC if there is a conflict with files
• Prepare MSP claim
• Report all appropriate coding
• Submit claim using an acceptable method
• Use available resources online
33
Noridian Medicare Portal
• Functionality
– Eligibility
• MSP information, Hospice election, and Home Health
episodes
– Claim Status including Reviewer Comments
– Payment Floor / Prior Checks Issued
– Claim-Specific Remittance
– Reopening & Redetermination Submission
& Status
34
Primary Remittance Advice (RA)
Requirements
• Certain information from Primary payer’s
Remittance Advice (RA) is required on an
MSP claim:
– Claim Adjustment Segments (CAS) related
groups
– Claim Adjustment Reason Codes (CARC)
– Associated adjustment amounts made by
primary payer
35
Claim Adjustment Reason Codes
(CARCS)
• Where do providers report CARCs from Primary EOB on
EMC claims?
– Submit appropriate CARCs at the claim level (Loop
2320)
• A listing of CARCs can be found at:
http://www.wpc-edi.com/
– Using the wrong CARC can cause claims to
process incorrectly
– If a CARC on the primary remit is not on the
list, find the most appropriate code as Noridian
is not allowed to advise what CARC to bill
36
Common MSP Claim Errors
•
•
•
•
•
•
•
Incorrect MSP type
Patient relationship code
Use of the occurrence code 18 and date
Billing a secondary insurance as primary
Using unclear shorthand with remarks
Coordinating with VA
Commenting not related on a WCSA
37
Helpful Tip
• For claims where the MSP file is not
present on CWF, providers should include
the following information on the claim:
– Name of Insurance
– Name of the Insured
– Address of Insurance
– Effective date of insurance
– Policy number
– Patient Relationship
38
Conditional Payments
MSP Claims – Conditional Payment
• Under certain circumstances, Medicare
may make conditional payments, subject
to reimbursement if the insurer has not
paid or will not pay promptly
– Benefits have exhausted
– NGHP has not paid within 120 day
promptly pay guidelines
40
MSP Claims – Billing Conditional
Payment
• For EMC claims – Payer Code ‘C’ is automatically
billed
• Occurrence Code – 24 with date of denial/benefits
exhaust and occurrence code 01-05 indicating the
MSP involvement and date
– Most common error is not billing this occurrence code
with date of insurance denial (causes RC 3906739074)
• Value Code – use appropriate value code with
0.00 dollar amount
• Remarks of why billing conditionally
41
Primary Pays Towards
Deductible/Coinsurance
• If no payment is made to claim, all money
is applied to deductible or coinsurance
– Occurrence Code 24 with date payment
applied to deductible or coinsurance
– Appropriate value code with $0.00
– Remarks indicating payment was applied to
deductible/coinsurance
42
Medicare Tertiary Claims
What is tertiary?
• Tertiary insurance is the third insurance
policy responsible for payment.
– There are few circumstances Medicare is truly
the beneficiary’s third insurance coverage
44
Is Medicare truly tertiary (3rd payer)?
• Does the beneficiary have two valid open
files on CWF for the date of service?
• Have you received a payment from both
insurance companies?
– If yes, you are able to submit the claim to
Medicare with the primary and secondary
insurances listed, and Medicare listed as the
3rd payer. Don’t forget to use the appropriate
corresponding VC’s for the MSP files.
45
Examples
• Beneficiary has two GHP’s
primary:
– Blue Cross Blue Shield;
working aged
– Aetna; working aged
Both insurances have made a
payment to the provider
• Bill the claim to Medicare as
a tertiary claim with all
appropriate coding.
• Beneficiary has two NGHP’s
primary:
– State Farm; auto/no-fault
– Geico; liability
State farm has made a
payment, however Geico
has denied and made no
payment
• Bill the claim to Medicare as
secondary with State Farm
primary and the appropriate
coding with the payment.
Due to the second NGHP
making no payment, this is
not a true tertiary claim to
submit.
46
MSP Decision Tree
Who Pays First?
• JE:
https://med.noridianmedicare.com/web/jea
/topics/msp
– Select “Decision Tree – Who Pays First”
• JF:
https://med.noridianmedicare.com/web/jfa/
topics/msp
• Select “Decision Tree – Who Pays First”
48
Reason Code Guidance
RC 31300
• Claim submitted with
– Medicare as primary payer when MSP coding
is present on the claim
– Primary payer on the claim is not matching
the MSP provisions
• RTPs with 31300
50
RC 31361
• Claim submitted with:
– OC 24 and date
– MSP VC with 0.00
• Suspends with 31361
51
RC U6815
• Claim submitted with:
– Medicare primary
– Matching diagnosis codes to WCSA MSP file
• Suspends with U6815
52
RC U680A-I
• Claim submitted with:
– Medicare primary but MSP file valid on CWF
for DOS
• Claim will end with reject RC appropriate for
specific MSP file (34XXX)
53
RTP Conditional Claims
• Claim submitted with:
– MSP VC and 0.00
– No OC 24 and date
• RTP 31303
– OC 24 and date
– No MSP VC and amount
• RTP 31409
54
MSP Updates
Effective January 1, 2016
DDE MSP Claim Submission
• Previously per CR 6426 providers were
not allowed to submit/correct/cancel/adjust
MSP claims via DDE
• CR 8486 Reverses this decision
– Effective January 1, 2016 for claims received
on or after this date
– Implementing January 4, 2016
– Medicare Secondary Payer (MSP) claims may
be submitted/corrected/canceled/adjusted in
DDE
56
Claims Inquiry Screen 3
57
Claims Inquiry Screen 3 – F11
58
Medicare Residual Payment
• CR 9009 Effective January 1, 2016
• Residual secondary payment is due
– Workers’ Compensation Medicare Set-Aside
(WCMSA) or Ongoing Responsibility of Medicals
(ORM) benefits may terminate or deplete during a
beneficiary hospital stay
– Services are payable when covered and reimbursable
by Medicare and one of the following CARCs present
• 27 – Expenses occurred after coverage terminated.
• 35 – Lifetime benefit maximum has been reached.
• 119 – Benefit maximum for this time period, or occurrence,
has been reached.
• 149 – Lifetime benefit maximum has been reached for this
source/benefit category
59
UB-04 Claim Form Locators
Form
Locator
Description
Value Codes Associated
31-34
Occurrence code for ESRD coordination
period or accident date
13,14,15,47
39-41
a-d
Appropriate value code and amount paid by
primary insurance
12,13,14,15,42,43,47
50a
Specific payer code(s) and insurance name(s)
12,13,14,15,42,43,47
58a
Name of policy holder
12,13,14,15,42,43,47
59a
Patient relationship to the insured
12,13,14,15,42,43,47
60
UB-04 Claim Form Locators2
Form
Locator
Description
Value Codes Associated
60a
Health Insurance Claim Number (HICN)
12,13,14,15,42,43,47
61a
Insurance Group Name
12,13,15,43
62a
Insurance Group Number
12,13,14,15,43
65a
Name of employer
12,13,14,15,42,41,43
80
Remarks – Additional information
12,13,14,15,42,43,47
61
Provider Resources
MSP References
• MSP References
– https://med.noridianmedicare.com
• Noridian resources:
– Admission Questions to ask Beneficiaries
– Who Pays First – MSP Decision Tree
– Form Locators Required for Billing MSP
Claims
– Billing MSP electronically
63
Resources
• Coordination of Benefits & Recovery
Overview
– https://www.cms.gov/Medicare/Coordination-ofBenefits-and-Recovery/Coordination-of-Benefitsand-Recovery-Overview/Overview.html
• Medicare Secondary Payer Manual Pub 10005: Chapter 3 – MSP Provider Billing
Requirements
– https://www.cms.gov/Medicare/Coordination-ofBenefits-and-Recovery/Coordination-of-Benefitsand-Recovery-Overview/Overview.html
64
QUESTION AND ANSWER SESSION
ARE THERE ANY QUESTIONS?
THANK YOU FOR ATTENDING
65