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Provider Alerts

Provider Consulting Solutions (PCS) would like to offer you the following alerts and updates on issues that may have a large impact on your staff and facility.

Ambulatory Patient Groups

The New York State budget agreement for fiscal year 2008-2009 mandated a shift in New York State Medicaid reimbursement methodology to a prospective payment system (PPS). The NYS DOH selected Ambulatory Patient Groups (APGs) as the new payment methodology for Medicaid outpatient services. The implementation of APGs is the first major change to the New York Medicaid outpatient reimbursement methodology in over 20 years. Hospitals will need to make significant changes to their billing and receivables management systems for outpatient Medicaid services. To see how PCS is uniquely equipped to help your organization, click here.

Medicare Severity - Diagnosis Related Groups(MS-DRGs)

In October 2007, the Medicare Inpatient Prospective Payment System (IPPS) adopted changes in the Diagnosis Related Group (DRG) grouper logic to better reflect severity of illness, complexity of service and resource utilization. The Medicare-Severity DRG (MS-DRG) changes include an extensive revision to the list of diagnoses that are considered complications and comorbidities (CC). Two separate lists now identify Major Complications and Comorbidities (MMC) and "regular" CCs. The number of DRGs has increased to 745 MS-DRGs from 538.

Hospital Case-Mix changes will be influenced by the degree to which hospitals and professional staff understand the heightened importance of documentation and coding for MS-DRGs. Medicare reduced DRG rates in FY2008, and plans greater reductions in the future; the rate reduction is intended to compensate for case mix increases resulting from improved coding. Medicare's assumption may not reflect what's happening in your HIM Department. PCS can tailor educational services for your facility based on a review of your records and coding. Let our experienced consultants help your Hospital rise to the challenge posed by MS-DRGs.

Retraction of Recent Change to Rules for Reporting Angioplasty, Atherectomy and Stenting of the Same Peripheral Vessel

Centers for Medicare and Medicaid Services (CMS) has retracted the change found in the October 2007 edition of the National Correct Coding Initiative (NCCI) Policy Manual which impacted the reporting of therapeutic vascular procedures in the same peripheral vessel (Chapter 5, section 16 of the NCCI Policy Manual Version 13.3).

In summary, the revised policy stated that when multiple therapeutic procedures (i.e., angioplasty, atherectomy, stent placement) are performed in a single vessel only the most successful may be reported.

Due to tremendous backlash from hospitals, providers and professional organizations, NCCI will revert back to the following text, originally published in 1996, (see Chapter 5, section D-16 of the NCCI Policy Manual Version 14.3). The change will be retroactive to claims with dates of service on or after October 1, 2007.

"When percutaneous angioplasty of a vascular lesion is followed at the same session by a percutaneous or open atherectomy, generally due to insufficient improvement in vascular flow with angioplasty alone, only the most comprehensive atherectomy that was performed (generally the open procedure) is reported (see sequential procedure policy, Chapter I, Section M)."

It is now appropriate to report both angioplasty (or atherectomy) and stenting of the same vessel when the documentation supports that the stent was required due to sub-optimal angioplasty (or atherectomy) results. However, as before, when both an angioplasty and an atherectomy are performed on the same vessel, then only the atherectomy may be reported.

Hospitals should be aware of these changes and make modifications accordingly.

RAC Contractor Announcement...And the RAC Contractors are...
  • Diversified Collection Services, Inc. of Livermore, California, in Region A, initially working in Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and New York.
  • CGI Technologies and Solutions, Inc. of Fairfax, Virginia, in Region B, initially working in Michigan, Indiana and Minnesota.
  • Connolly Consulting Associates, Inc. of Wilton, Connecticut, in Region C, initially working in South Carolina, Florida, Colorado and New Mexico.
  • HealthDataInsights, Inc. of Las Vegas, Nevada, in Region D, initially working in Montana, Wyoming, North Dakota, South Dakota, Utah and Arizona.

Be prepared. RAC audits are scheduled to begin in the next several months. PCS can give you a comprehensive compliance profile. Our RAC risk assessment reports and claim identification encompass the New York, California and Florida demonstration experience. Additionally, these reports focus on possible future RAC risk areas.

Contact PCS today to quantify your RAC financial exposure.

RAC Edit Publication - Medicare Medically Unbelievable Edit (MUE)

Within the Outpatient setting, billed services are currently reviewed against Medically Unbelievable Edits (MUE). MUEs are applied to billed HCPCS and, if flagged, the claim is returned to the provider (RTPd). Hospitals have reported varying degrees to which they can determine whether the RTPd claim was attributable to an MUE edit. And sometimes, where MUE was determined, the MUE result has been questioned. To minimize the risk of fraud and potential gaming by the billing provider, the RTPd claim is not available for appeal and the specific MUE unit was not made available to the public. The hospital is left to request a reconsideration of the MUE value by contacting the National Correct Coding Initiative*.

In this setting, hospitals have been forced to write off untold revenue; the ambiguity to billing regulations has caused frustration in the hospital community. This is about to change.

Effective October 1, 2008, CMS made public a set of existing MUEs on the CMS website at At this time, CMS will only publicize HCPCS and unit pairs with MUE values of less than three (3). Due to ongoing concerns related to fraud and abuse, some lower value MUEs and MUEs with values greater than three (3) still remain elusive. CMS anticipates updating the MUE values on a quarterly basis and potentially increasing the threshold for publication. Edits will also be available through NTIS in the future.

Contact PCS to implement the MUE thresholds and help you correct your billings going forward.

*National Correct Coding Initiative - Correct Coding Solutions, LLC - Fax: (317) 571-1745

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