Corporate Compliance

Mentor moment: Going beyond the common medical necessity thought process

Case Management Weekly, March 23, 2011

Many case management professionals are familiar with Title XVIII the Social Security Act, 42 U.S.C. 1395 section 1862 (a)(1)(a), which states:

No Payment may be made under Part A or Part B for any expenses incurred for items or services 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.

Most healthcare professionals consider a service medically necessary if it:

  • Meets the provisions of a Local Coverage Determination (LCD) or National Coverage Determination (NCD)
  • Is provided at the proper level of care (i.e., inpatient or outpatient) 

However, medical necessity acquires new meaning in the context of recent Medicare Administrative Contractor (MAC), Recovery Audit Contractor (RAC) and CERT denials of clinical scenarios that at face value appear reasonable and necessary. Contractors are denying services because physician documentation did not meet reasonable standards to perform the procedures. 

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