Reimbursement guide for LTV series ventilators ® Table of contents Section I: Reimbursement essentials........................................................................................................................................................................................................ 1 General Medicare information....................................................................................................................................................................................................................... 1 Centers for Medicare and Medicaid (CMS): Regional offices.......................................................................................................................................................................... 2 General information on coding, coverage and payment................................................................................................................................................................................. 3 Section II: Sites of service—home, LTACH and SNF................................................................................................................................................................................ 5 Site of service................................................................................................................................................................................................................................................ 5 Home............................................................................................................................................................................................................................................................ 5 LTACH........................................................................................................................................................................................................................................................... 7 SNF............................................................................................................................................................................................................................................................. 8-9 ® Section III: Coverage, coding and payment for LTV ventilators..........................................................................................................................................................10 Process for utilizing the LTV series ventilators................................................................................................................................................................................................10 Site of service...............................................................................................................................................................................................................................................11 Home...........................................................................................................................................................................................................................................................11 LTACH..........................................................................................................................................................................................................................................................15 SNF...............................................................................................................................................................................................................................................................15 Section IV: Coding verification competitive products...........................................................................................................................................................................17 Coding verification.......................................................................................................................................................................................................................................17 Section V: Accessory coding and payment.............................................................................................................................................................................................18 How are accessories to ventilators coded and paid?.....................................................................................................................................................................................18 Glossary of Medicare terms.....................................................................................................................................................................................................................19 Abbreviations and acronyms...................................................................................................................................................................................................................20 Helpful reimbursement website..............................................................................................................................................................................................................21 i Section I—Reimbursement essentials The practice of medical billing and reimbursement is very complex. Home Medical Equipment (HME), Long-Term Acute Care (LTAC) and Skilled Nursing Facilities (SNF) providers alike must stay abreast of coding changes, develop sound billing practices and provide supporting documentation along every step of the way. To expedite the reimbursement process, all claims should be submitted with the proper information, including initial consultation, history and physical (H&P) and diagnostic findings. Appropriate use of the ICD-9- CM codes and HCPCS Level I and II codes will help minimize denials due to lack of documentation or improper billing. Additionally, providers may elect to routinely contact insurance carriers for pre-authorization prior to providing service. HMEs may check http://www.dmepdac.com for information related to product listings under appropriate HCPCS codes and/or to code search. General Medicare information The Centers for Medicare and Medicaid Services (CMS) is the agency located Part B Medical Insurance: Most people pay a monthly premium for Part B. in Baltimore, Maryland that administers the Medicare and Medicaid programs. Medicare Part B (Medical Insurance) helps cover doctors’ services and outpatient Medicare was enacted under the 1965 Amendments to the Social Security Act. . care. It also covers some other medical services that Part A doesn’t cover, such It was formerly called the Health Care Financing Administration (HCFA). as some of the services of physical and occupational therapists, and some home Medicare is the federal health insurance program for: • People age 65 or older • People under age 65 with certain disabilities • People of all ages with end-stage renal disease (permanent kidney failure requiring dialysis or a kidney transplant) Parts of the Medicare program and coverage healthcare. Part B helps pay for these covered services and supplies when they are medically necessary. Part D Prescription Drug Coverage: Most people will pay a monthly premium for this coverage. Starting January 1, 2006, new Medicare prescription drug coverage was available to everyone with Medicare. Everyone with Medicare can get this coverage that may help lower prescription drug costs and help protect against higher costs in the future. Medicare Prescription Drug Coverage is insurance. Private companies provide the coverage. Beneficiaries choose the drug plan and pay a Part A Hospital Insurance: Most people do not pay a premium for Part A because monthly premium. Like other insurance, if a beneficiary decides not to enroll in . they or a spouse already paid for it through their payroll taxes while working. a drug plan when they are first eligible, they may pay a penalty if they choose to Medicare Part A (Hospital Insurance) helps cover inpatient care in hospitals, including join later. critical access to hospitals and skilled nursing facilities (not custodial or long-term care). It also helps cover hospice care and some home healthcare. Beneficiaries must meet certain conditions to get these benefits. 1 Centers for Medicare and Medicaid (CMS): Regional offices The Centers for Medicare and Medicaid have 10 separate regional offices that provide state-specific information on Medicare, Medicaid and SCHIP programs. Region I: Connecticut, Maine, Massachusetts, New Hampshire, Region VI: Arkansas, Louisiana, New Mexico, Oklahoma and Texas Rhode Island and Vermont. Centers for Medicare & Medicaid Services (CMS): Region VI Centers for Medicare & Medicaid Services (CMS): Region I 1301 Young Street, Suite 714. JFK Federal Building. Dallas, TX 75202. Room 2325. Phone: 214.767.6423 Boston, MA 02203. Region VII: Iowa, Kansas, Missouri and Nebraska Phone: 617.565.1185 Region II: New York and New Jersey Richard Bolling Federal Building, Room 235. Centers for Medicare & Medicaid Services (CMS): Region II 601 East 12th Street. 26 Federal Plaza, 38th Floor. Kansas City, MO 64106. New York, NY 10278. Phone: 816.426.5233 Phone: 212.264.3657 Region VIII: Colorado, Montana, North Dakota, South Dakota, Utah Region III: Delaware, Maryland, Pennsylvania, Virginia, West Virginia and Wyoming. and the District of Columbia. Centers for Medicare & Medicaid Services (CMS): Region VIII Centers for Medicare & Medicaid Services (CMS): Region III Colorado State Bank Building. Public Ledger Building, Suite 216. 1600 Broadway, Suite 700. 150 South Independence Mall West. Denver, CO 80202. Philadelphia, PA 19106. Phone: 303.844.2111 Phone: 215.861.4140 Region IX: Arizona, California, Hawaii and Nevada Region IV: Alabama, North Carolina, South Carolina, Florida, Georgia, Centers for Medicare & Medicaid Services (CMS): Region IX Kentucky, Mississippi and Tennessee. 75 Hawthorne St., Suite 408. Centers for Medicare & Medicaid Services (CMS): Region IV San Francisco, CA 94105. Atlanta Federal Center. Phone: 415.744.3501 61 Forsyth Street, S.W., Suite 4T20. Atlanta, GA 30303-8909. Phone: 404.562.7500 2 Centers for Medicare & Medicaid Services (CMS): Region VII Region X: Alaska, Idaho, Oregon and Washington Centers for Medicare & Medicaid Services (CMS): Region X 2201 Sixth Avenue, Suite 911. Region V: Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin Seattle, WA 98121. Centers for Medicare & Medicaid Services (CMS): Region V Phone: 206.615.2306. 233 North Michigan Avenue, Suite 600. . Chicago, IL 60601. More information on the individual regional offices can be obtained from Phone: 312.886.6432 the Centers for Medicare and Medicaid website at http://www.cms.gov. Medicare Administrative Contractors (MACs) – May be standalone or bundled These are private insurers under contract with CMS for provider/supplier enrollment, – May be driven by breakthrough or existing technologies claims payment and appeals. There are two different entities: General information about coding • A/B MACs are transitioning from Fiscal Intermediaries and Part B Carriers and The Healthcare Common Procedural Coding System (HCPCS) provides a standardized cover 15 distinct areas. • DME MACS cover four distinct regions and process Durable Medical Equipment (DME) products and supplies (more details under Site of service: Home). The beneficiary’s residence determines which DME MAC processes the claim. system for billing Medicare for drugs, devices or procedures. HCPCS consists of: • Level I Current Procedure Terminology (CPT) codes • Level II national codes General information regarding coding, coverage and payment Definitions: Coverage: Terms and conditions for payment Coding: Unique identifiers for diagnoses, procedures, devices & diagnostics, HCPCS codes must be used when billing Medicare carriers and, in some states, when billing Medicaid carriers. Due to HIPAA, HCPCS codes are the national code set and used by all insurance carriers. Level I codes: HCPCS mainly consists of CPT codes. These five-digit codes provide a standardized means of reporting services or procedures performed by a physician. inpatient services and outpatient services Level II codes: Codes describe drugs and devices and those services not covered in Payment: Remuneration by health insurance plans, government-funded programs Level I. Most DME products, including those used for ventilators, are billed with a The difference between these concepts • Coverage – Is not guaranteed when you receive FDA approval/clearance – Does not guarantee a new or favorable billing code – Does not guarantee favorable reimbursement • Coding – Links coverage and payment – Does not guarantee coverage – Does not guarantee favorable reimbursement Level II code. What are the Place of Service (POS)/Site of Service (SOS) codes? • HIPAA qualified Medicare as a covered entity and thus, as a covered entity, must use the place of service (POS) codes from the National POS code set for processing its electronically submitted claims. • POS has a payment rate designation of F for facility and NF . for nonfacility. How does the SOS payment policy affect provider payments? • Providers billing professional services are paid at one of two maximum allowable fees, depending on where the service is performed. • Payment – Function of coverage and coding – May be subject to limits 3 General information about coverage Overview Medicare provides coverage for items and services for more than 43 million beneficiaries. The vast majority of coverage is provided on a local level and developed by medical directors and the contractors that pay Medicare claims. In some cases, Medicare deems it appropriate to develop a National Coverage product is being used. Each site of service will be discussed in the respective sections of this manual. How are the payment amounts for CPT Level I codes established for professional services performed in facility and non-facility settings? • Based on the Resource-Based Relative Value Scale (RBRVS) methodology, . Determination (NCD) for an item or service to be applied on a national basis for . CPT fee schedule amounts are established using three relative value unit . all Medicare beneficiaries meeting the criteria for coverage. (RVU) components: Medicare coverage is limited to items and services that are reasonable and necessary 1. Work for the diagnosis or treatment of an illness or injury (and within the scope of a 2. Practice expense Medicare benefit category). National coverage determinations (NCDs) are made 3. Malpractice expense through an evidence-based process, with opportunities for public participation. In some cases, CMS’ own research is supplemented by an outside technology • Two levels of practice expense components determine the fee schedule amounts assessment and/or consultation with the Medicare Evidence Development & for reimbursing professional services. This may result in two RBRVS maximum Coverage Advisory Committee (MEDCAC). In the absence of a national coverage allowable fees for a procedure code. These are: policy, an item or service may be covered at the discretion of the Medicare contractors based on a local coverage determination (LCD). • Medical necessity: Services or supplies that are proper and needed for the diagnosis or treatment of a medical condition; are provided for the diagnosis, direct care and treatment of a medical condition; meet the standards of good medical practice in the local area and aren’t mainly for the convenience of the patient or physician. Medical necessity is established by answering the “why” question: “Why” does the patient require this therapy/equipment? • Certificate of Medical Necessity (CMN): A form required by Medicare that allows the patient to use certain durable medical equipment prescribed by the physician or one of the physician’s office staff. It documents the “Why does the patient require this equipment” question. General information about payment Each site of service has its own payment structure: • Home • LTACH 4 Therefore, reimbursement for ventilators may vary based on the setting in which the • SNF 1. Facility setting maximum allowable fees (FS fee): Paid when the provider performs the services in a facility setting (e.g., a hospital or ambulatory surgery center). The cost of the resources are the responsibility of the facility. 2. Non-facility setting maximum allowable fees (NFS fee): Paid when the provider performs the service in a non-facility setting (e.g., office or clinic), and typically bears the cost of resources, such as labor, medical supplies and medical equipment associated with the service performed. • Some services, by nature of their description, are performed only in certain settings and have only one maximum allowable fee per code. Examples of these services include: 1.Evaluation and management (E&M) codes, which specify the site-of-service (SOS) within the description of the procedure codes (e.g., initial hospital care). 2.Major surgical procedures that are generally performed only in hospital settings. Section II—Sites of service—home, LTACH and SNF 1. Site of service: Home Durable Medical Equipment Medicare Administrative Contractors (DMEMACs) In an effort to provide greater efficiency in the Medicare program as it applies to Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS), CMS awarded contracts to four insurance carriers who serve as its contractors, known as Durable Medical Equipment Medicare Administrative Contractors (DME MACs). Among their many responsibilities are processing claims as well as writing local coverage policies for DMEPOS. Each DME MAC covers a specific geographic region of the country, noted below, and only processes Medicare claims for DMEPOS items. CMS has established a very informative section on its website especially for coding, coverage and payment issues related to DMEPOS, http://www.cms.gov/center/dme.asp. You may also get more information by calling 800.MEDICARE (800.633.4227). Jurisdiction A: Connecticut, Delaware, Maine, Massachusetts, New Hampshire, Jurisdiction C: Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, New Jersey, New York, Pennsylvania, Rhode Island, Vermont and Washington, DC. Mississippi, New Mexico, North Carolina, Oklahoma, Puerto Rico, South Carolina, NHIC, Corp. National Heritage Insurance Company Tennessee, Texas, U.S. Virgin Islands, Virginia and West Virginia 75 Sgt. William Terry Drive Cigna Government Services CGS Administrators, LLC Hingham, MA 02043 2 Vantage Way DME Customer Service (IVR): 866.419.9458 Nashville, TN 37202 DME Customer Service: 866.590.6731 DME Customer Service (IVR): 866.238.9650 http://www.medicarenhic.com DME Customer Service: 866.270.4909 Medical Director: Dr. Paul Hughes http://www.cgsmedicare.com Jurisdiction B: Illinois, Indiana, Kentucky, Michigan, Minnesota, Medical Director: Dr. Robert Hoover Ohio and Wisconsin. Jurisdiction D: Alaska, Arizona, California, Hawaii, Idaho, Iowa, Kansas, Missouri, National Government Services, Inc. Montana, Nebraska, Nevada, North Dakota, Oregon, South Dakota, Utah, 8115 Knue Road Washington, Wyoming, American Samoa, Guam and N. Mariana Islands. Indianapolis, IN 46250 Noridian Administrative Services, LLC. DME Customer Service (IVR): 877.299.7900 900 42nd Street South DME Customer Service: 866.590.6727 Fargo, ND 58103-2146 http://www.ngsmedicare.com/ngsmedicare/HomePage.aspx DME Customer Service (IVR): 877.320.0390 or [email protected] Medical Director: Dr. Stacey Brennan DME Contact Center: 866.243.7272 http://www.noridianmedicare.com Medical Director: Dr. Richard Whitten 5 Medicare pricing, data analysis and coding (DME PDAC) Who administers the program? What is the HCPCS review or coding verification process? • Noridian Administrative Services, LLC (NAS) is the insurance company located HCPCS review or coding verification process is the process that allows in Fargo, North Dakota who contracts with CMS to serve as the Pricing, Data Analysis and Coding (PDAC) Contractor. It performs the activities that Palmetto GBA Statistical Analysis DME Regional Carrier (SADMERC) performed prior to August 2008. • Website is http://www.dmepdac.com. What are the functions of the PDAC? manufacturers, distributors and other parties to request a coding decision on a DMEPOS item. A Coding Verification Request form and supporting documentation is submitted to the PDAC staff for review and a decision. Manufacturers use this process to verify that their particular DMEPOS product falls into a particular HCPCS code. The process takes usually 90 days and the PDAC will issue a coding verification letter to the manufacturer stating that its product falls into a particular HCPCS code. The PDAC will then list it with the DMEC program. • Provides data analysis support to the DME Program Safeguard . Contractors (PSCs). • Guides manufacturers and suppliers on the proper use of the HCPCS through product reviews and decisions. • Conducts national pricing functions for DMEPOS services. Available resources • Assists CMS with DMEPOS fee schedules. The PDAC website includes resources to assist manufacturers, distributors and How does the DMEC program on the PDAC website help manufacturers suppliers in coding DMEPOS products and provides information on HCPCS and suppliers? changes. This includes advisory articles, previously published by the Statistical The PDAC supplies a web-based application that provides HCPCS coding In addition, they provide related DME and HCPCS websites and information assistance and national pricing information via searches for HCPCS Level II about the Comprehensive Error Rate Testing program to help prevent coding codes and modifiers, DMEPOS and CMS national fee schedules on its website. errors. All PDAC questions should be directed to: There are four interactive components that work together to provide HCPCS . PDAC Contact Center coding information: http://www.dmepdac.com Analysis DME Regional Carrier (SADMERC), and those published by the PDAC. Toll free: 877.735.1326 • Search by HCPCS information Direct: 701.433.3077 • Search by modifier Fax: 866.209.1236 • Search by fee schedule • Search by DMEPOS product classification list Hours: 8:30 a.m. to 4 p.m. CT Mailing address:Pricing, Data Analysis and Coding, . PO Box 6757, Fargo, ND 58108-6757 Courier address:Pricing, Data Analysis and Coding, 6 900 42nd Street, South Fargo, ND 58108-6757 Coverage in the home care setting Long-term acute care facility structure Coverage for DMEPOS is either governed by a national coverage determination • Level 1 services: Long-term acute care (LTAC) services provided to clients (NCD), which would apply in all states, or by local coverage determinations (LCD). who require more than eight hours of direct skilled nursing care per day. . The national coverage determinations can be found on the CMS website (http:// Level 1 services include one or both of the following: www.cms.gov/medicare-coverage-database). The local coverage determinations can be found on each one of the DME MAC websites listed above and in the Appendix section of this manual. More information about ventilators will be found in Section III of this manual. A national coverage determination (NCD) does exist for ventilators and thus applies to all states. Ventilators: Covered for treatment of neuromuscular diseases, thoracic restrictive - Active ventilator weaning care and any specialized therapy services, such as physical, occupational and speech therapies - Complex medical care that may include: + Care for complex draining wounds + Care for central lines + Multiple medications (intravenous) diseases and chronic respiratory failure consequent to chronic obstructive pulmonary + Frequent assessments and close monitoring disease. Includes both positive and negative pressure types. (See §240.5 of the . + Third degree burns that may involve grafts and/or frequent transfusions NCD Manual.) Payment in the home care setting Medicare payment for DME, prosthetics and orthotics (P&O), parenteral and enteral + Specialized therapy services, such as physical, occupational and . speech therapies • Level 2 services: Long-term acute care (LTAC) services provided to clients who nutrition (PEN), surgical dressings and therapeutic shoes and inserts is equal to 80% require four to eight hours of direct skilled nursing care per day. Level 2 services of the lower of either the actual charge for the item or the fee schedule amount include at least two of the following: calculated for the item, less any unmet deductible. The beneficiary is responsible for 20% of the lower of either the actual charge for the item or the fee schedule amount calculated for the item, plus any unmet deductible. We have included specific payment information regarding ventilators and accessories in Section III of this manual. 2. Site of service: Long-term acute care (LTAC) - Ventilator care for clients who are stable, dependent on a ventilator and have complex medical needs - Care for clients who have: tracheostomies, complex airway management and medical needs, and the potential for decannulation - Specialized therapy services, such as physical, occupational and . speech therapies Medical Assistance Administration (MAA) approved LTAC facilities provide inpatient intensive long-term acute care services to eligible Medical Assistance clients who require the following Level 1 or Level 2 services. 7 LTAC PPS *MAA pays the LTAC facility the LTAC fixed per diem rate in effect at the time the LTAC services are provided, minus the sum of: • Client liability, whether or not collected by the provider • Any amount of coverage from third parties, whether or not collected by the provider, including, but not limited to, coverage from: - Insurers and indemnitors - Other federal or state medical care programs - Payments made to the provider on behalf of the client by individuals or organizations not liable for the client’s financial obligations - Any other contractual or legal entitlement of the client, including, but . covers certain skilled care services that are needed daily on a short-term basis . (up to 100 days). • Skilled care requires the involvement of skilled nursing or rehabilitative staff so . to be certain it is given safely and effectively. Skilled nursing and rehabilitation staff includes: - Registered nurses - Licensed practical and vocational nurses - Physical and occupational therapists - Speech-language pathologists - Audiologists not limited to: Per diem PPS, CB and RUG categories + Crime victims’ compensation The Balanced Budget Act of 1997 mandated the implementation of a per diem + Workers’ compensation prospective payment system (PPS) for SNFs covering all costs (routine, ancillary + Individual or group insurance + Court-ordered dependent support arrangements + The tort liability of any third party *Note: MAA may make annual rate increases to the LTAC fixed per diem rate by using the same inflation factor and date of rate increase that MAA uses for acute care hospital diagnostic-related group (DRG) rates. 3. Site of service: Long-term acute care (LTAC) Skilled nursing facilities structure • Skilled care is healthcare given when skilled nursing or rehabilitation is needed to treat, manage, observe and evaluate care. Examples of skilled care include: intravenous injections and physical therapy. • It is care given in a skilled nursing facility (SNF) by professional staff. - Non-professional staff is not considered skilled care. 8 • Usually people do not stay in a SNF until they are completely recovered. Medicare and capital) related to the services furnished to beneficiaries under Part A of the Medicare program. Major elements of the system include: Rates: Federal rates were set using allowable costs from FY 1995 cost reports. The rates also include an estimate of the cost of services which, prior to July 1, 1998, had been paid under Part B but furnished to SNF residents during a Part A covered stay. FY 1995 costs were updated to FY 1998 by a SNF market basket minus one percentage point for each of fiscal years 1996, 1997 and 1998. Providers that received new provider exemptions in FY 1995 were excluded from the database. Routine cost limit exceptions payments were also excluded. The data was aggregated nationally by urban and rural area to determine standardized federal per diem rates to which case mix and wage adjustments applied. Case mix adjustment: Per diem payments for each admission are case-mix adjusted using a resident classification system (Resource Utilization Groups III or RUG) based on data from resident assessments (Minimum Data Sets or MDS 2.0) and relative weights developed from staff time data. Geographic adjustment: The labor portion of the federal rates is adjusted for Conceptually, SNF CB resembles the bundling requirement for inpatient hospital geographic variation in wages using the hospital wage index. services that has been in effect since the early 1980s, assigning to the facility itself Annual updates: Payment rates are increased each Federal fiscal year using a SNF the Medicare billing responsibility for virtually the entire package of services that a market basket index. facility resident receives, except for certain services that are specifically excluded. Also enacted in the Balanced Budget Act of 1997 (BBA), Public Law 105-33, CB eliminates the potential for duplicative billings for the same service to the Part Section 4432(b), is a Consolidated Billing (CB) requirement for SNFs. Under the CB A fiscal intermediary by the SNF and the Part B carrier by an outside supplier. It requirement, an SNF itself must submit all Medicare claims for the services that its also enhances the SNF’s capacity to meet its existing responsibility to oversee and residents receive (except for specifically excluded services listed below). coordinate the total package of care that each of its residents receives. 9 Section III—Coverage, coding and payment for LTV series ventilators Process for utilizing the LTV series ventilators Create with your customer, the process for determining that the LTV ventilator is the best choice for a particular patient: 1.Develop relationships with the physician, case manager, the DME provider and if possible and of great importance, a caregiver to the patient. a. Generally, steps 1 and 2 occur concurrently. As the ventilator is being presented to the physician and /or RT, the relationship/s necessary to be successful begin. b. Remember to network with the case manager and the patient’s caregiver (this so time invested in training staff and caregivers on the ventilator will be time well-spent. i. If nurses and RTs do not feel comfortable using the ventilator, the discomfort becomes the reason for its lack of success, not the lack of familiarity on the part of the staff. b.Remember, once a patient is discharged on another ventilator, it is a lost opportunity and one not likely to be regained; therefore, getting to the patient prior to their discharge from an institutional setting is a critical step. There are a number of tools available to support the benefits of the LTV ventilator will be the parent when dealing with a child). These individuals will be strong and assist in convincing the physician, case manager and caregiver of the LTV advocates for the LTV ventilator and make powerful arguments to the payer in ventilator’s capabilities. favor of the LTV ventilator. i. Instances exist where payers agreed to pay or provide increased reimbursement simply because the parent was relentless in their pursuit to obtain the best product/value for their child. 2.Have the patient placed on the LTV ventilator while in a subacute care/step down unit to demonstrate the benefits and to have the patient and family acclimate to the ventilator. Have them “get a feel” for the value of the ventilator and thus create a strong desire. 3.Now it is time to have all of the parties involved “buy-in” to the LTV ventilator as the ventilator of choice. The goal is for all parties to recite the ventilator’s benefits for this particular patient. a.Success in demonstrating the features and benefits to the patient, caregiver . and providers will be directly proportional to the amount of time spent familiarizing them with the ventilator and its capabilities. It can be said that . 10 the LTV ventilator is only as good as the weakest person on the night shift, . i. These tools include reprints of clinical articles, reference lists, in-service videos, media kits, etc., but none of these replace the direct interaction with these influencers. ii.If these individuals are not convinced that the LTV ventilator is the ventilator of choice, chances of success in selling the LTV ventilator will be diminished. 4.Once a commitment for the LTV ventilator is obtained, the next step is to establish medical necessity by having/coaching the physician on the medical necessity for the prescription and answering any foreseen issues with reimbursement. The physician needs to write a Certificate of Medical Necessity, which should include information as outlined on the following page: a.The patient’s medical history and respiratory ailment. b.A synopsis of the most recent episode. This is typically the reason why they . are now in the hospital. c.Why they need Pressure Support, Pressure Control and Flow Triggering. Ventilator coding and payment information d.Describe the alternatives or “consequences” if they don’t receive the benefit/s Coding: from the listed feature/s above. These consequences may include: i. A longer and more costly hospital stay E0450 ii.A longer weaning time iii.Risk of a repeated acute episode of a respiratory illness resulting in an E0461 emergency room visit and possible re-admission into the hospital. 5.Determine the appropriate reimbursement code to be used BEFORE the patient . E0463 is discharged. 6.Be prepared to answer several questions and overcome any resistance to why the A9279 patient needs the LTV ventilator. 1. Site of service: Home—the payment process E0464 Volume Control ventilator, without Pressure Support mode, may include Pressure Control mode, used with invasive interface (e.g., tracheostomy tube) Volume Control ventilator, without Pressure Support mode, may include Pressure Control mode, used with noninvasive interface (e.g., mask) Pressure Support ventilator with Volume Control mode, may include Pressure Control mode, used with invasive interface (e.g., tracheostomy tube) Monitoring feature/device, standalone or integrated, any type, includes all accessories, components and electronics, not otherwise classified Pressure Support ventilator with Volume Control mode, may include Pressure Control mode, used with noninvasive interface (e.g., mask) Establishing medical necessity Answer the question, “Why does the patient require a ventilator?” Describe the medical purpose for ventilatory support, such as respiratory insufficiency/failure . Payment: due to [name the disease/s]. Physiologic parameters play a role in medical necessity . The following information is designed to provide guidance on determining the (e.g., ABGs demonstrating before and after results from being placed on the most appropriate code/s to use, provide some guidelines to assist in preparing ventilator, SpO2 readings, NIF, etc.). reimbursement submissions and put forth some examples on a state-by-state basis Ventilator coverage example Positive and negative pressure ventilators are generally covered for treatment of neuromuscular diseases, thoracic restrictive diseases and chronic respiratory failure associated with chronic obstructive pulmonary disease. whereby submissions have been completed. • Medicare - For the most current Medicare fee schedules, please use the HCPCS code search at: http://www.dmepdac.com. • Medicaid - Representative State Medicaid fee schedules can be found on the below table/s. Every effort was given to achieve accuracy in reporting this information as of September 2011. 11 Medicaid reimbursement by state State E0450 E0461 E0463 E0464 Notes Alabama $649.07 $801.64 $1,125.10 Not list Alaska $781.48 $1,002.05 $1,408.30 $1,408.30 Arizona $29.72/day $29.72/day $43.79/day $43.79/day California $649.07 $649.07 $1,125.10 $1,125.10 Colorado $608.08 $774.29 $1,374.39 $1374.39 Florida $756.60 N/A $756.60 $756.60 Medical necessity Georgia $763.62 Not covered $1,125.10 $1,125.10 Prior authorization required Illinois $855.81 $394.33 $855.81 $855.81 Prior authorization required Indiana $770.77 $809.15 $1,135.65 $1,135.65 Kentucky $913.17 Not covered $1,265.74 $1,265.74 Manually priced - MSRP - Manually priced - MSRP - 18% OR provider invoice 18% OR provider invoice submitted amount submitted amount Manually priced - MSRP Louisiana 18% OR provider invoice Not covered submitted amount Maine $792.25 $791.46 $1,253.94 $1,253.94 $1,002.25 (rental 1st 6 mos) $1,002.25 (rental 1st 6 mos) $1,255.19 (rental 1st 6 mos) $1,255.19 (rental 1st 6 mos) $851.91 (7 mos & beyond) $851.91 (7 mos & beyond) $1,476.70 (7 mos & beyond) $1,476.70 (7 mos & beyond) Michigan $843.04 $708.01 $843.04 Manually priced Minnesota $1,001.25 $1,001.25 $1,475.22 $1,475.22 Massachusetts Prior authorization required Prior authorization required: 602.417.4400 Prior authorization required Prior authorization required: Form 10013 Prior authorization required Prior authorization required Out of state providers require prior authorization Yes, web-forms Covered for rental only; they never cap; prior authorization required if both stationary and portable are ordered Mississippi Missouri 12 $680.85 $825.00 and $412.50 for backup vent $680.85 Not covered $1,180.18 $1,180.18 First vent: $1,406.38 Not an approved code in the Second vent: $703.19 State of MO Nebraska $917.44 $1,087.30 $1,466.93 $1,466.93 Ohio $760.00 Not covered $900.00 Not Covered Pennsylvania $778.32 $801.64 $1,181.36 Not Covered South Dakota $859.84 $1,001.25 $1,475.22 $1,475.22 Prior authorization required Prior authorization required at http:// www.dss.mo.gov/mhd/cs/dmeprecert/ pages/dmeprecert.htm Medicaid reimbursement by state (continued) State E0450 E0461 E0463 E0464 Notes Texas $949.79 Not covered $949.79 $1,476.70 Prior authorization required Vermont $8794.5 Manually priced Manually priced Not covered E0461 requires prior authorization Virginia $13,015.34 $13,015.34 $1,284.9 $1,284.9 Washington $851.91 $851.91 $1,476.7 $1,476.7 E0463/E0464 prior authorization required; will pay $425.95 for 2nd backup ventilator Wisconsin $7,123.03 Not covered $8,226.45 $8,226.45 Yes, prior authorization required after 60 days w/ E0450 Frequently asked questions Time and Variable Termination Criteria. (The other is the TBird Legacy. . Why does the LTV ventilator cost more than a conventional ventilator? The I-Vent offers Variable Rise Time, but does not offer Variable . • The LTV ventilator employs the latest technology in a form and function that results in higher manufacturing cost. • There was also a substantial investment in developing this technology and the benefits derived from this equipment are three-fold: - It can assist in reducing the overall cost of caring for the patient since they can be discharged sooner than previously possible. - Depending on the patient’s condition, the LTV ventilator’s features . (e.g., Pressure Support) may reduce the time to wean a patient from a ventilator, resulting in an overall reduction in costs. - The LTV ventilator’s size and weight has been said to increase a patient’s quality of life since the patient and their family members are more mobile. Which ventilator gets prescribed for what medical necessity? • If the medical necessity is for Pressure Support: Termination Criteria). - All of these ventilators are priced in the same range. The PLV and LP series ventilators do not offer Pressure Support. • If the medical necessity is for Pressure Control and Pressure Support: - The LTV 950 and 1150 ventilators offer Pressure Control and Pressure Support with Variable Rise Time and Variable Termination Criteria. - The T Bird Legacy does not offer Pressure Control and the Achieva does not offer Pressure Control with Pressure Support (SIMV). - The I-Vent offers Pressure Support with Pressure Control, but does not provide Variable Termination Criteria. - All of these ventilators are priced competitively among each other. - The PLV and LP series ventilators do not offer Pressure Control or . Pressure Support. - The LTV ventilator is currently one of two commercially available ventilators with 510(k) clearance for the home that offers Pressure Support with Variable Rise 13 • If the medical necessity is for Flow Triggering: Claims for upgrades - All of the LTV ventilators offer flow triggering, except the LTV 800. Two lines should be listed on each claim for an upgrade. Suppliers will need - The T-Bird Legacy and I-Vent also offer flow triggering. to bill their submitted charges for the upgraded item on Line 1 and the full - The Achieva only offers flow triggering when attached to a high-pressure external gas source, which is typically not found in the home. - The PLV and LP series ventilators do not offer flow triggering. What if the physician order is for a Volume ventilator (E0450 or E0461) and all the HME provider has in stock or carries in inventory are Pressure Support (E0463 or E0464) ventilators? amount for the physician order on Line 2. Both line items are to appear on a single claim. Claims for free upgrades When providing a free upgrade to a beneficiary, suppliers should report the appropriate HCPCS code for the non-upgraded item that the physician ordered. A “GL” modifier is attached to the HCPCS code for the physician-ordered item to indicate it is an upgraded item at no additional charge. Suppliers may only • Bill using the upgrade provision with appropriate modifiers. charge for the non-upgraded item on the claim form. In this situation, the • Payment will be granted for the reasonable and necessary therapy/Volume supplier does not bill the HCPCS code that describes the item being provided. ventilator (E0450 or E0461) that the physician prescribed. • In addition, be certain to escalate some example claims through your MAC’s In box 19 of the claim form, or as an attachment to the claim, the supplier must specify the make and model of the upgraded item that was provided customer service process, as this will identify the need for any code and/or and describe why this item is an upgrade. If filing claims electronically, fee schedule rate change/s necessary this information may be entered in the NTE segment/line note on the 837 Background electronic format. Suppliers may use advanced beneficiary notices (ABNs) when providing upgrades. CMS defines an upgrade as an item that is more expensive because the item contains more components or features, or is greater in quantity than what the physician ordered. Items that are simply more expensive, or of “higher quality” than standard items, do not qualify as an upgrade. DME upgrades ABN and claims modifiers Upgrades must be within the range of services that are appropriate for the beneficiary’s medical condition. ABNs may not be used to substitute an item or ABN required Required modifier/s DMAC payment Beneficiary pays for upgrade No GL R&N item only (GL line) No service that does not meet the intended medical purpose of the item originally ordered by the physician. An ABN is not required if the supplier chooses to provide a free upgrade to the beneficiary. When providing a free upgrade, suppliers should not have the beneficiary sign an ABN, because the beneficiary will not be charged more than . the normal deductible and copayment for the non-upgraded item. 3. Supplier provides upgrade for supplier convenience: a. Supplier provides upgrade free of charge to beneficiary GL is added to HCPCS code for item that meets Medicare coverage requirements and demonstrated that this is an upgraded item at no additional charge. 14 R&N = Reasonable and necessary 2. Site of service: LTAC—the payment process • Beginning in FY 2008, CMS adopted the refined severity-adjusted DRGs that were also adopted under the IPPS, that is, the Medicare-Severity-LTC- LTAC fixed per diem rate is the daily rate Medical Assistance Administration DRGs (MS-LTC-DRGs), which continue to be weighted to account for the (MAA) reimburses for LTAC room and board and selected services. Refer to difference in resource use by LTAC patients. prior authorization information for more details about selected services. Payment rate • Payments to LTACs under the LTAC PPS is based on a single standard Federal 3. Site of service: SNF—the payment process Resource Utilization Group (RUG): A ventilator patient example rate for both the inpatient operating and capital-related costs, but not The case-mix adjusted rates for each of the RUG groups can be found in the certain pass-through costs. final rule for the SNF PPS. They are: • The LTAC payment is determined by CMS starting with the standard Federal rate, which is the standard Federal rate for the previous LTAC PPS rate year, updated by the increase factor, and adjusted for outlier payments and budget neutrality. • The standard Federal rate is multiplied by the applicable Medicare severity • SE3: $374 (urban); $364 (rural) • SE2: $318 (urban); $310 (rural) • SE1: $283 (urban); $277 (rural) These do not include the AIDS adjustment or the geographic adjustment. The for long-term care diagnostic related group (MS-LTC-DRG) relative weight to labor portion of the rule is then adjusted for geographic variation using the determine the Federal prospective payment that is paid for each discharge. hospital wage index. Those rates are in the final rule. - Referred to as the unadjusted LTCH-PPS payment. - This amount is then subject to the case-level adjustments and facility-level adjustments for each discharge. • Under the LTAC PPS, patients are classified into distinct diagnostic groups based on clinical characteristics and expected resource needs. The patient classification system groupings under the LTAC PPS are called long-term care diagnosis-related groups (LTC-DRGs). - The LTC-DRGs are the same DRGs used under the hospital inpatient prospective payment system (IPPS), but they have been weighted to reflect the resources required to treat the type of medically complex patients’ characteristic of LTACs. - Relative weights for the LTC-DRGs reflect resource utilization for each diagnosis and account for the variation in cost per discharge. •Under the LTAC PPS, the LTC-DRG relative weights are updated annually for each Federal fiscal year (October 1 through September 30) using the most recently available LTAC claims data. Long-term acute care ventilator facility EXAMPLE LTC – DRG 207 Title Resp system diagnosis w/ vent support 96+ hours Relative weight 2.1381 Average length of stay 34.6 Threshold: Short stay outlier 28.8 LTAC cases 13,299 LTCH-PPS payment $79,268 Note: •The “unadjusted LTCH-PPS payment” is $79,268. •This calculation was derived by multiplying the FY2009 standard Federal rate times the FY2008 relative weight: $39,114 x 2.0266 for this example. •Numbers were extrapolated from Table 3 in the May 9, 2008 LTCH-PPS final rule. 15 Category: Moving on to Medicaid: A ventilator patient example Extensive services: Services that last 14 days: IV feeding or medications, suctioning, Post 100 days of the patient receiving Part A Medicare benefits, coverage . tracheostomy care, ventilator / respirator. (If MDS meets this criteria, but ADL < 7, stops unless another SNF event is identified. Ventilator patients who stay on . then the MDS automatically classifies under Special Care.*) go to Medicaid services and are now considered non-covered by Medicare . ADL = 7 - 18 and are outpatients. End splits: Extensive services count: IV feedings, IV medications, special care, Medicaid payments vary from state-to-state. For example, PA and TN pay a bundled clinically complex, impaired cognition RUG category: SE3, SE2, SE1 PPS/RUG format, so ventilator payment continues to be part of that bundle. The SNF bills and the HME provider rents to the SNF as during the Medicare stay. Some states use the DME HCPCS fee schedule payment for ventilators. Remember, in order to bill Level II HCPCS, a supplier number is required. 16 Section IV—Coding verification competitive products Coding verification for Pressure Support ventilators Manufacturer Product name ™ *HCPCS code/s LTV 900 ventilator LTV 950 ventilator LTV 1000 ventilator TBird® Legacy E0463 (invasive) or E0464 (noninvasive) CareFusion (also under the name of Pulmonetic Systems, Inc. and Viasys Healthcare Respiratory Technologies Group) ReVel ventilator LTV 1200 ventilator LTV 1150 ventilator LTV 1100 ventilator Covidien (also under the name of Nellcor Puritan Bennett— a Tyco Healthcare Company) Puritan Bennett 540 Achieva PS Achieva PSO2 E0463 or E0464 E0463 E0463 GE Healthcare (also under the name of Versamed, Inc.) IVent IVent IVent IVent IVent E0463 or E0464 E0463 or E0464 E0463 or E0464 E0463 E0463 Newport Medical Instruments Newport Newport Newport Newport Philips Respironics Trilogy 200 ventilator Trilogy 100 ventilator PLV continuum ventilator E0463+, A9279 or E0464+ E0463 or E0464 E0463 or E0464 CareFusion LTV 800 laptop ventilator E0450 (invasive) or E0461 (noninvasive) Covidien LP10 volume ventilator E0450 Philips/Respironics LifeCare PLV-100 portable volume ventilator E0450 101 expert model 101 performance model 101 signature model 201-IC 201-IC/AB HT70 family of ventilators HT70M family of ventilators HT50-H ventilator HT50-H1 ventilator E0463 (invasive) or E0464 (noninvasive) *Codes *Descriptors E0450 Volume Control ventilator, without Pressure Support mode, may include Pressure Control mode, used with invasive interface (e.g., tracheostomy tube) E0461 Volume Control ventilator, without Pressure Support mode, may include Pressure Control mode, used with noninvasive interface (e.g., mask) E0463 Pressure Support ventilator with Volume Control mode, may include Pressure Control mode, used with invasive interface (e.g., tracheostomy tube) A9279 Monitoring feature/device, standalone or integrated, any type, includes all accessories, components and electronics, not otherwise classified E0464 Pressure Support ventilator with Volume Control mode, may include Pressure Control mode, used with noninvasive interface (e.g., mask) 17 Section V—Accessory coding and payment How are accessories to ventilators coded and paid? The ventilator codes we have been discussing address positive and negative pressure ventilators used with invasive or noninvasive interfaces. Medicare categorizes ventilators as items requiring frequent and substantial servicing. For items that fall in the payment category of frequent and substantial service, rental payments include payment for supplies and accessories unless specifically noted otherwise. Humidifiers are considered accessories and cannot be billed separately. Additional payment is not made for repair, maintenance or replacement of equipment that requires frequent and substantial service. It is the supplier’s responsibility to make certain there is an emergency plan in place to address mechanical failure of the equipment. Accessories to ventilators may consist of the following items: • Humidifiers • Filters • Batteries, battery cables, battery charger • Breathing circuits Other: • LTM (Lap Top Monitor graphics package) is coded under A9279 - Monitoring feature/device, standalone or integrated, any type, includes all accessories, components and electronics, not otherwise classified 18 Glossary of Medicare terms (CMS) Centers for Medicare and Medicaid Services: The federal agency that runs the Medicare program. In addition, CMS works with the States to run the Medicaid program. CMS works to make sure the beneficiaries in these programs are able to get high quality healthcare. • “Part A” covers the Medicare inpatient hospital, post-hospital skilled nursing facility care, home health services and hospice care. • “Part B” is the supplementary medical insurance benefit (SMIB) covering the Medicare doctor’s services, outpatient hospital care, outpatient physical therapy and speech (DRG) Diagnosis Related Group: A classification system that categorizes hospital pathology services, home healthcare and other health services and supplies not covered patients into clinically coherent and homogenous groups with respect to resource use under Part A of Medicare. (i.e., similar treatments and statistically similar lengths of stay for patients with related medical conditions). Classification of patients is based on the International Classification of Diseases, the presence of a surgical procedure, patient age, presence or absence of significant co-morbidities or complications and other relevant criteria. Medically necessary: A term for describing [a] requested service that is reasonably calculated to prevent, diagnose, correct, cure, alleviate or prevent worsening of conditions in the client that endanger life, or cause suffering or pain, or result in an illness or infirmity, or threaten to cause or aggravate a handicap, or cause physical deformity or malfunction. (HCPCS) Healthcare Common Procedural Coding System: A medical code set that There is no other equally effective, more conservative or substantially less costly course of identifies healthcare procedures, equipment and supplies for claim submission purposes. . treatment available or suitable for the client requesting the service. For some purposes, It has been selected for use in the HIPAA transactions. HCPCS Level I contain numeric . “course of treatment” may include mere observation or, where appropriate, no treatment CPT codes, which are maintained by the AMA. HCPCS Level II contains alphanumeric at all. codes used to identify various items and services that are not included in the CPT medical code set. (LTAC) Long term acute care: Inpatient intensive long-term acute care services provided in MAA-approved LTAC facilities to eligible Medical Assistance clients who require Level . 1 or Level 2 services. LTAC fixed per diem rate: The daily rate MAA reimburses for LTAC room and board and selected services. Non-covered service or charge: A service or charge that is not covered by the Medical Assistance Administration, including, but not limited to, such services or charges as a private room, circumcision and video recording of the procedure. Pricing, data analysis and coding (PDAC): Provides support to the DME Program Safeguard Contractors (PSCs) along with guiding manufacturers and suppliers on the proper use of HCPCS. Ratio of costs-to-charges (RCC): The methodology used to pay hospitals for services Market basket: Described as a fixed-weight index because it answers the question of exempt from the DRG payment method. It also refers to the factor applied to a hospital’s how much more or less it would cost, at a later time, to purchase the same mix of goods allowed charges for medically necessary services to determine payment to the hospital for and services that was purchased in a base period. As such, it measures “pure” price these DRG-exempt services. changes only. A market basket is constructed in three steps. The sum of the products for all cost categories yields the composite index level in the market basket in a given year. Reasonable cost: Fiscal Intermediaries and carriers use CMS guidelines to determine reasonable costs incurred by individual providers in furnishing covered services to enrollees. Medicaid: The state and federally funded Title XIX program under which medical care is Reasonable cost is based on the actual cost of providing such services, including direct provided to persons eligible for the categorically needy program or medically needy program. and indirect cost of providers and excluding any costs that are unnecessary in the efficient Medicare: The federal government health insurance program for certain aged delivery of services covered by the program. or disabled clients under Titles II and XVIII of the Social Security Act. Medicare . has two parts: 19 Abbreviations and acronyms ABN—Advance Beneficiary Notice ICF—Intermediate Care Facility ADMC—Advance Determination of Medicare Coverage ICN—Internal Claim Number ALJ—Administrative Law Judge ICU—Intensive Care Unit BBA—Balanced Budget Act IRP—Inexpensive or Routinely Purchased CMN—Certificate of Medical Necessity LMRP—Local Medical Review Policies CMR—Comprehensive Medical Review MAA—Medical Assistance Administration CMS—Centers for Medicare and Medicaid Services MCM—Medicare Carriers Manual COB—Coordination of Benefit MedPAC—Medicare Payment Advisory Commission COPD—Chronic Obstructive Pulmonary Disease MSN—Medicare Summary Notice CWF—Common Working File MSP—Medicare Secondary Payer DHHS—Department of Health and Human Services NF—Nursing Facility DME—Durable Medical Equipment NH—Nursing Home DMEPOS—Durable Medical Equipment, Prosthetics, Orthotics and Supplies NON-PAR—Non-Participating Provider DRG—Diagnosis Related Groups NOS—Not Otherwise Specified DX—Diagnosis NSC—National Supplier Clearinghouse ECF—Extended Care Facility NSF—National Standard Format EOMB—Explanation of Medicare Benefits OBRA—Omnibus Budget Reconciliation Act ERN—Electronic Remittance Notice OIG—Office of the Inspector General FDA—Food and Drug Administration OPPS—Outpatient Prospective Payment System HCPCS—Healthcare Common Procedure Coding System PA—Prior Authorization HHA—Home Health Agency PAR—Participating Provider HHS—Health and Human Services PIN—Provider Identification Number HICN—Health Insurance Claim Number RA—Remittance Advice HIPAA—Health Insurance Portability and Accountability Act Rx—Prescription HMO—Health Maintenance organization PDAC—Statistical Analysis Durable Medical Equipment Regional Carrier ICD-9-CM—International Classification of Diseases, SNF—Skilled Nursing Facility Clinical Modification, 9th Revision 20 UPIN—Unique Provider Identification Number Helpful Reimbursement Websites Region A MAC: National Heritage Approved Accreditation Agency Contact List http://www.medicarenhic.com/dme/index.shtml http://www.cms.hhs.gov/CompetitiveAcqforDMEPOS/ Region B MAC: AdminaStar Federal Competitive Bidding Implementation Contractor (CBIC) http://www.ngsmedicare.com/ngsmedicare/HomePage.aspx http://www.dmecompetitivebid.com/palmetto/cbic.nsf/DocsCat/Home Region C MAC: Cigna Medicare DMEPOS competitive bidding overview http://www.cignagovernmentservices.com/jc/index.html http://www.cms.hhs.gov/DMEPOSCompetitiveBid/ Region D MAC: Noridian Administrative Services Durable Medical Equipment Code System (DMECS) https://www.noridianmedicare.com/dme/index.html https://www.dmepdac.com/ CMS Durable Medical Equipment Center DMEPOS fee schedule http://www.cms.hhs.gov/center/dme.asp http://www.cms.hhs.gov/DMEPOSFeeSched/LSDMEPOSFEE/list.asp#TopOfPage State Medicaid webpage links http://64.82.65.67/medicaid/states.html DMEPOS Quality Standards http://www.cms.hhs.gov/CompetitiveAcqforDMEPOS/04_New_Quality_ Standards.asp 21 WARNING—U.S. Federal Law restricts this device to sale by or on the order of a physician. CareFusion 22745 Savi Ranch Parkway Yorba Linda, CA 92887 800.231.2466 toll-free 714.283.2228 tel 714.283.8493 fax CareFusion Germany 234 GmbH Leibnizstrasse 7 97204 Hoechberg Germany +49 931 4972-0 tel +49 931 4972-423 fax CareFusion Yorba linda, CA carefusion.com © 2011 CareFusion Corporation or one of its subsidiaries. All rights reserved. LTV is a trademark or registered trademark of CareFusion Corporation or one of its subsidiaries. All other trademarks are property of their respective owners. RC2834 (1111/2500) L3431 Rev. A
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