2024 Medicare Coding Guide: Part 1 - Traditional Medicare

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Part 1: Traditional Medicare

Use internal billing edits to reduce denials

With nearly 67 million people enrolled in traditional Medicare, it’s not surprising that 98% of physicians are participating providers. However, participation doesn’t guarantee payment for services rendered. As with any payer, there are countless rules to follow, and one misstep can cause denials that greatly impact net revenue. Fortunately, there are ways to proactively mitigate the risk of traditional Medicare denials.

“Medicare denials are inevitable. The key to getting ahead of them is having visibility into why they’re denied,” says Toni Elhoms, CCS, CPC, CPMA, CRC, CEO at Alpha Coding Experts in Orlando, Florida.

Practices should pay close attention to denial trends that emerge, says Richelle Marting, JD, MHSA, RHIA, CPC, an attorney at Marting Law in Olathe, Kansas. For example, do denials frequently relate to certain procedure codes? Diagnosis codes? Physicians? “This information can help you dig further so you can prevent denials from recurring,” she says.

What is the best way, generally speaking, to prevent denials?

Leverage edits in your billing system, says Lisa Calderon, a revenue cycle management consultant in Titusville, Florida. Providers can write rules for certain places of service, Current Procedural Terminology (CPT) codes, providers and other filters to stop claims for internal review before sending them to the payer, she explains. “The minute you see trends, if you’re constantly resubmitting claims, you immediately write a rule,” she says.

In this article, experts identify the most common traditional Medicare denials and explain how physicians can leverage technology features and process improvement strategies to reduce them.

Errors related to eligibility and benefits

Incorrect patient ID numbers are one of the most common errors that can lead to a traditional Medicare denial.

“This is a big problem because Medicare arbitrarily assigns new patient ID numbers without notice,” Calderon says. “Patients often don’t realize there was a change until they get your bill and need to figure it out.”

Looking at the ID number on the physical Medicare card is critical, Elhoms says. “These are avoidable denials if you have really solid front-end workflows and processes in place,” she adds.

However, even with training, staff may make mistakes. Though it won’t prevent every error, one way to increase data integrity is to write a rule in the billing system that automatically prevents claim submission when the traditional Medicare number doesn’t comply with the correct alphanumeric sequence requirements, Calderon says.

Another eligibility- and benefit-related denial occurs when practices bill traditional Medicare without realizing patients have coverage under a Medicare Advantage plan instead, says Julie Sylvestre, FACMPE, president and owner of Grey Ledge Medical Management in Smithfield, Rhode Island. “If a patient has only Medicare, you should dig deeper into the eligibility to see if there’s actually an active Medicare Advantage plan as well, so you avoid timely filing denials,” she adds.

Denials related to Medicare as a secondary payer are also problematic, Elhoms says. Front-end staff must understand when the Medicare program does not have primary payment responsibility, and they must be able to ask questions (e.g., “Is the injury related to a car accident or is it work-related?”) to prevent coordination of benefits denials.

Duplicate claims

Duplicate claims (i.e., claims with the same medical codes and dates of service) are a large source of billing-related denials, Elhoms says. “This can happen if you send claims in batches. Medicare will deny both claims that appear to be duplicates,” she adds. “The best way to avoid this is to set up edits in your billing system to flag these claims prior to submission.”

Invalid, outdated medical codes

October 1 and January 1 each year are the effective dates for new, revised and deleted International Statistical Classification of Diseases (ICD), Tenth Revision, diagnosis codes and CPT procedure codes, respectively. There are also the Centers for Medicare & Medicaid Services for Healthcare Common Procedure Coding System Level II quarterly coding updates, and there may be ICD-10 Clinical Modification diagnosis code changes each April as well. With these annual changes comes the potential for denials,
Marting says.

“Watching these lists and making sure the codes get updated in your system is a great way to avoid denials that are low-hanging fruit for payers,” she explains. “You can prevent these denials and expedite payment if you work with your billing vendor to update your system proactively.”

Wrong national drug code

Traditional Medicare denials frequently occur when staff report the wrong national drug code (NDC) with a CPT code for an injectable, says Elhoms, who provides this advice: “Evaluate your workflow with drug intake and make sure there’s a process for capturing the correct NDC numbers. Manufacturers also put this information on their websites, but the best place is the actual drug. If you’re not scanning it into your practice management system, you need to be very careful with manual entry.”

Wrong billing modifier

Although Medicare accepts modifier -59 (distinct procedural service), Elhoms says providers should only use it when no other, more specific modifier is available. In many cases, your Medicare administrative contractor may want to see an X modifier (i.e., XE, XS, XP or XU) instead, she adds.

Another potential denial to keep in mind pertains to new code G2211 (evaluation and management [E/M] complexity add-on service) that took effect on January 1, 2024. Elhoms says denials will occur when the same physician or nonphysician practitioner reports G2211 on the same date of service as another outpatient office visit E/M visit (i.e., codes 99202-99205, 99211-99215) with modifier 25. For example, Medicare will deny the claim when the same physician reports an injection, E/M code 99213 with modifier -25 and G2211. The best way to avoid the denial is to create an edit/rule in the billing system to prevent staff from billing G2211 any time an E/M code with modifier -25 is also present, she adds.

Lack of medical necessity

Medical necessity denials may occur with certain laboratory tests (e.g., tests for vitamin D, vitamin B12 and prostate-specific antigens) or procedures (e.g., trigger point injections or joint injections). The best way to prevent them is to comply with local coverage determinations and national coverage determinations, Marting says.

“I always tell providers a denial due to lack of medical necessity doesn’t mean that you’re recommending or ordering medically inappropriate treatment,” she adds. “It’s usually a coverage rule that Medicare has, and we haven’t prepared our claim to demonstrate we meet that rule.”

In cases of Medicare noncoverage, practices should obtain an Advance Beneficiary Notice to alert patients that they may be responsible for the bill, Marting says.

Human error can also play a role in medical necessity denials. Marting recalls working with a practice where a medical coder routinely transposed numbers in a diagnosis code by accident. The result? The practice routinely sent erroneous medical claims for a lipid profile with a diagnosis code of an ear infection instead of high cholesterol.

“The denial prompted us to do some investigation, perform a root cause analysis and then go work on a prevention effort,” Marting says. “We created an alert that would not let a claim go out the door when that transposed diagnosis code was connected with a lipid profile. We were able to reduce our lipid profile denials for Medicare by 85%. You can apply this same concept to a lot of the common lab tests you perform in your office. You can look at Medicare’s coverage criteria and create edits or alerts for noncovered diagnoses to stop that claim for review.”