Appeal type: Inpatient Hospital
Decision: Favorable

We decided that the Plan has to pay for the outpatient hospital services provided from January 1, 2021, to January 2, 2021.
You asked the Plan to pay for the outpatient hospital services. You say that this claim should be paid as the EM service is billed on a claim for the prior year. The claim had to be split as the services were provided over two different years. The Plan denied your request. The Plan says that this claim was rejected due to the OCE edit 57 as it does not meet the requirements to receive a comprehensive APC payment.
The Plan must follow Medicare rules. The rules say that Medicare health plans must make reasonable and diligent efforts to gather and forward to the IRE information regarding its decision to deny coverage or payment. The rules also indicate that all outpatient hospital claims are routed to the OCE which imposes certain edits as detailed in the routinely updated I/OCE Specifications files. Among the rules for a facility billed for code G0378 (Hospital observation service, per hour) is the criterion that an EM service must be billed on the same date or the date before G0378 is billed. We reviewed the I/OCE Specifications file for this date of service. OCE edit 57 is invoked when "There is no specified E/M or critical care visit the day of or the day preceding the observation and the date of observation is 01/01/yyyy." The required disposition for a claim with this edit is for claim suspension. Per this file, "A claim suspension means that the claim is not returned to the provider but is not processed for payment until the (payer) decides or obtains further information." This means that the fact that this edit was invoked is not
sufficient to determine whether a claim is payable and requires investigation/development by the Plan. The Plan has not made reasonable and diligent efforts to gather and forward to us information regarding their decision to deny your request. You stated in your appeal argument that the EM service required by the rules were reported on another claim for 2020 services. The Plan did not indicate whether a claim was received for these services and did not provide a copy of this claim to show that an EM service was not billed for date of service 12/31/2020. The Plan did not make any attempts to request further information from the provider, including a copy of this prior claim or medical records to verify whether EM services were provided on 12/31/2020. We find that the denial of payment is not substantiated as the Plan did not take the necessary actions to verify whether payment criteria were met. Based on this information, we decided that Medicare rules for coverage of the outpatient hospital services have been met. Therefore, we decided that the Plan has to pay for the outpatient hospital services provided from January 1, 2021, to January 2, 2021.
If the Plan does not agree with our decision, they can ask us to open a case again. We only open a case again if we believe there was a mistake or if there is new information to review. The Plan has to show us the mistake and/or send us the new information. This does not happen often. If we decide to open the case again, we will send you a letter.