Corporate Compliance

Tip: Determining whether a service is medically necessary

Compliance Monitor, May 6, 2009

Facilities must be able to screen for the medical necessity of a service before rendering it to Medicare patients. Therefore, staff members registering patients must have access to National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs). A computerized method may be the best solution. Many software vendors have automated this process.
 
Use the following process to determine the medical necessity of services: 
  1. Verify whether the test or service has an LCD or NCD
  2. If the test or service to be performed does not have limited coverage under an NCD or LCD, proceed and perform the test or service ordered
  3. If the test or service to be performed does have limited coverage under an NCD or LCD, review the signs, symptoms, or diagnosis provided by the physician and determine whether the test is considered medically necessary based on the physician’s documentation 
This tip was adapted from The Compliance Officer’s Handbook, Second Edition. For more information about the book or to order your copy, visit the HCMarketplace.

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