Manual Medical Review Process for Therapy Claims
Medicare Part B Services
A manual medical review process for Medicare Part B therapy services that exceed a $3,700 threshold was mandated by the "Middle Class Tax Relief and Job Creation Act of 2012" and extended for services in 2013 by the "American Taxpayer Relief Act of 2012."
On March 21, 2013, CMS released their long-term solution to meeting the mandated requirements for the manual medical review process. The mandate requires any therapy claims for combined speech-language pathology and physical therapy that reach $3,700 to be reviewed for medical necessity. The $3,700 threshold includes the total allowed charges for services furnished by independent practitioners and all institutional services under Medicare Part B (i.e., hospital outpatient departments, skilled nursing facilities, critical access hospitals).
The manual medical review applies to all Part B outpatient therapy settings for services after January 1, 2103, including:
- Private practice—therapy and/or physician offices
- Part B skilled nursing facility care
- Home Health agencies (Type of Bill 34X)
- Outpatient Rehabilitation Facilities
- Comprehensive Outpatient Rehabilitation Facilities
- Hospital Outpatient Departments, excluding all Critical Access Hospitals, but including:
- Type of Bill 12X or 13 X
- Revenue codes 042X, 043X, or 044X
- Services with the modifiers –GN, -GO, and –GP
The 2013 legislation also extended the use of an Advanced Beneficiary Notice (ABN), and though CMS has not issued additional guidance, speech-language pathologists should consider providing their clients with an ABN if they believe the service may not meet Medicare coverage criteria for medical necessity. An ABN clarifies liability for payment if the prepayment review results in a denial for not meeting Medicare coverage criteria.
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The preapproval process implemented in 2012 no longer applies. For services rendered between January 1, 2013, and March 31, 2013, the Medicare Administrative Contractors (MACs) will conduct prepayment review on claims that have reached the $3,700 threshold. CMS requested MACs conduct these manual medical reviews within 10 days
For services rendered on or after April 1, 2013, Medicare Recovery Audit Contractors (RACs) will conduct the medical reviews. Reviews have been divided by state into two categories:
- Prepayment Review: For claims submitted from Florida, California, Michigan, Texas, New York, Louisiana, Illinois, Pennsylvania, Ohio, North Carolina, and Missouri.
- Postpayment Review: For claims submitted from the remaining states not listed above.
- Claims submitted from Florida, California, Michigan, Texas, New York, Louisiana, Illinois, Pennsylvania, Ohio, North Carolina, and Missouri will be classified under the "Recovery Audit Prepayment Review Demonstration" and automatically undergo prepayment review. Prepayment review occurs when services have been rendered, claims are submitted, but the claim is stopped prior to adjudication for review.
- The MAC will send an Additional Document Request (ADR) to the provider requesting that the documentation be sent to the Recovery Auditor. The process for submitting the documentation is to be determined by the MAC and the Recovery Auditor.
- The Recovery Auditor will conduct prepayment review within 10 business days of receiving the additional documentation and will notify the MAC of the payment decision.
- Prepayment review of claims always results in an "initial determination'' and is assessed on the current claim. Once the status has been determined (i.e., services were or were not reasonable and necessary), the claim will be processed.
- Claims submitted from the remaining states not listed above will undergo an immediate postpayment review by the Recovery Auditors.
- Postpayment review occurs when the services have been rendered, claims are submitted, the claim is adjudicated for payment, and the claim is paid.
- The MAC will flag the claims that meet $3,700 threshold and then send an Additional Document Request (ADR) to the provider requesting that the documentation be sent to the Recovery Auditor. The process for submitting the documentation is to be determined by the MAC and the Recovery Auditor.
- The Recovery Auditor will conduct postpayment review and will notify the MAC of the payment decision. CMS did not indicate a timeframe for notification to the provider.
- Postpayment may result in no change to the initial payment to the provider or may result in a "revised determination" that would require the provider to pay back monies for services determined to be "not reasonable or necessary." The provider will be notified of any payment determination, and if necessary, be given the options of
- paying back funds by check,
- recoupment from future payments,
- applying for an extended payment plan, or
- appealing the decision.
For more information, please contact ASHA's health care economics and advocacy team at firstname.lastname@example.org.