Making sense of Medicare denials, ICD-10 codes for common claims

Renee StantzQ: Our practice has received a couple of denials from Medicare that we cannot figure out. They say that the referring provider cannot order or refer. Can you explain what this means? Can we bill the patient?

A: According to MLN Matters SE1305, beginning January 6, 2014, the Centers for Medicare and Medicaid Services (CMS) turned on the Phase 2 ordering/referring denial edits. This means that Medicare will deny Durable Medical Equipment, Prosthetic, Orthotic, and Supplies (DMEPOS) claims if the ordering/referring physician is not identified, not enrolled in Provider Enrollment, Chain, and Ownership System (PECOS), or not of a specialty type that may order/refer the service/item being billed.

Below are the American National Standards Institute (ANSI) denials that will be listed on your Remittance Advice if the ordering/referring provider’s National Provider Identifier (NPI) reported on the claim does not pass the edits:

CO-183: The Referring Provider is not eligible to refer the service billed.

N574: Our records indicate the ordering/referring provider is of a type/specialty that cannot order or refer. Please verify that the claim ordering/referring provider information is accurate or contact the ordering/referring provider.

CO-16: Claim/service lacks information which is needed for adjudication.

N264: Missing/incomplete/invalid ordering provider name.

N265: Missing/incomplete/invalid ordering provider primary identifier.

N575: Mismatch between the submitted ordering/referring provider name and records.

Make sure the qualifier in the electronic claim 2420E NM102 loop is a one (person). Organizations (qualifier two) cannot order/refer.

Can’t bill patient

In response to your second question, SE1305 reads, “Claims from billing providers and suppliers that are denied because they failed the ordering/referring edit will not expose a Medicare beneficiary to liability. Therefore, an Advance Beneficiary Notice (ABN) is not appropriate in this situation.”

Q: We have learned to check our Medicare carrier’s Local Coverage Determinations to see what diagnoses codes we can bill with procedures. How are we going to know what ICD-10 codes will work on our claims?

A: I’m so glad to hear you thinking ahead and following the Local Coverage Determinations (LCDs) for direction. In a MLN Matters® article (Number MM8348) effective October 7, 2013, the Centers for Medicare and Medicaid Services (CMS) announced that all Internal Classification of Diseases, Tenth Revision (ICD-10) LCDs and associated ICD-10 articles will be revised no later than April 10, 2014. This will give your office plenty of time to research and understand the revised articles that apply to the procedures your office performs.

These LCDs and articles will receive a new LCD or article ID number; however, they will not be considered new policies because only revisions were made, leaving the intent of the coverage/non-coverage unchanged. 

The MLN Matters® article also states that those LCDs and articles that don’t contain ICD-10 information, or articles not attached to an LCD, will be published on the Medicare Coverage Database (MCD) no later than September 4, 2014.

Keep an eye out for these LCDs and articles, so your office will be on top of the changes prior to the ICD-10 conversion on October 1, 2014. 

To read the full MLN Article, go to MLN Matters® Article MM8348.

Q: When we transition to ICD-10, how are we going to bill them on our claims since they only allow for diagnosis codes up to five digits?

A: The Centers for Medicare and Medicaid Services (CMS) and the Office of Management and Budget has approved an update to the CMS-1500 form, officially designated as “version 12/12,” which can be used starting January 2014.

Physicians will see two significant changes on the new form.  Version 02/12 will give physicians the ability to:

• Identify whether they are using ICD-9-CM or ICD-10-CM codes, which will be very important during the transition period, and

• Use up to twelve codes in the diagnosis field (the current limit is four).

According to MLN Matters® MM8509 released on December 27, 2013, the new form will be effective with claims received on or after April 1, 2014. However, there is a phase-in period.

CMS' timeline for implementation is as follows:

• January 6, 2014: Medicare begins receiving and processing paper claims submitted on the revised CMS 1500 claim form (02/12)

• January 6-March 31, 2014: Dual use period when Medicare receives and processes paper claims submitted on the old (08/05) and new (02/12) CMS 1500 claim forms

• April 1, 2014: Medicare receives and processes paper claims submitted only on the revised CMS 1500 claim form (02/12).

It’s important to note that if you are submitting your claims electronically, talk with your software vendors about their timelines for updating practice management system and Electronic Health Records systems to accommodate use of the new form.

The answers to readers' questions were provided by Renee Stantz, a billing and coding consultant with VEI Consulting Services in Indianapolis, Indiana. Send your practice management questions to medec@advanstar.com.