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Note from Hugh

Medicare Weekly Update, June 10, 2008

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I know that many hospitals are anxiously awaiting the additional guidance CMS has promised on “incident to” coverage of hospital outpatient services. As reported in the April 15 issue of Medicare Weekly Update, in early April, CMS representatives announced at an American Health Lawyers Association’s (AHLA) conference that CMS planned to issue additional guidance in response to the high volume of phone calls CMS has received relating to the recently revised CMS manual provisions on “incident to” coverage in a hospital outpatient setting. I was present at the AHLA conference when CMS made that announcement. I left the conference with the distinct impression that the additional guidance would be released shortly after the conference.

I have an update; however, it is not good news. My colleague Brian Murphy, who serves as editor of Medicare Weekly Update, spoke briefly with Heather Hostetler last week about this issue. Heather is a lawyer who works as a Policy Analyst in CMS’s Hospital and Ambulatory Policy Group. She serves as CMS’s point person on hospital “incident to” issues. Heather told Brian that CMS remains aware of the importance of getting out additional guidance, but that none will be immediately forthcoming. She noted that CMS is in the middle of the next rule making cycle and that they are very busy.

This is a very important compliance issue for most hospitals. In the absence of clarification from CMS’s national office, hospitals should contact their local FI or MAC for guidance on these issues.

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