Email not displaying correctly? View it in your browser. Issue #18 — December 28, 2011
AAPC BillingInsider e-Newsletter

F R O M   T H E   F I E L D

5010 Deadline Four Days Away, Discretion Period or Not

It's no surprise (unless you've been on the moon) that the new 5010 documentation standard becomes effective Jan. 1, 2012. Any relief offered by a Centers for Medicare & Medicaid Services (CMS) decision to impose a discretion period via contracted payers ending March 31st doesn't let billers off the hook. Compliance for implementation remains January 1.

Here is what CMS is saying:

"Medicare FFS has experienced significant increases in 5010 production transactions during the last few months. Submitters have tested, but have not taken the step to move into production for 5010 and D.0. In addition, many submitters have not yet initiated testing with their Medicare administrative contractor (MAC). To ensure progress continues to be made, CMS is planning to take the following steps for submitters and receivers of Medicare Part B and durable medical equipment (DME) transactions (submitters and receivers of Medicare Part A transactions will follow the same action plan starting 30 days after Part B and DME).

  • In December 2011, submitters/receivers that have tested and been approved for 5010/D.0 will be notified that they have 30 days to cutover to the 5010/D.0 versions.
  • Submitters/receivers that have not yet tested will be notified in December 2011 that they must submit their transition plan and timeline to their MAC in 30 days.
  • MACs will notify submitters/receivers; and submitters/receivers have the responsibility to notify the providers they service.

"If a complaint is received by CMS after January 1, 2012, the entity against which the complaint has been filed will be evaluated to determine its level of compliance. An assessment will be made of the filed-against entity's efforts to test and become compliant. OESS will take appropriate actions as permitted under the authority of the HIPAA enforcement rule, but will not assess any penalties and/or civil monetary penalties during this 90-day period."

In other words: Failure after Jan. 1 to provide such information as physical addresses, nine-digit ZIP codes, National Drug Codes (NDC), and other specific information may not delay payment, but it may prompt enforcement down the road. Contact your payer and, if you haven't done so, do a 5010 test.

Check out this part of the CMS website for the latest information about the 5010 standard and the discretion period. In addition to answering frequently asked questions, the federal website has compliance plans and templates for practices, facilities, and payers.

G O O D   T I P S

Prepare Now for Modifier PD
By Barbara J. Cobuzzi, MBA, CPC, CPC-H, CPC-P, CPC-I, CHCC, CENTC

CMS is expanding the "three-day payment window" for outpatient services provided within 72 hours of an inpatient admission. As of July 1, 2012 the payment window will apply to both diagnostic and non-diagnostic services.

Medicare will pay a reduced fee for physicians' services that are clinically related to an inpatient admission, occur within 72 hours of the admission, and are furnished by a physician practice wholly owned or wholly operated by a hospital. The rule applies whether the inpatient and outpatient diagnoses codes are the same or different.

There are two minor exceptions to the three-day window payment rule:

  1. The three-day payment window for non-diagnostic services does not apply to either rural health care (RHC) or federally qualified health care centers (FQHC). These organizations must follow the 72-hour rule for diagnostic services, however, if they are owned or controlled by a hospital.
  2. When the decision for surgery is made within the 72 hours prior to the surgery (i.e., when modifier 57 Decision for surgery is properly applied to an E/M service code), the physician services do receive payment based on non-facility fees.

New HCPCS Level II modifier PD Diagnostic or related non-diagnostic item or service provided in a wholly owned or wholly operated entity to a patient who is admitted as an inpatient within 3 days, or 1 day should be appended to identify claims for related services provided within 72 hours of an inpatient admission. The modifier may be used beginning Jan. 1, and CMS recommends that practices "begin to append the modifier to claims subject to the 3-day payment window at that time."

Claims provided by any physician practice owned or controlled by a hospital will have to be held for at least three days prior to submission: The practice does not want to submit a claim without modifier PD, and then discover that the patient was admitted within 72 hours. The hospital is responsible to notify the practice of related inpatient admissions.

If non-diagnostic services are not clinically related to an inpatient admission within 72 hours, the hospital or wholly owned or wholly operated physician practice should document the reason those services are not clinically related. In such a case, the practice should receive full payment.

For more information, see the November 28, 2011 Federal Register.

F E A T U R E D   S T O R Y

Billing Services Not as Liable
By Ken Camilleis, CPC, CPC-I, CMRS

According to the HIPAA Privacy Rule, covered entities (CEs) such as hospitals, physicians, clearinghouses, and insurance payers are obligated to safeguard protected health information (PHI). The HIPAA Security Rule extends liability of CEs to PHI transmitted in an electronic format (ePHI). HIPAA also defines business associates (BAs) as entities working as "trading partners" with CEs. Medical billing services under this definition are classified as BAs; however, unlike CEs, BAs were initially exempt from HIPAA statutes.

One provision of 2009's American Recovery and Reinvestment Act (ARRA), referred to as Health Information Technology for Economic and Clinical Health (HITECH), contains a stipulation that BAs (e.g., billing companies) are liable for actions under HIPAA, such as breach of PHI/ePHI. This raised a stir among billing agencies as to scope of responsibility under HITECH and whether independent billing services can be cited under the False Claims Act if a client commits fraud.

Outsourcing of the medical billing function is a cost-effective method allowing medical practitioners to focus on the clinical side of medicine while the billing company concentrates on a practice's A/R. The coder is the missing link in the life cycle of the administrative process. Independent billing companies don't always have coders; neither do they have ready access to their clients' medical records. The provider usually employs the coders. The billing company merely serves as a pipeline to the payer and isn't vulnerable to false claim charges. But if the billing company does provide coding services - such as documentation integrity review or code verification - its billers may be liable in the case of an OIG or payer audit.

Under HITECH, if an independent billing company receives PHI, such as on paper registration forms, superbills, and referral forms, it must protect it, to include destroying it with shredders or the use of a certified data destruction company. If the billing service handles ePHI, it must ensure that it has appropriate safeguards as required by the HIPAA Security Rule.

In This Issue
5010 Deadline
Modifier PD
Billing Not as Liable

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