Corporate Compliance

Note from the instructor: Medicare change processes Part I: Claim adjustments and Reopenings

Medicare Insider, August 19, 2014

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This week’s note from the instructor is written by Judith L. Kares, JD, regulatory specialist for HCPro.    

 
This week we will begin a two-part discussion on several Medicare processes involving changes to claims as originally submitted and/or adjudicated. In this week’s note we will focus on timely claims adjustments and the reopening of claims by contractors and adjudicators, as well as by providers and beneficiaries. Next week we will review the five-level Medicare appeals process and the relationship of that process to claim adjustments and reopenings. 
 
Recent guidance
 
CMS recently released Medicare Claims Processing Transmittal R3022CP, which sets out a new streamlined, standardized process for providers to request the reopening of a claim (Reopening). Prior to this, A/B Medicare Administrative Contractors (A/BMACs) were permitted to create their own reopening processes, subjecting providers to different processes in different jurisdictions. To prepare for the new process, CMS sought permission and approval from the National Uniform Billing Committee to create:
 
  • A new Type of Bill frequency code (“Q”) for providers to use to identify a Request for Reopening; and
  • Several series of Condition Codes for providers to use to designate the type of Reopening being requested and other key facts. 
 
In addition to Transmittal R3022CP, CMS also released two related MLN Matters articles: MM8581 and SE1426. Both provide helpful information, but MLN Matters article SE1426, in particular, provides a comprehensive list of the new Condition Codes and examples of appropriate coding, depending upon the type of Reopening being requested. Hospitals are encouraged to review these recently released documents, along with Chapter 34 of the Medicare Claims Processing Manual (MCPM), which focuses on Reopenings, to answer any questions they might have.
 
Claim adjustments
 
Before we focus on Reopenings, we need to review the Medicare rules relating to claim adjustments. A provider’s ability to adjust its initial claim is limited to the following:
1.     If the provider failed to include a particular item or service on the initial claim, an adjustment claim to include the item or service is subject to the timely filing limitation for the item or service (generally, one year from the date of service).
2.     With respect to IPPS claims, there is an even shorter time frame. If the adjustment would result in a change to a higher paying DRG, the adjustment must be submitted within 60 days of the date of the remittance for the initial claim.
3.      If, however, an adjustment claim otherwise corrects or supplements information previously submitted on a timely claim about specified services or items furnished to a specified individual, it is subject to the rules governing administrative finality, rather than the otherwise applicable timely filing limitations. The rules governing administrative finality include Reopenings and are found in the MCPM, Chapter 34. For claims submitted on and after January 1, 2015, such claims must be submitted with a “Q” in the fourth position of the Type of Bill to identify them as a Reopening. (See MCPM, Chapter 1, Section 70.5 for more information.)
 
Reopenings
Let us now review Reopenings, in general, and the new Request for Reopening process, in particular. As defined by Medicare, “a reopening is a remedial action taken to change a final determination or decision that resulted in either an overpayment or an underpayment, even though the determination or decision was correct based on the evidence of record.” 
 
In Transmittal R3022CP and relevant sections of Chapter 34 of the MCPM, CMS notes Reopenings are “separate and distinct” from the Medicare appeals process. The principal difference is providers have certain rights to appeal under the Medicare appeals process, whereas the decision to Reopen is generally at the discretion of the contractor or adjudicator. For example, an A/BMAC’s denial of a claim is an initial determination, which gives the provider certain rights to appeal that denial. On the other hand, an A/BMAC’s refusal to reopen a claim determination is not an initial determination and, therefore, is not appealable. Generally, a claim determination may not be appealed and Reopened at the same time. For example, if a Reopening is pending when a subsequent timely appeal is filed, the Reopening will be refused in order for the appeal to proceed. There are also different time limitations and conditions that apply to a provider’s right to appeal and a provider’s right to Request a Reopening. 


With respect to Reopenings, whether initiated by a contractor or adjudicator or requested by a party (a provider or beneficiary), the time limitations also vary depending upon who is initiating or requesting the Reopening and whether the decision maker is a contractor or adjudicator. 

A contractor may reopen and revise its initial determination or redetermination on its own motion, as follows:
  • Within one year from the date of the initial determination or redetermination for any reason; or
  • Within four years from the date of the initial determination or redetermination for good cause as defined in §10.11; or
  • At any time if:
    • There exists reliable evidence the initial determination was procured by fraud or similar fault as defined in 42 CFR §405.902; or
    • The initial determination is unfavorable, in whole or in part, to the party (provider or beneficiary), but only for the purpose of correcting a clerical error on which the determination was based. Third party payer error does not constitute clerical error for these purposes.
A party (provider or beneficiary) may request a contractor to reopen and revise its initial determination or redetermination under the same circumstances, except a party may not request a contractor to reopen its initial determination or redetermination at any time upon reliable evidence of fraud or similar fault. In addition, although in certain circumstances a contractor can reopen at any time, CMS does not expect a contractor would regularly grant such requests, especially for older claims where the claims history is not readily available.
 
An adjudicator, either a Qualified Independent Contractor (QIC), an Administrative Law Judge (ALJ) or the Appeals Council (AC), may only reopen and revise its reconsideration, hearing decision or review, respectively, under the following conditions:
  • Within 180 days from the date of its decision for good cause in accordance with 42 CFR §405.986; or,
  • At any time if the reconsideration or hearing decision or review was procured by fraud or similar fault.
A party may only request an adjudicator (QIC, ALJ or the AC) to reopen and revise its reconsideration, hearing decision or review within 180 days from the date of the reconsideration or hearing decision or review, as applicable, for good cause in accordance with 42 CFR §405.98.
 
New Request for Reopening process
As noted above, when a provider needs to correct or supplement a claim within the timely filing limits for those items or services, providers may submit an adjustment claim. When the need for a correction is discovered beyond the timely filing limits, however, an adjustment bill is not allowed, and a provider must utilize the Reopening process to correct the error. In MLN Matters article SE1426, CMS provides guidance on the new Reopening process, including the new Type of Bill and Condition Codes to be reported and examples of appropriate coding. With respect to Requests for Reopening submitted on and after January 1, 2015, providers are required to report the following codes and related information: 
  • Type of Bill xxxQ
  • An applicable Reopening Condition Code (R1-R9) to identify the nature/circumstances of the error or mistake to be corrected
  • An applicable Adjustment Condition Code (D0, D1, D2, D4, D9, E0) to identify what was changed on the claim, if appropriate
  •  A Condition Code W2 to attest there is no appeal in process
  • An Adjustment Reason Code (for DDE claims only)
    • R1 = less than one year from Initial Determination
    • R2 = one to four years from Initial Determination
    • R3 = more than four years from Initial Determination
  • Reopenings that require “Good Cause” to be documented must have a Remark/Note from the provider to that effect.
To facilitate the Reopening process, CMS recommends any Reopening request that contains changes or additions from the original claim should contain a remark/note explaining what has been changed. If the change or addition affects a line item instead of a claim item, CMS recommends providers indicate which lines are being changed in the remark/note.
 
Next week we will review the five-level Medicare appeals process and the relationship of that process to claim adjustments and Reopenings in more detail.  

 

 



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