(Medicare Claims Processing Manual)

The DME MACs identify instances where revisions to DMEPOS fees are needed and forward requests to CMS via email to the Division of Data Systems. The information must be contained in an ASCII file.  The requests must include a narrative description.   The following file specifications are 2003 examples, the actual file names may change each year:   Data Set Name  DMEREV1A.TXT  First Quarter Submission   DMEREV1B.TXT  Second Quarter Submission  DMEREV1C.TXT  Third Quarter Submission  DMEREV1D.TXT  Fourth Quarter Submission Record Format  Field Name  PIC Position  Comment  HCPCS Code  X(5)  1 - 5  Filler  X(1)  6 - 6 Set to Spaces  First Modifier  X(2)  7 - 8  Filler  X(1)  9 Set to Spaces  Second Modifier  X(2)  10 - 11  Filler  X(2)  12 - 13 Set to Spaces  State  X(3)  14 - 16  Filler  X(1)  17 Set to Spaces  Field Name  PIC Position  Comment  Revised Base Fee  S9(5)V99 18 - 26 1992 level for surgical dressings;  1995 level for PEN;  2013 level for Splints & Casts;  2012 level for certain IOLs;  1989 for all other categories  Filler  X(1)  27 Set to Spaces  Capped Rental Rebasing Indicator  X(1)  28 For Capped Rental Services Only:  0 - IR not applied to original base fee and base fee in effect prior to 1991, base fee is subject to rebasing adjustment  1 - IR applied to original base fee or base fee not in effect prior to 1991, base fee is exempted from rebasing adjustment  Filler  X(1)  29 Set to Spaces  Nature of Fee Revision X(1)  30 0 = Correction 1 = IR Revision 2 = Other -  Please submit supporting documentation. Filler  X(1)  31  Set to Spaces  IR - Effective Date  9(8) 32 - 39 Field is applicable only to those records where the fee has changed due to an inherent reasonableness decision and the previous field contains a value of 1.  Format is YYYYMMDD  The CMS will recalculate current year fee schedule amounts as appropriate and release the entire file in the record layout described in 60.1.  An indicator in the record field (Pricing Change Indicator) will identify those instances where pricing amounts have changed.  The CMS will also issue instructions for implementing the revised fee schedule amounts with the fee schedule.   60.5  Rural ZIP Code Claim Record Layout for Medicare Contractors Processing Rural DMEPOS Fee Schedule Claims  (Rev. 3350, Issued: 09- 11-15, Effective: 01 -01-16, Implementation: 01- 04-16)  This file contains rural area, as defined in 42 CFR 414.202, ZIP codes within the contiguous United States for use processing claims subject to the adjusted fee schedule methodology required by Section1834(a)(1)(F) of the Social Security Act.  The CMS wil l provide the specific file names when the rural ZIP code files are released.   Field Name  Pic Position  Comment  Effective Date  9(8) 1 - 8 Effective date that ZIP code considered rural  (CCYYMMDD).  Expiration Date  9(8) 9 - 16 Final date for considering a ZIP code rural. Field will be filled with 99999999s if an end- date has not been established.  Discontinued rural ZIP codes will be end dated as of the end of the quarter it was last an active rural ZIP. File Format is CCYYMMDD.  ZIP Code  X(5)  17 - 21 5-digit ZIP code considered rural  State  X(2)  22 - 23  Filler  X(17)  24 -40 Set to spaces   70 - Parenteral and Enteral Nutrition (PEN) Fee Schedule  (Rev. 1, 10- 01-03) PM B -01-54, AB -02-152  The Balanced Budget Act of 1997 4315 authorized the Secretary to implement a fee schedule for parenteral and enteral nutrition (PEN) items and services.  These items were previously paid on a reasonable charge basis.  The DME MACs will make payment based on the new PEN fee schedule effective for claims with dates of service on or after January 1, 2002.  The file layout for the PEN fee schedule is consistent with that of the DMEPOS fee schedule in 60.1 above except that Region, Ceiling, and Floor fields are not applicable and will be zero filled.   The CMS issues instructions for implementing an annual PEN fee schedule along with the DMEPOS fee schedule instructions.  The PEN fee schedule is provided to DME MACs and the Pricing, Data Analysis, and Coding Contractor (PDAC) via CMS mainframe telecommu nication system.   70.1 - Record Layout for PEN Fee Schedule  (Rev. 3350, Issued: 09- 11-15, Effective: 01 -01-16, Implementation: 01- 04-16)  Field Name  Pic Position  Comment  Year  X(4)  1 - 4 Applicable Update Year  Field Name  Pic Position  Comment  HCPCS Code  X(5)  5 - 9 All current year active and deleted codes  1st Modifier  XX 10 - 11  2nd Modifier  XX 12 - 13  Jurisdiction  X 14 D = DME MAC Jurisdiction  Category  XX 15 - 16 PE = Parenteral and Enteral Nutrition.   HCPCS Action  X 17 Indicates active/delete status in HCPCS file A = Active Code  D = Deleted Code, price provided for grace period processing only  Filler  XX 18 - 19 Value = 00  State  XX 20 - 21  Original Base Fee  9(5)V99  22 - 28 This amount is not used for pricing claims.  It is on file for informational purposes.  Beginning January 1, 2016, this field will include the Competitive Bidding Rural Fee Amount for specific HCPCS codes.  A new indicator field (RURAL FEE INDICATOR) shall be populated with a value of R when the Rural Fee is present in this field.  Filler  9(5)V99  29 - 35 This field is zero filled.  Filler  9(5)V99  36 - 42 This field is zero filled.  Updated Fee Schedule Amount  9(5)V99  43 - 49 Amount used for pricing.  Gap-Fill Indicator  X 50 0 = No Gap -filling required.  1 = A/B MAC (B) Needs to Gap -fill Original Base Year Amount.  Pricing Change Indicator  X  51 0 = No change to the updated fee schedule amount since previous release.  1 = A change has occurred to the updated fee schedule amount since the previous release.  Rural Fee Indicator  X(01)  52 R = Rural Fee is present in the Original Base Fee field  Filler  X(8)  53 - 60   80 - Reasonable Charges as Basis for A/B MAC (B)/DME MAC Payments  (Rev. 1, 10- 01-03) B3-5000, AB -01-118, AB -02-136, B -02-089  Effective with services furnished on or after January 1, 1992, A/B MACs (B) pay for physicians services based on a fee schedule.  Nonphysician services are also paid based on a percentage of fee schedule amounts depending on the type of nonphysician and s ervice rendered.  Other services and supplies (e.g., DMEPOS) are paid under the fee schedule designed specifically for those services.  Beginning in 1992, only the services listed below are paid under the reasonable charge methodology.  Where payment continues to be made on a reasonable charge basis for items and services, other than ambulance and laboratory services, A/B MACs (B) compute customary and prevailing charge updates at the beginning of each fee screen year (the 12- month period beginning January), using available statistics on charges for services from claims processed or services rendered during the 12 month period ending June 30 immediately preceding the start of the fee screen year.  For example, the customary and prevailing charge rates established for fee screen year 2003 (January 1, 2003, through December 31, 2003) are based on the charges made from July 1, 2001, through June 30, 2002.  Instructions regarding payment for ambulance and for laboratory services still subject to reasonable charges are found in Medicare Claims Processing Manual, Chapter 15, Ambulance, and Chapter 16, Laboratory Services from Independent Labs, Physicians, and Providers.  Additional instructions regarding payment for dialysis supplies and equipment are provided in the Medicare Claims Processing Manual, Chapter 8, Outpatient ESRD Hospital, Independent Facility, and Physician/Supplier Claims.   See specific year Program Memorandum instructions for a list of codes that are subject to the inflation -indexed charge (IIC) each year.  A/B MACs (B) compute each years IIC screen, by increasing the appropriate previous years screen by the percentage amount specified in annual Program Memorandum instructions.  A/B MA Cs (B)  must not compute IIC screens for items paid using gap- filled payment amounts in the previous year.  See specific year Program Memorandum instructions for any variances to these rules and for each years specific increase percentage.   Services paid on a reasonable charge basis continue to be paid for under the rules in this section.  A/B MACs (B)/DME MACs have the primary responsibility for determining reasonable charges.  The following guidelines are intended to assure overall consiste ncy among A/B MACs (B)/DME MACs with respect to the concepts applied in making reasonable charge determinations.   80.1 - Criteria for Determining Reasonable Charge  (Rev. 1, 10- 01-03) B3-5002, B -03-007  There are two criteria in 1842 of the Act that must be considered in determining the reasonable charge for a service.  They are:    The customary charges for similar services generally made by the physician or other person furnishing such services; and    The prevailing charges in the locality for similar services.   Therefore, the reasonable charge for a specific service in the absence of unusual medical complications or circumstances, may not exceed the lowest of:    The customary charge for that service;   The prevailing charge made for similar services in the locality; or   The actual charge for the service.  (See 80.8.)   The law also provides that the reasonable charge for a service not exceed the charge applicable for a comparable service under comparable circumstances to the contractors policyholders or subscribers.  (See 80.7.)  The A/B MAC (B) or DME MAC also determines if the charge for the specific item or service is inherently reasonable.   The income of an individual patient may not be considered in determining the amount of the reasonable charge.   Public Law 96- 499 requires that reasonable charge payments be based on customary and prevailing charge screens in effect on the date the service is rendered.  However, if the service was rendered at any time prior to the current fee year, payment is based on the screens in effect during the preceding fee screen year.   To implement this provision, the A/B MAC (B) must complete the following activities:   Retain the prior years pricing files in the system so that reasonable charge pricing data is available for two years.  As of July 1, 2003, all A/B MACs (B) operating the MCS system must retain at least five pricing files (current period plus four prior periods); and    Price the service based on the date of service on the claim using pricing files in effect for the same year as the date of service.   80.2 - Updating Customary and Prevailing Charges  (Rev. 1, 10- 01-03) B3-5003  A/B MACs (B)/DME MACs update customary and prevailing charge limits at the beginning of each fee screen year (the 12 -month period beginning January), using available statistics on charges for services from claims processed or services rendered during the 12-month period ending June 30 immediately preceding the start of the fee screen year.  For example, the limits used during fee screen year 2003 (January 1, 2003, through December 31, 2003) were based on the charges made from July 1, 2001, through June 30, 2002.  Customary and prevailing charge screens for a fee screen year are not changed except for the following reasons:    In individually identified and highly unusual situations where equity clearly indicates that the increases are warranted and requested by the entity furnishing the service;   To correct erroneous calculations; or   To establish screens for new services.