Hugh Aaron's Medicare Weekly Update  | HCPro

In this issue - May 06, 2008

  1. Note from Hugh

  2. CMS Regulations

  3. CMS Transmittals and MLN Matters articles

  4. Other CMS and OIG Issuances

  5. CMS Public Events this Week

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Hugh Aaron's Medicare Weekly Update
May 06, 2008
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Welcome to Hugh Aaron's Medicare Weekly Update!

This e-zine provides a weekly update for healthcare coding, billing, and compliance professionals who must stay current on government regulations and guidance relating to Medicare coverage, billing, and payment for inpatient and outpatient hospital services.

Today's issue covers regulatory developments released last week.

I hope that you find this publication a valuable resource. Feel free to forward this newsletter to your clients, colleagues, and peers.


Note from Hugh

As discussed below, CMS issued a transmittal (Change Request 5860) last week providing billing instructions for implantable devices furnished to inpatients where the hospital received the device at no cost or received a full or partial credit for the device due to a recall or premature failure of the device. These instructions relate to a new regulation (42 CFR 412.89) that CMS implemented as part of the 2008 IPPS final rule. Under this new regulation, for certain MS-DRGs involving implantable devices, hospitals receive a payment reduction if the hospital received the implanted device at no cost or if the hospital received a full or partial credit for the device due to a recall or premature failure of the device.

Under the regulation, the mechanics of the payment reduction are quite simple. The FIs and MACs simply subtract the cost of the device (for devices received at no cost to the hospital) or the amount of the credit (where the hospital received full or partial credit for the device) from the amount that would have otherwise been payable under IPPS.  

The problem is that, until the new transmittal was issued last week, it was unclear how hospitals were supposed to communicate the cost of the replaced device or the amount of the credit to the FIs and MACs. The good news is that the transmittal answersthis question. The transmittal instructs hospitals to report the cost of the device or the amount of the credit using value code “FD.”

Operationally, this will be a challenge for most hospitals. Hospitals will have to develop a process to ensure that devices received at no cost or for credit are identified and that the cost of the device or the amount of the credit is included on the claim.

There are a couple of aspects of the transmittal that baffle me. The transmittal states that the payment reduction is effective for discharges on or after July 1, 2008. This seems inconsistent with the regulation which states that the payment reduction is effective for discharges on or after October 1, 2007. Also, the transmittal’s effective date is October 1, 2008.

Consequently, it is unclear how hospitals are supposed to bill for these cases prior to that date. I have a call into CMS to try and clarify these date issues. If I receive any useful information, I’ll report back in a future issue of Medicare Weekly Update.

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CMS Regulations

Fiscal Year (FY) 2009 Inpatient Prospective Payment System (IPPS) proposed rule published in Federal Register

On April 30, the FY 2009 IPPS proposed rule was published in the Federal Register. As reported in the April 22 issue of Medicare Weekly Update, CMS had previously posted a display copy of the rule on the CMS Web site.

View the 2009 IPPS proposed rule.

To comment on the rule, click here.

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CMS Transmittals and MLN Matters articles

CMS issues updated billing instructions for blood and blood products

On May 2, CMS issued a transmittal announcing updated billing instructions for blood and blood products.

Effective date: October 1, 2008
Implementation date: October 6, 2008

View the transmittal.

CMS issues instructions for billing replaced devices under the IPPS that are received without cost or with a credit

On May 2, CMS issued a transmittal announcing billing instructions for replaced devices under the IPPS that are received without cost or with a credit. See “Note from Hugh” above for a discussion of this transmittal.

Effective date: October 1, 2008
Implementation date: October 6, 2008

View the transmittal.

CMS issues update to cost reporting forms and instructions

On May 2, CMS issued a transmittal announcing an update to cost reporting forms and instructions in chapter 36 of the Provider Reimbursement Manual.

View the transmittal.

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Other CMS and OIG Issuances

CMS issues final decision memo on artificial hearts

On May 2, CMS posted a final decision memo on coverage of artificial hearts. CMS determined that evidence is inadequate to conclude that the use of an artificial heart is reasonable and necessary, but will cover artificial hearts under coverage with evidence development when beneficiaries are enrolled in a clinical study.

View the final decision memo.

View a related press release.

CMS issues final decision memo on screening DNA stool tests for colorectal cancer

On April 28, CMS issued a final decision memo on screening DNA stool tests for colorectal cancer. CMS is not expanding the colorectal cancer screening benefit to include coverage of this test.

View the final decision memo.

CMS issues fact sheet on interim final rule with comment implementing Medicare, Medicaid, and SCHIP Extension Act of 2007 changes to the Long Term Care Hospital (LTCH) prospective payment system (PPS)

On May 1, CMS issued a fact sheet announcing an interim final rule with comment implementing Medicare, Medicaid, and SCHIP Extension Act of 2007 changes to the LTCH PPS.

View the fact sheet.

View a related press release.

OIG issues report reviewing high-dollar payments for Part A inpatient claims processed by TriSpan Health Services

On April 28, the OIG issued a report reviewing high-dollar payments for inpatient claims processed by TriSpan Health Services between January 1, 2003, and December 31, 2003. The OIG determined that of 38 payments of $200,000 or more, providers were incorrectly paid for 20 claims.

View the OIG report.

OIG issues report reviewing high-dollar payments for Part A outpatient claims processed by TriSpan Health Services

On May 2, the OIG issued a report reviewing high-dollar payments for outpatient claims processed by TriSpan Health Services between January 1, 2003, and December 31, 2003. The OIG determined that none of the four high-dollar payments ($50,000 or more) were appropriate, resulting in $227,547 in overpayments.

View the OIG report.

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CMS Public Events this Week

CMS has no public events scheduled for this week.

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You don’t have to be a lawyer, but you have to know the laws.
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For more information or to order, visit HCPro's Healthcare Marketplace, or call the Customer Service Department at 800/650-6787 and mention Source Code EZINEAD.


        



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NEED TO CONTACT US?

Brian Murphy
Senior Managing Editor
bmurphy@hcpro.com

Editor's note: HCPro welcomes comments from readers of the Medicare Weekly Update. While Mr. Aaron is unable to answer individual questions, questions from readers will be considered for possible inclusion in the "Note from Hugh" section of future editions of the Medicare Weekly Update or in the Q&A sections of other HCPro publications and Web sites (in which case, you will receive a copy of the Q&A prior to or upon publication).



HUGH AARON'S MEDICARE WEEKLY UPDATE

Volume 2 Issue 18

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