(Medicare Claims Processing Manual)

cc: Beneficiary   Situation III -  To the beneficiary when the beneficiary is held liable   Paragraph(s):   We have reviewed your claim for (description of the services). When we reviewed your claim, we considered two things. First, we considered whether the service you received was reasonable and necessary. Medicare will only pay for reasonable and necessary services. We found that the service was not reasonable and necessary.   Second, we considered whether you knew, or were told, that Medicare would not pay. Medicare would not hold you liable if you did not know and your (doctor/supplier) did not tell you in advance, in writing, that Medicare would not pay. In that case, we woul d pay you any amount you pay or paid your (doctor/supplier) for the service. Our review shows that (choose one of the following to complete the sentence: (the (doctor/ supplier) told you in writing, before giving the service, that Medicare would not pay); (this service had been denied on other claims for you); OR (we told you in a letter dated (DATE) that Medicare would not pay for this service)). Since we believe you knew Medicare would not pay for this service, Medicare cannot pay. You are liable for the charges.   If you do not agree with our decision, ask for a reconsideration from a Qualified Independent Contractor (QIC). The QIC will decide whether the service was reasonable and necessary. The QIC will also decide whether you knew, or were told, Medicare would not pay. You must ask for a reconsideration within 180 days of the date you receive this notice. At the reconsideration, you may present any new evidence which would affect our decision. If you need help, your social security office will help you request a r econsideration.  cc: Physician/Supplier   Situation IV -  Rider paragraph to be included in the copy of the notice to the beneficiary when the physician/supplier is held liable   If you paid any amounts to (physicians/suppliers name) for this service, Medicare will pay you back the amount you paid. To get this payment, bring or send to this office three things. (1) A copy of this notice. (2) Your (doctors/suppliers) bill. (3) A  receipt or other proof you have paid the bill.   (See 120.4 for handling requests for indemnification where payment has been made to a liable practitioner or supplier.)   130 - A/B MAC (A) and (HHH) Specific Instructions for Application of Limitation on Liability  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  See 120.5.1 for guide language.   130.1 - Applicability of the Limitation on Liability Provision to Claims for Ancillary, Outpatient Provider and Rural Health Clinic Services Payable Under Part B  (Rev. 3187, Issued: 02- 06-15, Effective: 03 -06-15, Implementation: 03- 06-15)  The following sections discuss how the limitation on liability provision is applied to claims involving ancillary, outpatient and rural health clinic services billed to the A/B MAC (A), where reimbursement is sought under Part B.  The A/B MAC (A) determine s whether limitation on liability applies to these categories of claims when the basis for the denial is that the services were not reasonable and necessary (under 1862(a)(l)  of the Act).   130.1.1 - Determining Beneficiary Liability in Claims for Ancillary and Outpatient Services  (Rev. 594, Issued: 06- 24-05, Effective: 07 -01-05, Implementation: 07- 01-05)  A presumption will be made that the beneficiary did not know that items or services are not covered unless there is evidence to the contrary. Indication on the claim that the beneficiary received proper advance beneficiary notice before receiving the nonco vered ancillary, outpatient, or rural health clinic services is evidence to the contrary which rebuts the presumption in the beneficiarys favor. The definitions of proper advance beneficiary notice to the beneficiary are set forth in 40.3. Note that if the reason liability is at issue coincides with the end of coverage for a period of care in specific settings -- inpatient hospital, skilled nursing, home health, hospice or comprehensive outpatient rehabilitation facilities -- notification un der the expedited determination process will be required as of July 1, 2005.  See CR#3903 for preliminary information on the expedited process, including its interaction with liability notice policy (i.e., ABNs).  130.1.2 - Determining Provider Liability in Claims for Ancillary and Outpatient Services  (Rev. 1, 10- 01-03)  The procedures in 30.2 apply for determining liability for providers. A provider may have its liability waived in an individual claim if it can establish that it did not know and could not have been expected to know that Medicare would not make payment for the items or services .  130.2 - Prior Hospitalization and Transfer Requirements for SNF Coverage as Related to Limitation on Liability  (Rev. 1, 10- 01-03)  In order to qualify for post -hospital extended care services, the individual must meet the prior hospitalization and transfer requirements discussed in Coverage of Extended Care Services Under Hospital Insurance, Chapter 8 of the Medicare Benefit Policy Manual. The following sections discuss the relationship of these requirements to the limitation on liability provision.   A.  Three- Day Prior Hospitalization   Before Medicare can pay for post -hospital extended care services, it must determine whether the beneficiary had a prior qualifying hospital stay of at least three consecutive calendar days. When a beneficiarys liability for a hospital stay is waived, the hospital days to which the limitation on liability applies cannot be used to satisfy the 3- day prior hospitalization requirement, since the services rendered during the days in question were found noncovered because they were not considered reasonable and necessary or because they constituted custodial care. (See Coverage of Extended Care (SNF) Services Under Hospital Insurance, Chapter 8, of the Medicare Benefit Policy Manual for determining whether the 3 -day prior hospitalization requirement is met.) If  a beneficiarys hospital stay was partially covered, the A/B MAC (A) considers the covered portion of the stay in determining whether the SNF prior hospitalization requirement is met.   B.  Transfer Requirements   1.  Transfer Period   The A/B MAC (A) applies the limitation on liability provision where it determines that all the SNF care received during the period serving to satisfy the transfer requirements described in Coverage of Extended Care Services Under Hospital Insurance, Chap ter 8 of the Medicare Benefit Policy Manual, either constituted custodial care or was not reasonable and necessary.   Where the A/B MAC (A) determines that only the beneficiarys liability can be waived, the limitation on liability applies through the date of the notice to the beneficiary including any inpatient days beyond the transfer period. If the provider is also ent itled to limitation on liability and program payment is possible under the limitation on liability provision, such payment is appropriate through the date of the notice and, if the A/B MAC (A) determines that additional time is needed to arrange for post -discharge care, for up to 24 hours after the date of notice to the provider or the beneficiary, whichever is earlier. If the A/B MAC (A) determines that even more time is needed to arrange post -discharge care, up to 24 additional hours may be paid for. (See  50.)   Where a beneficiary who is entitled to limitation on liability starts to require and receives reasonable and necessary or noncustodial services only after the expiration of the SNF transfer period, the beneficiary nevertheless may have his/her liability waived for days where such services were rendered, in addition to those days waived during the noncovered transfer period but only through the date of notice to the beneficiary . If the provider is also entitled to limitation on liability, program payment may be made under the limitation on liability provision through the date of notice of noncoverage and, if the A/B MAC (A) determines that additional time is needed to arrange for post -discharge care, for a grace period of l day thereafter. If the A/B MAC (A) determines that even more time is needed to arrange post -discharge care, 1 additi onal grace period day may be paid for. (See 50.) This payment is made because it is inequitable to waive liability for noncovered services rendered during the transfer period but not for a period thereafter (prior to notice) during which the beneficiary needed and received an otherwise covered level o f care.   2.  Delayed Transfer Due to Medical Appropriateness   The law also provides for an extension of the usual 30- day time limit for transfer where the patients condition makes it medically appropriate. (Coverage of Extended Care Services Under Hospital Insurance, in the Medicare Benefit Policy Manual, Chapter 8.) However, if the A/B MAC (A) determines that such an extension is not allowable because an interval of more than 30 days for transfer to a SNF was not medically appropriate, it denies the SNF services because the transfer requirement was not met. The li mitation on liability provision is not applicable in such a case.   130.3 - Application of Limitation on Liability to SNF and Hospital Claims for Services Furnished in Noncertified or Inappropriately Certified Beds  (Rev. 4001, Issued: 03- 16-18, Effective: 06 -19-18, Implementation: 06- 19-18)  A.  General   Payment for SNF and hospital claims may not be denied solely on the basis of a beneficiarys placement in a non- certified portion of the same institution that also includes a participating SNF or hospital. When requested by the beneficiary or his/her authorized representative, a provider must submit a claim to the A/B MAC (A) for services rendered in a non -certified bed. When the A/B MAC (A) reviews a claim for services rendered in a non -certified bed, it first determines whether the beneficiary consented t o the placement. (See subsection C.) If the A/B MAC (A) finds that the beneficiary consented, it denies the claim. If it finds that the beneficiary did not consent, it determines whether there are any other reasons for denying the claim. (See subsection D.) If there is another reason for denying the claim, the A/B MAC (A) denies it. However, if none of the reasons for denial exist, beneficiary liability must be waived as provided under 1879(e)  of the Act and a further determination must be made as to whether the provider, rather than the Medicare program, must accept liability for the services in question. (See Coverage of Extended Care Services Under Hospital Insurance in the Medicare Benefi t Policy Manual, Chapter 8.)   B.  Provider Notice Requirements   When a SNF or hospital places a patient in a noncertified or inappropriately certified portion of the institution because it believes the patient does not require a covered level of care, or for any other reason, it must notify the patient (or authorized r epresentative) in writing that services in a noncertified or inappropriately certified bed are not covered. The provider uses the appropriate notice specified in 70 for SNFs or swing beds, 80 for inpatient hospitals, to advise the beneficiary of its decision to place him/her in a noncertified bed, using language such as:   We are placing you in a part of the institution that is not appropriately certified by Medicare because (you do not require a level of care that will qualify as skilled nursing care/or covered hospital services under Medicare)/(or state any other reasons f or the noncertified bed placement). Nonqualifying services furnished a patient in a noncertified or inappropriately certified bed are not payable by Medicare. However, you may request us to file a claim for Medicare benefits. Based on this claim, Medicare will make a formal determination and advise whether any benefits are payable to you.   (For related general billing requirements, see Chapter 1, 60 of this manual, or other chapters specific to the benefit being billed: Chapter 3 for inpatient hospitals and swing beds, Chapter 6 for swing bed PPS and inpatient SNFs, and Chapter 7 for outpatient SNFs.)   C.  Determining Beneficiary Consent