Radiology Administrator’s Compliance & Reimbursement Insider, January 2006

In this case, code 71270 would be paid at 100% and the technical component of codes 74170 and 72194 would each be paid at 75% of the fee schedule amount.

Under the current rule, CMS would pay 50% of the fee schedule amount for the technical components of codes 74170 and 72194 in 2007.

The 11 families as published in the final rule can be found in the box on p. 3 of the PDF of this issue. The families of procedures are based on claims data that show that these procedures are often performed in combination, most likely during a single session.

Several individuals asked CMS for clarification about the proposed rule's definition of a "single session." CMS has defined a single session as more than one of the imaging services in a single family provided to the patient during one encounter in which the multiple-procedure reduction would apply.

On the other hand, if a patient has a separate encounter on the same day for a medically necessary reason and receives a second imaging service from the same family, CMS considers these studies as provided in separate sessions. In the latter case, physicians should use modifier -59 to indicate multiple sessions, and the multiple procedure reduction does not apply.

For example, a brain magnetic resonance imaging scan is performed on a patient in the morning, the results of which later in the day reveal the need for a magnetic resonance angiography (MRA) to evaluate the carotid arteries. These are considered separate sessions, and both procedures will be reimbursed at 100% of the fee schedule amount. Submit the second procedure (i.e., the MRA) with the -59 modifier appended.

Medicare carriers will establish edits to ensure that separate sessions are not inappropriately scheduled for contiguous body area imaging in attempts to bypass the reduction. Using the -59 modifier to bypass the payment reduction in which separate sessions are not medically necessary constitutes fraud.

Physician self-referral changes

Under the physician self-referral statute and regulations, a physician is prohibited from making referrals for certain services referred to as designated health services (DHS) to an entity with which he or she (or an immediate family member) has a financial relationship, unless an exception applies.

For 2006, CMS proposed adding diagnostic and therapeutic nuclear medicine procedures to the list of DHS to which the self-referral ban applies.

However, to minimize the effect on providers of nuclear medicine services and allow them time to restructure current arrangements, CMS has delayed the effective date of this change to January 1, 2007.

Contrast material

In the final rule, CMS announced that it will delay the implementation of separate payment for high osmolar contrast material (HOCM). Payment for HOCM will continue to be included as part of the practice expense associated with the procedure for 2006.

Insider source

Stacie L. Buck, RHIA, LHRM, vice president, Southeast Radiology Management, 512 SW St. Lucie Crescent, Stuart, FL 34994, 772/600-0324; stacie@southeastrad.com.

Take five steps to terminate managed care contracts

If you have a managed care contract that is no longer profitable, you'll need to take several steps to terminate the agreement. Many facilities believe a simple phone call or letter is sufficient.

"But they're in for a big surprise," says consultant Caryl A. Serbin, RN, BSN, LHRM , president of Surgery Consultants of America, Inc.

Why terminate a contract?

Payer contracts may become less profitable over time. Some may even end up costing you money.

"Any contract that drains your revenues is one you should walk away from. This can be hard, but it's necessary for many facilities," says Serbin.

There are several reasons why once-profitable contracts can become unprofitable, including the following:

How to terminate a contract

Each facility will have different needs, but here are five basic steps to take to get out of a contract:

Step #1: Check your contract.

The contract will tell you what you need to do to terminate the agreement. If you are unsure about the process, have your attorney help you determine what your contract requires. You'll probably see one of the following types of termination clauses:

Many of the contracts that have termination-without-cause clauses also have minimum-term clauses. This type of clause sets a certain period of time that must pass under the contract before either party can initiate a termination. For example, a minimum term of 120 days would require a facility to honor the contract for 120 days before terminating it.

Step #2: Obtain board approval.

In most cases, you'll need to obtain your governing board's approval before officially terminating a payer contract.

"You'll want to give the board the results of your evaluation and clearly demonstrate that you are consistently losing money under the contract," says Serbin.

A board will want information related to the plan (e.g., the number of lives covered annually, types of cases, most common cases, and profits or losses on those cases). Also present other factors (e.g., noncompliance with the contract, those that contribute to lost revenue), Serbin says. Explain to the board what type of contract you have and how you will meet all of the termination requirements.

Step #3: Write a letter to the payer.

Once you decide to terminate a contract and obtain board approval, write a letter to the payer stating your intention to terminate the contract.

Your contract may spell out a contact person for contract-related issues—if it does, send your letter to that person at the address specified in the contract. Otherwise, address the letter to the contract's administrator or official who deals with contract terminations. In any case, send it by certified mail with a return receipt requested.

"This way there is no ambiguity about whether or not the payer received the letter. If the return receipt is signed, the payer can't claim that it didn't receive the letter or didn't receive it on a certain date," Serbin says.

Don't send a generic letter. Instead, include specific information related to your contract. For example, a termination-with-cause contract will require different information from a termination-without-cause contract (see sample letters below).

If your contract permits you to terminate without cause, then your letter, like our sample Letter #1, should

If you're terminating the contract with cause, use Letter #2 as a model. Your letter, like ours, should

Step #4: Make a follow-up call.

Once the termination takes effect, follow up with a telephone call to the person who received the notice.

"You'll want to be sure that the payer's computer system has been updated to show your facility as nonparticipating," says Serbin.

This way, you can avoid billing problems that may arise. For example, once the contract ends, your organization will treat the payer's patients who come to your facility as out-of-network, but if the payer doesn't properly update its system, it will still regard the patients as in-network.

Step #5: Notify staff.

Once you've decided to terminate a payer contract, notify your staff that you no longer participate with the payer. Staff can relay this information to patients and physicians appropriately. Your staff should understand that your facility could still treat a noncovered patient, but only as an out-of-network patient. This means that the patient may have a larger copayment or deductible.

Insider source

Caryl A. Serbin, RN, BSN, LHRM , president of Surgery Consultants of America, Inc., Central Park, Suites 501-503, 13740 Cypress Terrace Circle, Fort Myers, FL 33907; 888/453-1144; cas@surgecon.com.

Properly terminate payer contracts

The following are two letters that your organization can use to officially notify a payer that you intend to terminate your contract. One can be used if you terminate an agreement without cause. The other is for a termination with-cause contract. Both letters set a termination date.

Letter #2 describes the reasons for termination. Both letters set forth the particular contract requirements that have been met as a prerequisite to terminating the contract. Surgery center consultant Caryl Serbin, RN, BSN, LHRM, helped develop the letters. Adapt them for use in your facility.

Letter #1: Termination-without-cause letter

[ Insert date ]

Via certified mail with return receipt

Re: Contract # ___________

Dear [ insert name ],

This letter will serve as notice that we are terminating our contract with [ insert name of plan ] effective [ insert date ]. Our contract began [ insert date ], and therefore, we have completed the minimum term of 120 days as set forth under the contract [ insert section or article or contract ]. Pursuant to [ insert section or article of contract ], we are providing 90 days' notice with this letter. Therefore, the effective termination date will be 90 days from the date of this notification, or [ insert date ].

Thank you for the opportunity to provide quality healthcare services to your participants. Please feel free to contact me with any questions or if you require any additional information.

Yours truly,

[ Insert name ]

Letter #2: Termination-with-cause letter

[ Insert date ]

Via certified mail with return receipt

Re: Contract # ___________

Dear [ insert name ],

Effective immediately we are terminating our contract with you. Our contract [ insert section or article of contract ] states that we may terminate this contract with-cause. Your repeated failure to pay "clean" claims in a timely manner violates [ insert article or section of contract ] and provides us with necessary cause.

We have provided you with prior notice [ insert date of notice ], which is attached, and allowed you a 90-day period to remedy this problem, as required by [ insert section or article of contract ]. The breach has not been cured.

Please feel free to contact me with any questions or if you require any additional information.

Master appeals with these seven steps for success

By Deborah L. Mack, RN, MSN, CNOR, CASC

Insurance carriers report that facilities fail to appeal 90% of all improperly reimbursed payments for correct payment. This often occurs because facilities expect the insurance carriers to pay correctly or because the person assigned to posting payments is not familiar with the facilities' contracted rates.

To ensure that your facility receives owed payment when reimbursed incorrectly, you need to have an efficient appeals process. The following seven steps can help you successfully master the appeals process:

1. Assign one or two staff to post payments daily. The administrator or business office manager should prepare and maintain annually a spreadsheet for the payment analyst to use when posting payments. Maintain each managed care contract in a binder in your business office for access to your payment analyst and appeals processor. If your state has a workers' compensation fee schedule, include those expected payments as well. Also include

A carve-out is typically an arrangement that removes certain benefits from an insurance plan's coverage, but provides for them through a contract with a separate set of providers.

2. Make a copy of the explanation of benefits (EOB) when the payment falls short and forward it to your assigned appeal processor. Establish guidelines to let staff know what the expected time frames are for processing appeals. Most carriers have a specified time frame to appeal for additional payment. Verify whether your carriers provide a specific form to use for appeals and provide your appeals processor with standardized letters for each insurance carrier with the appeals address.

3. When preparing the appeal, explain how you arrived at your expected additional payment amount. Use the following as an example:

It is sometimes necessary to include a copy of the related section of your contract to the carrier. The person processing the claims typically doesn't have access to your contract exclusions or carve-outs.

At a minimum, the appeal documents should include

Send appeals via certified mail if possible, document your initiation of the appeal in your billing/collections software program, and maintain a copy of all documents.

4. The appeals processor should track all appeals on a spreadsheet with the following information in addition to any other pertinent details:

A person in collections should follow up on the appeals within the first 15 days to verify that the carrier received the appeal and inquire about the expected date of processing.

5. Every 30 days, the business office manager should review the appeals tracking log to ensure that there are no appeals older than 60 days. If there are, contact your managed care representative for assistance. The business office manager should also review all denials of appeals and address these issues with the managed care representative.

6. Every month, the business office manager should review all EOBs to ensure they include the correct payment posting (i.e., the correct amount owed to the provider according to the service provided) and verify whether appeals are initiated, if applicable. If time only permits a sampling of those payments, include your contracted payers.

7. Maintain an accurate appeals log so you will have valuable information when your contract with your carrier is due for renegotiations. If one particular carrier has a high appeal rate, then use this information to negotiate different terms. For example, if XYZ has difficulty processing your implant carve-out, ask for a percentage of billed charges. If you can produce strong data to prove the payer's inability to process claims correctly, you have an advantage.

Insider source

Deborah L. Mack, RN, MSN, CNOR, CASC, area vice president of National Surgical Hospitals and executive director of Sequoia Surgical Pavilion, 2405 Shadelands Dr. #200, Walnut Creek, CA 94598; 925/935-6700; dmack@nshinc.com.

RACRI 2005 index

Ask the Insider

Clearing up confusion with PET/CT billing while awaiting the final word from CMS. June, p. 6.

Coding advice related to patients who have a history of breast cancer. Aug., p. 6.

Diagnostic testing and recovery from sedation. Oct., p. 4.

Radiation exposure, how much is too much? Sept., p. 5.

Sharing T1 lines. Jan., p. 8.

Space rental agreements between radiologists and OB/GYN. Feb., p. 6.

Your toughest coding questions answered. Nov., p. 8.

Auditing tips

Cut claim denials by having compliance officers review denied claims. Feb., p. 5.

IOM recommends new audit requirement for mammography facilities. Aug., p. 8.

Compliance

Ask 11 questions during performance reviews to assess employee compliance awareness. May, p. 6.

Keep good hotline records to improve compliance. March, p. 5.

Model memo: Performing an employee compliance review. May, p. 8.

Sample hotline report sheet. March, p. 8.

CMS updates and coding

2005 CPT code changes: Carotid artery stents. April, p. 1.

Barrier falls for use of out of state radiologists. Jan., p. 1.

Billing and reimbursement challenges for kyphoplasty. July, p. 3.

CMS issues proposed MPFS rule. Oct., p. 1.

CMS, New Medicare billing rules for LOCM. June, p. 5.

CMS takes new position on PET codes: From G to CPT codes. May, p. 1.

CPT code changes increase documentation requirements for transcatheter procedures. March, p. 4.

CPT code changes require more documentation for ultrasounds. Feb., p. 1.

Final regs and changes for LOCM. Jan., p. 5.

Fourth quarter coding correct edits released. Nov., p. 6.

Medicare updates. Aug., p. 4.

New G code for bone marrow aspiration and biopsy. Jan., p. 5.

Sample ultrasound documentation checklist. Feb., p. 2.

Stent and PTA placements: Code them correctly. Sept., p. 4.

Understanding the new codes for cardiac CT. Sept., p. 6.

Vessel mapping G code. Jan., p. 7.

Do's and don'ts

Do ensure tech documentation is readily available in chart. March, p. 3.

Do take care when handling telephone complaints. May, p. 5.

Do use -52 modifier to bill 'bilateral' procedure on one side. March, p. 3.

HIPAA

HIPAA authorizations are often overlooked. April, p. 2.

HIPAA compliance and PACS: Can it happen? Jan., p. 4.

HIPAA security rule implementation date draws near. April, p. 5.

Hospital relations

Large pay gap between academic and private practice in radiology. Oct., p. 5.

Radiologist compensation up—but so are the workloads. Oct., p. 7.

When your hospital demands performance criteria, meet it head on with demands of your own. April, p. 6.

Legal issues

Digital mammography brings benefits but may increase radiologists' malpractice risk. May, p. 3.

Dispose of confidential records appropriately. June, p. 8.

Eight factors that affect an incorporated practice's risk of criminal changes. April, p. 3.

Imaging centers under pressure to enter leasing agreements may be on thin ice. July, p. 1.

Management strategies

Designated coders can perk up your bottom line. June, p. 7.

Dispose of confidential records appropriately. June, p. 8.

Get guts: Strong leadership can turn your practice into a winner. Aug., p. 1.

Hire for attitude, train for skill. Aug., p. 3.

Keep your business on track, improve accountability. Aug., p. 7.

Managing: Five tips to reduce employee turnover. July, p. 6.

RFPs can keep your purchases on track and help you keep your job. Nov., p. 1.

RTs play a critical role in the revenue cycle. Sept., p. 1.

Sample employee questionnaire. July, p. 8.

Surviving the precertification process: Getting approved. July, p. 4.

Tips to ease patient anxiety at your facility. Sept., p. 8.

Regulatory issues

Dispose of confidential records appropriately. June, p. 8.

Imaging centers under pressure to enter leasing agreements may be on thin ice. July, p. 1.

Regulators interested in administrative services agreements. Jan., p. 2.

Technology

Digital mammography: Easing the transition for radiologists. March, p. 1.

Fast facts about the DMIST trial. Nov., p. 5.

In the battle between digital and analog, digital comes out on top for certain women. Nov., p. 4.

Radiologists disagree in digital debate. Jan., p. 6.

Sample form: Checklist for Alzheimer's disease documentation. June, p. 4.

Setting up a solid PET/CT program takes planning and forethought. June, p. 1.

Technologist training

Correct coding: Modifier usage is a key component. Feb., p. 3.

Don't permit techs to administer sedatives. Feb., p. 7.

Modifier application chart: By area. Feb., p. 4.

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