(Medicare Claims Processing Manual)

E.  Any claim about which there is any suspicion of fraud or abuse, whether with respect to the notifier, the category of notifiers, or the class of items or services involved.  110.5.3 - Other Reasons for Contractor Request for Copies of ABNs  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  Other good reasons for contractors to request submission of copies of ABNs include, but are not limited to, the following:   A - Any need that arises from the appeals processes for documentation.  B - Any practical need to identify the particular items and/or services, dates of service, reasons for predicting Medicare denial of payment, or other pertinent facts about the beneficiary notification.   C - Any plausible allegation or dispute as to the form, content, or delivery of a particular ABN or a particular group of ABNs, e.g., all ABNs furnished by a particular notifier, all ABNs for a particular item, etc.   D - For the purposes of a data analysis, utilization study, or other investigation or study.  120 - Contractor Specific Instructions for Application of Limitation on Liability  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  120.1 - Documentation of Notices Regarding Coverage  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  A critical step in the implementation of the limitation on liability provision is the distribution by contractors of notices regarding coverage issues to the medical community, or to specific segments of it, such as laboratories or certain physician specialty groups. An ongoing program of communication by contractors is essential. Timely communication of existing general notices to physicians and suppliers new to a contractors service area is essential. The existence of written general notices will often determine the extent of program liability. As a minimum, the contractor should have a program for dissemination of the coverage guidelines published in the National Coverage Determinations Manual and the Medicare Benefit Policy Manual, as well as other guidelines contained in this manual for determining medical necessity and others issued from time to time in other CMS issuances.   120.2 - Availability of Coverage Notices to Operating Personnel  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  All review personnel should have ready access to a file of general notices regarding coverage for processing review cases involving the issue of limitation on liability.  In addition to general notices, the contractor must have a mechanism for identifying and locating correspondence with individual physician/suppliers regarding coverage of particular services or items. This mechanism should meet at least the following minimum requirements:    The contractor must be able to determine if a practitioner or supplier has been sent an explanation, in lieu of, or in addition, to, a routine MSN denial notice, that a type of service or item is not reasonable and necessary. Such explanation may consist  of a general notice or may be individual correspondence with the physician/supplier such as is usually found in contractor correspondence units or comparable units. Claims history files can also be checked, but these are generally useful only when the ide ntical item or service in question has been previously denied as not meeting the requirements of 1862(a)(1) ;   A copy of such an explanation must be readily available to appeal personnel; and    Procedures must be established requiring that a check of all files be made to determine if such an explanation was ever sent before the physician/suppliers liability is limited.   Once a physician/supplier receives an explanation of denial for an item or service after an appeal determination, that determination would be considered a notice that should be readily accessible for future use for a similar claim(s).   120.3 - Applicability of Limitation on Liability Provision to Claims for Outpatient Physical Therapy Services Furnished by Clinics  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  A  General   The limitation on liability provision is applicable to claims for items or services furnished by a physician- directed outpatient physical therapy (OPT) clinic that are denied on the basis of 1862(a)(1) .  The limitation on liability determination for OPT clinic claims will be made by contractors at the initial determination level, in accordance with 120.4. The procedures discussed in 120.2, second bullet  , for determining a physicians/suppliers liability will be followed when processing this category of claims.  120.4 - Limitation on Liability Notices to Beneficiaries From Contractors  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  The contractor adds MSN Limitation of Liability Message 50.36.2 to the MSN sent to the beneficiary (who is presumed not to have knowledge of nonpayment by Medicare) at the time of the initial determination.   To message 50.36.2, it also adds the following language:   Do not apply if your (doctor/supplier) told you in writing, before furnishing the service, that Medicare would not pay.  The contractor adds MSN Limitation of Liability Message 50.36.1 to the MSN sent to the beneficiary (who is held to have had knowledge of nonpayment by Medicare) at the time of the initial determination.   The contractor adds, from the Remittance Advice Remarks Codes, the Justification for Services Remark M25 to the RA sent to the physician/supplier (who is presumed to have knowledge of nonpayment by Medicare) at the time of the initial determination.  The contractor adds, from the Remittance Advice Remarks Codes, the Justification for Services Remark M38 to the RA sent to the physician/supplier who is held to be not liable because the beneficiary is held liable at the time of the initial determination.   In addition to the above, as appropriate, the contractor notifies both the beneficiary and the physician/supplier at the time of the initial determination of their appeal rights (this is contained on the back of the MSN and the RA).   120.5 - Contractor Redeterminations or Reconsiderations in Assignment Cases Conducted at the Request of Either the Beneficiary or the Assignee  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  In every appeal where the limitation on liability provision is applicable, the redetermination consists of two stages. The first stage is a new, independent and critical reexamination of the facts regarding the coverage issue. If the original decision rega rding coverage was appropriate, the second stage is the decision whether to limit the liability of the beneficiary and, if so, whether to also limit the liability of the provider, practitioner, or supplier.   Redeterminations in assignment cases are conducted at the request of either the beneficiary or the assignee. Frequently, the redetermination request is received from only one of the parties, either the provider/physician/supplier or the beneficiary, and the only notice to the other party that a redetermination has been requested is a copy of the determination, i.e., after the fact. In a limitation on liability case, the parties may have adverse interests in the limitation on liability decision, since a prov ider, practitioner, or supplier may seek to show reason why the beneficiarys liability should not be limited in order to be able to collect his/her fee from the beneficiary. Therefore, when the contractor receives a request for a redetermination, it sends  a notice that a request has been filed to the other party to the redetermination indicating that that party may submit additional evidence. This is necessary to satisfy the statutory requirement that both parties be informed of their rights and privileges  in the appeal process.   120.5.1 - Guide Paragraphs for Contractors to Use Where 1879 Is Applicable at the Redetermination Level  (Rev. 1186, Issued:  02- 23-07; Effective:  01 -01-06; Implementation:  05 -23-07)  The contractor uses the following paragraphs (in addition to other required appeal decision paragraphs) where the limitation on liability provision applies at the appeal level in the various situations shown below:   Situation I -  To the provider, practitioner, or supplier when neither the provider, practitioner, or supplier nor the beneficiary is determined liable (program payment made under 1879 of the Act)   Paragraph(s):   Section 1879 of the Social Security Act permits Medicare payment to be made on behalf of a beneficiary to a physician/supplier who has accepted assignment for certain services for which payment would otherwise not be made under Medicare, if neither the beneficiary nor the physician/supplier knew, or could reasonably have been expected to know, that the services were excluded. The services affected by this provision are those that are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member. After reviewing (beneficiarys names) claim for (description of services), we have concluded that these services are excluded under Medicare. However, since we find that neither (beneficiarys name) nor you knew, or could reasonably have been expected to know, that the services were excluded from coverage, the Medicare program will reimburse you under this provision of the law for the reasonable charge for the services, less any deductible and coinsurance. (Beneficiarys name) is responsible for any deductible and coinsurance amounts. U pon receipt of this notice, it will be considered that you now have knowledge of the exclusion of (description of service) for similar conditions, and this limitation of liability will not apply to future claims for the same or substantially similar servic es.  cc: Beneficiary   Situation II -  To provider, practitioner, or supplier when the provider or practitioner or supplier is held liable   Paragraph(s);   Section 1879 of the Social Security Act permits Medicare payment to be made on behalf of a beneficiary to a provider or practitioner or supplier who has accepted assignment for certain services for which payment would otherwise not be made under Medicare. Medicare may make payment under this situation if neither the beneficiary nor the provider, practitioner, or supplier knew, or could reasonably have been expected to know, that the services were excluded. The services affected by this provision are those t hat are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member. After reviewing (beneficiarys names) claim for (description of services), we have determined that (benefici arys name) did not know and could not have been expected to know, that these services were excluded from coverage. However, we find that (select applicable phraseology from the following): (l) based upon the claim of (date) which was a similar claim in wh ich payment was denied; (2) (our notification to you of (date) that such services are excluded); (3) (or any other basis used to determine the provider, practitioner, or supplier to be liable)), you knew, or could have been expected to know, that these ser vices were excluded. We also find that you did not notify the beneficiary in writing, before the services were furnished, that Medicare likely would not pay for the services. Because of this, you are held liable for the full charges for the services.   We have also reviewed the claim with regard to the issue of whether the services were not reasonable and necessary. We found that the services were not reasonable and necessary.   If you disagree with this determination regarding your liability, on the basis that the services were necessary, or on the basis that you did not know, and could not reasonably have been expected to know, that Medicare would not pay for the services, or on the basis that you notified the beneficiary in writing, before the services were furnished, that Medicare likely would not pay for the services, you may request a reconsideration within 180 days of receipt of this notice, at which time you may present any new evidence that would have a material effect on this determination. Our office, or your social security office, will assist you if you need help in requesting a reconsideration.   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.