Jurisdiction B DME MAC Supplier Manual

Transcription

Jurisdiction DME MAC
Supplier Manual
Foreword
[MARCH 2008]
J urisdiction B DME MAC Supplier Manual
ABOUT THIS MANUAL
The Jurisdiction B DME MAC Supplier Manual is designed to assist suppliers in claim submission of
durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) to the Jurisdiction B
Durable Medical Equipment Medicare Administrative Contractor (DME MAC). National Government
Services, Inc. will continue to advise suppliers and physicians filing DMEPOS claims the in Jurisdiction
B geographical area of Medicare policy and procedure changes that are implemented by the Centers
for Medicare & Medicaid Services (CMS). In addition to the Jurisdiction B DME MAC Supplier Manual,
be sure to read the Jurisdiction B Connections, published on a quarterly basis, for more detailed
information concerning Medicare program updates and changes. The Jurisdiction B Connections is
available at www.NGSMedicare.com.
Contact the Jurisdiction B DME MAC Customer Care Contact Center toll free at 866-590-6727, 8:30 a.m.
to 5:30 p.m. Eastern Time (ET), Monday through Friday, for all Jurisdiction B states. The Interactive
Voice Response (IVR) system is also available at 877-299-7900 from 6:00 a.m.–7:00 p.m. ET.
ABOUT NATIONAL GOVERNMENT SERVICES
Throughout the country, National Government Services, Inc. has efficient operational, financial, and
human resources in place, positioning the organization as a national leader in the Medicare industry.
National Government Services (with its corporate predecessors) maintains the following contracts:

Medicare Part A Fiscal Intermediary for: California, Connecticut, Delaware, Hawaii, Illinois,
Indiana, Kentucky, Maine, Massachusetts, Michigan, Nevada, New Hampshire, New York, Ohio,
Vermont, Virginia, West Virginia, Wisconsin, and the U.S. Territories of American Samoa, Guam
and Northern Mariana Islands.
Medicare Part A Regional Home Health Intermediary for: Alaska, Arizona, California,
Connecticut, Hawaii, Idaho, Maine, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire,
New Jersey, New York, Oregon, Rhode Island, Vermont, Washington and the U.S. Territories of
American Samoa, Guam, Northern Mariana Islands, Puerto Rico, and U.S. Virgin Islands.
Part B Carrier for: Indiana, Kentucky, New Jersey, and New York
Jurisdiction B Durable Medical Equipment Medicare Administrative Contractor for:
Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio, and Wisconsin
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Table of Contents
[MARCH 2008]
T able of Contents
1
2
General Information
The Medicare Program
1
The Medicare Card
1
The Common Working File
2
Deductible and Coinsurance
3
The CMS Internet-Only Manuals
3
Enrollment Process
Obtaining and Retaining Medicare DMEPOS Billing Privileges
1
Change of Information
5
Directory of Medicare Suppliers
5
Supplier Standards
6
Change of Ownership
9
Resources Available to Assist Suppliers with the Enrollment Process
3
4
10
Participation Program
Enrollment
1
Benefits of Participation
2
Assignment of Claims
2
Medicare Secondary Payer
Coordination of Benefits Contractor
1
Medicare’s Role
2
Medicare Secondary Payer Programs
3
Billing Requirements
9
Claim Liability Calculation
10
Medicare Secondary Payer Overpayments
11
Sample Jurisdiction B DME MAC MSP Voluntary Refund Form
Sample Jurisdiction B DME MAC MSP Offset Request Form
Sample Admission Questions to Ask Medicare Beneficiaries
1
15
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5
6
7
8
Medicare Policy Information
General Medical Policy Information
1
Current DMEPOS Medical Policies
7
Certificates of Medical Necessity/DME Information Forms
Overview
1
DME Forms
1
External Infusion Pumps & Enteral/Parenteral Nutrition
2
CMN/DIF Completion Instructions
2
Cover Letters
5
Section C Example
5
Sample CMN Forms
6
HCPCS Codes Requiring a CMN or DIF
6
Documentation
Orders
1
Certificates of Medical Necessity
4
Documentation in the Patient’s Medical Record
4
Proof of Delivery Requirements
5
Requests for Additional Information
7
Advance Determination of Medicare Coverage
Eligible Items
1
Submitting ADMC Requests
1
ADMC Requirements
2
ADMC Determination
5
Sample ADMC Request Form
9
Advance Beneficiary Notice
General Guidelines
1
Limitation on Liability
2
2
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Upgrades
3
Advance Beneficiary Notice Completion
4
Sample Form CMS-R-131-G Advance Beneficiary Notice
10
11
Claim Filing Jurisdiction
Claim Filing Based on Beneficiary Address
1
Disposition of Incorrectly Filed Claims
1
Durable Medical Equipment Medicare Administrative Contractors
2
DME MAC Jurisdictions
3
Claim Submission
Acceptable Claim Formats
1
Claim Filing Time Limits
1
Signature on File Requirements
3
Ordering Claim Forms
4
CMS-1500 Hints and Tips
5
New Revised CMS-1500 Form (Version 08-05)
6
Sample CMS-1500 Form (Version 08-05)
CMS-1500 Form (Version 08-05) Field Descriptions and Instructions
12
9
Mailing Address
22
Resources
22
Electronic Data Interchange
Electronic Media Claims
1
Administrative Simplification Compliance Act
2
Electronic Format
2
How to Become an Electronic Submitter
3
Testing Process and Requirements
4
Express Plus
5
Front-End Error Report
6
Claim Status Inquiry/Beneficiary Eligibility
7
Electronic Remittance Advice
7
Electronic Funds Transfer
8
Jurisdiction B DME MAC EDI Helpdesk
8
3
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13
14
Password Reset Requests
9
E-Commerce Consultants
9
National Government Services Web Site
10
EDI List Serve
10
E-Commerce Connection
10
Level II HCPCS Codes and HCPCS Modifiers
Level II HCPCS Codes
1
HCPCS Modifiers
3
The Statistical Analysis Durable Medical Equipment Regional Carrier (SADMERC)
7
DMEPOS Payment Categories
Inexpensive or Other Routinely Purchased DME
1
Items Requiring Frequent and Substantial Servicing
1
Customized Items
1
Other Prosthetic and Orthotic Devices
2
Transcutaneous Electrical Nerve Stimulators
2
Parenteral and Enteral Nutrition Pumps
3
Home Dialysis Supplies
3
Capped Rental Items
4
Oxygen and Oxygen Equipment
6
Repairs, Maintenance and Replacement
13
Sample Rent/Purchase Option for Power Wheelchairs Letter
15
Sample ESRD-382 Form
15
Pricing
Fee Schedules
1
Reasonable Charges
2
Drug Pricing
4
Individual Consideration
5
Inherent Reasonableness
5
4
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16
17
18
19
Medicare Benefit and Denial Categories
Benefit Categories
1
Denial Categories
3
Prevention of Common Claim Submission Errors
6
Supplier Remittance Notice
General Information
1
Tips for Reading the Remittance Notice
1
Sample Remittance Notice
3
Remittance Notice Key
4
Resources
6
Medicare Summary Notice
Sample MSN
2
Summary of Numbered Fields on Sample MSN
4
Resources
5
Reopenings and Appeals
Reopenings for Minor Errors and Omissions
1
Appeals
3
Sample Jurisdiction B DME MAC Request for Redetermination Form
Sample Jurisdiction B DME MAC Reconsideration Request Form
Sample Form CMS-1696 Appointment of Representative
Sample Form CMS-20034 Request for Part B Medicare Hearing by an ALJ
20
Overpayments
DME MAC Initiated Demand Letters
1
The Offset Process
1
Immediate Offset by Fax
2
Appealing a Refund
2
Supplier Voluntary Refunds
2
5
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Lost or Mutilated Checks
3
Change of Address
3
Sample Jurisdiction B DME MAC PCU Voluntary Refund Form
Sample Jurisdiction B DME MAC PCU Offset Request Form
21
22
Customer Care
Interactive Voice Response System
1
Customer Care Contact Center
1
Telephone Inquiries
2
Written Inquiries
4
Resources
Jurisdiction B DME MAC Contact Information
1
Jurisdiction B DME MAC Forms Index
3
Acronyms
5
6
Chapter 1: General Information
[MARCH 2008]
1 General Information
THE MEDICARE PROGRAM
The Medicare program is a federal health insurance program whose beneficiaries include persons 65
years of age or older, disabled persons, and persons with chronic renal disorders. It is governed by
the Centers for Medicare & Medicaid Service (CMS) of the U.S. Department of Health and Human
Services. The Social Security Administration (SSA) offices across the country take applications for
Medicare and provide general information about the program. The SSA is also responsible for any
changes or termination of a patient’s Medicare enrollment.
The program was established by Congress in 1965 when it enacted Title XVIII of the Social Security
Act, hereafter referred to as “the Act.” The Medicare program consists of two distinct parts.
Part A—Hospital Insurance
Hospital Insurance (Part A) helps pay for inpatient care in hospitals, critical access hospitals and skilled
nursing facilities. It also covers hospice care and some home health care.
Part B—Medical Insurance
Medical Insurance (Part B) covers items and/or services that are medically necessary by a physician,
outpatient hospital services, home health care, and a number of other medical services not covered by
Part A benefits including durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS).
Enrollment for Part B coverage is voluntary. Individuals pay a monthly premium which can be
deducted from monthly Social Security benefits. Individuals must meet an annual deductible* each
calendar year before Part B benefits are paid.
* The Part B deductible for 2008 is $135 and is subject to change each year.
By law, Medicare does not cover supplies or services received outside of the United States. The United
States includes the 50 states, District of Columbia, Commonwealth of Puerto Rico, Virgin Islands,
Guam, American Samoa and the territorial waters adjoining these land areas. Review the Claim Filing
Jurisdiction chapter of the Jurisdiction B DME MAC Supplier Manual for details on the geographical
locations included in Jurisdiction B.
THE MEDICARE CARD
All beneficiaries receive a health insurance card showing whether they have Hospital insurance (Part
A), Medical insurance (Part B), or both, and the effective date(s) of coverage. When a husband and
wife are both covered, each will have a separate card and Medicare Claim Number (i.e., Health
Insurance Claim Number [HICN]).
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Sample Medicare card:
Medicare HICN
In order for Medicare claims to process correctly, the patient’s complete name, as it appears on the
card, and the HICN should be correctly entered on all Medicare claims. To ensure accuracy, the supplier
should view the actual card and record the information or make a photocopy for their records. Each
patient’s health insurance card should be rechecked at least once a year since HIC numbers can change
depending on the type of benefits a beneficiary is currently entitled to under the SSA. If the beneficiary
insists the Medicare card is incorrect, the supplier should advise the beneficiary to contact their local
servicing Social Security Field Office to obtain a new Medicare card. Information that does not match
eligibility records will cause suspension or denial of claims.
Note: The letters at the end of the beneficiary’s HIC # do not necessarily indicate the type of coverage they
have. Example: 456-45-6456A does not mean the beneficiary has Part A only, or 456 46 6456B does not
indicate that this beneficiary has elected Part B benefits.
THE COMMON WORKING FILE
The Common Working File (CWF) is the system used by the CMS to verify entitlement and correct
utilization of benefits. The CWF houses the records of all claims processed for all beneficiaries assigned
to that site. When a claim is processed, the CWF checks its records to verify eligibility, days used,
deductible and coinsurance status and other utilization edits. The CWF contains information regarding
the beneficiary’s date of birth, date of death (if applicable), health maintenance organization (HMO) and
hospice elections and other information used to determine the correct utilization of benefits.
When a contractor receives a claim, a query is sent to the CWF to verify the HICN and the name of
the patient, as well as the appropriate utilization of benefits. Accurate reporting of the HICN is critical
to the CWF.
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DEDUCTIBLE AND COINSURANCE
Deductible
Each calendar year the patient must satisfy a deductible* before Medicare Part B payments can be
made. The Part B deductible is subject to change each year. The total Medicare allowed amount on a
claim is reduced by the amount of any remaining deductible prior to payment. Charges that are
denied, or that are noncovered, do not count toward the deductible.
All individuals covered under Medicare are required to satisfy the full deductible amount regardless of
when during the year their eligibility began. In other words, individuals who become eligible for
Medicare in December are responsible for the full deductible amount.
* The Part B deductible for 2008 is $135.
Coinsurance
For most services, Medicare pays 80 percent of the allowed amount for covered services after
subtracting any remaining deductible.
Medicare beneficiaries are responsible for the remaining 20 percent of the allowed amount (i.e.,
coinsurance payment) and any deductible subtracted on the claim. In some cases, a beneficiary’s
supplemental insurance coverage will pay these amounts.
On assigned claims, it is recommended the supplier only collect the 20 percent coinsurance from the
beneficiary at the time of delivery. This will allow for the accurate calculation of deductible status by
Medicare and prevent any refund to the beneficiary of over-collected deductible amounts.
THE CMS INTERNET-ONLY MANUALS
The CMS Internet-Only Manuals (IOMs), part of the CMS Online Manual System, is used by the various
CMS program components, partners, contractors, and state survey agencies to administer CMS programs.
They are the CMS’ program issuances, day-to-day operating instructions, policies, and procedures that are
based on statutes, regulations, guidelines, models, and directives. The IOMs are also a good source of
Medicare and Medicaid information for the general public.
To view the IOMs, go to www.cms.hhs.gov/Manuals/IOM/list.asp.
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Chapter 2: Enrollment Process
[DECEMBER 2007]
2 Enrollment Process
OBTAINING AND RETAINING MEDICARE DMEPOS
BILLING PRIVILEGES
Under durable medical equipment (DME) jurisdictional processing, every supplier of durable medical
equipment, prosthetics, orthotics and supplies (DMEPOS) must obtain billing privileges from the
National Supplier Clearinghouse (NSC).
A supplier is an entity or individual, which provides, sells or rents DMEPOS to Medicare beneficiaries.
The NSC is the organizational entity contracted by the Centers for Medicare & Medicaid Services (CMS)
to issue Medicare billing privileges to suppliers of DMEPOS and to maintain a supplier file that contains
information collected via the CMS-855S enrollment form.
The NSC distributes enrollment supplier applications (Provider/Supplier Enrollment Application or
CMS-855S form), verify the data, issue billing privileges to approved suppliers and maintain a national
DMEPOS supplier file. The NSC must process supplier data and issue billing privileges before a supplier
may start submitting claims to a durable medical equipment Medicare administrative contractor (DME
MAC). The NSC will verify all information submitted.
The supplier must complete the CMS-855S application and meet one of the following conditions if
they plan to bill Medicare for DMEPOS:

Enrolling in Medicare for the first time as a DMEPOS supplier

Currently enrolled in Medicare as a DMEPOS supplier and need to report changes to their
business, other than enrolling a new business location (e.g., they are adding, deleting or changing
existing information under this Medicare supplier billing number)

Currently enrolled in Medicare as a DMEPOS supplier but need to enroll a new business location.
Note: This is to add a new location to an organization with a tax identification number already
listed with the NSC (this differs from changing information on an already existing location).
Note: 42 C.F.R. 424.57(b)(1) requires suppliers to enroll separate physical locations other than
warehouses or repair facilities.

Currently enrolled in Medicare as a DMEPOS supplier and have been asked to reenroll in order to
verify or update their information (includes situations where the supplier has been asked to attest
that their organization is still eligible to receive Medicare payments)

Reactivating their Medicare DMEPOS supplier billing privileges (e.g., their Medicare supplier billing
privileges were deactivated because of no billing activity and they wish to receive payment from
Medicare for future claims)
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Voluntarily terminating their Medicare DMEPOS supplier billing privileges
Instructions on how to obtain and complete the CMS-855S may be found under the Supplier
Enrollment/Forms/CMS-855S Form section of the NSC Web site at www.PalmettoGBA.com/NSC.
The supplier is accountable for the accuracy of the information on the CMS-855S form. Any deliberate
misrepresentation or concealment of material information may subject the supplier to liability under
civil and criminal laws.
The NSC will contact a supplier if a CMS-855S form is incomplete or has inconsistent information.
Further, all suppliers are subject to a site visit in order to determine compliance with the supplier
standards. Suppliers found in noncompliance with the supplier standards are subject to denial or
revocation of their NSC issued billing privileges. The denial/revocation notification outlines the appeals
process available to suppliers, including instructions on requesting an appeal.
According to the CMS Internet-Only Manual (IOM) Publication 100-8, Medicare Program Integrity
Manual, Chapter 10, Section 6.2, a supplier that is denied enrollment in the Medicare program cannot
submit a new enrollment application until the following has occurred:

If the denial was not appealed, the provider or supplier may reapply after its appeal rights
have lapsed.
If the denial was appealed, the provider or supplier may reapply after it received notification the
determination was upheld.
Each DMEPOS supplier applying for Medicare billing privileges must disclose ownership on the CMS-855S
form in accordance with Section 1124A of the Social Security Act and Section 4313 of the Balanced
Budget Act of 1997, by including the following information:

The names and social security numbers of the owners, managing employees, those with
controlling interest of five percent or more, and/or authorized representatives/members of the
board of directors (including nonprofit corporations) as well as any partnership regardless of the
percentage of ownership.
The names of all owners, managing employees and/or authorized representatives/members of the
board of directors who have received penalties, been sanctioned, or excluded by the Medicare,
Medicaid and/or other federal and state authorities or programs.
The term managing employee is defined as any individual, including a general manager, business
manager, or administrator, who exercises operational or managerial control over the DMEPOS
supplier, or who conducts the day-to-day operations of the DMEPOS supplier. For Medicare enrollment
purposes, “managing employee” also includes individuals who are not actual employees of the
DMEPOS supplier but, either under contract or through some other arrangement, manage the
day-to-day operations of the DMEPOS supplier.
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An authorized official must be an owner, general partner, chairman of the board, chief financial
officer, chief executive officer, or president or must hold a position of similar status and authority
within the supplier's organization. This individual must have the authorization to legally bind the
organization to a contract.
The authorized official has the authority to sign the initial CMS-855S application on behalf of the
supplier and to notify the NSC of any change or that the billing privileges are no longer valid due to
sale of the entity. Only the authorized official can add, change or delete delegated officials or sign off
on the change of the authorized official.
Adding delegated officials is an option and is not required. Delegated officials may either be a
managing employee of the supplier, or hold a five percent direct ownership interest or partnership
interest in the supplier. Managing employees include general managers, business managers, or
administrators—individuals who exercise operational or managerial control over the supplier, or who
conduct the day-to-day operations of the supplier. A delegated official must be an employee of the
supplier, and proof, such as a W-2 form, may be requested.
Delegated officials may not delegate their authority to any other individual. Once a delegated official
has been designated, he/she may make any changes and/or updates to the provider status including
enrolling additional locations, reenrolling the supplier, reactivating the supplier or adding new
part-owners.
Suppliers may have as many authorized and delegated officials as desired as long as the individual
meets the respective definition. These officials are not location specific, but rather are supplier
specific. For example, if a supplier has multiple locations under one tax id number, the authorized and
delegated officials appointed will be the authorized signers for all locations.
On May 1, 2006, CMS issued the revised CMS-855 Medicare enrollment applications. Listed below are
changes and enhancements made specifically to the CMS-855S. DMEPOS suppliers should review and
become familiar with this information.

Requires the submission of the national provider identifier (NPI) and a copy of the NPI notification
furnished by the National Plan and Provider Enumeration System (NPPES). Suppliers should
provide their NPI where requested and submit a copy of the notification verifying the NPI.
Suppliers unable to locate their NPI notification should contact the NPPES at 800-465-3203 or
send an e-mail to [email protected].
Applying for the NPI is a process separate from Medicare enrollment. To obtain an NPI, the
supplier may apply online at https://NPPES.cms.hhs.gov. For more information about NPI
enumeration, go to www.cms.hhs.gov/NationalProvIdentStand.
Note: Each enrolled supplier of DMEPOS that is a covered entity under Health Insurance Portability
and Accountability Act (HIPAA) must designate each practice location (if they have more than one) as
a subpart and ensure that each subpart obtains its own unique NPI. Federal regulations require that
each location of a Medicare DMEPOS supplier have its own unique billing number. In order to comply
with that regulation, each location must have its own unique NPI.
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[DECEMBER 2007]
In addition, the address listed on the NPI notification must match the address listed on the CMS-855S.
CMS requires a copy of the notification to be submitted with all enrollment documentation, which
includes initial applications, changes of information, reenrollments and reactivations.

Requires suppliers to complete the Authorization Agreement for Electronic Funds Transfer
(CMS-588). With regards to DMEPOS enrollment, suppliers should submit the CMS-588 electronic
funds transfer (EFT) form when initially enrolling or submitting an application for an additional
location. Suppliers must list the proper Medicare contractor and ensure the form has the original
signature of the authorized or delegated official. Also, suppliers should submit a separate form for
each Medicare contractor where it submits claims.
Note: Suppliers completing a reenrollment package, who are not currently enrolled in the EFT
program, should submit the completed CMS-588 form along with the required attachment verifying
the bank account information. The NSC will then forward the form to the appropriate DME MAC for
processing.
Along with the completed form, suppliers must include one of the following verifying the account
information:
− Voided check
− Deposit slip
− Notification on bank letterhead verifying the account information
The role of the NSC is to verify the form is complete, confirm the correct DME MAC has been
indicated (based on the information the supplier has provided on the CMS-855S) and to ensure
the agreement is signed properly. Once verified, the NSC will send the agreements to the
appropriate DME MAC for processing.
Again, suppliers should only submit the CMS-588 form to the NSC when submitting the CMS-855S
for initial enrollment when enrolling an additional location or reenrolling and not currently enrolled
in the EFT program. The NSC does not enroll suppliers into the EFT program. Any changes to EFT
information should be submitted following existing procedures.

A new section was added for suppliers to provide a specific address of where the NSC should mail
their reenrollment packages. If a supplier would like to receive their reenrollment at an address
other than the address where correspondences are received, the supplier should list this address in
Section 2.A.3. This enhancement was made to provide all suppliers, especially those suppliers with
multiple locations, a single address where they would like their reenrollment packages mailed.

Requires suppliers to provide the name and phone number of the insurance underwriter. The NSC is
required by CMS to verify coverage. Section 2.D requires suppliers to provide identifying information
for both the insurance agent and the underwriter. Providing this information will assist in facilitating
the verification process.
On April 2, 2007, CMS issued a Final Rule on accreditation for DMEPOS suppliers. Because of the
Final Rule, Section 2.F was added for suppliers to provide information concerning accreditation.
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Requires suppliers list the state(s) where items or services are being provided. Section 4 is where
suppliers will indicate what jurisdiction the majority of claims will be submitted and list the
individual states where items and services are provided. This information is being collected in
order to ensure suppliers are properly licensed in the states where they provide Medicare-covered
items to beneficiaries.
CHANGE OF INFORMATION
Any changes or updates to information provided on the CMS-855S form must be reported to the NSC
within 30 days after such changes have taken place. Updated information should be submitted on the
CMS-855S form. Failure to provide the updated information is grounds for denial or revocation of the
Medicare supplier number. In order to receive timely information from the DME MAC, the NSC
must have the supplier’s correct address. The NSC maintains the supplier’s correspondence
address information and transmits this information to the DME MAC. All changes, including changes in
address, must be reported to the NSC.
Be sure to attach all location specific licenses to any Change of Information form that includes a
change of physical location. This will be required before any changes can be made to the supplier file.
This serves as notice to suppliers that they should apply for any new location-specific licenses from the
specific licensing board (e.g., the Board of Pharmacy, business license offices, etc.) as quickly as
possible to ensure compliance with supplier standard #1.
Further instructions on how to complete a change of information for various reasons may be found in
the Supplier Enrollment/Change of Information section of the NSC Web site at
www.PalmettoGBA.com/NSC.
All CMS-855S forms and changes to previously submitted information must be sent to:
Regular Mail Address
Overnight Mail Address
National Supplier Clearinghouse
AG-495
P.O. Box 100142
Columbia, South Carolina 29202-3142
AG-495
2300 Springdale Drive, Bldg 1
Camden, South Carolina 29020
DIRECTORY OF MEDICARE SUPPLIERS
The CMS is responsible for producing a directory of all Medicare suppliers. This directory will not
include physicians or ambulatory surgical centers that furnish supplies, except optometrists. The
directory of Medicare suppliers can be found online at www.medicare.gov/Supplier/Home.asp.
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SUPPLIER STANDARDS
Medicare regulations have defined standards a supplier must meet to receive and maintain billing
privileges. These standards can be found in the Supplier Enrollment/Standards & Compliance/Supplier
Standards section of the NSC Web site at www.PalmettoGBA.com/NSC.
The Medicare DMEPOS supplier standards were finalized and became effective December 11, 2000.
These standards are listed below.
Source: Section 424.57 Special payment rules for items furnished by DMEPOS suppliers and issuance of
DMEPOS supplier billing privileges.
(A) Definitions
As used in this Section, the following definitions apply:
DMEPOS
Stands for durable medical equipment, prosthetics, orthotics, and supplies.
DMEPOS supplier
An entity or individual, including a physician or a Part A provider, which sells
or rents Part B covered items to Medicare beneficiaries and which meets the
standards in paragraph (c) of this section. Medicare covered items means
medical equipment and supplies as defined in Section 1834(j)(5) of the
Social Security Act.
(B) General Rule
A DMEPOS supplier must meet the following conditions in order to be eligible to receive payment for a
Medicare-covered item:
1) The supplier has submitted a completed application to CMS to furnish Medicare-covered items
including required enrollment forms. (The supplier must enroll separate physical locations it
uses to furnish Medicare-covered DMEPOS, with the exception of locations that it uses solely as
warehouses or repair facilities.)
2) The item was furnished on or after the date CMS conveyed billing privileges to the supplier.
3) The CMS has not revoked or excluded the DMEPOS supplier’s privileges during the period which
the item was furnished has not been revoked or excluded.
4) A supplier that furnishes a drug used as a Medicare-covered supply with durable medical
equipment or prosthetic devices must be licensed by the state to dispense drugs (A supplier of
drugs must bill and receive payment for the drug in its own name. A physician, who is enrolled
as a DMEPOS supplier, may dispense, and bill for, drugs under this standard if authorized by the
state as part of the physician's license.)
5) The supplier has furnished to CMS all information or documentation required to process the claim.
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[DECEMBER 2007]
(C) Application Certification Standards
The supplier must meet and must certify in its application for billing privileges that it meets and will
continue to meet the following standards:
1) Operates its business and furnishes Medicare-covered items in compliance with all applicable
Federal and State licensure and regulatory requirements.
2) Has not made, or caused to be made, any false statement or misrepresentation of a material fact on
its application for billing privileges. (The supplier must provide complete and accurate information in
response to questions on its application for billing privileges. The supplier must report to CMS any
changes in information supplied on the application within 30 days of the change.)
3) Must have the application for billing privileges signed by an individual whose signature binds
a supplier.
4) Fills orders, fabricates, or fits items from its own inventory or by contracting with other
companies for the purchase of items necessary to fill the order. If it does, it must provide, upon
request, copies of contracts or other documentation showing compliance with this standard. A
supplier may not contract with any entity that is currently excluded from the Medicare program,
any state health care programs, or from any other Federal Government Executive Branch
procurement or nonprocurement program or activity.
5) Advises beneficiaries that they may either rent or purchase inexpensive or routinely purchased
durable medical equipment, and of the purchase option for capped rental durable medical
equipment, as defined in Section 414.220(a) of this subchapter. (The supplier must provide,
upon request, documentation that it has provided beneficiaries with this information, in the
form of copies of letters, logs or signed notices.)
6) Honors all warranties expressed and implied under applicable state law. A supplier must not
charge the beneficiary or the Medicare program for the repair or replacement of Medicare-covered
items or for services covered under warranty. This standard applies to all purchased and rented
items, including capped rental items, as described in Section 414.229 of this subchapter. The
supplier must provide, upon request, documentation that it has provided beneficiaries with
information about Medicare-covered items covered under warranty, in the form of copies of
letters, logs, or signed notices.
7) Maintains a physical facility on an appropriate site. The physical facility must contain space for
storing business records including the supplier’s delivery, maintenance, and beneficiary
communication records. For purposes of this standard, a post office box or commercial mailbox
is not considered a physical facility. In the case of a multisite supplier, records may be
maintained at a centralized location.
8) Permits CMS, or its agents to conduct on-site inspections to ascertain supplier compliance with
the requirements of this section. The supplier location must be accessible during reasonable
business hours to beneficiaries and to CMS, and must maintain a visible sign and posted hours
of operation.
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[DECEMBER 2007]
9) Maintains a primary business telephone listed under the name of the business locally or toll-free
for beneficiaries. The supplier must furnish information to beneficiaries at the time of delivery of
items on how the beneficiary can contact the supplier by telephone. The exclusive use of a
beeper number, answering service, pager, facsimile machine, car phone, or an answering
machine may not be used as the primary business telephone for purposes of this regulation.
10) Has a comprehensive liability insurance policy in the amount of at least $300,000 that covers
both the supplier’s place of business and all customers and employees of the supplier. In the
case of a supplier that manufactures its own items, this insurance must also cover product
liability and completed operations. Failure to maintain required insurance at all times will result
in revocation of the supplier's billing privileges retroactive to the date the insurance lapsed.
11) Must agree not to contact a beneficiary by telephone when supplying a Medicare-covered item
unless one of the following applies:
(i) The individual has given written permission to the supplier to contact them by telephone
concerning the furnishing of a Medicare-covered item that is to be rented or purchased.
(ii) The supplier has furnished a Medicare-covered item to the individual and the supplier is
contacting the individual to coordinate the delivery of the item.
(iii) If the contact concerns the furnishing of a Medicare-covered item other than a covered item
already furnished to the individual, the supplier has furnished at least one covered item to
the individual during the 15-month period proceeding the date on which the supplier makes
such contact.
12) Must be responsible for the delivery of Medicare covered items to beneficiaries and maintain
proof of delivery. (The supplier must document that it or another qualified party has at an
appropriate time, provided beneficiaries with necessary information and instructions on how to
use Medicare covered items safely and effectively).
13) Must answer questions and respond to complaints a beneficiary has about the Medicare-covered
item that was sold or rented. A supplier must refer beneficiaries with Medicare questions to the
appropriate carrier. A supplier must maintain documentation of contacts with beneficiaries
regarding complaints or questions.
14) Must maintain and replace at no charge or repair directly, or through a service contract with
another company, Medicare-covered items it has rented to beneficiaries. The item must function
as required and intended after being repaired or replaced.
15) Must accept returns from beneficiaries of substandard (less than full quality for the particular
item) or unsuitable items (i.e., inappropriate for the beneficiary at the time it was fitted and
rented or sold) from beneficiaries.
16) Must disclose these supplier standards to each beneficiary to whom it supplies a
Medicare-covered item.
17) Must comply with the disclosure provisions in Section 420.206 of this subchapter.
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[DECEMBER 2007]
18) Must not convey or reassign a supplier’s billing privileges.
19) Must have a complaint resolution protocol to address beneficiary complaints that relate to
supplier standards in paragraph (c) of this section and keep written complaints, related
correspondence and any notes of actions taken in response to written and oral complaints.
Failure to maintain such information may be considered evidence that supplier standards have
not been met. (This information must be kept at its physical facility and made available to CMS,
upon request.)
20) Must maintain the following information on all written and oral beneficiary complaints, including
telephone complaints, it receives:
(i) Name, address, telephone number, and health insurance claim number of the beneficiary.
(ii) A summary of the complaint; the date it was received; the name of the person receiving the
complaint, and a summary of actions taken to resolve the complaint.
(iii) If an investigation was not conducted, the name of the person making the decision and the
reason for the decision.
21) Provides to CMS, upon request, any information required by the Medicare statute and
implementing regulations.
(D) Failure to Meet Standards
The CMS will revoke a supplier’s billing privileges if it is found not to meet the standards in paragraphs
(b) and (c) of this section. (The revocation is effective 15 days after the entity is sent notice of the
revocation, as specified in Section 405.874 of this subchapter.)
(E) Renewal of Billing Privileges
A supplier must renew its application for billing privileges every three years after the billing privileges are
first granted. Each supplier must complete a new application for billing privileges three years after its
last renewal of privileges. The NSC will notify suppliers via mail when a new renewal application is due.
CHANGE OF OWNERSHIP
When there is a change of ownership, new billing privileges must be issued unless the new owners
assume all liabilities and the tax identification number of the existing supplier. Otherwise, the new
owner may not use the existing supplier’s billing privileges (supplier standard #18). The new owner
must submit form CMS-855S to the NSC within thirty (30) days of the change of ownership, along with
a bill of sale, articles of incorporation filed with the state and any other documents that show the
exact nature of the transaction.
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[DECEMBER 2007]
If there is a change in the tax identification number, the outgoing owner must notify the NSC by
completing the CMS-855S as a “Voluntary Termination of Billing Number.” The request to voluntarily
terminate the supplier’s billing privileges must be submitted on the CMS-855S. Per Chapter 10, Section
7 of the CMS IOM Publication 100-08, Medicare Program Integrity Manual, all changes must be
reported on the CMS-855S.
The old billing privileges will be inactivated. If the NSC determines the new owners have met all
requirements, the new privileges will be effective from the date of the change of ownership. Claims for
items furnished between the date of the change of ownership and the issuance of the new privileges
may be submitted to the DME MAC once the supplier has received the new privileges.
Further information about change in ownership, including instructions on how to submit a voluntary
termination, may be found in the Supplier Enrollment/Standards & Compliance/Change of Information
section of the NSC Web site at www.PalmettoGBA.com/NSC.
RESOURCES AVAILABLE TO ASSIST SUPPLIERS WITH
THE ENROLLMENT PROCESS
The NSC Web Site
www.PalmettoGBA.com/NSC

Helpful hints for completing the CMS-855S
Numerous Frequently Asked Questions (FAQs) regarding the enrollment process
The NSC Top Ten—the top ten reoccurring issues that delay processing
Information regarding the NSC site visit process
Licensure information
A checklist to ensure the CMS-855S was completed properly and that all required documentation
has been provided
The NSC Customer Service Line
866-238-9652
NSC analysts are available Monday through Friday from 9:00 a.m. until 5:00 p.m. Eastern Time (ET) to
answer questions regarding the enrollment process. If the supplier has questions regarding supplier
specific information, please be sure the caller is listed on the supplier file. NSC analysts will not be able
to give supplier specific information to someone who is not listed on the supplier file. The NSC also
has a voice mailbox available to Spanish suppliers who do not speak English.
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[DECEMBER 2007]
NSC E-Mail Address
[email protected]
If preferred, suppliers can e-mail their questions to this address. Questions received will be answered
within a reasonable time frame. The NSC suggests suppliers do not submit protected health care
information via e-mail.
NSC Interactive Voice Response Unit
The NSC Interactive Voice Response (IVR) Unit allows suppliers to obtain:

General information regarding the enrollment process
Information on the appeals process
Status of a new application, reenrollment, reactivation or change of information
Instructions on how to obtain a CMS-855S
Contact information for the NSC, durable medical equipment regional carrier/DME MACs and CMS
The IVR is available 24-hours a day, seven days a week (except for routine system maintenance) and
can be accessed by calling the NSC Customer Service line at 866-238-9652.
11
Chapter 3: Participation Program
[DECEMBER 2007]
3 Participation Program
The Medicare participation program involves a voluntary agreement between a supplier and Medicare.
Under the agreement, the supplier agrees to accept assignment for all services rendered to Medicare
beneficiaries and to accept the Medicare allowed amount as the total charge for any covered item.
Any Medicare-enrolled supplier may choose to participate in the program. Participation is not automatic;
the assignment of a durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) supplier
number does not enroll a supplier in the program. A separate participation agreement must be filed with
the National Supplier Clearinghouse (NSC).
Once a supplier is enrolled in the program, the agreement applies to locations enrolled under the
same tax identification number. Participation is not location specific. This is true whether the supplier
is an individual, partnership or corporation.
ENROLLMENT
The participation enrollment form is available on the NSC Web site at www.PalmettoGBA.com/NSC.
Suppliers may also obtain an enrollment form by calling the NSC toll free at 866-238–9652, or by
writing to:
Palmetto GBA—AG-495
P.O. Box 100142
If preferred, suppliers can e-mail their questions to [email protected]. Questions
received will be answered within a reasonable time frame. The NSC suggests that suppliers refrain
from submitting protected healthcare information via e-mail.
The Centers for Medicare & Medicaid Services (CMS) offers an open enrollment period each year when
suppliers may enroll in the program or provide notice of the termination of their participation
agreement. The open enrollment period usually takes place mid-November to the end of December.
The NSC notifies suppliers of the specific dates for the enrollment period each year.
In order to terminate a participation agreement, a supplier must notify the NSC in writing during the
enrollment period. The written notice must be postmarked before the end of the enrollment period
and have the original signature of the authorized official. The termination will be effective January 1 of
the following year.
The NSC will acknowledge receipt of a request, which has been completed appropriately and has the
proper original signature, to enroll or to terminate enrollment in the participation program. Suppliers
who do not receive an acknowledgement within a reasonable time should contact the NSC.
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[DECEMBER 2007]
BENEFITS OF PARTICIPATION
By agreeing to accept assignment on all claims, a participating provider receives certain advantages.
By accepting assignment, a supplier:

requests direct payment from Medicare for covered items;
accepts the Medicare allowed amount as the full charge for the item or service; and
has the right to appeal claim determination by the durable medical equipment Medicare
administrative contractor (DME MAC).
Medicare also advertises the participation status of providers to beneficiaries by providing a directory of
participating providers to senior citizens groups and, upon request, to individual Medicare beneficiaries.
Medicare provides for the automatic crossover of claims to Medigap insurers for participating
providers. In other words, when a participating supplier provides the appropriate information on a
claim for a beneficiary who has a Medigap insurance policy, Medicare will transfer the claim
information to the Medigap insurer after processing, reducing paperwork for the supplier. Refer to the
Paper Claim Form Completion chapter of this manual for CMS-1500 claim form completion instructions
to ensure automatic crossover.
ASSIGNMENT OF CLAIMS
It should be noted that the terms participating and nonparticipating refer to suppliers. The terms
assigned and nonassigned refer to claims.
By accepting assignment on a claim a supplier agrees to accept Medicare’s allowed amount as the full
charge for the items or services provided. This means that for covered services, the supplier may
collect only the deductible and remaining coinsurance amounts from the beneficiary. A claim for an
assigned item is considered paid in full when the DME MACs allowed amount is paid.
On an assigned claim that was denied because the beneficiary did not meet Medicare’s medical
necessity criteria, the beneficiary may be held financially responsible for Medicare’s allowed amount if
an acceptable Advance Beneficiary Notice (ABN) was obtained. Refer to Chapter 9, Advanced
Beneficiary Notice, for detailed information regarding ABN requirements.
For noncovered items, the beneficiary may be held financially responsible for the supplier’s entire
charge regardless of whether the claim is filed assigned or nonassigned.
Assignment for Nonparticipating Suppliers
Suppliers who have not enrolled in the participation program (i.e., nonparticipating suppliers) may accept
assignment on a claim-by-claim basis. On a nonassigned claim that was denied because the beneficiary
did not meet Medicare’s medical necessity criteria, the beneficiary may be held financially responsible
for the supplier’s entire charge if an acceptable ABN was obtained prior to rendering the services.
A nonparticipating supplier may not file assigned claims for some items and nonassigned claims for
other items when they were provided to the same beneficiary on the same date.
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[DECEMBER 2007]
Once a claim has been filed as assigned, it may not be changed to nonassigned without the consent of
both the beneficiary and the supplier. The notice to rescind must be received by the DME MAC prior to
payment determination.
Assignment Violation
When an assignment violation is noted by the DME MAC through the review of a claim or through a
beneficiary complaint, the DME MAC will educate the supplier on the terms of the assignment agreement.
The supplier may be required to return a refund and provide a corrected statement to the beneficiary.
Where there are repeated violations of the assignment agreement, the DME MAC may suspend further
payment to the supplier on assigned claims as directed by the CMS. For payable claims, payment will
be made directly to the beneficiary. The beneficiary will be advised that the supplier has not complied
with the requirements for receiving payment from Medicare.
3
Chapter 4: Coordination of Benefits and Medicare Secondary Payer
[DECEMBER 2007]
4 Coordination of Benefits and Medicare
Secondary Payer
COORDINATION OF BENEFITS CONTRACTOR
Reference: Centers for Medicare & Medicaid Services (CMS) Internet-Only Manual (IOM) Publication
100-05, Medicare Secondary Payer Manual, Chapter 4, Coordination of Benefits Contractor (COBC)
Requirements, www.cms.hhs.gov/manuals/downloads/msp105c04.pdf
The Coordination of Benefits Contractor (COBC) consolidates the activities that support the collection,
management and reporting of other insurance coverage for Medicare beneficiaries. The COBC is
primarily an information gathering entity whose purpose is to identify the health benefits available to a
Medicare beneficiary and to coordinate the payment process to prevent mistaken payment of Medicare
benefits. The COBC is dependent upon various sources to collect this information, including
beneficiaries, providers, suppliers and Medicare contractors.
The COBC is virtually responsible for all initial Medicare Secondary Payer (MSP) development activities
formerly performed by contractors.
COBC responsibilities include:

Ensuring the accuracy and timeliness of updates to the Common Working File (CWF) MSP
auxiliary file
Developing claims to determine the existence or validity of MSP for Medicare beneficiaries.
Handling all MSP related inquiries, including those seeking general MSP information, but not those
related to specific claims or recoveries. These inquiries (verbal and written) can come from any
source, including but not limited to beneficiaries, attorneys/beneficiary representatives,
employers, insurers, providers, suppliers and contractors.
Assigning new Medigap claim-based Coordination of Benefits Agreement (COBA) identifiers to
Medigap insurers
On October 1, 2007, the COBC assumed responsibility for the Medigap claim-based crossover, which
will be driven by information that participating providers enter on the incoming claim.
Participating providers that are permitted under the Administrative Simplification Compliance Act
(ASCA) to bill Medicare on paper should include the newly assigned five-digit COBA Medigap claimbased ID within Item 9-D of the CMS-1500 claim form.
In accordance with Public Law 104-191 and 45 Code of Federal Regulations (CFR) 160, the COBC will
only transmit claim to Medigap claim-based crossover recipient in the Health Insurance Portability and
Accountability Act (HIPAA) American National Standards Institute (ANSI) X12-N 837 professional
(version 4010A1) coordination of benefits (COB) claim format, or in the National Council for
Prescription Drug Program (NCPDP) version 5.1 batch standard 1.1 format.
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[DECEMBER 2007]
Note: Providers may reference a weekly updated listing of the newly assigned COBA Medigap claim-based
IDs for Medicare billing purposes at the following Web site:
www.cms.hhs.gov/COBAgreement/Downloads/Medigap%20Claimbased%20COBA%20IDs%20for%20Billing%20Purpose.pdf
The COBC does not process claims, nor does it handle any mistaken payment recoveries or claims
specific inquiries. The Medicare intermediaries and carriers are responsible for processing claims
submitted for primary or secondary payment. Refer to the information below to determine whom to
contact to resolve specific MSP-related questions.
Contact the COBC to:

report employment changes or any other insurance coverage information;
report a liability, auto/no-fault or Workers’ Compensation case;
ask general MSP questions/concerns; and
ask questions regarding MSP letters and questionnaires.
Contact your local Medicare intermediary or carrier to:

answer questions regarding Medicare claim or service denials and adjustments;
answer questions concerning how to bill for payment;
process claims for primary or secondary payment; and
accept the return of inappropriate Medicare payment.
The COBC Customer Service number is 800-999-1118. Hours of operation are 8:00 a.m.–8:00 p.m.
Eastern Time, Monday–Friday, except holidays.
Direct general written inquiries to:
Medicare—Coordination of Benefits
P.O. Box 5041
New York, New York 10274-5041
MEDICARE’S ROLE
Reference: CMS IOM Publication 100-05, Medicare Secondary Payer Manual,
www.cms.hhs.gov/Manuals/IOM/list.asp.
Since the Medicare program’s inception, Congress has enacted a number of laws that have made
Medicare a secondary payer to other insurance in certain situations.
The role of MSP in particular situations is similar to the coordination of benefits clauses in private
health insurance policies. Ordinarily, Medicare should be viewed as a secondary payer when a
beneficiary can reasonably be expected to receive medical benefits through one or more of the
following situations:
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[DECEMBER 2007]

Group health plan (GHP) meeting MSP provisions for Age, Disability, or End-Stage Renal
Disease (ESRD)
Accidents with available no-fault (nonliability, med-pay) or liability insurance
Workers’ Compensation
Federal Black Lung Program
Veterans Administration
Please note that Medigap, Medicaid and TRICARE are not among the programs primary to Medicare.
Upon initial contact with the patient, providers/suppliers determine if there are any other payers that
may be primary to Medicare. A sample MSP questionnaire is included at the end of this chapter.
Suppliers are encouraged to use this questionnaire or a similar form of their own to help identify
payers that may be primary to Medicare. Once a supplier has identified the primary payer, the supplier
should bill that payer first. Medicare should not be billed until the supplier has received notice of
payment or rejection by the primary insurer. Once the notice is received, the supplier must include the
primary payer information on the Medicare claim (see the Billing Requirements section of this chapter
for instructions).
When Medicare is the secondary payer, certain information is needed to determine Medicare liability.
Medicare must know how much the primary insurer allowed and how much the primary insurer paid.
Many Medicare patients have other insurance that is primary to Medicare. Suppliers who fail to identify
payers that are primary to Medicare may have their claims denied. Early detection of an MSP situation
and proper billing will result in improved claims flow.
MEDICARE SECONDARY PAYER PROGRAMS
Reference: CMS IOM Publication 100-05, Medicare Secondary Payer Manual, Chapter 2, MSP Provisions,
www.cms.hhs.gov/manuals/downloads/msp105c02.pdf
During the registration process, suppliers should screen their patients to determine if there are other
payers that may be primary to Medicare. The following information provides details about the various
MSP programs.
Employer Group Health Plans
Medicare is secondary payer for some beneficiaries who are enrolled in an employer group health plan
(EGHP). Medicare defines an EGHP as any health plan that is offered to employees and their families
by an employer of 20 or more full-time and/or part-time employees. This definition includes a
multiemployer group health plan (GHP) that has at least one employer with 20 or more employees.
The durable medical equipment Medicare administrative contractor (DME MAC) assumes, in the
absence of contrary evidence, that EGHPs meet the 20 employee test.
If the beneficiary has appealed or is protesting an EGHP denial, conditional primary benefits may be
paid for any reason other than the following:
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[DECEMBER 2007]
1) The EGHP offers only secondary coverage of services covered by Medicare, or
2) The EGHP denied the claim because the time limit for filing the claim with Medicare expired, or
3) The EGHP denied the claim because the time limit for filing the claim with the EGHP expired
(whether appealed or not)
Working Aged
In 1982, Congress created the MSP category known as Working Aged.
The current rules regarding the Working Aged have been in effect since May 1, 1986. For services
rendered on or after this date, Medicare will be secondary for those people age 65 and over who are
covered under an EGHP. The EGHP must be through the current employment of the beneficiary or
his/her spouse, and the employer must have a minimum of 20 employees. There are no longer any
age ceilings for the beneficiary, as long as he/she is at least 65. Similarly, a working spouse of the
beneficiary may be any age.
Example: Mr. Patrick is 71 years old and retired. Mrs. Patrick is employed at a real estate office that
employs 24 people, and carries group insurance on both her and Mr. Patrick. Medicare is secondary.
The employer insurance should be billed first for all durable medical equipment, prosthetics, orthotics
and supplies (DMEPOS) items.
Individuals with End-Stage Renal Disease
Medicare is secondary to benefits payable under a GHP for individuals of any age who are entitled to
Medicare benefits due to end-stage renal disease (ESRD). The GHP may be through a current or
former employer of the beneficiary or through coverage of another family member who covers the
beneficiary on their group health plan. (Exception: A retirement plan which has become secondary
payer to Medicare does not have to revert to being primary payer.) Medicare is secondary payer for a
period of 30 months. This 30-month period (the ESRD coordination period) begins with the first month
of Medicare eligibility. After the 30-month period has been completed, Medicare will be primary
regardless of other available GHPs.
For patients undertaking hemodialysis, there is a three-month waiting period before they are eligible
for Medicare benefits. Patients who undertake peritoneal dialysis may waive the three-month waiting
period. In the case of a kidney transplant, Medicare coverage can begin the month an individual is
admitted to an approved hospital for a kidney transplant or procedures preliminary to a transplant if
the transplant takes place in that month or within the two following months. If the transplant is
delayed more than two months after the individual is admitted to the hospital, Medicare coverage will
begin two months before the month the actual transplant takes place, or if earlier, the first day of the
third month after the monthly maintenance dialysis began.
Example 1: An individual begins routine hemodialysis in April 2005. He/she would have a threemonth waiting period (April, May and June) and would then be eligible for Medicare benefits on July 1,
2005. His/her 30-month ESRD coordination period would be from July 2005 through December 2007.
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[DECEMBER 2007]
Example 2: An individual begins routine peritoneal dialysis in April 2005. He/she could waive the
three-month waiting period and Medicare eligibility would begin immediately. His/her 30-month ESRD
coordination period would be from April 2005 through September 2007.
Note: In the examples above, if the individual was covered under a GHP through their own or another
family member’s current or former employment with an employer of any size, the GHP would be the
primary payer throughout the 30-month ESRD coordination period.
For beneficiaries entitled to Medicare solely on the basis of ESRD, Medicare coverage ends 12 months
after the month they no longer require maintenance dialysis treatments or 36 months after the month
of a successful kidney transplant. If the transplant fails during or after that 36-month period and the
beneficiary resumes maintenance dialysis or receives another transplant, Medicare coverage will
continue or be reinstated immediately without any waiting period.
If an individual has more than one period of entitlement based solely upon ESRD, a coordination
period is determined for each period of entitlement. In the case where a kidney transplant fails and
the individual requires dialysis after the 36-month period of Medicare entitlement, the 30-month
coordination period begins with the month in which renal dialysis begins, not three months after the
month dialysis is reinstated. This is because a second waiting period is not required for re-entitlement
to Medicare for situations involving kidney transplant failure. However in the case where a kidney
transplant fails and the individual requires dialysis before the 36-month period of entitlement ends,
there is no break in Medicare entitlement and thus no new coordination period.
Individuals with Disability
Medicare is secondary payer for a beneficiary entitled to Medicare due to a disability other than ESRD
who also meets the following criteria:
1) He/she is under age 65, and
2) Covered under a large group health plan (LGHP) due to either his/her own employment or the
employment of a family member with an employer of 100 or more employees. (Note: Employers
must comply with the disability provisions when they have met the criteria of having 100 or
more full and/or part-time employees for at least 50 percent of their business year.)
MSP status for a disabled Medicare beneficiary is determined by the existence of LGHP coverage based
upon the beneficiary’s or a family member’s current employment status (per the Omnibus Budget
Reconciliation Act [OBRA’93] effective August 10, 1993).
An individual has current employment status with an employer if:
1) The individual is actively working as an employee, or
2) The individual is the employer (including self-employed persons), or
3) The individual is associated with the employer in a business relationship
Dual Entitlement
When a beneficiary’s entitlement to Medicare can be based upon more than one provision, Dual
Entitlement exists. Under prior MSP law, Medicare became the primary payer when a Medicare
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[DECEMBER 2007]
beneficiary became dually entitled to Medicare, e.g., disability and ESRD or age and ESRD. This
changed with the passage of OBRA 1993. It is no longer mandatory for Medicare to be the primary
payer in cases of dual entitlement. Section 13561(c) of OBRA 1993 (effective August 10, 1993)
provided that Medicare will remain the secondary payer throughout a coordination period. Even if the
beneficiary becomes entitled to Medicare based on disability or age before the ESRD coordination
period ends, Medicare will remain secondary payer. Additionally, a coordination period applies when
Medicare is secondary due to the Age or Disability provision and the beneficiary then becomes entitled
due to ESRD.
If the beneficiary loses entitlement due to ESRD but retains Medicare coverage due to age or
disability, then the MSP Age or Disability provisions will apply.
Note: A beneficiary is not dually entitled to Medicare by age and disability. When a disabled beneficiary
reaches age 65, he/she becomes entitled to Medicare by age and is no longer covered under the Medicare
Disability provision. If the beneficiary or their spouse is working, the Working Aged provision would apply.
Accidents
Medicare may revert to secondary payer for covered items when payment may reasonably be
expected to be made under a no-fault insurance (i.e., nonliability, med-pay), or a liability insurance.
Note: Medicare will be secondary payer regarding claims involving the conditions related to the accident.
Medicare would retain its normal payment status on other claims.
Additional Documentation
When filing a claim for conditions which result from an accident, additional documentation is
necessary, such as:

The specific location of the accident
A statement of whether or not the beneficiary feels someone else is liable
The name and address of the liable party
The name, address and policy number of the liable party’s insurance (this may be information for
the beneficiary’s automobile insurance company if the beneficiary was involved in and responsible
for an automobile accident)
The names and addresses of any attorneys involved
No-fault Insurance
No-fault (or nonliability) insurance may include motor vehicle medical coverage, premises medical
coverage, homeowner’s medical coverage or no-fault insurance. The supplier must pursue billing with
a no-fault insurance company before it may bill Medicare.
The supplier and the beneficiary are responsible for taking whatever action is necessary to obtain any
payment that can reasonably be expected under no-fault insurance. Medicare does not pay until the
beneficiary has exhausted his/her remedies under no-fault insurance. Medicare does not pay for
services that would have been covered by the nonliability no-fault insurance if the beneficiary had filed
a proper claim with those insurers. An exception is when the beneficiary, because of a physical or
mental incapacity, failed to meet a claim filing requirement stipulated by the policy.
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[DECEMBER 2007]
Note: If the no-fault insurance pays the beneficiary directly, the supplier must seek payment of those
funds from the beneficiary and should not bill Medicare for those amounts.
Liability Insurance
Liability insurance (including a self-insured plan) provides payment based upon legal liability for injury
or illness or damage to property or person. It may include automobile liability, uninsured motorist,
underinsured motorist, homeowner’s liability, malpractice, product liability, and general casualty
insurances. For purposes of billing Medicare, liability involvement is determined by the beneficiary
statement as to whether or not he/she feels someone else is responsible for the accident/incident.
If the beneficiary feels that someone else is responsible for the accident (not the claim), the supplier
must also identify and pursue the liability insurance company before billing Medicare. The liability
insurance must be pursued for the first 120 days. If the supplier receives a denial notice from the
insurance company before 120 days have passed, or the 120 days have passed without resolution,
they may bill Medicare conditionally.
Example 1 (No-fault): A Medicare beneficiary falls at their neighbor’s home. They are not holding
the neighbor responsible for the fall. However, the neighbor has no-fault (medical payments) coverage
under their homeowner’s policy. The supplier would need to bill the homeowner’s policy for all claims
related to this accident. The beneficiary does not have a choice in whether or not this policy is billed.
Example 2 (No-fault): A Medicare beneficiary is involved in an automobile accident. They are not
holding anyone else responsible for the accident. However, they have no-fault (medical payments)
coverage under their automobile policy. The supplier would need to bill the beneficiary’s automobile
policy for all claims related to this accident.
Example 3 (Liability): A Medicare beneficiary falls in a grocery store. The grocery store does not
carry no-fault (premises medical) insurance. However, the beneficiary is holding the grocery store
responsible for the accident. The supplier would need to bill the grocery store’s liability insurance for
all claims related to this accident.
Note: If the injury resulted from an automobile accident and there is indication of primary coverage under
an EGHP, the supplier bills the automobile medical or no-fault insurer or employer plan before requesting
conditional Medicare payments.
Medicare payment may not be made if payment can reasonably be expected to be made under a
Workers’ Compensation (WC) plan including plans provided under the Federal Employee’s
Compensation Act and the U.S. Longshoremen’s and Harbor Workers’ Compensation Act. The
beneficiary’s WC carrier should be billed first for all DMEPOS items related to the injury while at work.
Conditional Medicare Benefits
Conditional Medicare benefits may be paid while a WC claim is being contested. The beneficiary’s WC
carrier must be pursued for the first 120 days. If the supplier receives a denial from the insurance
company before 120 days or the 120 days have passed without resolution, the supplier may file the
claim with Medicare conditionally. Frequently, there is a long delay between the occurrence of an
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[DECEMBER 2007]
injury or illness and the decision by the state WC agency. A denial of Medicare benefits pending the
outcome of the appeal would mean individuals might be required to advance their own funds to pay
for expenses which would eventually be borne by either Medicare or WC. To avoid imposing hardship
on Medicare beneficiaries, conditional Medicare payments may be made pending a final decision on
the WC claim.
Note: Medicare will not make conditional payments if a WC Medicare Set-Aside has been approved by CMS.
Some Medicare beneficiaries are entitled to receive medical benefits under the Federal Black Lung
Program when DMEPOS items are provided for a condition attributable to lung diseases or conditions
caused by mining. The Department of Labor (DOL) administers the Federal Black Lung Program. If the
supplier is aware that the beneficiary is entitled to benefits under this program, the DOL should be
billed first for all DMEPOS items related to a black lung diagnosis. Mail claims to:
CSC Correspondence Unit
P.O. Box 740
Lanham, Maryland 20706
Medicare will continue to be primary payer for services not related to Black Lung disease. Suppliers
identify the diagnosis, signs, or symptoms that caused the services to be rendered. Medicare
secondary benefits may be available for services related to Black Lung disease. A copy of DOL’s
benefits explanation must accompany a claim to Medicare for secondary payment.
For a complete list of the diagnoses and conditions, as well as the items covered under the Federal
Black Lung Program, please refer to the National Government Services Web site at
www.adminastar.com/Providers/MSP/Programs/files/MedA_BlackLung.pdf, or submit a request in
writing to:
Freedom of Information
P.O. Box 50454
Indianapolis, Indiana 46250-0454
Veterans who are entitled to Medicare may choose which program will be responsible for payment of
DMEPOS covered by both programs.
Submit claims for which the veteran elects Medicare coverage to Medicare in the normal manner. A
denial from the Veterans Administration (VA) is not needed prior to submitting a claim to Medicare.
Claims cannot be submitted to both programs for the same dates and items. If a veteran elects
Medicare coverage, a claim should not be submitted to VA for any portion of that claim. If a veteran
elects VA coverage, a claim should not be submitted to Medicare for any portion of that claim.
8
[DECEMBER 2007]
Medicare and VA perform periodic computer data matches to identify duplicate payments. When
duplicate payments are found, Medicare will pursue recovery of its payment and will request information
for potential referral to the Internal Revenue Service or the Office of the Inspector General.
Submit DMEPOS claims to VA in situations such as:
1) Outpatient medical services were authorized by VA in advance. (Note: A VA Fee-Basis
Identification (ID) Card is not considered by Medicare to be an authorization. The veteran
retains his/her right to elect VA or Medicare coverage.)
2) Care is not authorized by VA in advance; the veteran is eligible for payment for care as
unauthorized service; the veteran chooses to submit a claim to VA for unauthorized services
rather than utilizing Medicare benefits.
Submit DMEPOS claims to Medicare in situations such as:
1) A veteran is eligible for Medicare benefits and hospital care is not authorized by VA in advance
or within 72-hours of admission.
2) A veteran is eligible for Medicare benefits, has a VA Fee-Basis ID Card and elects Medicare
coverage over VA.
3) A veteran is eligible for Medicare benefits and has no prior authorization from VA for care—unless
the veteran is eligible for payment for care as an unauthorized service—and the veteran chooses
to submit a claim to VA for unauthorized services rather than utilizing Medicare benefits.
4) A veteran is eligible for Medicare benefits and the VA has authorized payment for only a part of
the hospital treatment period.
CMS MSP Questionnaire
CMS has created a questionnaire that contains questions that can be used to ask Medicare
beneficiaries upon each inpatient and outpatient admission. The questionnaire is located in the CMS
IOM Publication 100-05, Medicare Secondary Payer Manual, Chapter 3, at
www.cms.hhs.gov/manuals/downloads/msp105c03.pdf
A sample of the CMS MSP Questionnaire is located at the end of this chapter. Suppliers are
encouraged to use the CMS MSP Questionnaire to screen for payers primary to Medicare.
Note: Suppliers should begin using the CMS MSP questionnaire effective September 11, 2006.
BILLING REQUIREMENTS
Medicare Secondary Payer claims must be filed electronically unless an Administrative Simplification
Compliance Act (ASCA) exception is met. Suppliers submitting MSP claims electronically must include
the primary payer paid amount, approved amount, and allowed amount from the EOB in the
2320.AMT segment. Suppliers should contact their software vendor to determine how the 2320.AMT
segment corresponds to their software program.
Note: Suppliers that qualify for an ASCA exception, and are therefore submitting their claims hardcopy,
must attach the EOB to the CMS-1500 claim form.
9
[DECEMBER 2007]
Medicare Secondary Claim Filing Tips

A claim should be submitted to the primary insurer first.
An Explanation of Benefits (EOB) or payment determination from the primary insurer must
accompany each paper claim submitted to Medicare.
Suppliers submitting MSP claims electronically must include the primary payer paid amount,
approved amount, and allowed amount from the EOB in the 2320.AMT segment.
If Medicare is secondary to a GHP, Items 11 and 11a–11c of the CMS-1500 claim form must
be completed.
If the claim is due to an accident, Items 10a–10c of the CMS-1500 claim form should be completed.
Do not enter the primary insurer’s payment amount in Item 29 of the CMS-1500. Complete this
field only if payment is received from the beneficiary.
Submit the total charge, not the difference between your usual charge and the primary insurer's
payment (i.e., coinsurance payment). The total charge should not be reduced to reflect the
Medicare or primary insurer’s allowed amounts.
Refer to the patient responsibility (PT RESP) field on the Medicare remittance notice to determine
how much to bill the beneficiary. The coinsurance (COINS) and deductible (DEDUCT) fields are
calculated based on the Medicare primary payment and do not apply to a secondary claim.
CLAIM LIABILITY CALCULATION
When Medicare receives a claim as the secondary payer, Medicare’s liability is the lower amount
derived from three calculations. The first calculation determines how much Medicare would pay
without regard to any primary insurer. The second calculation subtracts the primary insurer’s payment
from the higher of the Medicare allowance or primary insurer’s allowance.
Example 1:

Assigned Claim
Submitted Charge = $500
Primary Insurer’s Allowance = $500
Primary Insurer’s Payment = $000
Medicare Allowance = $380
This example assumes the $131 Medicare deductible had not been met. This example also assumes
the primary insurer applied $500 to their deductible.
Medicare Liability Without Regard to Other
Insurance:
$380 – 131 = 229 × 80% = $199.20
Medicare Liability Considering Other
Insurer’s Payment:
$500 – 0 = $500
Solution: Medicare would pay $199.20. The combined primary insurer’s payment and Medicare payment
equals $199.20. Since this is an assigned claim, the beneficiary may be billed for $176.80, the $131.00
Medicare deductible and $45.80 of coinsurance. The provider will then have received $380.
10
[DECEMBER 2007]
Example 2:

Assigned Claim
This example assumes the $131 Medicare deductible has been met.
Insurance:
$380 × 80% = $304
$500 – 320 = $180
Solution: Medicare would pay $180. The combined primary insurer’s payment and Medicare payment
equals $500, thus no balance is due from the patient. The claim is paid in full.
Example 3:

Assigned Claim
This example assumes the $131 Medicare deductible had been met. This example also assumes the
primary insurer applied $400 to their deductible.
Insurance:
$380 × 80% = $304
$400 – 0 = $400
Solution: Medicare would pay $304. The combined primary insurer’s payment and Medicare payment
equals $304. Since this is an assigned claim, the beneficiary may be billed for $76, the Medicare
coinsurance amount. The provider will then have received $380.
MEDICARE SECONDARY PAYER OVERPAYMENTS
If a provider, physician or supplier receives an overpayment that is a result of Medicare paying primary
on a claim when the beneficiary has primary insurance coverage through another insurer, the
provider, physician or supplier must refund Medicare’s overpayment. There are two methods suppliers
may use to return Medicare’s overpayment in an MSP situation. The supplier may complete an MSP
Voluntary Refund form and mail it, along with a copy of the primary payer’s Explanation of Benefits
(EOB) and a check for the amount that is owed Medicare, to our office. Or, the supplier may complete
an MSP Offset by Fax Request form and fax it, along with a copy of the primary payer’s EOB to our
office. When an offset is requested, Medicare will calculate the amount of the overpayment based
upon the information provided by the supplier and recoup the overpayment amount from a future
11
[DECEMBER 2007]
supplier payment. Calculating Medicare’s portion of a claim payment in MSP situations can be
complicated. For this reason, suppliers may prefer to use the MSP offset by fax process.
Note: If a supplier receives money from a liability insurer after having billed Medicare, the supplier may
retain only the amount of any unpaid deductible, coinsurance and noncovered items and must return the
balance of the liability payment to the liability insurer, the attorney or the Medicare beneficiary.
Refund Forms
The following pages include the approved MSP-related refund forms. Suppliers should use these
forms only if an MSP-related voluntary refund needs to be submitted or if they need to request an
offset by fax.
The Jurisdiction B DME MAC MSP Voluntary Refund Form is located on the National Government
Services Web site at
www.adminastar.com/Providers/DMERC/Forms/files/MSP%20Voluntary%20Refund%20Form.pdf.
The Jurisdiction B DME MAC MSP Offset Request Form is located on the National Government Services
Web site at
www.adminastar.com/Providers/DMERC/Forms/files/MSP%20Offset%20Request%20Form.pdf.
These forms are also located on the National Government Services Web site at
www.NGSMedicare.com:

Select
Select
Select
Select
AdminaStar Federal
Jurisdiction B DME MAC
MSP
MSP Forms
12
Jurisdiction B DME MAC MSP Voluntary Refund Form
Shall Be Completed By Medicare Contractor
Date: _______________________________________ Contractor Deposit Control #: ___________________________________________________
Date of Deposit: ______________________________ Contractor Contact Name: _____________________________________________________
Phone #:___________________________________________ Contractor Fax: _________________________________________________________
Contractor Address: __________________________________________________________________________________________________________
Shall Be Completed By Provider/Physician/Supplier, Or Other Entity
Please complete and forward to your Medicare contractor. This form, or a similar document containing the following information, should accompany every unsolicited/voluntary refund so that receipt of check is properly recorded and applied. Physician/Supplier or Other Entity Name: ______________________________________________________________________________________
Address: ____________________________________________________________________________________________________________________
Provider/Physician/Supplier #: _________________________ Tax Id #: ____________________________________________________________
Contact Person: __________________________________________________ Phone #: _________________________________________________
Amount of Check $: __________________________ Check #: _________________________ Check Date: ______________________________
Refund Information
For each claim, provide the following: Patient Name: _______________________________________________________ HIC #:_______________________________________________ Medicare Claim Number: _____________________________________________ Claim Amount Refunded $: ___________________________ Reason Code for Claim Adjustment: ___________________________________ (Reason Codes are listed below. Use one reason per claim.) (Please list all claim numbers involved. Attach separate sheet, if necessary) Note: If Specific Patient/HIC/Claim #/Claim Amount data not available for all claims due to Statistical Sampling, please indicate methodology and formula used to determine amount and reason for overpayment: _______________________________________________________________ ____________________________________________________________________________________________________________________________ Note: If specific patient/HIC/Claim # information is not provided, no appeal rights can be afforded with respect to this refund. Providers/physicians/suppliers, and other entities who are submitting a refund under the OIG’s Self‐Disclosure Protocol are not afforded appeal rights as stated in the signed agreement presented by the OIG. For Institutional Facilities Only: Cost Report Year(s) _________________________________ (If multiple cost report years are involved, provide a breakdown by amount and corresponding cost report year.) For OIG Reporting Requirements
Do you have a Corporate Integrity Agreement with OIG? Are you a participant in the OIG Self‐Disclosure Protocol? Reason Codes
Yes Yes No No Billing/Clerical: MSP/Other Payer Involvement: 01 – Corrected Date of Service 07 – MSP Group Health Plan Insurance 02 – Duplicate 08 – MSP No Fault Insurance 03 – Corrected CPT Code 09 – MSP Liability Insurance 04 – Not Our Patient(s) 10 – MSP, Worker’s Comp. (including Black Lung) 05 – Mod. Add/Remove 11 – Veterans Administration 06 – Billed in Error Mail Completed Form To: National Government Services, Inc. MSP Jurisdiction B DM E MAC Indiana Lockbox 660065 Indianapolis, Indiana 46266‐0065 National Government Services, Inc.
Page: 1 of 1
MSP IN 042 02/07 Miscellaneous: 12 – Insufficient Doc 13 – Patient Enroll HMO 14 – Svcs. Not Rendered 15 – Medical Necessity 16 – Other‐Be Specific Jurisdiction B DME MAC MSP Offset Request Form
Instructions
This form should be used to initiate a request for immediate offset of an overpayment. There are two types of overpayments: (1) Demanded (i.e., Medicare identified), and (2) Voluntary (i.e., provider identified). Please fill out the appropriate section in its entirety and fax the completed form to 317‐841‐4480. Type of Refund
Medicare identified—Section I (demand letter has been received) Provider identified—Section II (no letter has been received) I. Complete This Section for Medicare Identified Refunds
Date of Request:_________________________ Amount of Overpayment $: _______________________ Claim Control Number: __________________ Accounts Receivable (AR) Number: ________________ Notes: • All of the above information can be found on the Medicare demand letter. • Please make sure you attach a copy of the first page of the original demand letter. II. Complete This Section for Provider Identified Refunds
Date of Service: ___________________________ Beneficiary HIC #: ______________________________ Claim Control Number: ____________________ Amount of Overpayment $: ______________________ Specific Reason for Refund: _________________________________________________________________ Notes: • All of the information in the section above is required to ensure proper processing. • Please make sure you attach a completed copy of the Voluntary Refund Form for each request. This form can be found on the National Government Services, Inc. Web site (www.NGSMedicare.com). • A demand letter will be generated once this request has been fulfilled. You may disregard that letter. Provider Information (Required)
Name: ____________________________________________ Provider #: _____________________________ Address: _____________________________________ City, State, Zip: _____________________________ Contact Name: _____________________________________ Phone #: _____________________________ Signature of Requestor: _____________________________________________________________________ National Government Services, Inc.
Page: 1 of 1
MSP IN 040 02/07 Jurisdiction B DME MAC Supplier Manual
[DECEMBER 2007]
SAMPLE ADMISSION QUESTIONS TO ASK MEDICARE
BENEFICIARIES
Revision 53, Issued June 9, 2006, Effective September 11, 2006, Implementation September 11, 2006.
The following sample questionnaire contains questions that can be used to ask Medicare beneficiaries
upon each inpatient and outpatient admission. Providers may use this as a guide to help identify other
payers that may be primary to Medicare. This questionnaire is a model of the type of questions that
may be asked to help identify MSP situations. Suppliers that choose to use this questionnaire should
note that it was developed to be used in sequence. Instructions are listed after the questions to
facilitate transition between questions. The instructions will direct the patient to the next appropriate
question to determine MSP situations.
Part I
1) Are you receiving Black Lung (BL) benefits?
______ Yes; Date benefits began (MM/DD/CCYY): __________________________________________
BL is primary payer only for claims related to BL.
______ No.
2) Are the services to be paid by a government research program?
______ Yes. Government research program will pay primary benefits for these services
______ No.
3) Has the Department of Veterans Affairs (DVA) authorized and agreed to pay for your care at this
facility?
______ Yes. DVA is primary for these services.
______ No.
4) Was the illness/injury due to a work-related accident/condition?
______ Yes; Date of injury/illness (MM/DD/CCYY):__________________________________________
Name and address of Workers’ Compensation (WC) plan:_____________________________________
___________________________________________________________________________________
Policy or identification number: __________________________________________________________
Name and address of your employer: _____________________________________________________
___________________________________________________________________________________
WC is primary payer only for claims for work-related injuries or illness, go to Part III.
______ No. Go to Part II.
Part II
1) Was illness/injury due to a nonwork-related accident?
______ Yes; Date of accident (MM/DD/CCYY): ____________________________________________
______ No. Go to Part III
15
[DECEMBER 2007]
2) Is no-fault insurance available? (No-fault insurance is insurance that pays for health care services
resulting from injury to you or damage to your property regardless of who is at fault for causing
the accident.)
______ Yes.
Name and address of no-fault insurer(s) and no-fault insurance policy owner: ____________________
___________________________________________________________________________________
___________________________________________________________________________________
Insurance claim number(s): ____________________________________________________________
______ No.
3) Is liability insurance available? (Liability insurance is insurance that protects against claims based
on negligence, inappropriate action or inaction, which results in injury to someone or damage to
property.)
______ Yes.
Name and address of liability insurer(s) and responsible party: ________________________________
___________________________________________________________________________________
___________________________________________________________________________________
Insurance claim number(s): ____________________________________________________________
______ No.
No-fault insurer is primary payer only for those services related to the accident. Liability insurance is
primary payer only for those services related to the liability settlement, judgment, or award. Go to part III.
Part III
1) Are you entitled to Medicare based on:
______ Age. Go to Part IV
______ Disability. Go to Part V
______ ESRD. Go to Part VI
Please note that both “Age” and “ESRD” OR “Disability” and “ESRD” may be selected simultaneously. An
individual cannot be entitled to Medicare based on “Age” and “Disability” simultaneously. Please complete
ALL “PARTS” associated with the patient’s selections.
Part IV—Age
1) Are you currently employed?
______ Yes.
___________________________________________________________________________________
___________________________________________________________________________________
______ No. If applicable, date of retirement: (MM/DD/CCYY):_________________________________
______ No. Never employed.
2) Do you have a spouse who is currently employed?
______ Yes.
16
[DECEMBER 2007]
Name and address of your spouse’s employer: _____________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
______ No. If applicable, date of retirement (MM/DD/CCYY): _________________________________
If the patient answered “No” to both questions 1 and 2, Medicare is primary unless the patient answered
“Yes” to questions in Part I or II. Do not proceed further.
3) Do you have group health plan (GHP) coverage based on your own, or a spouse’s current
employment?
______ Yes, both.
______ Yes, self.
______ Yes, spouse.
______ No. Stop. Medicare is primary payer unless the patient answered yes to the
questions in Part I or II.
4) If you have GHP coverage based on your own current employment, does your employer that
sponsors or contributes to the GHP employ 20 or more employees?
______ Yes. GHP is primary. Obtain the following information.
Name and address of GHP: _____________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
Policy identification number (this number is sometimes referred to as the health insurance benefit
package number): ____________________________________________________________________
Group identification number: ____________________________________________________________
Membership number (prior to the Health Insurance Portability and Accountability Act (HIPAA), this
number was frequently the individual’s Social Security Number (SSN); it is the unique identifier
assigned to the policyholder/patient):_____________________________________________________
Name of policyholder/named insured:_____________________________________________________
Relationship to patient: ________________________________________________________________
______ No.
5) If you have GHP coverage based on your spouse’s current employment, does your spouse’s
employer that sponsors or contributes to the GHP, employ 20 or more employees?
___________________________________________________________________________________
___________________________________________________________________________________
package number): ____________________________________________________________________
Membership number (prior to the HIPAA, this number was frequently the individual’s SSN; it is the
unique identifier assigned to the policyholder/patient): _______________________________________
17
[DECEMBER 2007]
______ No.
If the patient answered “no” to both questions 4 and 5, Medicare is primary unless the patient answered
“yes” to questions in part I or II.
Part V—Disability
1) Are you currently employed?
______ Yes.
___________________________________________________________________________________
___________________________________________________________________________________
2) Do you have a spouse who currently employed?
______ Yes.
Name and address of your spouse’s employer: _____________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
3) Do you have GHP coverage based on your own, or a spouse’s current employment?
______ Yes, both.
______ Yes, self.
______ Yes, spouse.
______ No.
4) Are you covered under the GHP of a family member other than your spouse?
______ Yes.
Name and address of your family member’s employer: _______________________________________
___________________________________________________________________________________
___________________________________________________________________________________
______ No.
If the patient answered “no” to questions 1, 2, 3 and 4, stop. Medicare is primary unless the patient
answered “yes” to questions in part I or 11.
5) If you have GHP coverage based on your own current employment, does your employer that
sponsors or contributes to the GHP employ 100 or more employees?
___________________________________________________________________________________
___________________________________________________________________________________
18
[DECEMBER 2007]
package number): ____________________________________________________________________
Membership number (prior HIPAA, this number was frequently the individual’s SSN; it is the unique
identifier assigned to the policyholder/patient): _____________________________________________
______ No.
6) If you have GHP coverage based on your spouse’s current employment, does your spouse’s
current employer that sponsors or contributes to the GHP employ 100 or more employees?
___________________________________________________________________________________
___________________________________________________________________________________
package number): ____________________________________________________________________
______ No.
7) If you have GHP coverage based on a family member’s current employment, does your family
member’s employer that sponsors or contributes to the GHP, employ 100 or more employees?
___________________________________________________________________________________
___________________________________________________________________________________
package number): ____________________________________________________________________
______ No.
If the patient answered “no” to questions 5, 6, and 7, Medicare is primary unless the patient answered
“yes” to questions in part I or II.
Part VI—ESRD
1) Do you have GHP coverage?
______ Yes.
19
[DECEMBER 2007]
If applicable, your GHP information:
___________________________________________________________________________________
___________________________________________________________________________________
package number): ____________________________________________________________________
Membership number (prior to HIPAA, this number was frequently the individual’s SSN; it is the unique
Name and address of employer, if any, from which you receive GHP coverage: ___________________
___________________________________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
If applicable, your spouse’s GHP information:
___________________________________________________________________________________
package number): ____________________________________________________________________
Name and address of employer, if any, from which your spouse receives GHP coverage: ___________
___________________________________________________________________________________
___________________________________________________________________________________
If applicable, your family members GHP information: ________________________________________
___________________________________________________________________________________
package number): ____________________________________________________________________
Name and address of employer, if any, from which your family receives GHP coverage: ____________
___________________________________________________________________________________
___________________________________________________________________________________
______ No. Stop. Medicare is primary.
2) Have you received a kidney transplant?
______ Yes. Date of transplant (MM/DD/CCYY): ____________________________________________
______ No.
20
[DECEMBER 2007]
3) Have you received maintenance dialysis treatments?
______ Yes. Date dialysis began (MM/DD/CCYY):___________________________________________
If you participated in a self-dialysis training program, provide date training started (CCYY/MM/DD):
___________________________________________________________________________________
______ No.
4) Are you within the 30-month coordination period that starts MM/DD/CCYY? (The 30-month
coordination period starts the first day of the month an individual is eligible for Medicare [even if
not yet enrolled in Medicare] because of kidney failure—usually the fourth month of dialysis. If the
individual is participating in a self-dialysis training program or has a kidney transplant during the
three-month waiting period, the 30-month coordination period starts with the first day of the
month of dialysis or kidney transplant.)
______ Yes.
______ No. Stop. Medicare is primary.
5) Are you entitled to Medicare on the basis of either ESRD and age or ESRD and disability?
______ Yes.
______ No.
6) Was your initial entitlement to Medicare (including simultaneous or dual entitlement) based on
ESRD?
______ Yes. Stop. GHP continues to pay primary during the 30-month coordination period.
______ No. Initial entitlement based on age or disability.
7) Does the working aged or disability MSP provision apply (i.e., is the GHP already primary based on
age or disability entitlement?
______ Yes. Stop. GHP continues to pay primary during the 30-month coordination period.
______ No. Medicare continues to pay primary.
If no MSP data are found in the Common Working File (CWF) for the beneficiary, the provider still asks the
types of questions above and provides any MSP information on the bill using the proper uniform billing
codes. This information will then be used to update CWF through the billing process.
21
Chapter 5: Medical Policy Information
[MARCH 2008]
5 Medical Policy Information
GENERAL MEDICAL POLICY INFORMATION
Medical policies are a combination of national and regional decisions. The Centers for Medicare &
Medicaid Services (CMS) defines national policy in the CMS Internet Only Manual (IOM) Publication
100-03, Medicare National Coverage Determinations Manual, and the CMS IOM Publication 100-08,
Medicare Program Integrity Manual. The durable medical equipment Medicare administrative
contractor (DME MAC) is required to follow national policy where it exists. However, when there is
no national policy on a subject, the DME MAC has the authority and responsibility to establish
regional policy.
A local coverage determination (LCD), as established by Section 522 of the Benefits, Improvements &
Protection Act (BIPA) of 2000, is a decision by a fiscal intermediary or carrier on whether to cover a
particular service on a fiscal intermediary-wide or carrier-wide basis in accordance with Section
1862(a)(1)(A) of the Social Security Act (i.e., a determination as to whether the service is reasonable
and necessary). The Final Rule establishing LCDs was published in the Federal Register on November
7, 2003.
Medical policies are published as two related documents: the LCD and a policy article.
The major sections of the LCD are:

Indications and Limitations of Coverage and/or Medical Necessity—This section defines coverage
criteria based upon a determination of whether an item is reasonable and necessary. It includes
information from National Coverage Determinations (NCDs) when applicable. When an item does
not meet these criteria, it will be denied as “not medically necessary.”
HCPCS Codes and Modifiers
ICD-9 Codes and Diagnoses That Support Medical Necessity
Documentation Requirements
Revision History
The major sections of the Policy Article are:

Nonmedical Necessity Coverage and Payment Policy—This section identifies situations in which an
item does not meet the statutory definition of a benefit category (e.g., durable medical
equipment, prosthetic devices, etc.) or when it doesn’t meet other requirements specified in
Regulations. It also identifies situations in which an item is statutorily excluded from coverage for
reasons other than medical necessity. In these situations, the policies will continue to identify the
denial as “noncovered.” This section may also include statements defining when an item will be
denied as “not separately payable” or situations in which claim processing for the item is not
within the Jurisdiction B DME MAC geographical area.
Coding Guidelines
1
[MARCH 2008]
Note: The term Policy Article will have a very specific meaning and will be used in the title of the article to
define the document that is related to the LCD.
The LCD and Policy Article taken together will be referred to as the “medical policy.” The Policy Article
will be part of the same document and will immediately follow the LCD in the medical policy. In the
CMS database (http://cms.hhs.gov/mcd/indexes.asp), the Policy Article can be accessed both as an
attachment to the LCD and as a separate article in the Articles section of the database.
Medical Policy Development
DME MAC medical policies are administrative and educational tools designed to inform suppliers and
medical professionals about Medicare coverage requirements and to assist suppliers in submitting correct
claims for payment. The development of medical policies is a collaborative effort led by the medical
directors of the four DME MACs. The intent of the policy development process is to provide the
opportunity for input from the supplier and medical community, to enhance the understanding of the
policy by those individuals, and to assure that the final policy is consistent with sound medical practice.
The initial stage of the process is the development of a draft policy. This is based on a review of the
medical literature and the contractor’s understanding of medical practice relating to the item. The
medical directors seek input from various individuals and groups during the drafting phase of policy
development.
Drafts of new medical policies or revised policies that propose more restrictive medical necessity
coverage criteria are sent for comment to a wide spectrum of national and regional organizations
representing manufacturers, suppliers, physicians and other healthcare professionals. These draft
medical policies can be found on the National Government Services Web site at
www.adminastar.com/Providers/DMERC/MedicalPolicy/MedicalPolicy.cfm. At least 45 days are allowed
for comments to draft policies. Since there is no fixed schedule for the release of draft DME MAC
policies, suppliers and other interested individuals should check the National Government Services
Web site periodically for new information.
The DME MAC encourages written comments to the draft policies. Commenters that disagree with any
aspects of the policy should offer specific alternative wording and support their suggestions with
references from the published medical literature.
After the close of the comment period, the DME MAC medical directors review all of the comments
received and revise the medical policy as appropriate. The medical directors summarize the comments
and give a response to each indicating whether they agree or disagree with the suggestion. If they do
not agree, they give reasons for the decision. This comment and response document is posted on the
DME MAC’s Web site when the final policy is published.
Per the CMS IOM Publication 100-08, Medicare Program Integrity Manual, Chapter 13, Section 13.1.4,
the DME MACs shall ensure that the LCDs are developed and revised in accordance with CMS IOM
Publication 100-08, Medicare Program Integrity Manual, Chapter 13, Section 13.1.4.
2
[MARCH 2008]
CMS requires that the recommended LCDs developed by the DME MACs be identical for each jurisdiction
to ensure uniformity for DMEPOS suppliers that operate nationally. The DME MACs shall maintain the
LCD record. The LCD record shall consist of any document or material that the DME MACs considered
during the development of the new or revised LCD, including, but not limited to, the following:
1) Any medical evidence considered on or before the date the LCD was recommended to the DME
MACs for adoption, including, but not limited to, the following:
Scientific articles
Technology assessments
Clinical guidelines
Documentation from the Food and Drug Administration (FDA) regarding safety and efficacy
of a drug or device with the exception of proprietary data and privileged information
Statements from clinical experts, medical textbooks, claims data or other indication of
medical standard of practice

2) Comment and response documents (a summary of all comments received by the DME MACs
concerning the recommended LCD); this applies only to new LCDs or revised LCDs that were
sent for comment.
The DME MAC shall publish the adopted LCD by way of the Medicare Coverage Database (MCD). The
DME MACs shall provide an Internet link on their contractor Web site to the MCD to provide access to
the adopted LCD.
Note: Final medical policies are published on the National Government Services Web site at
www.adminastar.com/Providers/DMERC/MedicalPolicy/MedicalPolicy.cfm.
Local Coverage Determination Reconsideration Process
The LCD Reconsideration Process is a mechanism by which interested parties can request a revision of
an LCD. In order to be considered a valid request, the following requirements must be met:

Requestor must be qualified
Subject must be appropriate
Information submitted must be adequate
Process for submission must be followed
Any request for LCD reconsideration that, in the judgment of the DME MAC, does not meet these
requirements is invalid.
Requestor
The DME MAC will consider all LCD reconsideration requests from:

Beneficiaries residing in their jurisdiction, or
Suppliers doing business in their jurisdiction
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[MARCH 2008]
The DME MAC may consider LCD reconsideration requests from any other interested party doing
business in their jurisdiction.
Subject
The LCD Reconsideration Process is available only for final LCDs. The whole LCD or any part of the
LCD may be reconsidered. Requests are not accepted for other documents including:

National Coverage Decisions (NCD)
Coverage provisions in interpretive manuals—such as the CMS Internet Only Manual (IOM)
Draft LCDs
Retired LCDs
Individual claim determinations
Bulletins, articles, training materials
Any instance in which no LCD exists, i.e., requests for development of an LCD
If modification of the LCD would conflict with an NCD, the request is not valid. Refer to the NCD
reconsideration process at http://www.cms.hhs.gov/DeterminationProcess/.
Information to be Submitted
The request must identify the language that the requestor wants added to or deleted from an LCD.
Requests must include a justification supported by new evidence, which may materially affect the
LCD’s content or basis. When articles or textbooks are cited, copies of the published documents must
be included.
The level of evidence required for LCD reconsideration is the same as that required for new/revised
LCD development. As described in the CMS IOM Publication 100-08, Medicare Program Integrity
Manual, LCDs are to be based on the strongest evidence available. In order of preference, LCDs are
based on:

Published authoritative evidence derived from definitive randomized clinical trials or other
definitive studies
General acceptance by the medical community (standard of practice), as supported by sound
medical evidence based on:
− Scientific data or research studies published in peer-reviewed medical journals, or
− Consensus of expert medical opinion (i.e., recognized authorities in the field), or
− Medical opinion from medical associations or other health care experts
Acceptance by individual health care providers, or even a limited group of health care providers,
normally does not indicate general acceptance by the medical community. Testimonials indicating such
limited acceptance, and limited case studies distributed by sponsors with financial interest in the
outcome, are not sufficient evidence of general acceptance by the medical community. The broad range
of available evidence will be considered and its quality will be evaluated before a conclusion is reached.
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[MARCH 2008]
Submission Process
In order to be valid, the request for LCD reconsideration must be in writing and must include the
name and mailing address of the requestor. Inclusion of a telephone number and/or email address is
optional. If the requestor is a supplier, the supplier number must be included. If the requestor is
neither a beneficiary nor a supplier, the requestor must identify the nature of their business and who
they represent (if applicable).
Requests may be submitted by mail, e-mail or fax to:
National Government Services, Inc.
Attn: Medical Policy
P.O. Box 6036
[email protected]
-OrFax: 317-841-4600
DME MAC Response
Within 30 days after the request is received, the DME MAC will determine whether the request is valid
or invalid and will notify the requestor of that determination. If the request is invalid, the DME MAC
will explain why it was invalid.
If the request is valid, within 90 days after the request is received, the DME MAC will make a
reconsideration decision and will notify the requestor of the decision with its rationale. Decision
options include:

No revision
Revision to a less restrictive policy
Revision to a more restrictive policy, or
Retiring the policy
Any revision to the policy will then be published in a future update and posted to the DME MAC Web site.
Scope of Policies
The LCDs and Policy Articles address many of the most frequently ordered durable medical equipment,
prosthetics, orthotics and supplies (DMEPOS) items and services, but clearly not all. If coverage
criteria for an item are not defined in a policy, then it means that only general coverage criteria apply,
i.e. the item must fall within a benefit category, it must not be excluded by statute or by national CMS
policy as described in the CMS IOM Publication 100-03, Medicare National Coverage Determinations
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[MARCH 2008]
Manual and CMS IOM Publication 100-08, Medicare Program Integrity Manual, and it must be
reasonable and necessary in the individual case for the diagnosis or treatment of illness or injury, or to
improve the functioning of a malformed body member.
When coverage is addressed in the medical policy, it only refers to coverage of claims processed by
the DME MAC under specific benefit categories. (Refer to the Benefit Categories section for more
information.) The items described in the policies may be covered under other provisions of the law,
e.g., as part of institutional care in a hospital or nursing facility, as an item incident to a physician’s
service, etc. However, in these circumstances, the claim would not be submitted to the DME MAC and
the coverage statements in the DME MAC policy may not apply.
Individual Consideration
In the medical policies, the stated coverage criteria represent the circumstances under which Medicare
usually covers the item. However, the policies do not include every possible acceptable indication.
Other indications can be considered for coverage if the denial or potential denial is based on a medical
necessity decision by the DME MAC. (If the denial/potential denial is based on a benefit coverage
determination—i.e., the policy states the item is “noncovered”—or on a national medical necessity
policy, then an exception cannot be considered.) Other indication will be covered only if there is
detailed documentation of the medical necessity for the item in the individual case.
The nature and extent of the documentation required would have to be individualized based on the
item in question. Some of the following information would likely be pertinent:

The diagnosis relating to the need for the item
Complicating medical conditions
Functional abilities and limitations (e.g., the ability to ambulate or transfer, the amount of time in
a bed, chair or wheelchair, the type and frequency of activities outside the home)
The duration of the condition
The overall course (improving or worsening)
Rehabilitation potential (including recent prior functional level)
Prognosis
Description of and response to prior treatment
Experience with similar items
Physical examination findings, test results, etc.
Documentation can be provided either with the initial claim or with an appeal. If it is provided with the
initial claim, the supplier should include as much information as possible in the NTE (Note) segment of
the electronic claim.
For additional information regarding the LCD process, please refer to the CMS IOM Publication 100-08,
Medicare Program Integrity Manual, Chapter 13.
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[MARCH 2008]
CURRENT DMEPOS MEDICAL POLICIES
The DMEPOS medical policies are no longer included in the Jurisdiction B DME MAC Supplier Manual.
All DMEPOS medical policies can be located on the National Government Services Web site at
7
Chapter 6: Certificates of Medical Necessity/DME Information Forms
[MARCH 2008]
6 Certificates of Medical Necessity/
DME Information Forms
OVERVIEW
A Certificate of Medical Necessity (CMN) or DME Information Form (DIF) is a form required to help
document the medical necessity and other coverage criteria for selected durable medical equipment,
prosthetics, orthotics and supplies (DMEPOS) items. The Documentation section of each individual
medical policy shows which items require one of these forms.
CMNs contain sections A through D. Sections A and C are completed by the supplier and Sections B
and D are completed by the physician. A DIF is completed and signed by the supplier. It does not
require a narrative description of the equipment and cost or a physician signature.
For certain items or services billed to the durable medical equipment Medicare administrative
contractor (DME MAC), the supplier must receive a signed CMN from the treating physician or a signed
DIF from the supplier. A supplier must have a faxed, photocopied, an original signed order or an
electronic CMN or DIF in their records before they can submit a claim for payment to Medicare. The
Centers for Medicare & Medicaid Services (CMS) form number is in the bottom left corner of the form.
CMNs and DIFs are referred to by their CMS form numbers. DME form numbers identify the CMN on
electronic claims submitted to the DME MAC. For example, CMS Form 484 serves as the CMN for
oxygen. CMS Form 10125 serves as the DIF for External Infusion Pump.
A faxed, photocopied, an original signed order, or an electronic signed CMN or DIF must be
maintained by the supplier and be available to the DME MAC or zone program integrity contractors
(ZPICs) on request. When hard-copy CMNs or DIFs are submitted to the DME MAC or ZPIC, the
supplier must include a copy of only the front side. When CMNs are submitted electronically to the
DME MAC or ZPIC, information from sections A and B are required.
For additional requirements and instructions on how to properly complete CMNs and DIFs, please refer
to the CMS IOM Publication 100-08, Medicare Program Integrity Manual, Chapter 5, Sections 5.3,
5.3.1, 5.3.2, 5.3.3, 5.5, and 5.6.
In 2006 CMS developed new and improved CMNs and DIFs. The official instruction regarding the form
changes are located on the CMS Web site at www.cms.hhs.gov/Transmittals/downloads/R167PI.pdf.
DME FORMS
The following table indicates the DME CMN forms.
DME Form
484.03
04.04B
04.04C
CMS Form
484
846
847
Items Addresses
Oxygen
Pneumatic compression devices
Osteogenesis stimulators
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[MARCH 2008]
DME Form
06.03B
07.03A
11.02
CMS Form
848
849
854
Items Addresses
Transcutaneous electrical nerve stimulators (TENS)
Seat lift mechanisms
Section C Continuation Form
The following table indicates the DIFs for external infusion pumps and parenteral and enteral nutrition
(PEN).
DME Form
10.03
09.03
CMS Form
10126
10125
Items Addresses
Enteral/parenteral nutrition
External infusion pump
EXTERNAL INFUSION PUMPS &
ENTERAL/PARENTERAL NUTRITION
For claims processed on or after July 1, 2007, the new DIFs will be the only forms accepted for
external infusion pumps and parenteral and enteral nutrition (PEN).
CMN/DIF COMPLETION INSTRUCTIONS
In Section A, at least the patient’s name, address, telephone and Health Insurance Claim Number
(HICN), the supplier’s name, address, telephone and National Supplier Clearinghouse (NSC) number
and the Healthcare Common Procedure Coding System (HCPCS) codes must be completed by the
supplier before the CMN is sent to the physician.
The Initial Date in Section A should be either the specific date that the physician gives as the start of
the medical necessity or, if the physician does not give a specific start date, the Initial Date should be
the date of the verbal or preliminary order.
Section B may not be completed by the supplier on the CMS forms 484, 846, 847, 848, and 849.
Section B may be completed by the physician, the physician’s employee or another clinician involved in
the care of the patient (e.g., nurse, physical or occupational therapist, etc.) as long as that person is
not the supplier.
Section C on the CMS forms 484, 846, 847, 848, and 849 reflects the requirements from the 1994
Amendments to the Social Security Act. It provides an opportunity for the ordering physician to review
and confirm a detailed description of the items provided. It also indicates the supplier’s charge and
what the Medicare fee schedule allowance will be, if applicable. Section C contains a blank space that
can be formatted in different ways. However the following guidelines must be met.
The description of the item provided must include not only those items listed in Section A of the CMN,
but also any accessories, options, supplies or drugs which are related to the item and which are
provided by the supplier. There should be a narrative description for each related item billed on a
separate claim line. The exact HCPCS description is not required; a reasonable, abbreviated descriptor
may be substituted.
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[MARCH 2008]
For every item listed, the supplier must always specify their submitted charge. For purchased
equipment, accessories and options, the full charge must be specified. For rental equipment,
accessories and options, the supplier must specify “per month” or “/month.” For accessories, supplies,
nutrients, or drugs which are replaced regularly, the supplier must specify what time span the charge
represents, e.g., per day, per week, per month, etc.
The supplier must list the Medicare fee schedule amount for each item, accessory and option, if
applicable. The fee schedule allowance should reflect the same time span and quantity used in the
submitted charge column. If the Medicare allowed amount is determined by methods other than a fee
schedule (e.g., miscellaneous codes), a N/A (not applicable) should be put in the Medicare allowed
charge column.
Section C must be completed by the supplier before the CMN is sent to the physician. Samples of
Section C formats are provided below within this chapter. Suppliers may use other formats as long as
the required information is presented.
Satisfactory completion of Section C will be assessed in postpayment audits. Civil monetary penalties
can be assessed for failure to comply.
Section D contains the physician’s attestation statement, physician’s signature, and date. The
physician who signs the CMN must be the physician who is actively/presently treating the patient.
Claims submitted with CMNs lacking a physician signature will be denied. Suppliers billing electronically
must indicate presence of the physician’s signature as specified in the electronic billing instructions.
The date in Section D must be the date that the physician signs the CMN. Both the signature and date
must be personally entered by the physician and may not be a stamp.
For codes requiring a CMN or DIF, the CMN/DIF must accompany claims for purchase of these items
(including replacement), for the first month rental of equipment, for the initial provision of PEN
nutrients and supplies, and for any required revised certifications/recertifications. Submitting
CMNs/DIF when they are not required (e.g., subsequent months on rental items, oxygen or PEN when
there is no change in the order and no requirement for recertification) may cause claims processing
problems/delays and is discouraged.
Because CMS forms 484, 846, 847, 848, and 849 have been approved by the Office of Management
and Budget (OMB), when a CMN is submitted with a paper claim, the hard copy CMN must be an
exact reproduction of the CMS form. However, when the CMN is submitted electronically to the DME
MAC, the font on a hard copy CMN which the supplier retains in their files may be modified as follows:

Pitch may vary from 10 characters per inch (CPI) to 17.7 CPI
Line spacing must be 6 lines per inch
Each CMN must have a minimum ¼-inch margin on all four sides
Without exception, these modified hard-copy forms must contain identical questions/wording to
the CMS forms, in the same sequence, with the same pagination and identical
instructions/definitions printed on the back
CMN question sets may not be combined
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[MARCH 2008]
A nurse practitioner, clinical nurse specialist, or physician assistant may complete Section B and sign
Section D if they meet all the requirements for them to sign orders as described in the Documentation
chapter of this manual.
For a CMN that is mailed or delivered to the physician, it must be a two-sided CMN. For a CMN that is
faxed or sent electronically to the physician, the supplier must send the back of the CMN form as well
as the front. If the supplier is faxing multiple CMNs to the physician at the same time, only one copy
of the back of the form needs to be faxed. The physician must review, complete, and correct Section A
as needed, complete Section B, review Section C, sign and date Section D, and send the completed
CMN to the supplier. If any change is made to a CMN after the physician has completed Section B and
signed Section D, the physician must line through the correction and initial and date the
change or the supplier may choose to have the physician complete a new CMN. For a hard-copy
CMN, the physician may either mail or fax the completed CMN to the supplier. When a physician faxes
a completed CMN to the supplier or mails a completed CMN that they have received as a fax, the back
of the CMN form does not need to be included.
Upon request by the DME MAC, the supplier must provide in a timely manner the CMN that they
received from the physician in a format that the DME MAC can accept. For medical review or appeals
purposes, the DME MAC will accept any of the following forms of a CMN:

An original “pen and ink” document
A photocopy
A facsimile image
An electronically maintained document (An electronically maintained document is one which has
been created modified, and stored via electronic means, such as commercially available software
packages and servers.)
When a claim is reviewed by the ZPIC as part of an investigation of potentially fraudulent behavior by
a supplier, it will be the supplier’s responsibility to prove the authenticity/validity of the claim(s) under
investigation. The DME MAC may require the supplier to prove the authenticity/validity of the
signature on the CMN, or any other questionable portion of the claim(s) under investigation. Proof of
the authenticity/validity of a signature may take a variety of forms. The ZPIC will determine the
appropriate level of proof needed.
For items that require a CMN, the supplier must have a fully completed CMN in their records before
they submit a claim to the DME MAC.
When a CMN/DIF is submitted hard copy to the DME MAC, the supplier must include a copy of only
the front side. When a CMN is submitted electronically to the DME MAC, only information from
Sections A, B, and D is transmitted.
The date of service on the claim (which corresponds to the delivery date on claims for purchased
items or on the first month’s claim for rental items) may be different than the Initial Date on the CMN.
However, if the date of service on a claim is prior to the Initial Date on the CMN, the claim line will be
denied as not medically necessary. Furthermore, to ensure that an item is still medically necessary
when it is delivered, the delivery date must be within three months following the Initial Date on the
CMN or within three months from the date of the physician’s signature.
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[MARCH 2008]
CMS forms 484, 846, 847, 848, and 849 can serve as the physician order if the narrative description in
Section C is sufficiently detailed. Refer to the Documentation chapter of this manual for the
requirements of detailed written orders.
For items which require a detailed written order prior to delivery and which have a CMN (i.e., air
fluidized beds, TENS, seat lift mechanisms), suppliers may utilize a completed and physician-signed CMN
for this purpose, if the CMN is signed and dated prior to delivery of the item. Otherwise, a separate
detailed written order in addition to a subsequently completed and signed CMN would be necessary.
The physician is encouraged, although not required, to keep a copy of the CMN in their patient’s
medical record.
CMNs are a standardized means of submitting some medical necessity information to the DME MACs.
A CMN does not by itself provide sufficient documentation of medical necessity, even though it is
signed by the treating physician. There must be clinical information in the patient’s medical record
which substantiates the answers on the CMN and supports the medical necessity for the item in the
individual case.
CMNs will be audited periodically to validate proper completion and transmission to the DME MAC and
to verify that the answers on CMNs are supported by information in the patient’s medical record. If the
information contained in either the supplier’s records or in the patient’s medical record fails to
substantiate the CMN, or if it appears that the CMN has been altered, the item will be considered not
medically necessary and a denial or overpayment will be initiated.
COVER LETTERS
Cover letters may be used by a supplier as a method of communication between themselves and the
physician. There is no restriction on the content of cover letters. However, suppliers should remind
physicians that it is their responsibility to determine the medical need for, and the utilization of, all
health care services. Suppliers are also encouraged to remind physicians that it is the physician’s
responsibility to ensure that the information on the CMN relating to the beneficiary’s condition is
correct and is supported by information in the patient’s medical record.
SECTION C EXAMPLE
Item:
Codes:
HCPCS Description:
A
B
C
D
E0781
A4222
A4221
J2270
Ambulatory infusion pump
Supplies for external drug infusion pump, per cassette or bag
Supplies for maintenance of drug infusion catheter, per week
Morphine sulfate, 10 mg
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[MARCH 2008]
Item:
Quantity:
Supplier’s Charge:
Medicare Fee Schedule Allowance:
A
B
C
D
1
3/week
1/week
168/week
$747.30/month
$153.30/week
$30.00/week
$300.00/week
$235.28/month
$121.44/week
$20.39/week
N/A*
* A not applicable (N/A) entry means that Medicare payment will be determined by a method other than a
fee schedule; it does not indicate that Medicare will deny the item.
SAMPLE CMN FORMS
The following pages provide photocopy-ready samples of all the DME forms. Instructions for
completion of the CMNs/DIFs are included within this chapter and should be reviewed and followed.
The DME forms are located on the National Government Services at
www.adminastar.com/Providers/DMERC/MedicareManuals/pubcmn.htm.
The new DME forms can also be accessed from the CMS Web site at
www.cms.hhs.gov/CMSForms/CMSForms/list.asp.
HCPCS CODES REQUIRING A CMN OR A DIF
The following HCPCS codes are those which require a CMN/DIF on claims that should be listed in
Section A of the CMN/DIF. For narrative descriptions, refer to the specific local coverage determination
and policy article, and/or the HCPCS Coding page on the National Government Services Web site at
http://www.adminastar.com/Providers/DMERC/HCPCSCodes/HCPCSCodes.html.
B4034
B4160
B4197
B9006
E0444
E0668
E0779
J0287
J1817
J9065
B4035
B4161
B4199
E0424
E0627
E0669
E0780
J0288
J2175
J9100
B4036
B4162
B4216
E0425
E0628
E0671
E0781
J0289
J2260
J9110
B4149
B4164
B4220
E0430
E0629
E0672
E0784
J0895
J2270
J9190
B4150
B4168
B4222
E0431
E0650
E0673
E0791
J1170
J2271
J9200
B4152
B4172
B4224
E0434
E0651
E0720
E1390
J1250
J2275
J9360
B4153
B4176
B5000
E0435
E0652
E0730
E1391
J1265
J2278
J9370
6
B4154
B4178
B5100
E0439
E0655
E0731
E1392
J1325
J3010
J9375
B4155
B4180
B5200
E0440
E0660
E0747
E1405
J1455
J3285
J9380
B4157
B4185
B9000
E0441
E0665
E0748
E1406
J1457
J7500
K0455
B4158
B4189
B9002
E0442
E0666
E0760
J0133
J1562
J9000
K0738
B4159
B4193
B9004
E0443
E0667
E0776
J0285
J1570
J9040
Chapter 7: Documentation
[MARCH 2008]
7 Documentation
ORDERS
Dispensing Orders
Before dispensing any durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) item
to a beneficiary, the supplier must have an order from the treating physician. Except for items
requiring a detailed written order prior to delivery, the “dispensing” order may be either a verbal order
or a preliminary written order (original “pen and ink,” facsimile image, photocopy, signature stamp, or
electronic). Verbal orders must be documented in the patient’s file. The dispensing order must contain
a description of the item, the name of the beneficiary, the name of the physician, and the start date of
the order. The dispensing order does not need to be as comprehensive as the detailed written order,
which is required before submitting a claim (see following section). For items that are dispensed based
on a verbal order, the supplier must obtain a detailed written order before submitting a claim (see
following section). The supplier must maintain written documentation of the dispensing order and this
documentation must be available to the durable medical equipment Medicare administrative contractor
(DME MAC) upon request. Except for items requiring a detailed written order prior to delivery, if the
supplier does not have an order from the treating physician before dispensing an item, it will be
denied as not medically necessary.
A detailed written order prior to delivery is required for the following:

Pressure reducing pads, mattress overlays, mattresses, and beds
Seat lift mechanisms
Transcutaneous electrical nerve stimulation (TENS) units
Power operated vehicles
Power wheelchairs
Wheelchair seating
Negative pressure wound therapy pumps
The supplier must have a detailed written order for these items (see following section)—original “pen
and ink,” facsimile image, photocopy, or electronic—which has been both signed and dated by the
treating physician before dispensing the item. For these items, if the supplier does not have a detailed
written order prior to delivery, it will be denied as statutorily noncovered.
Detailed Written Orders
Before submitting a claim for any DMEPOS item to the DME MAC, the supplier must have a detailed
written order (original “pen and ink,” signature stamp, facsimile image, photocopy, or electronic)
which has been both signed and dated by the treating physician. This detailed written order is in
addition to the dispensing order described above, unless the dispensing order meets all the
requirements specified in this section.
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[MARCH 2008]
The supplier may not submit a claim based only on a verbal order. If an item requires a Certificate of
Medical Necessity (CMN), and if the CMN contains all the information described in this section, it may
serve as the detailed written order. Except for items requiring a detailed written order prior to
delivery, if the supplier does not have a detailed written order for an item prior to submitting a claim,
it will be denied as not medically necessary. For items requiring a detailed written order prior to
delivery (see Dispensing Orders section), if the order has not been obtained, the item will be denied as
statutorily noncovered.
CMNs for parenteral and enteral nutrition (PEN) and external infusion pumps were replaced by the
DME MAC Information Forms (DIFs) for claims with dates of service on or after January 1, 2007. DIFs
are completed by the supplier and physicians do not have to review and sign them. However, since
the CMNs usually served as the detailed written order, suppliers will now have to obtain the detailed
written order using a different document for PEN and external infusion pump claims.
The detailed written order must contain the beneficiary’s name, the signature of the treating physician
and the date that the order is signed.
All orders must clearly specify the start date of the order. The date that the order is signed will be
considered the start date unless a separate start date is entered. If the order is for an item that has
been dispensed before the date that the detailed written order is signed (e.g., a written confirmation
of a verbal order), then the order must clearly specify the start date in addition to the signature date.
The detailed written order (required before submitting a claim) must be sufficiently detailed, including
all options or additional features which will be separately billed or which will require an upgraded
code. The description can be either a narrative description (e.g., lightweight wheelchair base) or a
brand name/model number. If the order is for a rented item or if the coverage criteria in a policy
specify length of need, the order must include the length of need. If the order is for accessories or
supplies that will be provided on a periodic basis, the order should include appropriate information on
the quantity used, frequency of change or use, and length of need. (For example, an order for surgical
dressings might specify one 4 × 4 hydrocolloid dressing that is changed 12 times per week for one
month or until the ulcer heals.) If the supply is a drug, the order must specify the name of the drug,
concentration (if applicable), dosage, frequency of administration, and duration of infusion (if applicable).
The detailed description of the item may be completed by someone other than the physician.
However, the treating physician must review the detailed description and personally sign and date the
order to indicate agreement.
Upon request by the DME MAC and/or the zone program integrity contractor (ZPIC), the supplier must
provide in a timely manner the detailed written order that they received from the physician in a format
that the DME MAC and/or ZPIC can accept. For medical review or appeals purposes, the DME MAC
and/or ZPIC will accept any of the following forms of an order:

An original “pen and ink” document
A photocopy
A facsimile image, or
An electronically maintained document
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[MARCH 2008]
Note: An electronically maintained document is one that has been created, modified and stored via
electronic means, such as commercially available software packages and servers.
When a claim is reviewed by the ZPIC as part of an investigation of potentially fraudulent behavior by
a supplier, it will be the supplier’s responsibility to prove the authenticity/validity of the claim(s) under
investigation. The ZPIC may require the supplier to prove the authenticity/validity of the signature on
the order, or any other questionable portion of the claim(s) under investigation. Proof of the
authenticity/validity of a signature may take a variety of forms. The ZPIC will determine the
appropriate level of proof needed.
For additional instructions regarding physician orders, verbal orders, preliminary written orders, and
detailed written orders prior to delivery, please refer to the Centers for Medicare & Medicaid Services
(CMS) Internet-Only Manual (IOM) Publication 100-08, Medicare Program Integrity Manual, Chapter 5,
Sections 5.2, 5.2.1, 5.2.2, 5.2.3, 5.2.3.1.
Requirements for New Orders

A new order is required when there is a change in the order for the accessory, supply, drug, etc.
A new order is required on a regular basis (even if there is no change in the order) only if it is so
specified in the Documentation section of a particular medical policy.
A new order is required when an item is replaced.
A new order is also required when there is a change in supplier.
In cases where two or more suppliers merge, the resultant supplier should make all reasonable
attempts to secure copies of all active orders from the supplier(s) purchased. This document should be
kept on file by the resultant supplier and be available to the DME MAC on request.
For additional requirements for new orders please refer to the CMS IOM Publication 100-08, Medicare
Program Integrity Manual, Chapter 5, Section 5.2.4.
Special Rules for Nurse Practitioners and Clinical Nurse
Specialists
A nurse practitioner or clinical nurse specialist may provide the dispensing order and sign the detailed
written order if they satisfy all the following requirements:

They
They
They
They
are treating the beneficiary for the condition for which the item is needed, and
are practicing independently of a physician, and
bill Medicare for other covered services using their own provider number, and
are permitted to do all of the above in the state in which the services are rendered
Special Rules for Physician Assistants
A physician assistant may provide the dispensing order and may document and sign the detailed
written order if they satisfy all the following requirements:
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[MARCH 2008]

They meet the definition of a physician assistant found in Section 1861(aa)(5) of the Social
Security Act or Section 2156(A) of the CMS IOM Publication 100-08, Medicare Program Integrity
Manual, Chapter 5, Section 5.5 and 5.6, and
They are treating the beneficiary for the condition for which the item is needed, and
They are practicing under the supervision of a doctor of medicine or doctor of osteopathy, and
They have their own Unique Physician Identification Number (UPIN), and
They are permitted to perform services in accordance with state law
For additional requirements regarding nurse practitioners, clinical nurses and physician assistants
please refer to the CMS IOM Publication 100-08, Medicare Program Integrity Manual, Chapter 5,
Section 5.5 and 5.6.
Medical necessity information (e.g., an ICD-9 diagnosis code, narrative description of the patient’s
condition, abilities, limitations, etc.) is not considered part of the order; although it may be entered on
the same document as the order.
CERTIFICATES OF MEDICAL NECESSITY
Please refer to the Certificates of Medical Necessity chapter of this manual for detailed information
regarding this subject.
DOCUMENTATION IN THE PATIENT’S MEDICAL
RECORD
For any DMEPOS item to be covered by Medicare, the patient’s medical record must contain sufficient
documentation of the patient’s medical condition to substantiate the necessity for the type and quantity
of items ordered and for the frequency of use or replacement (if applicable). The information should
include the patient’s diagnosis and other pertinent information including, but not limited to, duration of
the patient’s condition, clinical course (worsening or improvement), prognosis, nature and extent of
functional limitation, other therapeutic interventions and results, past experience with related items, etc.
If an item requires a CMN, it is recommended that a copy of the completed CMN be kept in the patient’s
record. However, neither a physician’s order nor a CMN nor a supplier-prepared statement nor a
physician attestation by itself provides sufficient documentation of medical necessity, even though it is
signed by the treating physician. There must be clinical information in the patient’s medical record which
supports the medical necessity for the item and substantiates the answers on the CMN (if applicable) or
information on a supplier-prepared statement or physician attestation (if applicable).
The patient’s medical record is not limited to the physician’s office records. It may include hospital,
nursing home or home health agency records, and records from other professionals including, but not
limited to, nurses, physical or occupational therapists, prosthetists, and orthotists.
The documentation in the patient’s medical record does not have to be routinely sent to the supplier
or to the DME MAC. However, the DME MAC may request this information in selected cases. If the
DME MAC does not receive the information when requested, or if the information in the patient’s
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[MARCH 2008]
medical record does not adequately support the medical necessity for the item, then (on assigned
claims) the supplier is liable for the dollar amount involved unless a properly executed advance
beneficiary notice (ABN) of possible denial has been obtained.
For additional documentation requirements, please refer to the CMS IOM Publication 100-08, Medicare
Program Integrity Manual, Chapter 5, Section 5.7 and 5.8.
PROOF OF DELIVERY REQUIREMENTS
Documentation Requirements
Suppliers are required to maintain proof of delivery documentation in their files. Documentation must
be maintained in the supplier’s files for seven years.
Proof of delivery is required in order to verify that the beneficiary received the DMEPOS. Proof of
delivery is one of the supplier standards as noted in 42 CFR, 424.57(12). Proof of delivery
documentation must be made available to the DME MAC upon request. For any services, which do
not have proof of delivery from the supplier, such claimed items and services shall be denied and
overpayments recovered. Suppliers who consistently do not provide documentation to support their
services may be referred to the Office of the Inspector General for investigation and/or imposition
of sanctions.
Delivery Methods
Note: For the purpose of the delivery methods noted below, the designee is defined as:
“Any person who can sign and accept the delivery of durable medical equipment on behalf of the
beneficiary.”
Suppliers, their employees or anyone else having a financial interest in the delivery of the item are
prohibited from signing and accepting an item on behalf of a beneficiary (i.e., acting as a designee on
behalf of the beneficiary). The relationship of the designee to the beneficiary should be noted on the
delivery slip obtained by the supplier (i.e., spouse, neighbor, etc.). The signature of the designee
should be legible. If the signature of the designee is not legible, the supplier/shipping service should
note the name of the designee on the delivery slip.
Method 1—Direct Delivery to the Beneficiary By the Supplier
Suppliers may deliver directly to the beneficiary or the designee. An example of proof of delivery to a
beneficiary would be having a signed delivery slip. It is recommended that the delivery slip include:
1)
2)
3)
4)
5)
The patient’s name
The quantity delivered
A detailed description of the item being delivered
The brand name, and
The serial number
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[MARCH 2008]
The date of signature on the delivery slip must be the date that the DMEPOS item was received by the
beneficiary or designee. In instances where the supplies are delivered directly by the supplier, the date
the beneficiary received the DMEPOS supply shall be the date of service on the claim.
Method 2—Delivery via Shipping or Delivery Service
If the supplier utilizes a shipping service or mail order, an example of proof of delivery would include
the service’s tracking slip and the supplier’s own shipping invoice. If possible, the supplier’s records
should also include the delivery service’s package identification number for that package sent to the
beneficiary. The shipping service’s tracking slip should reference the following:

Each individual package
The delivery address
The corresponding package identification number given by the shipping service, and
The date delivered (if possible)
If a supplier utilizes a shipping service or mail order, suppliers shall use the shipping date as the date
of service on the claim.
Suppliers may also utilize a return postage-paid delivery invoice from the beneficiary or designee as a
form of proof of delivery. The descriptive information concerning the DMEPOS item (i.e., the patient’s
name, the quantity, detailed description, brand name, and serial number), as well as the required
signatures from either the beneficiary or the beneficiary’s designee, should be included on this invoice
as well.
For DMEPOS products that are supplied as refills to the original order, suppliers must contact the
beneficiary prior to dispensing the refill. This shall be done to ensure that the refilled item is necessary
and to confirm any changes/modifications to the order. Contact with the beneficiary or designee
regarding refills should take place no sooner than approximately seven days prior to the
delivery/shipping date. For subsequent deliveries of refills, the supplier should deliver the DMEPOS
product no sooner than approximately five days prior to the end of usage for the current product. This
is regardless of which delivery method is utilized. DME MACs shall allow for the processing of claims
for refills delivered/shipped prior to the beneficiary exhausting his/her supply.
Method 3—Delivery to Nursing Facility on Behalf of a Beneficiary
When a supplier delivers items to a nursing facility, the documentation described for Method 1 is
required. When a delivery service is used to deliver the item to a nursing facility, the documentation
described for Method 2 is required.
For those patients that are residents of a nursing facility, upon request from the DME MAC, suppliers
should obtain copies of the necessary documentation from the nursing facility to document proof of
delivery or usage by the beneficiary (e.g., nurse’s notes).
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[MARCH 2008]
Items Provided in Anticipation of Discharge from a Hospital or
Skilled Nursing Facility
Exceptions to the preceding statements concerning the date(s) of service on the claim occur when the
items are provided in anticipation of discharge from a hospital or nursing facility. A supplier may
deliver a DMEPOS item to a patient in a hospital or nursing facility for the purpose of fitting or training
the patient in the proper use of the item. This may be done up to two days prior to the patient’s
anticipated discharge to their home. The supplier shall bill the date of service on the claim as the date
of discharge and shall use the place of service (POS) code 12 (patient’s home). The item must be for
subsequent use in the patient’s home. No billing may be made for the item on those days the patient
was receiving training or fitting in the hospital or nursing facility.
A supplier may not bill for drugs or other DMEPOS items used by the patient prior to the patient’s
discharge from the hospital or a Medicare Part A nursing facility stay. Billing the DME MAC for surgical
dressings, urological supplies, or ostomy supplies that are provided in the hospital or during a
Medicare Part A nursing facility stay is not allowed. These items are payable to the facility under Part A
of Medicare. This prohibition applies even if the item is worn home by the patient from the hospital or
nursing facility. Any attempt by the supplier and/or facility to substitute an item that is payable to the
supplier for an item that, under statute, should be provided by the facility, may be considered to be
fraudulent. These statements apply to durable medical equipment delivered to a patient in hospitals,
skilled nursing facilities (POS = 31), or nursing facilities providing skilled services (POS = 32).
A supplier may deliver a DMEPOS item to a patient’s home in anticipation of a discharge from a
hospital or nursing facility. The supplier may arrange for actual delivery of the item approximately two
days prior to the patient’s anticipated discharge to their home. The supplier shall bill the date of
service on the claim as the date of discharge and should use the POS code 12 (patient’s home).
REQUESTS FOR ADDITIONAL INFORMATION
If the original claim and CMN do not contain all the information required to determine the medical
necessity of the supply or item, the DME MAC may request additional information from the
supplier, the ordering physician or the beneficiary through the Additional Documentation Request
(ADR) process.
Suppliers/physicians will be allowed 30 days to respond to ADR letters. If after 30 days the DME MAC
has received no response, the DMEPOS item will be denied for lack of information. The Jurisdiction B
DME MAC ADR address is:
Additional Documentation Requests
P.O. Box 7061
7
Chapter 8: Advance Determination of Medicare Coverage
[MARCH 2008]
8 Advance Determination of Medicare
Coverage
Advanced Determination of Medicare Coverage (ADMC) is a process by which the durable medical
equipment Medicare administrative contractor (DME MAC) will provide the requestor with a coverage
decision prior to delivery of an item.
ELIGIBLE ITEMS
ADMC will be available only for the following wheelchair base Healthcare Common Procedure Code
System (HCPCS) codes and related options and accessories:
E1161
E1231
E1232
E1233
E1234
K0005
K0009
Manual adult size wheelchair, includes tilt in space
Wheelchair, pediatric size, tilt-in-space, rigid, adjustable, with seating system
Wheelchair, pediatric size, tilt-in-space, folding, adjustable, with seating system
Wheelchair, pediatric size, tilt-in-space, rigid, adjustable, without seating system
Wheelchair, pediatric size, tilt-in-space, folding, adjustable, without seating system
Ultralightweight manual wheelchair
Not otherwise classified manual wheelchair base
Power wheelchairs:
Group
Group
Group
Group
Group
2
3
4
5
3
Group 4
(K0835–K0843)
(K0856–K0864)
(K0877–K0886)
(K0890, K0891)
(K0848–K0855) provided with an alternative drive control interface (E2321–E2322,
E2325, E2327–E2330)
(K0868–K0871) provided with an alternative drive control interface (E2321–E2322,
E2325, E2327–E2330)
New HCPCS within the Power Mobility Device Local Coverage Determination (LCD) L21271 are in effect
for Advance Determination of Medicare Coverage (ADMC) submissions received on or after November
15, 2006. All ADMC requests providing the old HCPCS will be rejected.
Note: When a particular wheelchair base is eligible for ADMC, all wheelchair options and accessories
ordered by the physician for that patient along with the base HCPCS code will be eligible for ADMC.
SUBMITTING ADMC REQUESTS
Effective February 18, 2008, all ADMC requests must be sent to National Government Services due to
the medical review transition from the program safeguard contractors (TriCenturion) to the DME MACs.
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[MARCH 2008]
ADMC requests may either be mailed or sent by fax. ADMC requests cannot be submitted electronically.
When submitting an ADMC request either by mail or fax, please include the ADMC cover sheet (located
at the end of this chapter) with each request. The mailing address for ADMC requests is:
Attn: Medical Review—ADMC
P.O. Box 6036
Fax ADMC information to 317-595-4759
ADMC cover sheets are located on the National Government Services Web site at
http://www.adminastar.com/Providers/DMERC/Forms/files/ADMCForm.pdf.
ADMC REQUIREMENTS
Certificates of Medical Necessity (CMNs) for manual and power wheelchair bases were discontinued
effective April 1, 2006, prompting questions about what information should be submitted to support
an ADMC request.
Because CMNs are no longer required and will not be used for the submission of wheelchair claims,
the first page of the ADMC request must contain all of the following demographic information:

Beneficiary information
− Name
− Health Insurance Claim Number (HIC #)
− Address
− Date of birth

Place of service

ICD-9 diagnosis code (narrative description is not sufficient)

Supplier information
− Name
− National Supplier Clearinghouse (NSC) number
− Address
− Phone number

Physician’s information
− Name
− Unique Physician Identification Number (UPIN)
− Address
− Phone number
Note: If the information listed above is not present, ADMC requests received by the DME MACs will be rejected.
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[MARCH 2008]
Manual Wheelchairs
For manual wheelchairs, the supplier must include the following (1–3):
1) A detailed written order that lists the specific wheelchair base that is to be provided and each
option/accessory that will be separately billed. The order must also specify which HCPCS code is
associated with each item on the order. This information may be entered by the supplier but the
order must be signed and dated by the physician.
2) Information from the patient’s medical record that documents that the coverage criteria defined
in the medical policy on Manual Wheelchairs have been met.
3) A home assessment which establishes that the beneficiary or caregiver is able to use the
wheelchair ordered to assist with activities of daily living (ADLs) in the home.
For more information on coverage criteria, coding guidelines and documentation requirements, refer
to the medical policies for Manual Wheelchairs, Wheelchair Options and Accessories, and Wheelchair
Seating on the National Government Services Web site at
Power Wheelchairs
For power wheelchairs, the supplier must include all of the following items (1–4):
1) The order that the supplier received within 45 days following the completion of the face-to-face
examination. This order must contain the following elements:
Beneficiary name
Description of the item. This may be general, e.g., “power wheelchair” or “power mobility
device,” or may be more specific.
Date of the face-to-face examination. If the evaluation involved multiple visits, enter the
date of the last visit. (Refer to the Power Wheelchairs policy for additional information.)
Pertinent diagnoses/conditions that relate to the need for the power wheelchair
Length of need
Physician’s signature
Date of physician signature
There must be a date stamp or equivalent on the order to indicate when it was received by
the supplier.
2) A detailed product description (which includes information previously contained in the detailed
written order) that lists the specific wheelchair base that is to be provided and each
option/accessory that will be separately billed. This document must also specify which HCPCS
code is associated with each item on the list. This information may be entered by the supplier
but the document must be signed and dated by the physician. (The signature date on this
document does not have to be within 45 days following the face-to-face exam.) For ADMC
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[MARCH 2008]
requests that are received on or after August 24, 2006, the document must also include the
supplier’s charge and the Medicare fee schedule allowance for each item. If there is no fee
schedule allowance, enter “Not Applicable.”
3) A copy of the report of the face-to-face examination by the physician—and other
licensed/certified medical professionals (LCMPs), if applicable. There must be a date stamp or
equivalent on the report(s) to indicate when they were received by the supplier. For ADMC
requests received on or after August 10, 2006, LCMPs reports that are to be considered part of
the face-to-face examination must include an attestation statement from the supplier indicating
that the LCMP has no financial relationship with the supplier. Refer to the Power Wheelchairs
policy for guidance on the type of documentation to be included. Note: If the power wheelchair
is a replacement within five years of one billed with the same HCPCS code that was previously
covered by Medicare, a face-to-face examination is not required.
4) A home assessment which establishes that the beneficiary is able to use the wheelchair ordered
to assist with ADLs in the home.
For more information on coverage criteria, coding guidelines, and documentation requirements, refer
to the medical policies for Motorized/Power Wheelchairs, Wheelchair Options and Accessories and
Wheelchair Seating on the National Government Services Web site at
Additional Guidance
Any information provided that explains the medical necessity for separately billed options and
accessories must use the same short description for the item that is used in the detailed product
description or detailed written order.
If the patient’s weight and/or height are needed to support the medical necessity for items that are
ordered, that information should be included on the first page of the ADMC request.
Even if the majority of the face-to-examination is performed by an LCMP, the ADMC request must also
include the report of the face-to-face examination with the physician.
Include the manufacturer, the product name, the model number and the width of wheelchair
cushion(s) that are provided. Make certain that the product is listed on the Statistical and Analysis
Durable Medical Equipment Medicare Regional Carrier (SADMERC) Product Classification List and that
the HCPCS code on the ADMC is the one specified by the SADMERC.
Suppliers are reminded that if an affirmative determination is made on the wheelchair base but
individual options/accessories are denied, there may be no resubmission or other request for an ADMC
determination on these. If these items are provided and denied at the time of claim submission, the
supplier may present additional information to justify coverage through the appeals process.
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[MARCH 2008]
ADMC DETERMINATION
Upon receipt of an ADMC request, the DME MAC Medical Review Department will make a
determination within 30-calendar days. The DME MAC Medical Review Department will provide the
supplier and beneficiary with its determination, either affirmative or negative, in writing. If it is a
negative determination, the letter will indicate why the request was denied, e.g., not medically
necessary, insufficient information submitted to determine coverage, statutorily noncovered.
If a wheelchair base receives a negative determination, all accessories will also receive a negative
determination. If a wheelchair base receives an affirmative determination, each accessory will receive
an individual determination.
Affirmative Determination
An affirmative determination only relates to whether the item is medically necessary based on the
information submitted. An affirmative determination does not provide assurance that the beneficiary
meets Medicare eligibility requirements nor does it provide assurance that any other Medicare
requirements (e.g., place of service, Medicare Secondary Payer) have been met. Only upon submission
of a complete claim can the DME MAC Medical Review Department make a full and complete
determination. An affirmative determination does not extend to the price that Medicare will pay for the
item. Finally, the DME MAC Medical Review Department may review selected claims on a prepayment
or postpayment basis and may deny a claim or request an overpayment if it determined that an
affirmative determination was made based on incorrect information.
An affirmative ADMC is only valid for items delivered within six months following the date of the
determination. If the wheelchair is not delivered within that time, the supplier has the option of either
submitting a new ADMC request (prior to providing the item) or filing a claim (after providing the item).
If the item is provided within six months following an affirmative determination, and if the claim is for
all the same items that were listed on the ADMC request, the documentation that supports the medical
necessity of the item does not need to be submitted with the claim. If any of the items on the ADMC
request were described by HCPCS code K0108 and if those items were provided, the supplier must
ensure that the narrative description used on the claim matches the narrative description used on the
ADMC determination letter. If a wheelchair base receives an affirmative determination, the supplier
may not submit a separate ADMC request for additional accessories.
If options or accessories are provided that were not listed on the ADMC request, the supplier should
submit whatever information is appropriate to document the medical necessity for the new item(s).
Negative Determination
A negative ADMC determination may not be appealed because it does not meet the regulatory
definition of an initial determination since no request for payment is being made. However, if the
ADMC request for the wheelchair base is denied and the supplier obtains additional medical
documentation, an ADMC request may be resubmitted. ADMC requests may only be resubmitted once
during the six-month period following a negative determination. If the wheelchair base is approved,
but one or more accessories are denied, an ADMC request may not be resubmitted for those
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[MARCH 2008]
accessories. If a supplier provides a wheelchair and/or accessories following a negative determination,
a claim for the item should be submitted. If new information is provided with the claim, coverage will
be considered. If the claim is denied, it may be appealed through the usual process.
6
Jurisdiction B DME MAC Advance Determination of Medicare Coverage (ADMC) Request Form ADMC HCPCS Code(s) and narrative for base wheelchair Note: Please submit this form along with supporting medical necessity documentation. Company Name: __________________________________________________________________ Company Address: __________________________________________________________________ __________________________________________________________________ Supplier Number: __________________________________________________________________ Contact Name: __________________________________________________________________ Telephone Number: __________________________________________________________________ Beneficiary Name: __________________________________________________________________ Beneficiary Address: __________________________________________________________________ __________________________________________________________________ HICN Number: __________________________________________________________________ Date of Birth: __________________________________________________________________ Place of Service: __________________________________________________________________ ICD 9: __________________________________________________________________ Physician’s Name: __________________________________________________________________ Physician’s Address: __________________________________________________________________ __________________________________________________________________ Telephone Number: __________________________________________________________________ UPIN: __________________________________________________________________ Number of Pages (including coversheet): _______________ Mail To: Fax To: National Government Services 1‐317‐595‐4759 Attn: Medical Review ‐ ADMC P.O. Box 6036 Indianapolis, In. 46206‐6036 National Government Services, Inc. Revised 1/07 Jurisdiction B DME MAC Supplier Manual
Chapter 9: Advance Beneficiary Notice
[DECEMBER 2007]
9 Advance Beneficiary Notice
GENERAL GUIDELINES
Advance Beneficiary Notice (ABN) is a written notice the supplier gives to a Medicare beneficiary
before providing items and/or services that are expected to be denied by Medicare based on one of
the following statutory exclusions:

Lack of medical necessity
Prohibited, unsolicited telephone contacts
No supplier number
Denial of Advanced Determination of Medicare Coverage (ADMC) request
Suppliers must use the OMB-approved ABN form CMS-R-131 (ABN-G), which is located later in this
chapter. For an ABN to be acceptable, it must:

be on the approved CMS-R-131 form;
clearly identify the particular item and/or service;
state that the supplier believes Medicare is likely (or certain) to deny payment for the particular
item and/or service; and
give the supplier’s reason(s) for their belief that Medicare is likely (or certain) to deny payment for
the item and/or service.
The ABN is designed for use with Medicare beneficiaries only (including those who are dually-eligible
for both Medicare and Medicaid). The ABN is not used for patients who are not Medicare beneficiaries.
The purpose of the ABN is to inform a Medicare beneficiary, before he or she receives specified items
and/or services that otherwise might be paid for, that Medicare probably will not pay for them on that
particular occasion. The ABN also allows the beneficiary to make an informed consumer decision on
whether or not to receive the items and/or services for which he or she may have to pay “out-ofpocket” through other insurance coverage (e.g., employer group health plan coverage), through
Medicaid or other federal/nonfederal payment source.
For assigned and nonassigned claims that have been denied as not medically necessary, the supplier
will be held liable for the item and/or service and may not bill or collect from the beneficiary unless the
supplier provided advance notice to the beneficiary in writing before providing the item/service stating
that the beneficiary agreed to pay for the item/service if it is denied by Medicare. If these conditions
are met, the beneficiary would be liable for payment to the supplier if Medicare denies the claim for
the reason listed on the ABN. To be held liable for payment means that the beneficiary will be liable
for payment “out-of-pocket,” or through other insurance coverage (e.g., employer group health plan
coverage), or through Medicaid or other federal or nonfederal payment source.
The ABN requirements apply to both assigned and nonassigned claims, as there are financial liability
provisions under Medicare law.
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[DECEMBER 2007]
A single ABN covering an extended course of treatment is acceptable provided the ABN identifies all
items and services for which the physician or supplier believes Medicare will not pay. If as extended
course of treatment progresses and additional items or service are to be furnished for which the
physician or suppliers believes Medicare will not pay, the supplier must separately notify the
beneficiary in writing (i.e., give the beneficiary another ABN) that Medicare is not likely to pay for the
additional items or services and obtain the beneficiary’s signature on the ABN.
One year is the limit for use of a single ABN for an extended course of treatment; if the course of
treatment extends beyond one year, a new ABN is required for the remainder of the course of
treatment. An ABN, once signed by the beneficiary, may not be modified or revised. When a
beneficiary must be notified of new information, a new ABN must be given.
LIMITATION ON LIABILITY
Limitation on liability applies to assigned claims for durable medical equipment, prosthetics, orthotics
and supplies (DMEPOS) services that have been disallowed due to:

medical necessity;
prohibition on unsolicited telephone calls;
no supplier number; or
no ADMC.
Under limitation on liability, a beneficiary can be held liable for an item and/or service denied due to
reasons cited on the ABN.
Refund requirements apply to both assigned and nonassigned claims for DMEPOS services disallowed
because of medical necessity, prohibition on unsolicited telephone contacts, supplier number, or no
ADMC. The refund requirements state that suppliers must make refunds of any amounts collected if
the beneficiary was not properly notified of possible disallowed Medicare claims.
It is the supplier’s responsibility to notify the beneficiary in writing before providing an item or service,
so that the beneficiary understands they will be held responsible for payment due to the item and/or
service never being covered because it is not reasonable or necessary. Modifier GA should be reported
in Box 24D of the CMS-1500 claim form with the appropriate Healthcare Common Procedure Coding
System (HCPCS) code when the claim is filed for payment. The use of modifier GA is not optional and
must be used anytime an ABN has been obtained. Modifier GZ should be reported in Box 24D of the
CMS-1500 claim form when the physician or supplier needs to indicate that a denial is expected, but
there is no ABN on file.
If Medicare denies a claim as not medically necessary, but the supplier believes the service/item is
medically necessary, the supplier should request a review of the claim. If the supplier chooses to
request a review, suppliers should include any additional information necessary to support the claim. If
a supplier requests a review within 30 days, they may delay refunding to the beneficiary until Medicare
makes a determination on the review request. If the review request renders a favorable decision, the
supplier is not required to refund the beneficiary for the item or service in question. If the review
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[DECEMBER 2007]
request renders an unfavorable decision, the supplier must refund any monies collected for the item
and/or service in question to the beneficiary within 15 days of receiving the review decision. The
Medicare beneficiary will be notified of all review activity.
A supplier may submit a review request any time within 120 days of receiving the initial determination,
however in order to delay refunding the patient suppliers must submit a review request within 30 days
of the initial determination.
Modifiers That May Be Associated with ABNs
GA
GZ
GK
GL
Waiver of liability (expected to be denied as not reasonable and necessary, ABN on file)
Item or service not reasonable and necessary (expected to be denied as not reasonable and
necessary, no ABN on file)
Actual item/service ordered by physician, item associated with a GA or GZ modifier
Medically unnecessary upgrade provided instead of nonupgraded item, no charge, no ABN
UPGRADES
CMS defines an upgrade as an item that is more expensive, contains more components or features, or
is greater in quantity than what the physician ordered. Medicare will accept ABNs on upgrades. The
upgraded item must be within the range of services that are appropriate for the beneficiary’s medical
condition (e.g., beneficiary can upgrade from a standard manual wheelchair to a power wheelchair,
but not from a walker to a wheelchair). The beneficiary has the choice on whether or not to upgrade.
If the supplier believes the upgrade is more than what Medicare considers medically necessary an ABN
may still be used in this situation, but the supplier must follow the current guidelines that are in place
for the use of ABNs. The supplier would bill the appropriate DME MAC by providing the item/service
that the physician ordered on one claim along with the GA modifier on the same line.
If the beneficiary agrees to be financially liable by signing an ABN, a supplier may collect the
difference between the charges for the upgraded item and the charges for the nonupgraded item.
ABNs for upgrades apply to both assigned and nonassigned claims. A supplier may decide to provide a
free upgrade for a beneficiary. When providing a free upgrade, the supplier should not have the
beneficiary sign an ABN, because the supplier should not be charging more than the normal deductible
and co-payment for the nonupgraded item.
When providing a free upgrade, suppliers should use the appropriate HCPCS code for the
nonupgraded item/service that the physician ordered. Suppliers should add the modifier GL with the
correct HCPCS code. The supplier should specify the make and model of the upgraded item/service
that was provided in Box 19 of the CMS-1500 form or as an attachment to the claim. The supplier
should also describe why the item/service was an upgrade. When billing electronically, suppliers
should provide this same information in the Note segment of the electronic claim.
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[DECEMBER 2007]
The following examples explain how to file claims with an ABN and without an ABN:
Upgraded with an ABN
Item ordered by the physician
Upgrade without an ABN
Item ordered by the physician
K0004RRKHGA
K0001RRKHGK
K0004RRKHGZ
K0001RRKHGK
$100
$50
$100
$50
For additional instructions, review CMS Program Memorandum AB-02-168 at
www.cms.hhs.gov/Transmittals/downloads/AB02168.pdf.
ADVANCE BENEFICIARY NOTICE COMPLETION
The Header of the ABN should include the supplier’s company name, address and telephone number.
The supplier should also place their company’s logo here if applicable. On the line that indicates
patient’s name, the supplier should document the name of the patient and should not substitute the
name of an authorized representative. The beneficiary’s Medicare Health Insurance Claim Number
(HICN) should be entered on the line stating Medicare number.
The following information should be entered in the body of the ABN.
Section A
In this section (beginning with “We expect that Medicare will not pay for the item (s) or service (s)”—
in the “Items or Services” box) specify the health care items or services for which you expect Medicare
will deny. A detailed description of the items or services should be provided so the beneficiary fully
understands which items may not be paid for by Medicare. In the second box, which is identified as
the “Because:” box state in detail the specific reason why Medicare is likely to deny payment for the
particular item or service. The reasoning should be clearly understood to the patient.
Estimated Cost Line
Suppliers may provide the beneficiary with an estimated cost of the items and/or services.
Option 1 and Option 2 Boxes
The supplier should have the beneficiary select one of the following two boxes:

Option 1 (Yes. I want to receive these items and/or services.)
Option 2 (No. I have decided not to receive these items or services.)
Date and Signature Line
The patient, or person acting on his or her behalf, should enter the date of which they signed the ABN
in the “Date” blank area. In the “Signature of patient…” blank, the patient, or the person acting on his
or her behalf, must sign his or her name.
4
Patient’s Name:
Medicare # (HICN):
ADVANCE BENEFICIARY NOTICE (ABN)
NOTE: You need to make a choice about receiving these health care items or services.
We expect that Medicare will not pay for the item(s) or service(s) that are described below.
Medicare does not pay for all of your health care costs. Medicare only pays for covered items
and services when Medicare rules are met. The fact that Medicare may not pay for a particular
item or service does not mean that you should not receive it. There may be a good reason your
doctor recommended it. Right now, in your case, Medicare probably will not pay for –
Items or Services:
Because:
The purpose of this form is to help you make an informed choice about whether or not you
want to receive these items or services, knowing that you might have to pay for them yourself.
Before you make a decision about your options, you should read this entire notice carefully.
• Ask us to explain, if you don’t understand why Medicare probably won’t pay.
• Ask us how much these items or services will cost you (Estimated Cost: $_________________),
in case you have to pay for them yourself or through other insurance.
PLEASE CHOOSE ONE OPTION. CHECK ONE BOX. SIGN & DATE YOUR CHOICE.
Option 1.
YES.
I want to receive these items or services.
I understand that Medicare will not decide whether to pay unless I receive these items
or services. Please submit my claim to Medicare. I understand that you may bill me for
items or services and that I may have to pay the bill while Medicare is making its decision.
If Medicare does pay, you will refund to me any payments I made to you that are due to me.
If Medicare denies payment, I agree to be personally and fully responsible for payment.
That is, I will pay personally, either out of pocket or through any other insurance that I have.
I understand I can appeal Medicare’s decision.

Option 2. NO. I have decided not to receive these items or services.
I will not receive these items or services. I understand that you will not be able to submit a
claim to Medicare and that I will not be able to appeal your opinion that Medicare won’t pay.
_____________ _
Date
_________________________________________
Signature of patient or person acting on patient’s behalf
NOTE: Your health information will be kept confidential. Any information that we collect about you on this
form will be kept confidential in our offices. If a claim is submitted to Medicare, your health information on this form
may be shared with Medicare. Your health information which Medicare sees will be kept confidential by Medicare.
OMB Approval No. 0938-0566
Form No. CMS-R-131-G
(June 2002)
Chapter 10: Claim Filing Jurisdiction
[JUNE 2007]
10 Claim Filing Jurisdiction
CLAIM FILING BASED ON BENEFICIARY ADDRESS
Four DME MACs process DMEPOS claims for designated states and territories. National Government
Services is the Jurisdiction B DME MAC. National Government Services processes DMEPOS claims for
the states of Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio and Wisconsin. Unlike other
Medicare claims, DMEPOS claim jurisdiction is based on the beneficiary’s address on file with the Social
Security Administration. A DMEPOS claim should be sent to the DME MAC jurisdiction for the state in
which the beneficiary resides.
DISPOSITION OF INCORRECTLY FILED CLAIMS
Paper Claims
Paper claims filed to the incorrect DME MAC for DMEPOS items will be returned to the supplier
unprocessed. The supplier must file the claim to the appropriate DME MAC based on beneficiary
residence.
Suppliers should review the DME MAC jurisdictions list to determine which DME MAC maintains
authority over the claim.
Electronic Claims
Electronic claims transmitted to the incorrect DME MAC for DMEPOS items will be rejected by the DME
MAC. A reject code will indicate the claim should be filed to the appropriate DME MAC.
Electronic claims transmitted to the incorrect DME MAC will be forwarded to the appropriate DME MAC
based on the beneficiary address. The supplier must have an Electronic Data Interchange (EDI)
Enrollment form on file at the DME MAC that is receiving the transferred claim. If the supplier does not
have an EDI Enrollment form on file with the DME MAC that is receiving the transferred claim, the
claim will reject on the front-end and will not be entered into the Medicare processing system. If a
supplier does not have an EDI Enrollment form on file, the supplier should contact the jurisdiction that
received the transferred claim to obtain an EDI Enrollment form.
Examples
A beneficiary resides in Michigan and purchases DME in Ohio. The Ohio supplier sends the claim to the
local Ohio carrier. The claim will be returned to the supplier. The supplier must send the claim to the
appropriate DME MAC (in this case, Jurisdiction B).
If a Minnesota supplier files a paper claim for a beneficiary with a permanent residence in Wyoming to
the Jurisdiction B DME MAC, the Jurisdiction B DME MAC will send the claim back to the supplier. The
supplier must then send the claim to the appropriate DME MAC (Jurisdiction D).
1
[JUNE 2007]
If a Minnesota supplier files an electronic claim to the Jurisdiction B DME MAC for a beneficiary whose
permanent residence is Wyoming, the Jurisdiction B DME MAC will transfer the claim to Jurisdiction D
DME MAC. If the Jurisdiction D DME MAC has an EDI Enrollment form on file, the Jurisdiction D DME
MAC will accept the claim on the front-end and adjudicate the claim. If the Jurisdiction D DME MAC
does not have an EDI Enrollment form on file, the claim will reject on the front-end. The supplier must
complete and forward an EDI Enrollment form to the Jurisdiction D DME MAC and resubmit the
electronic claim.
DURABLE MEDICAL EQUIPMENT MEDICARE
ADMINISTRATIVE CONTRACTORS
The first of the full and open Medicare administrative contractor (MAC) competitions were held for the
durable medical equipment (DME) claims workloads. The Centers for Medicare & Medicaid Services
(CMS) decided to start the Medicare Contracting Reform initiative with durable medical equipment
Medicare administrative contractors (DME MACs) because the workload of the four current durable
medical equipment regional carriers (DMERCs) was stable and the risk of any significant program
disruption to the provider and beneficiary communities would be minimal.
On January 6, 2006, CMS announced that it had awarded the contracts for the four specialty MACs that
will handle administration of Medicare claims for DME. Three of the four DME MACs are operational.
Jurisdiction A
The Jurisdiction A DME MAC contract was awarded to National Heritage Insurance Company (NHIC).
NHIC immediately began transition activity and became fully operational as the DME MAC on July 1,
2006. The states included in DME MAC Jurisdiction A are: Connecticut, Delaware, District of Columbia,
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island
and Vermont.
Jurisdiction B
The Jurisdiction B DME MAC contract was awarded to National Government Services, Inc., which
immediately began transition activity and became fully operational as the DME MAC on July 1, 2006.
The states included in DME MAC Jurisdiction B are: Illinois, Indiana, Kentucky, Michigan, Minnesota,
Ohio and Wisconsin.
Jurisdiction C
The Jurisdiction C DME MAC contract was awarded to CIGNA Government Services, which became
fully operational as the DME MAC on June 1, 2007. The states included in Jurisdiction C are: Alabama,
Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma,
Puerto Rico, South Carolina, Tennessee, Texas, U.S. Virgin Islands, Virginia and West Virginia.
2
[JUNE 2007]
Jurisdiction D
The Jurisdiction D DME MAC contract was awarded to Noridian Administrative Services (NAS). The
states included in DME MAC Jurisdiction D are: Alaska, American Samoa, Arizona, California, Guam,
Hawaii, Idaho, Iowa, Kansas, Missouri, Montana, Nebraska, Nevada, North Dakota, Northern Mariana
Islands, Oregon, South Dakota, Utah, Washington and Wyoming.
On January 24, 2006 CIGNA filed a protest of this award made to NAS and an automatic stay on
performance of work was triggered until a decision on the protest could be rendered. On May 4, 2006,
CMS received notification that GAO denied CIGNA’s protest of the award to NAS. As a result of this
decision, CMS authorized NAS to resume work under Jurisdiction D as of May 8, 2006. As of
September 30, 2006, NAS had assumed full responsibility for administering the DME work for
Jurisdiction D.
Additional DME MAC Contract Options
The solicitation for DME MAC contracts also included four options for which offerors were able to
submit proposals: the Medicare Electronic Data Interchange System (MEDIS), the Data Center, the
National Supplier Clearinghouse (NSC) and Data Analysis and Coding (DAC) (similar to the current
SADMERC). Those options were originally awarded on January 6, 2006, to Palmetto. But, because of
the protests of the Jurisdiction C DME MAC award and the fact that Jurisdictions A, B, and D have
already become operational using nonstandard front-end systems and individual data centers, CMS
has decided that the MEDIS and the Data Center are being dropped from award consideration.
Decisions with respect to the NSC and DAC are pending. In the interim, Palmetto GBA will be providing
those services through their contracts for the NSC and SADMERC.
Resources
Current information on Medicare Administrative Contracts can be found on the CMS Web site at
www.cms.hhs.gov/MedicareContractingReform/08_DurableMedicalEquipmentMedicareAdministrativeCo
ntractor.asp.
DME MAC JURISDICTIONS
The map on the following page identifies the four DME MAC jurisdictions and the states each is
contracted to serve.
3
[JUNE 2007]
DME MAC Jurisdictions
4
Chapter 11: Claim Submission
[MARCH 2008]
11 Claim Submission
ACCEPTABLE CLAIM FORMATS
Durable medical equipment Medicare administrative contractors (DME MACs) accept Medicare claims
both on paper using the CMS-1500 claim form and electronically. The CMS-1500 is one of the basic
forms prescribed by the Centers for Medicare & Medicaid Services (CMS) for the Medicare Program. It
is only accepted from physicians and suppliers that are excluded from the mandatory electronic claims
submission requirements set forth in the Administrative Simplification Compliance Act, Public Law
107-0105 (ASCA), and the implementing regulation at 42 CFR 424.32.
To accommodate the reporting of the national provider identifier (NPI), the CMS-1500 claim form
(version 12-90) was revised in July of 2006. The new CMS-1500 claim form (version 08-05) became
effective January 1, 2007. The major difference between the revised CMS-1500 (version 12-90) and
the version 08-05 CMS-1500 claim form is the split provider identifier fields.
CMS Change Request 5616 announced that beginning July 2, 2007, suppliers who are eligible to
submit paper claims must use the CMS-1500 claim form (version 8-05). Claims received on or after
July 2, 2007 version 12-90 of the CMS-1500 claim form will be rejected.
Note: Acceptance of the CMS-1500 claim form (version 08-05) involves the paper claim form only.
Suppliers submitting electronic claims are required to use the Health Insurance Portability and
Accountability Act (HIPAA) compliant format.
For information on electronic claim submission, please refer to Chapter 12, Electronic Data
Interchange, in this manual.
CLAIM FILING TIME LIMITS
Medicare law prescribes specific time limits within which claims for benefits may be submitted. The
terms of the law require that the claim be filed no later than the end of the calendar year following the
year in which the service was furnished, except as follows.
The time limit on filing claims for services furnished in the last three months of a year is the same as if
the services had been furnished in the subsequent year. Therefore, the time limit on filing claims for
services furnished in the last three months of the year is December 31 of the second year following
the year in which the services were rendered. For example:
Note: For services rendered on or before September 30, 2006, the claim filing time limit has expired.
For Dates of Service:
The Claim Must Be Filed By:
October 1, 2004–September 30, 2006
December 31, 2007
December 31, 2008
1
[MARCH 2008]
December 31, 2009
December 31, 2010
Whenever the last day for timely filing of a claim falls on a Saturday, Sunday, federal nonworkday or
legal holiday, the claim will be considered timely if it is filed on the next workday.
Claims for services filed outside the time limit will be denied.
According to the Omnibus Budget Reconciliation Act (OBRA) of 1989, assigned Medicare claims must
be filed within one year from the date of service or the payment will be reduced by 10 percent.
Supplier Responsibility for Filing Claims To Medicare
OBRA 89 requires a Medicare provider to submit a completed claim within one year when furnishing
covered items to a Medicare beneficiary. The provider is relieved of this obligation when furnishing
noncovered items, unless the beneficiary requests Medicare payment/determination.
If the beneficiary chooses to waive Medicare determination/payment, the supplier is relieved of the
responsibility to file claims for covered Medicare items. Should the beneficiary change his/her mind in
the future, the supplier would again be responsible for submitting claims for covered items to Medicare.
The participating supplier must always accept assignment on a claim and must accept the resulting
Medicare allowed amount as full reimbursement for the item(s). A 10 percent reduction in the allowed
amount occurs for claims not filed within one year of the service date. The beneficiary is not
responsible for this reduction. Participating suppliers are responsible for obtaining all necessary
supporting documentation to prove the medical necessity (where applicable), order prior to delivery,
as well as any additional information as specified in the medical policies.
The nonparticipating supplier has the option to choose—on a claim-by-claim basis—whether to accept
assignment on a Medicare claim. If the supplier chooses to accept assignment, the supplier must file a
complete claim to Medicare on the beneficiary’s behalf. The 10 percent reduction for claims filed
beyond the one-year limitation applies. The supplier must also accept the Medicare allowed amount as
the full payment for the item(s) furnished. In this instance, the supplier is responsible for obtaining all
documentation to support the medical need of the item (i.e., the physician’s order, a certificate of
medical necessity [if applicable] and order prior to delivery, and any additional information as specified
in the medical policies).
When a nonparticipating supplier chooses not to accept assignment, the supplier must file a claim to
Medicare on the patient’s behalf. Either the supplier or the beneficiary can obtain the medical
necessity information to support the need of the item(s). Suppliers must ensure the beneficiary
understands Medicare may not reimburse if the required information is missing. The supplier may
choose to hold the Medicare claim until the beneficiary presents the medical documentation. If the
beneficiary refuses to obtain the necessary documentation, the supplier should file the claim, including
as much information as possible.
2
[MARCH 2008]
SIGNATURE ON FILE REQUIREMENTS
Medicare requires that suppliers obtain beneficiary authorization before filing claims for any service to
the DME MAC. This authorization is called the Assignment of Benefits (AOB) and must be signed by
the beneficiary or their authorized representative. The AOB applies only to those particular items listed
on the form. The supplier should maintain this one-time payment authorization in the patient’s
records. The supplier must indicate “SOF” or “signature on file” in Box 12 on the CMS-1500 claim form
when billing Medicare.
When a beneficiary is unable to sign because of mental or physical limitations, forms may be signed
on their behalf by one of the following representatives:

Legal guardian
Representative payee—a person designated by the Social Security Administration or other
governmental agency to receive an incapable beneficiary’s monthly cash benefits
Authorized representative—acts on behalf and in best interest of the beneficiary and is usually a
parent, legal guardian of minor, or legal guardian of an adult who has been declared incompetent
Designee—any person who can sign and accept the delivery of durable medical equipment (DME)
on behalf of the beneficiary
Relative
Friend
Representative of an institution providing care or support
Governmental agency providing assistance
If the patient is unable to sign, the statement’s signature line must indicate the patient’s name followed
by the word “by,” and then the representative’s name, address, relationship to the patient and the
reason the patient cannot sign. When an illiterate or physically handicapped beneficiary signs by mark
(X), the signature and address of the witness should be entered next to the beneficiary’s mark.
This procedure must be implemented by suppliers utilizing paperless (electronic) claim submission.
Suppliers must incorporate the following language in a document to be signed by the patient and retained
in the supplier’s files.
Statement to Permit Payment of
Medicare Benefits to Provider,
Physicians and Patient
Name of Beneficiary
HICN
I request that payment of authorized Medicare benefits be made either to me or on my behalf for
any services furnished me by or in (name of Provider), including physician services. I authorize any
holder of medical or other information about me to release to the Centers for Medicare & Medicaid
Services and its agents any information needed to determine these benefits or benefits for related
services.
3
[MARCH 2008]
These records should be easily accessible and available for DME MAC inspection upon request. If the
required information is not on the AOB form, then the form will be considered invalid and an
overpayment will be requested if payment has been made.
Once the above statement is executed, suppliers may enter “signature on file” in the patient’s
signature line of the CMS-1500 claim form.
Suppliers must complete and promptly submit a claim whenever durable medical equipment, prosthetics,
orthotics and supplies (DMEPOS) items are rendered to a Medicare beneficiary—even if assignment is not
accepted. On any bills or receipts sent to Medicare patients, the following statement should be included.
Do not use this bill for claiming Medicare benefits. A claim has been, or will be, submitted to
Medicare on your behalf.
If the patient has a Medigap policy, the following statement below must be signed by the patient or their
authorized representative to authorize payment of mandated Medigap benefits to the participating
physician or supplier if required Medigap information is included in Item 9 of the CMS-1500 claim form and
its subdivisions.
Date
Patient Name
Health Insurance Claim Number
I request that payment of authorized Medicare benefits be made on my behalf to (SUPPLIER NAME)
for any services furnished to me by (SUPPLIER NAME). I authorize any holder of medical information
about me to release to the Centers for Medicare & Medicaid Services and its agents any information
needed to determine these benefits.
Once the above statement is executed, suppliers must indicate on the claim form that a separate
Medigap authorization has been obtained by entering “SOF” in Item 13 of the CMS-1500 form. The
Medigap assignment on file in the participating provider and/or supplier’s office must be insurerspecific. It may state that the authorization applies to all occasions of service until it is revoked.
ORDERING CLAIM FORMS
Copies of the current CMS-1500 claim form (version 08/05) may be ordered from the Superintendent
of Documents; negatives for the CMS-1500 may be ordered from the U.S. Government Printing Office
(GPO). To purchase them from the GPO, call 202-512-1800. With these negatives, a printer may
produce copies of the CMS-1500 claim form. They may be altered to overprint a provider’s name
address and provider number.
4
[MARCH 2008]
CMS-1500 Paper Claim Form
Single Sheet
2 Part Snap-out
1 Part Continuous
2 Part Continuous
100
100
2500
1400
$13
$15
$72
$59
017-060-00468-1
017-060-00469-0
017-060-00470-3
017-060-00471-1
All of the forms listed above are sensor coded. On any order for 100 packages or more that is shipped to
one address, a 25 percent discount can be applied to the prices shown above. For orders of 100,000
copies or more, the Superintendent of Documents can furnish CMS-1500 claim forms preprinted with the
practitioner’s name, address, and ID number, or customize the form in certain other ways. For
information on this service, contact the GPO Superintendent of Documents at 202-512-2404.
Ordering Information
Contact the GPO Superintendent of Documents Order Desk between 8:00 a.m. and 4:30 p.m. Eastern
Standard Time (ET) at 202-512-1800.
Note: Orders must be placed using the SupDocs stock number.
CMS-1500 Negatives
Negatives for the CMS-1500 claim form and a specification package may be purchased. To purchase a
negative, make a check payable to “The Public Printer” and mail it along with the order to the
following address:
Asst. Supt. of Dept. Acct. Rep. Div.
U.S. Government Printing Office, Room C-830
Washington, District of Columbia 20401
Do not submit a purchase order, voucher or similar form for purchase, as this office can only process
payment by check or money order.
Shipment will be made approximately five business days after receipt of the order. For additional
information, call 202-512-1257.
CMS-1500 HINTS AND TIPS
Four-Digit Year
All dates should be written as a four-digit year, for example: 06/01/2001.
Date-Spanning
When billing for items in which date spanning is recommended or required, the delivery date may be
listed in the “From” field and the “To” field should indicate the date for which the supplies are
expected to last.
5
[MARCH 2008]
Multiple Forms
When a claim contains more than six items it should be continued on a second CMS-1500 form. Write
“continued” in Item 28 of all but the last form, and enter the cumulative total in Item 28 of the last
form. Other than Item 28, the additional forms should be completed in full.
Check the Completed Form Carefully
Watch for the following items. These are the most frequent reasons for claim rejection.

Incorrect supplier numbers
− National provider identifier (NPI) (Item 33a)
− NSC supplier number (Item 33b)
Missing or incorrect signatures (Items 12 and 31)
Diagnosis in Box 24e instead of Item 21
Missing modifiers on capped rental, inexpensive or other routinely purchased DME items (IRP)
Item 11 must not be left blank; if not applicable, write “None” in this section
NEW REVISED CMS-1500 FORM (VERSION 08-05)
The new revised CMS-1500 claim form, version 08-05, became effective January 1, 2007, but was not
mandated for supplier use until July 1, 2007. The CMS MLN Matters article MM5616 provides additional
details and instructions on the use of the new CMS-1500 claim form (version 08-05) and the
termination of the transition period to accept the previous CMS-1500 claim form (version 12-90).
A change log that identifies the various changes made to the new revised CMS-1500 claim form
(version 08-05) is available and can be viewed on the National Uniform Claim Committee (NUBC) Web
site at www.nucc.org/images/stories/PDF/change_log.pdf.
A sample CMS-1500 claim form (version 08-05) and form completion instructions are included on the
following pages. The new CMS-1500 form can also be located on the CMS Web site at
www.cms.hhs.gov/cmsforms/downloads/CMS1500805.pdf.
6
CARRIER
1500
HEALTH INSURANCE CLAIM FORM
APPROVED BY NATIONAL UNIFORM CLAIM COMMITTEE 08/05
PICA
MEDICARE
MEDICAID
(Medicare #)
(Medicaid #)
TRICARE
CHAMPUS
(Sponsor ’s SSN)
GROUP
HEALTH PLAN
(SSN or ID)
CHAMPVA
(Member ID#)
FECA
BLK LUNG
(SSN)
3. PATIENT’S BIRTH DATE
MM
DD
YY
2. PATIENT’S NAME (Last Name, First Name, Middle Initial)
5. PATIENT’S ADDRESS (No., Street)
OT HER
4. INSURED ’S NAME (Last Name, First Name, Middle Initial)
SEX
M
F
7. INSURED ’S ADDRESS (No., Street)
6. PATIENT RELATIONSHIP TO INSURED
Self
CITY
STATE
STATE
CITY
Married
Other
(Include Area Code)
TELEPHONE
(
Other
8. PATIENT STATUS
Single
ZIP CODE
Child
Spouse
(For Program in Item 1)
(ID)
ZIP CODE
)
Employed
Full-Time
Student
TELEPHONE (Include Area Code)
(
Part-Time
Student
)
9. OTHER INSURED ’S NAME (Last Name, First Name, Middle Initial)
10. IS PATIENT’S CONDITION RELATED TO:
11. INSURED’S POLICY GROUP OR FECA NUMBER
a. OTHER INSURED’S POLICY OR GROUP NUMBER
a. EMPLOYMENT? (Current or Previous)
a. INSURED’S DATE OF BIRTH
MM
DD
YY
NO
YES
b. OTHER INSURED’S DATE OF BIRTH
MM
DD
YY
b. AUTO ACCIDENT?
SEX
PLACE (State)
c. EMPLOYER’S NAME OR SCHOOL NAME
c. OTHER ACCIDENT?
b. EMPLOYER’S NAME OR SCHOOL NAME
c. INSURANCE PLAN NAME OR PROGRAM NAME
NO
YES
d. INSURANCE PLAN NAME OR PROGRAM NAME
d. IS THERE ANOTHER HEALTH BENEFIT PLAN?
10d. RESERVED FOR LOCAL USE
YES
READ BACK OF FORM BEFORE COMPLETING & SIGNING THIS FORM.
12. PATIENT’S OR AUTHORIZED PERSON’S SIGNATURE I authorize the release of any medical or other information necessary to process
this claim. I also request payment of government benefits either to myself or to the party who accepts assignment below.
SIGNED
14. DATE OF CURRENT:
MM
DD
YY
17. NAME OF REFERRING PROVIDER OR OTHER SOURCE
NO
If yes , return to and complete item 9 a-d.
13. INSURED’S OR AUTHORIZED PERSON’S SIGNATURE I authorize payment
of medical benefits to the undersigned physician or supplier for services
described below.
DATE
ILLNESS (First symptom) OR
INJURY (Accident) OR
PREGNANCY(LMP)
SIGNED
15. IF PATIENT HAS HAD SAME OR SIMILAR ILLNESS.
MM
DD
YY
GIVE FIRST DATE
16. DATES PATIENT UNABLE TO WORK IN CURRENT OCCUPATION
MM
DD
YY
MM
DD
FROM
TO
YY
17a.
18. HOSPITALIZATION DATES RELATED TO CURRENT SERVICES
MM
DD
YY
MM
DD
FROM
TO
YY
17b. NPI
19. RESERVED FOR LOCAL USE
20. OUTSIDE LAB?
YES
21. DIAGNOSIS OR NATURE OF ILLNESS OR INJURY (Relate Items 1, 2, 3 or 4 to Item 24E by Line)
1.
F
NO
YES
F
M
SEX
M
PATIENT AND INSURED INFORMATION
1.
PICA
1a. INSURED ’S I.D. NUMBER
$ CHARGES
NO
22. MEDICAID RESUBMISSION
CODE
ORIGINAL REF. NO.
3.
2.
24. A.
MM
DATE(S) OF SERVICE
From
To
DD
YY
MM
DD
YY
B.
PLACE OF
SERVICE
C.
EMG
4.
D. PROCEDURES, SERVICES, OR SUPPLIES
(Explain Unusual Circumstances)
CPT/HCPCS
MODIFIER
E.
DIAGNOSIS
POINTER
F.
H.
G.
EPSDT
Family
Plan
DAYS
OR
UNITS
$ CHARGES
1
I.
J.
RENDERING
PROVIDER ID. #
ID.
QUAL.
NPI
2
NPI
3
NPI
4
NPI
5
NPI
6
PHYSICIAN OR SUPPLIER INFORMATION
23. PRIOR AUTHORIZATION NUMBER
NPI
25. FEDERAL TAX I.D. NUMBER
SSN EIN
27. ACCEPT ASSIGNMENT?
26. PATIENT’S ACCOUNT NO.
( For govt. claims, see back )
YES
31. SIGNATURE OF PHYSICIAN OR SUPPLIER
INCLUDING DEGREES OR CREDENTIALS
(I certify that the statements on the reverse
apply to this bill and are made a part thereof.)
SIGNED
DATE
32. SERVICE FACILITY LOCATION INFORMATION
a.
NUCC Instruction Manual available at: www.nucc.org
NPI
b.
NO
28. TOTAL CHARGE
$
29. AMOUNT PAID
$
33. BILLING PROVIDER INFO & PH #
a.
30. BALANCE DUE
$
NPI
(
)
b.
APPROVED OMB-0938-0999 FORM CMS-1500 (08/05)
BECAUSE THIS FORM IS USED BY VARIOUS GOVERNMENT AND PRIVATE HEALTH PROGRAMS, SEE SEPARATE INSTRUCTIONS ISSUED BY
APPLICABLE PROGRAMS.
NOTICE: Any person who knowingly files a statement of claim containing any misrepresentation or any false, incomplete or misleading information may
be guilty of a criminal act punishable under law and may be subject to civil penalties.
REFERS TO GOVERNMENT PROGRAMS ONLY
MEDICARE AND CHAMPUS PAYMENTS: A patient’s signature requests that payment be made and authorizes release of any information necessary to process
the claim and certifies that the information provided in Blocks 1 through 12 is true, accurate and complete. In the case of a M edicare claim, the patient’s signature
authorizes any entity to release to Medicare medical and nonmedical information, including employment status, and whether the person has employer group health
insurance, liability, no-fault, worker’s compensation or other insurance which is responsible to pay for the services for which the Medicare claim is made. See 42
CFR 411.24(a). If item 9 is completed, the patient’s signature authorizes release of the information to the health plan or agency shown. In Medicare assigned or
CHAMPUS participation cases, the physician agrees to accept the charge determination of the Medicare carrier or CHAMPUS fiscal intermediary as the full charge,
and the patient is responsible only for the deductible, coinsurance and noncovered services. Coinsurance and the deductible are based upon the charge
determination of the Medicare carrier or CHAMPUS fiscal intermediary if this is less than the charge submitted. CHAMPUS is not a health insurance program but
makes payment for health benefits provided through certain affiliations with the Uniformed Services. Information on the patient ’s sponsor should be provided in those
items captioned in “Insured ”; i.e., items 1a, 4, 6, 7, 9, and 11.
BLACK LUNG AND FECA CLAIMS
The provider agrees to accept the amount paid by the Government as payment in full. See Black Lung and FECA instructions regarding required procedure and
diagnosis coding systems.
SIGNATURE OF PHYSICIAN OR SUPPLIER (MEDICARE, CHAMPUS, FECA AND BLACK LUNG)
I certify that the services shown on this form were medically indicated and necessary for the health of the patient and were personally furnished by me or were furnished
incident to my professional service by my employee under my immediate personal supervision, except as otherwise expressly permitted by Medicare or CHAMPUS
regulations.
For services to be considered as “incident” to a physician’s professional service, 1) they must be rendered under the physician’s immediate personal supervision
by his/her employee, 2) they must be an integral, although incidental part of a covered physician’s service, 3) they must be of kinds commonly furnished in physician’s
offices, and 4) the services of nonphysicians must be included on the physician’s bills.
For CHAMPUS claims, I further certify that I (or any employee) who rendered services am not an active duty member of the Uniformed Services or a civilian employee
of the United States Government or a contract employee of the United States Government, either civilian or military (refer to 5 USC 5536). For Black-Lung claims,
I further certify that the services performed were for a Black Lung-related disorder.
No Part B Medicare benefits may be paid unless this form is received as required by existing law and regulations (42 CFR 424.32).
NOTICE: Any one who misrepresents or falsifies essential information to receive payment from Federal funds requested by this form may upon conviction be subject
to fine and imprisonment under applicable Federal laws.
NOTICE TO PATIENT ABOUT THE COLLECTION AND USE OF MEDICARE, CHAMPUS, FECA, AND BLACK LUNG INFORMATION
(PRIVACY ACT STATEMENT)
We are authorized by CMS, CHAMPUS and OWCP to ask you for information needed in the administration of the Medicare, CHAMPUS, FECA, and Black Lung
programs. Authority to collect information is in section 205(a), 1862, 1872 and 1874 of the Social Security Act as amended, 42 CFR 411.24(a) and 424.5(a) (6), and
44 USC 3101;41 CFR 101 et seq and 10 USC 1079 and 1086; 5 USC 8101 et seq; and 30 USC 901 et seq; 38 USC 613; E.O. 9397.
The information we obtain to complete claims under these programs is used to identify you and to determine your eligibility. It is also used to decide if the services
and supplies you received are covered by these programs and to insure that proper payment is made.
The information may also be given to other providers of services, carriers, intermediaries, medical review boards, health plans , and other organizations or Federal
agencies, for the effective administration of Federal provisions that require other third parties payers to pay primary to Federal program, and as otherwise necessary
to administer these programs. For example, it may be necessary to disclose information about the benefits you have used to a hospital or doctor. Additional disclosures
are made through routine uses for information contained in systems of records.
FOR MEDICARE CLAIMS: See the notice modifying system No. 09-70-0501, titled, ‘Carrier Medicare Claims Record,’ published in the Federal Register, Vol. 55
No. 177, page 37549, Wed. Sept. 12, 1990, or as updated and republished.
FOR OWCP CLAIMS: Department of Labor, Privacy Act of 1974, “Republication of Notice of Systems of Records,” Federal Register Vol. 55 No. 40, Wed Feb. 28,
1990, See ESA-5, ESA-6, ESA-12, ESA-13, ESA-30, or as updated and republished.
FOR CHAMPUS CLAIMS: PRINCIPLE PURPOSE(S): To evaluate eligibility for medical care provided by civilian sources and to issue payment upon establishment
of eligibility and determination that the services/supplies received are authorized by law.
ROUTINE USE(S): Information from claims and related documents may be given to the Dept. of Veterans Affairs, the Dept. of Health and Human Services and/or
the Dept. of Transportation consistent with their statutory administrative responsibilities under CHAMPUS/CHAMPVA; to the Dept. of Justice for representation of
the Secretary of Defense in civil actions; to the Internal Revenue Service, private collection agencies, and consumer reporting agencies in connection with recoupment
claims; and to Congressional Offices in response to inquiries made at the request of the person to whom a record pertains. Appropriate disclosures may be made
to other federal, state, local, foreign government agencies, private business entities, and individual providers of care, on matters relating to entitlement, claims
adjudication, fraud, program abuse, utilization review, quality assurance, peer review, program integrity, third-party liability, coordination of benefits, and civil and
criminal litigation related to the operation of CHAMPUS.
DISCLOSURES: Voluntary; however, failure to provide information will result in delay in payment or may result in denial of claim. With the one exception discussed
below, there are no penalties under these programs for refusing to supply information. However, failure to furnish information regarding the medical services rendered
or the amount charged would prevent payment of claims under these programs. Failure to furnish any other information, such as name or claim number, would delay
payment of the claim. Failure to provide medical information under FECA could be deemed an obstruction.
It is mandatory that you tell us if you know that another party is responsible for paying for your treatment. Section 1128B of the Social Security Act and 31 USC 38013812 provide penalties for withholding this information.
You should be aware that P.L. 100-503, the “Computer Matching and Privacy Protection Act of 1988,” permits the government to verify information by way of computer matches.
MEDICAID PAYMENTS (PROVIDER CERTIFICATION)
I hereby agree to keep such records as are necessary to disclose fully the extent of services provided to individuals under the State ’s Title XIX plan and to furnish
information regarding any payments claimed for providing such services as the State Agency or Dept. of Health and Human Services may request.
I further agree to accept, as payment in full, the amount paid by the Medicaid program for those claims submitted for payment under that program, with the exception
of authorized deductible, coinsurance, co-payment or similar cost-sharing charge.
SIGNATURE OF PHYSICIAN (OR SUPPLIER): I certify that the services listed above were medically indicated and necessary to the health of this patient and were
personally furnished by me or my employee under my personal direction.
NOTICE: This is to certify that the foregoing information is true, accurate and complete. I understand that payment and satisfaction of this claim will be from Federal and State
funds, and that any false claims, statements, or documents, or concealment of a material fact, may be prosecuted under applicable Federal or State laws.
According to the Paperwork Reduction Act of 1995, no persons are required to respond to a collection of information unless it displays a valid OMB control number. The valid OMB
control number for this information collection is 0938-0999. The time required to complete this information collection is estimated to average 10 minutes per response, including the
time to review instructions, search existing data resources, gather the data needed, and complete and review the information co llection. If you have any comments concerning the
accuracy of the time estimate(s) or suggestions for improving this form, please write to: CMS, Attn: PRA Reports Clearance Officer, 7500 Security Boulevard, Baltimore, Maryland
21244-1850. This address is for comments and/or suggestions only. DO NOT MAIL COMPLETED CLAIM FORMS TO THIS ADDRESS.
[MARCH 2008]
Item #
1
Description
Type of claim
Cause
Reject
Yes
1a
Insured’s ID
Yes
2
Patient’s name
Yes
3
4
Patient’s birthdate/sex
Insured’s name
Yes
5
Patient’s address
6
7
Patient relationship to
insured
Insured’s address
8
Patient status
9
Other insured’s name
Special Instructions
Show the type of health insurance coverage applicable to this claim by
checking the appropriate box, e.g., if a Medicare claim is being filed,
check the Medicare box.
Enter the patient’s Medicare Health Insurance Claim Number (HICN)
whether Medicare is the primary or secondary payer. This is a required
field.
Enter the patient’s name, first name and middle initial, if any, as shown
on the patient’s Medicare card. This is a required field.
Enter patient’s eight-digit birth date (MM/DD/CCYY) and sex.
If there is insurance primary to Medicare, either through the patient’s
or spouse’s employment or any other source, list the name of the
insured here. When the insured and the patient are the same enter
“Same.” If Medicare is primary, leave blank.
Enter the patient’s mailing address and telephone number. On the first
line, enter the street address; the second line, the city and state; the
third line, the zip code and phone number.
If the beneficiary has a representative payee, then the representative
payee’s address is listed in Item 4. The beneficiary’s actual residence is
then entered in Item 32. This information is required in case the
representative payee is located in a different state from the beneficiary.
Check appropriate box for patient’s relationship to insured when Item 4
is completed.
Enter the insured’s address and telephone number. When the address
is the same as the patient’s, enter the word “Same.” Complete this
item only when Items 4 and 11 are completed.
Check the appropriate box for the patient’s marital status and whether
employed or a student.
Enter the last name, first name and middle initial of the enrollee in a
Medigap policy, if it is different from that shown in Item 2; otherwise,
enter the word “Same.” If no Medigap benefits are assigned, leave
blank. This field may be used in the future for supplemental insurance
plans. Only participating physicians and suppliers are to complete Item
9 and its subdivisions and only when the beneficiary wishes to assign
his/her benefits under a Medigap policy to the participating physician or
supplier. Participating physicians and suppliers must enter information
required in Item 9 and its subdivisions if requested by the beneficiary.
Participating physician’s/suppliers sign an agreement with Medicare to
accept assignment of Medicare benefits for all Medicare patients. A
claim for which a beneficiary elects to assign his/her benefits under a
Medigap policy to a participating physician/supplier is called a
mandated Medigap transfer.
Medigap: A Medigap policy meets the statutory definition of a
“Medicare supplemental policy” contained in both Sections 1882(g)(1)
of Title XVIIII of the Social Security Act and the definition contained in
the NAIC Model Regulation which is incorporated by reference to the
statute. It is a health insurance policy or other health benefit plan
offered by a private entity to those persons entitled to Medicare
benefits and is specifically designed to supplement Medicare benefits.
It fills in some of the “gaps” in Medicare coverage by providing
payment for some of the charges for which Medicare does not have
responsibility due to the applicability of deductibles, coinsurance
amounts, or other limitations imposed by Medicare. It does not include
limited benefit coverage available to Medicare beneficiaries such as
“specified disease” or “hospital indemnity” coverage. Also, it explicitly
excludes a policy or plan offered by an employer to employees, or
former employees, as well as that offered by a labor organization to
members or former members.
9
[MARCH 2008]
Item #
Description
9a
Other insured’s policy or
group number
9b
Other insured’s date of
birth
Employer’s name or
school name
9c
9d
Cause
Reject
Yes
Insurance plan name or
program name
10
Is patient’s condition
related to:
10d
Reserved for local use
11
Insured’s policy, group or
FECA number
Yes
Do not list other supplemental coverage in Item 9 and its subdivisions
at the time a Medicare claim is filed. Other supplemental claims are
forwarded automatically to the private insurer if the private insurer
contracts with the carrier to send Medicare claim information
electronically. If there is no such contract, the beneficiary must file
his/her own supplemental claim.
Enter the policy and/or group number of the Medigap insured preceded
by Medigap. Note: Item 9d must be completed if you enter a policy
and/or group number in Item 9a.
Enter the Medigap insured’s eight-digit birth date (MM/DD/CCYY)
and sex.
Leave blank if a Medigap PayerID is entered in Item 9d. Otherwise,
enter the claims processing address of the Medigap insurer. Use an
abbreviated street address, two-letter postal code, and zip code copied
from the Medigap insured’s Medigap identification card. For example:
1257 Anywhere Street Baltimore, MD 21204 is shown as “1257
Anywhere St MD 21204.”
Enter the five-digit COBA Medigap claim base identifier. If no identifier
exists, then enter the Medigap insurance program or plan name.
Note: The identifiers will range from 55000–59999. If you are a
participating provider of service or supplier and the beneficiary wants
Medicare payment data forwarded to a Medigap insurer under a
mandated Medigap transfer, all of the information in Items 9, 9a, 9b,
and 9d must be complete and accurate. Otherwise, the Medicare
carrier cannot forward the claim information to Medigap insurer.
Providers/suppliers may reference a list of assigned COBA Medigap
claim-based identifiers for Medicare billing at
www.cms.hhs.gov/COBAgreement/Downloads/Medigap%20Claimbased%20COBA%20IDs%20for%20Billing%20Purpose.pdf. Note: This
list is updated weekly.
Check “yes” or “no” to indicate whether employment, auto liability, or
other accident involvement applies to one or more of the services
described in Item 24. Enter the state postal code. Any item checked
“yes” indicates there may be other insurance primary to Medicare.
Identify primary insurance information in Item 11.
Use this item exclusively for Medicaid (MCD) information. If the patient
is entitled to Medicaid, enter the patient’s Medicaid number preceded
by MCD.
This item must be completed. By completing this item, the
physician/supplier acknowledges having made a good faith effort to
determine whether Medicare is the primary or secondary payer. If
there is insurance primary to Medicare, enter the insured’s policy or
group number and proceed to Items 11a through 11c.
Note: Enter the appropriate information in Item 11c if insurance
primary to Medicare is indicated in Item 11. If there is no insurance
primary to Medicare, enter the word “None” and proceed to Item 12. If
there has been a change in the insured’s insurance status due to their
employment status, e.g., retired, enter the word “None” and proceed
to Item 11b.
Insurance primary to Medicare circumstances under which Medicare
payment may be secondary to other insurance include: group health
plan coverage, Working Aged, Disability (large group health plan
[LGHP]), End-Stage Renal Disease (ESRD), No-fault, work-related
illness/injury Workers’ Compensation, Black Lung and Veterans
Benefits. Items 4, 6, and 7 must also be completed.
10
[MARCH 2008]
Item #
Description
11a
11b
Insured’s date of birth
Employer’s name or
school name
11c
Insurance plan name or
program name
11d
Is there another health
benefit plan
Patient’s or authorized
person’s signature
12
Cause
Reject
Yes
Note: For a paper claim to be considered for Medicare Secondary
Payer benefits, a copy of the primary payer’s Explanation of Benefits
(EOB) notice must be forwarded along with the claim form.
Enter the insured’s birth date and sex if different from Item 3.
Enter the employer’s name if applicable. If there is a change in the
insured’s insurance status, e.g. retired, enter the retirement date
preceded by the word “Retired.”
Enter the nine-digit PayerID number of the primary insurer. If no
PayerID number exists, then enter the complete primary payer’s
program or plan name. If the primary payer’s EOB does not contain the
claims processing address, record the primary payer’s claims
processing address directly on the EOB. This is required if there is
insurance primary to Medicare that is indicated in Item 11.
Leave blank. Not required by Medicare.
The patient or authorized representative must sign and date this item
unless the signature is on file. In lieu of signing the claim, the patient
may sign a statement to be retained in the provider, physician or
supplier file in accordance with Sections 3047.1–3047.3. If the patient
is physically or mentally unable to sign, a representative specified in
Section 3008 may sign on the patient’s behalf. In this event, the
statement’s signature line must indicate the patient’s name followed by
“by” the representative’s name, address, relationship to the patient and
the reason the patient cannot sign. The authorization is effective
indefinitely unless patient or the patient’s representative revokes this
arrangement.
Note: This can be a “Signature on File” and/or a computer generated
signature.
The patient’s signature authorizes release of medical information
necessary to process the claim. It also authorizes payment of benefits
to the provider of service or supplier when the provider of service or
supplier accepts assignment on the claim.
13
Insured’s or authorized
person’s signature
14
Date of current illness
15
If patient has had same
or similar illness, give
first date
Date patient unable to
work in current
occupation
16
Signature by Mark: When an illiterate or physically handicapped
enrollee signs by mark, a witness must enter his/her name and address
next to the mark.
The signature in this item authorizes payment of mandated Medigap
benefits to the participating physician or supplier if required Medigap
information is included in Item 9 and its subdivisions. The patient or
his/her authorized representative signs this item, or the signature must
be on file as a separate Medigap authorization. The Medigap
assignment on file in the participating provider of service/supplier’s
office must be insurer specific. It may state that the authorization
applies to all occasions of service until it is revoked.
Note: This can be a “Signature on File” and/or a computer generated
signature.
Enter the date of current illness, injury, or pregnancy. For chiropractic
services, enter the date of the initiation of the course of treatment and
enter the X-ray date (MM/DD/YY) in Item 19.
Enter dates patient is employed and unable to work in current
occupation. (An entry in this field may indicate employment related
insurance coverage.)
11
[MARCH 2008]
Item #
17
Description
Name of referring
physician or other source
Cause
Reject
Yes
Enter the name of the referring or ordering physician if the service or
item was ordered or referred by a physician.
The term “physician” when used within the meaning of Section 1861(r)
of the Social Security Act (the Act) and used in connection with
performing any function or action refers to:
1) A doctor of medicine or osteopathy legally authorized to practice
medicine and surgery by the state in which he/she performs such
function or action;
2) A doctor of dental surgery or dental medicine who is legally
authorized to practice dentistry by the state in which he/she
performs such functions and who is acting within the scope of
his/her license when performing such functions;
3) A doctor of podiatric medicine for purposes of Sections (k), (m),
(p)(1) and (s) and Sections 1814(a), 1832(a)(2)(F)(ii) and 1835 of
the Act, but only with respect to functions which he/she is legally
authorized to perform as such by the state in which he/she
performs them;
4) A doctor of optometry, but only with respect to the provision of
items or services described in Section 1861(s) of the Act which
he/she is legally authorized to perform as a doctor of optometry by
the state in which he/she performs them; or
5) A chiropractor who is licensed as such by a state (or in a state
which does not license chiropractors as such), and is legally
authorized to perform the services of a chiropractor in the
jurisdiction in which he/she performs such services, and who meets
uniform minimum standards specified by the Secretary, but only for
purposes of Sections 1861(s)(1) and 1861(s)(2)(A) of the Act, and
only with respect to treatment by means of manual manipulation of
the spine (to correct a subluxation). For the purposes of Section
1862(a)(4) of the Act and subject to the limitations and conditions
provided above, chiropractor includes a doctor of one of the arts
specified in the statute and legally authorized to practice such art in
the country in which the inpatient hospital services (referred to in
Section 1862[a][4] of the Act) are furnished.
Referring physician is a physician who requests an item or service
for the beneficiary for which payment may be made under the
Medicare program.
Ordering physician is a physician or, when appropriate, a
nonphysician practitioner who orders nonphysician services for the
patient. Reference the CMS Internet-Only Manual (IOM) Publication
100-02, Medicare Benefit Policy Manual, Chapter 15 for nonphysician
practitioner rules. Examples of services that might be ordered include
diagnostic laboratory tests, clinical laboratory tests, pharmaceutical
services, durable medical equipment, and services incident to that
physician’s or nonphysician practitioner’s service.
The ordering/referring requirement became effective January 1, 1992,
and is required by Section 1833(q) of the Act. All claims for Medicare
covered services and items that are the result of a physician's order or
referral shall include the ordering/referring physician's name. See Items
17a and 17b below for further guidance on reporting the
referring/ordering provider’s UPIN and/or NPI. The following
services/situations require the submission of the referring/ordering
provider information:
Medicare covered services and items that are the result of a
physician’s order or referral
12
[MARCH 2008]
Item #
Description
17a
Non NPI
Cause
Reject
Parenteral and enteral nutrition
Immunosuppressive drug claims
Hepatitis B claims
Diagnostic laboratory services
Diagnostic radiology services
Portable x-ray services
Consultative services
Durable medical equipment
When the ordering physician is also the performing physician (as
often is the case with in-office clinical laboratory tests)
When a service is incident to the service of a physician or
nonphysician practitioner, the name of the physician or nonphysician
practitioner who performs the initial service and orders the
nonphysician service must appear in Item 17
When a physician extender or other limited licensed practitioner
refers a patient for consultative service, submit the name of the
physician who is supervising the limited licensed practitioner
Enter the ID qualifier 1G, followed by the CMS assigned UPIN of the
referring/ordering physician listed in Item 17. The UPIN may be
reported on the CMS-1500 claim form until May 22, 2007, and must be
reported if an NPI is not available.
Note: Field 17a and/or 17b is required when a service was ordered or
referred by a physician. Effective May 23, 2008, and later, 17a is not to
be reported but 17b must be reported when a service was ordered or
referred by a physician.
17b
18
19
NPI of referring physician
Hospitalization dates
related to current
services
When a claim involves multiple referring and/or ordering physicians, a
separate Form CMS-1500 shall be used for each ordering/referring
physician. All physicians who order or refer Medicare beneficiaries or
services must report either an NPI or UPIN or both prior to May 23,
2007. After that date, an NPI (but not a UPIN) must be reported even
though they may never bill Medicare directly. A physician who has not
been assigned a UPIN shall contact the Medicare carrier. Refer to the
CMS IOM Publication 100-08, Medicare Program Integrity Manual,
Chapter 14, Section 14.6 for additional information regarding UPINs.
Enter the NPI of the referring/ordering physician listed in Item 17 as
soon as it is available. The NPI may be reported on the CMS-1500
claim form (version 08-05) as early as January 1, 2007.
Note: Field 17a and/or 17b is required when a service was ordered or
referred by a physician. Effective May 23, 2008, and later, 17a is not to
be reported but 17b must be reported when a service was ordered or
referred by a physician.
Complete this item when a medical service is furnished as a result of,
or subsequent to, a related hospitalization.
Enter the date the patient was last seen and the NPI of his/her
attending physician when an independent physical or occupational
therapist, or physician providing routine foot care submits claims. For
physical and occupational therapists, entering this information certifies
that the required physician certification (or recertification) is being kept
on file (see 2206.1).
Enter the x-ray for chiropractor services. By entering an x-ray date and
the initiation date for course of chiropractic treatment in Item 14, you
are certifying that all the relevant information requirements (including
level of subluxation) of the CMS IOM Publication 100-02, Medicare
Benefit Policy Manual, Chapter 15 are on file along with the appropriate
x-ray and are all available for carrier review.
13
[MARCH 2008]
Item #
Description
Cause
Reject
Enter the drug’s name and dosage when submitting a claim for Not
Otherwise Classified (NOC) drugs.
Enter a concise description of an “unlisted procedure code” if one can
be given within the confines of this box. Otherwise an attachment must
be submitted with the claim.
Enter all applicable modifiers when modifier 99 (multiple modifiers) is
entered in Item 24d. If modifier 99 is entered on multiple line items of
a single claim form, all applicable modifiers for each line item
containing modifier 99 should be listed as follows: 1=(mod), where the
number 1 represents the line item and “mod” represents all modifiers
applicable to the referenced line item.
Enter the statement “Homebound” when an independent lab renders
an EKG tracing or obtains a specimen from a homebound or
institutionalized patient. (See CMS IOM Publication 100-02, Medicare
Benefit Policy Manual, Chapter 15, “Covered Medical and Other Health
Services,” and CMS IOM Publication 100-04, Medicare Claims
Processing Manual, Chapter 16, “Laboratory Services from Independent
labs, Physicians and Providers” and CMS IOM Publication 100-01,
Medicare General Information, Eligibility, and Entitlement Manual,
Chapter 5, “Definitions,” respectively for the definition of “homebound”
and a more complete definition of a medically necessary laboratory
service to a homebound or an institutional patient.)
Enter the statement, “Patient refuses to assign benefits” when the
beneficiary absolutely refuses to assign benefits to a participating
provider. In this case, no payment may be made on the claim.
Enter the statement, “Testing for hearing aid” when submitting claims
to obtain intentional denials when other payers are involved.
(When dental exams are billed, enter the specific surgery for which the
exam is being performed.)
Enter the specific name and dosage amount when low osmolar contrast
material is billed but only if HCPCS codes do not cover them.
20
Outside lab
Enter the assumed and/or relinquished date for a global surgery claim
when providers share post-operative care. Enter the statement,
“Attending physician, not hospice employee” when a physician renders
services to a hospice patient but the hospice providing the patient’s care
(in which the patient resides) does not employ the attending physician.
Complete this item when billing for diagnostic tests subject to purchase
price limitations. Enter the purchase price under charges if the “yes” is
checked. A “yes” check indicates that an entity other than the entity
billing for the service performed the diagnostic test. A “no” check
indicates that no purchased tests are included on the claim. When
“yes” is annotated, Item 32 must be completed. When billing for
multiple purchased diagnostic tests, each test must be submitted on a
separate claim form.
Multiple purchased tests may be submitted on the ASC X12 837 electronic
format as long as appropriate line level information is submitted when
services are rendered at different service facility locations.
Note: This is a required field when billing for diagnostic tests subject
to purchase price limitations.
14
[MARCH 2008]
Item #
21
Description
Diagnosis or nature of
illness or injury
22
23
Medicaid resubmission
Prior authorization
number
Cause
Reject
Enter the patient’s diagnostic/condition. All physician specialties must
use an ICD-9-CM code number and code to the highest level of
specificity for the date of service. Enter up to four codes in priority
order (primary, secondary condition). An independent laboratory must
enter a diagnosis only for limited coverage procedures. All narrative
diagnosis for nonphysician specialties must be submitted on an
attachment.
Enter the Quality Improvement Organization (QIO) prior authorization
number for those procedures requiring QIO prior approval.
Enter the Investigational Device Exemption (IDE) number when an
investigational device is used in a FDA-approved clinical trial. Post
Market Approval number should also be placed here when applicable.
For physicians performing care plan oversight services, enter the 6-digit
Medicare provider number of the home health agency (HHA), or
hospice when CPT code G0181 (home health), or G0182 (hospice) is
billed.
Enter the 10-digit Clinical Laboratory Improvement Act (CLIA)
certification number for laboratory services billed by an entity
performing CLIA covered procedures.
24a
Dates of service
Yes
24b
Place of service
Yes
Note: Item 23 can contain only one condition. Any additional
conditions should be reported on a separate CMS-1500 form.
Enter the month, day and year for each procedure, service or supply.
When “from” and “to” dates are shown for a series of identical
services, enter the number of days or units in column G. This is a
required field. Return as unprocessable if a date of service extends
more than one day and a valid “to” date is not present.
Enter the appropriate place of service code(s) from the list provided.
Identify the location, using a place of service code for each item used
or service performed. Note: When a service is rendered to a hospital
inpatient, use the “inpatient hospital” code.
(Refer below to Place of Service Codes table.)
Place of Service Codes
Code
00–02
03
04
Title
Unassigned
School
Homeless Shelter
05
Indian Health Service
Freestanding Facility
06
Indian Health Service
Provider-Based Facility
Definition
A facility whose primary purpose is education
A facility or location whose primary purpose is to provide temporary
housing to homeless individuals (e.g., emergency shelters, individual or
family shelters). Please note that for the purposes of receiving durable
medical equipment (DME), a homeless shelter is considered the
beneficiary’s home.
A facility or location, owned and operated by the Indian Health Service,
which provides diagnostic, therapeutic (surgical and nonsurgical), and
rehabilitation services to American Indians and Alaska natives who do
not require hospitalization. Medicare does not currently use the POS
code designated for this setting. Claims submitted with this code will be
returned as unprocessable.
A facility or location, owned and operated by the Indian Health Service,
which provides diagnostic, therapeutic (surgical and nonsurgical), and
rehabilitation services rendered by, or under the supervision of,
physicians to American Indians and Alaska Natives admitted as
inpatients or outpatients. Medicare does not currently use the POS code
designated for this setting. Claims submitted with this code will be
15
[MARCH 2008]
Code
Title
Definition
07
Tribal 638 Freestanding
Facility
08
Tribal 638 ProviderBased Facility
09
Prison—Correction
Facility
A facility or location owned and operated by a federally recognized
American Indian or Alaska Native tribe or tribal organization under a 638
agreement, which provides diagnostic, therapeutic (surgical and
nonsurgical), and rehabilitation services to tribal members who do not
require hospitalization. Medicare does not currently use the POS code
A facility or location owned and operated by a federally recognized
American Indian or Alaska Native tribe or tribal organization under a 638
agreement, which provides diagnostic, therapeutic (surgical and
nonsurgical), and rehabilitation services to tribal members admitted as
inpatients or outpatients. Medicare does not currently use the POS code
A prison, jail, reformatory, work farm, detention center, or any other
similar facility maintained by either federal, state, or local authorities for
the purpose of confinement or rehabilitation of adult or juvenile criminal
offenders. (Effective 07/01/06)
10
11
Unassigned
Office
12
Patient’s Home
13
Assisted Living Facility
14
Group Home
15
Mobile Unit
16
Temporary Lodging
17–19
20
Unassigned
Urgent Care Facility
21
Inpatient Hospital
22
Outpatient Hospital
23
25
Emergency Room–
Hospital
Ambulatory Surgical
Center
Birthing Center
26
Military Treatment
24
Location, other than a hospital, skilled nursing facility (SNF), military
treatment facility, community health center, state or local public health
clinic, or intermediate care facility (ICF), where the health professional
routinely provides health examinations, diagnosis, and treatment of
illness or injury on an ambulatory basis.
Location, other than a hospital or other facility, where the patient
receives care in a private residence.
Congregate residential facility with self-contained living units providing
assessment of each resident’s needs and on-site support 24 hours a day,
seven days a week, with the capacity to deliver or arrange for services
including some health care and other services.
Congregate residential foster care setting for children and adolescents in
state custody that provides some social, health care, and educational
support services and that promotes rehabilitation and reintegration of
residents into the community.
A facility/unit that moves from place to place equipped to provide
preventive, screening, diagnostic, and/or treatment services.
A short term accommodation such as a hotel, camp ground, hostel,
cruise ship, or resort where the patient receives care, and which is not
identified by any other POS code. (Effective 04/01/08)
Location, distinct from a hospital emergency room, an office, or a clinic,
whose purpose is to diagnose and treat illness or injury for unscheduled,
ambulatory patients seeking immediate medical attention.
A facility, other than psychiatric, which primarily provides diagnostic,
therapeutic (both surgical and nonsurgical), and rehabilitation services
by, or under, the supervision of physicians to patients admitted for a
variety of medical conditions.
A portion of a hospital that provides diagnostic, therapeutic (both
surgical and nonsurgical), and rehabilitation services to sick or injured
persons who do not require hospitalization or institutionalization.
A portion of a hospital where emergency diagnosis and treatment of
illness or injury is provided.
A freestanding facility, other than a physician’s office, where surgical and
diagnostic services are provided on an ambulatory basis.
A facility, other than a hospital’s maternity facilities or a physician’s
office, which provides a setting for labor, delivery, and immediate
postpartum care, as well as immediate care of newborn infants.
A medical facility operated by one or more of the Uniformed Services.
16
[MARCH 2008]
Code
Title
Facility
27–30
31
Unassigned
Skilled Nursing Facility
32
Nursing Facility
33
Custodial Care Facility
34
Hospice
35–40
41
Unassigned
Ambulance–Land
42
Ambulance–Air or
Water
Unassigned
Independent Clinic
43–48
49
50
Federally Qualified
Health Center
51
Inpatient Psychiatric
Facility
52
Psychiatric Facility–
Partial Hospitalization
53
Community Mental
Health Center (CMHC)
54
55
56
Intermediate Care
Facility/Mentally
Retarded
Residential Substance
Abuse Treatment
Facility
Psychiatric Residential
Treatment Center
Definition
Military Treatment Facility (MTF) also refers to certain former U.S. Public
Health Service (USPHS) facilities now designated as Uniformed Service
Treatment Facilities (USTF).
A facility which primarily provides inpatient skilled nursing care and
related services to patients who require medical, nursing, or
rehabilitative services, but does not provide the level of care or
treatment available in a hospital.
A facility which primarily provides to residents skilled nursing care and
related services for the rehabilitation of injured, disabled, or sick
persons, or, on a regular basis, health-related care services above the
level of custodial care to other than mentally retarded individuals.
A facility which provides room, board and other personal assistance
services, generally on a long-term basis, and which does not include a
medical component.
A facility other than a patient's home in which palliative and supportive
care for terminally ill patients and their families are provided.
A land vehicle specifically designed, equipped and staffed for lifesaving
and transporting the sick or injured.
An air or water vehicle specifically designed, equipped and staffed for
lifesaving and transporting the sick or injured.
A location, not part of a hospital and not described by any other POS
code, that is organized and operated to provide preventive, diagnostic,
therapeutic, rehabilitative, or palliative services to outpatients only.
A facility located in a medically under-served area that provides Medicare
beneficiaries preventive, primary medical care under the general
direction of a physician.
A facility that provides inpatient psychiatric services for the diagnosis and
treatment of mental illness on a 24-hour basis, by or under the
supervision of a physician.
A facility for the diagnosis and treatment of mental illness that provides
a planned therapeutic program for patients who do not require full time
hospitalization, but who need broader programs than are possible from
outpatient visits to a hospital-based or hospital-affiliated facility.
A facility that provides the following services:
Outpatient services, including specialized outpatient services for
children, the elderly, individuals who are chronically ill, and residents
of the CMHC’s mental health services area who have been discharged
from inpatient treatment at a mental health facility
24-hour-a-day emergency care services
Day treatment, other partial hospitalization services, or psychosocial
rehabilitation services
Screening for patients being considered for admission to state mental
health facilities to determine the appropriateness of such admission,
and
Consultation and education services
A facility which primarily provides health-related care and services above
the level of custodial care to mentally retarded individuals, but does not
provide the level of care or treatment available in a hospital or SNF.
A facility that provides treatment for substance (alcohol and drug) abuse to
live-in residents who do not require acute medical care. Services include
individual and group therapy and counseling, family counseling, laboratory
tests, drugs and supplies, psychological testing and room and board.
A facility or distinct part of a facility for psychiatric care that provides a
total 24-hour therapeutically planned and professionally staffed group
17
[MARCH 2008]
Code
Title
Definition
living and learning environment.
57
Non-residential
Substance Abuse
Treatment Facility
A location that provides treatment for substance (alcohol and drug)
abuse on an ambulatory basis. Services include individual and group
therapy and counseling, family counseling, laboratory tests, drugs and
supplies, and psychological testing.
58–59
60
Unassigned
Mass Immunization
Center
61
Comprehensive
Inpatient Rehabilitation
Facility
62
Comprehensive
Outpatient
Rehabilitation Facility
63–64
65
Unassigned
End-Stage Renal
Disease Treatment
Facility
Unassigned
State or Local Public
Health Clinic
66–70
71
72
Rural Health Clinic
73–80
81
Unassigned
Independent
Laboratory
Unassigned
Other Place of Service
82–98
99
Item #
24c
24d
24e
Description
EMG
Procedures, services or
supplies
Diagnosis pointer
Cause
Reject
Yes
A location where providers administer pneumococcal pneumonia and
influenza virus vaccinations and submit these services as electronic
media claims, paper claims, or using the roster billing method. This
generally takes place in a mass immunization setting, such as, a public
health center, pharmacy, or mall but may include a physician office setting.
A facility that provides comprehensive rehabilitation services under the
supervision of a physician to inpatients with physical disabilities. Services
include physical therapy, occupational therapy, speech pathology, social
or psychological services, and orthotics and prosthetics services.
A facility that provides comprehensive rehabilitation services under the
supervision of a physician to outpatients with physical disabilities.
Services include physical therapy, occupational therapy, and speech
pathology services.
A facility other than a hospital, which provides dialysis treatment,
maintenance, and/or training to patients or caregivers on an ambulatory
or home-care basis.
A facility maintained by either state or local health departments that
provides ambulatory primary medical care under the general direction of
a physician.
A certified facility which is located in a rural medically underserved area
that provides ambulatory primary medical care under the general
direction of a physician.
A laboratory certified to perform diagnostic and/or clinical tests
independent of an institution or a physician’s office.
Other place of service not identified above.
Leave blank. Medicare providers are not required to complete this box.
Enter the procedures, services or supplies using the Healthcare
Common Procedure Coding System (HCPCS). When applicable, show
HCPCS modifiers with the HCPCS code. Enter the specific procedure
code without a narrative description. However, when reporting an
“unlisted procedure code” or a “not otherwise classified” (NOC) code,
include a narrative description in Item 19 if a coherent description can
be given within the confines of that box. Otherwise, an attachment
must be submitted with the claim. This is a required field.
Return as unprocessable if an “unlisted procedure code” or a NOC code
is indicated in Item 24d, but an accompanying narrative is not present
in Item 19 or on an attachment.
Enter the diagnosis code or reference number as shown in Item 21 to
relate the date of service and the procedures performed to the primary
diagnosis. Enter only one reference number per line item. When
multiple services are performed, enter the primary reference number
for each service: either a 1, or a 2, or a 3 or a 4. If a situation arises
where two or more diagnoses are required for a procedure code (e.g.,
pap smears), you must reference only one of the diagnosis in Item 21.
18
[MARCH 2008]
Item #
24f
Description
Charges
Cause
Reject
Yes
24g
Days or units
Yes
Enter the charge for each listed service.
Enter the number of days or units. This field is most commonly used for
multiple visits, units of supplies, anesthesia minutes or oxygen volume.
If only one service is performed, the numeral “1” must be entered.
Some services require that the actual number or quantity billed be
clearly indicated on the claim form (e.g., multiple ostomy or urinary
supplies, medication dosages or allergy testing procedure). When
multiple services are provided, enter the actual number provided.
For anesthesia, show the elapsed time (minutes) in Item 24g. Convert
hours into minutes and enter the total minutes required for this procedure.
Suppliers must furnish the units of oxygen contents except for
concentrators and initial rental claims for gas and liquid oxygen
systems. Rounding of oxygen is as follows:
24h
24i
24j
EPSDT
ID Qualifier (08/05)
Rendering provider’s
PIN (08/05)
24k
25
Federal Tax I.D.
number
For stationary gas system rentals, suppliers must indicate oxygen
contents in unit multiples of 50 cubic feet in Item 24g, rounded to
the nearest increment of 50. For example, if 73 cubic feet of oxygen
were delivered during the rental month, the unit entry “01”
indicating the nearest 50 cubic foot increment is entered in Item 24g.
For stationary liquid systems, units of contents must be specified in
multiples of 10 pounds of liquid contents delivered, rounded to the
nearest 10 pound increment. For example, if 63 pounds of liquid
oxygen were delivered during the applicable rental month billed, the
unit entry “06” is entered in Item 24g.
For units of portable contents only (i.e., no stationary gas or liquid
system used) round to the nearest cubic feet or one liquid pound,
respectively.
Enter the ID qualifier 1C in the shaded portion.
Prior to May 23, 2007, enter the rendering provider’s PIN in the shaded
portion. In the case of a service provided incident to the service of a
physician or nonphysician practitioner, when the person who ordered
the service is not supervising, enter the PIN of the supervisor in the
shaded portion.
Effective May 23, 2007 and later, do not use the shaded portion. As of
January 1, 2007, enter the rendering provider’s NPI number in the
lower portion. In the case of a service provided incident to the service
of a physician or nonphysician practitioner, when the person who
ordered the service is not supervising, enter the NPI of the supervisor
in the lower portion.
Enter the PIN (the NPI will be used when implemented) of the
performing provider of service/supplier if the provider is a member of a
group practice. When several different providers of service or suppliers
within a group are billing on the same CMS-1500 form, show the
individual PIN (or NPI when implemented) in the corresponding line
item. In the case of a service provided incident to the service of a
physician or nonphysician practitioner, when the person who ordered
the service is not supervising, enter the PIN (or NPI when
implemented) of the supervisor in Item 24K.
Enter the provider of service or supplier Federal Tax ID (Employer
Identification Number or Social Security Number) and check the
appropriate check box. Medicare providers are not required to complete
this item for crossover purposes since the Medicare contractor will
19
[MARCH 2008]
Item #
Description
26
Patient’s account
number
27
Accept assignment
Cause
Reject
Yes
retrieve the tax identification information from their internal provider file
for inclusion on the COB outbound claim. However, tax identification
information is used in the determination of accurate National Provider
Identifier reimbursement. Reimbursement of claims submitted without
tax identification information will/may be delayed
Enter the patient’s account number assigned by the provider of
service’s or supplier’s accounting system. This field is optional to assist
you in patient identification. As a service, any account numbers entered
here will be returned to you.
Check the appropriate box to indicate whether the provider of service
or supplier accepts assignment of Medicare benefits. If Medigap is
indicated in Item 9 and Medigap payment authorization is given in Item
13, the provider of service or supplier must also be a Medicare
participating provider of service or supplier and must accept
assignment of Medicare benefits for all covered charges for all patients.
Note: The following providers of service/suppliers and claims can only
be paid on an assignment basis:
Physician services to individuals dually entitled to Medicaid and Medicare
Clinical diagnostic laboratory services
“Participating” physician/supplier services
Services of physician assistants, nurse practitioners, clinical nurse
specialist, nurse midwives, certified registered nurse anesthetists, clinical
psychologists, clinical social workers
Ambulatory surgical center (ASC) services for covered ASC procedures
and home dialysis supplies and equipment paid under Method II
Ambulance services
Drugs and biologicals, and
Simplified billing roster for influenza virus vaccine and pneumococcal
vaccine
Enter total charges for all services (i.e., total of all charges in Item 24f).
Enter the total amount the patient paid on the covered services only.
Enter the signature of the provider of service or supplier, or his/her
representative, and the date the form was signed.

28
29
30
31
32
Total charge
Amount paid
Balance due
Signature of supplier
Name and address of
facility where services
were rendered
Yes
NR
Yes
Note: This is a required field. However, the claim can be processed if
the following is true. If a physician, supplier, or authorized person’s
signature is missing, but the signature is on file; or if any authorization
is attached to the claim or if the signature field has “Signature on File”
and/or a computer generated signature.
Enter the name and address, and zip code of the facility if the services
were furnished in a hospital, clinic, laboratory, or facility other than the
patient’s home or physician’s office. Effective for claims received on or
after April 1, 2004, the name, address, and zip code of the service
location for all services other than those furnished in place of service
home (code 12).
Effective for claims received on or after April 1, 2004, on the CMS-1500
claim form, only one name, address and zip code may be entered in
the block. If additional entries are needed, separate claim forms shall
be submitted.
Effective for claims with dates of service on or after October 1, 2007,
the name, address, and nine-digit zip code of the service location for
services paid under the Medicare physician fee schedule and anesthesia
services, other than those furnished in place of service home (12), and
any other places of service contractors treat as home, must be entered
20
[MARCH 2008]
Item #
Description
Cause
Reject
according to Chapter 1, Sections 10.1.1 and 10.1.1.1 of the CMS IOM
Publication 100-04, Medicare Claims Processing Manual.
Effective for claims with dates of service on or after October 1, 2007,
for claims received that require a nine-digit zip code with a four-digit
extension, a four-digit extension that matches one of the zip 9 file or a
four-digit extension that can be verified according to Chapter 1,
Sections 10.1.1 and 10.1.1.1 of the CMS IOM Publication 100-04,
Medicare Claims Processing Manual must be entered on the claim.
Providers of service (namely physicians) shall identify the supplier’s
name, address, zip code and PIN when billing for purchased diagnostic
tests. When more than one supplier is used, a separate CMS-1500
claim form should be used to bill for each supplier.
For foreign claims, only the enrollee can file for Part B benefits
rendered outside of the United States. These claims will not include a
valid zip code. When a claim is received for these services on a
beneficiary submitted CMS-1490S form, before the claim is entered in
the system, it should be determined if it is a foreign claim. If it is a
foreign claim, follow the instructions in Chapter 1 for disposition of the
claim. The carrier processing the foreign claim will have to make
necessary accommodations to verify that the claim is not returned as
unprocessable due to the lack of a zip code.
For durable medical, orthotic and prosthetic claims, the name
address or PIN of the location where the order was accepted
must be entered (durable medical equipment Medicare
administrative contractor [DME MAC] only).
This field is required. When more than one supplier is used, a separate
CMS-1500 claim form should be sued to bill each supplier.
This item is completed whether the supplier’s personnel performs the
work at the physician’s office or at another location.
If modifiers QB or QU are billed, indicating the service was rendered in
a Health Professional Shortage Area (HPSA), the physical location
where the service was rendered shall be entered if other than home.
If the supplier is a certified mammography screening center, enter the
six-digit FDA approved certification number.
32a
NPI
32b
Non NPI Identifier
Complete this item for all laboratory work performed outside a
physician’s office. If an independent laboratory is billing, enter the
place where the test was performed.
Enter the NPI of the service facility as soon as it is available. The NPI
may be reported on the CMS-1500 claim form (version 08-05) as early
as January 1, 2007, and must be reported May 23, 2007, and later.
Enter the ID qualifier 1C followed by one blank space and then the PIN
of the service facility. Effective May 23, 2007, and later, 32b is not to
be reported.
Providers of service (namely physicians) shall identify the supplier's PIN
when billing for purchased diagnostic tests.
For durable medical, orthotic and prosthetic claims, enter the PIN (of
the location where the order was accepted) if the name and address
was not provided in Item 32 (DMERC/DME MAC only).
21
[MARCH 2008]
Item #
33
33a
Description
Physician’s, supplier’s
billing name, address,
zip code and phone
NPI
33b
Non NPI
Cause
Reject
Yes
Enter the provider of service/supplier's billing name, address, ZIP code,
and telephone number. This is a required field.
Effective May 23, 2007, and later, the provider/supplier must enter the
NPI of the billing provider or group. The NPI may be reported on the
CMS-1500 claim form (version 08-05) as early as January 1, 2007. This
is a required field.
Enter the ID qualifier 1C followed by one blank space and then the PIN
of the billing provider or group. Effective May 23, 2007, and later, 33b
is not to be reported. Suppliers billing the DMERC/DME MAC will use
the National Supplier Clearinghouse (NSC) number in this item.
MAILING ADDRESS
All completed DMEPOS paper claims should be mailed to:
DMEPOS Claims
P.O. Box 7027
RESOURCES

A CMS Web-based training course can be located at
http://cms.meridianksi.com/kc/main/kc_frame.asp?kc_ident=kc0001&loc=1
The CMS IOM Publication 100-04, Medicare Claims Processing Manual, Chapter 26
The National Uniform Claim Committee: www.nucc.org
22
Chapter 12: Electronic Data Interchange
[MARCH 2008]
12 Electronic Data Interchange
ELECTRONIC MEDIA CLAIMS
All Health Insurance Portability and Accountability Act (HIPAA) compliant electronic claims are subject
to a 14-day payment floor. Claims submitted on paper are subject to a 29-day payment floor. By
submitting claims electronically, both Medicare and health care suppliers can process transactions
faster due to the difference in these payment floors.
Other electronic data interchange (EDI) advantages include:

increased cash flow;
ease of billing electronically (support is available);
lower administrative, postage and handling costs;
added efficiency and accurate claims filing—data is received precisely as input by the supplier’s
office, eliminating the chance of processing errors;
receipt of the Front-End Edit Report—a confirmation that can be downloaded via modem within
48-hours of transmission (this report verifies the acceptance of claims and Certificates of Medical
Necessity [CMNs] and/or Durable Medical Equipment [DME] Information Forms [DIFs]);
claims transmitted for a beneficiary who resides in another Jurisdiction are automatically transferred
to the appropriate DME MAC based on the beneficiary’s address listed on the claim*
availability of:
– Claim Status Inquiry (CSI) including beneficiary eligibility information
– electronic remittance advice (ERA)
– electronic funds transfer (EFT); and
ability to submit claims and CMNs and DME MAC Information Forms (DIFs) seven days a week,
including holidays.
* Claims are transferred to another DME MAC jurisdiction based on the beneficiary address listed in the
electronic claim. A transferred claim will not be processed by the DME MAC jurisdiction that receives the
transferred claim, unless the supplier has a signed EDI enrollment form on file with that jurisdiction.
Contact the appropriate jurisdiction(s) to receive an EDI enrollment form, when necessary.
Jurisdiction A:
Jurisdiction C:
Jurisdiction D:
NHIC Corp.
Telephone: 866-563-0049
www.medicarenhic.com
CIGNA Government Services
Telephone: 888-613-9271
www.palmettogba.com/JCEDI
Noridian Administrative Services
Telephone: 866-224-3094
www.cignagovernmentservices.com
1
[MARCH 2008]
ADMINISTRATIVE SIMPLIFICATION COMPLIANCE ACT
Section 3 of the Administrative Simplification Compliance Act (ASCA), Public Law (PL) 107-105, and
the implementing regulation at 42 CFR 424.32 require that all initial claims for reimbursement under
Medicare (except from small providers) be submitted electronically as of October 16, 2003, with
limited exceptions. Initial claims are those claims submitted to a Medicare fee-for-service carrier,
durable medical equipment Medicare administrative contractor (DME MAC), or fiscal intermediary for
the first time, including:

resubmitted previously rejected claims;
claims with paper attachments;
demand claims;
claims where Medicare is secondary and there is only one primary payer; and
nonpayment claims.
Medicare is prohibited from payment of claims submitted in a non-electronic manner that do not meet
the limited exceptions criteria. Claims required to be submitted electronically effective October 16,
2003, and later must comply with the appropriate claim standards adopted for national use under
HIPAA (see the Electronic Format section of this chapter). The mandatory electronic claim submission
requirement does not apply to claims submitted by beneficiaries, suppliers that only furnish services
outside of the United States, claims submitted to Medicare managed care plans, or to health plans
other than Medicare.
Further details on the ASCA provision, exception criteria and how to apply for a waiver can be found
on the National Government Services, Inc. Web site at
www.adminastar.com/Providers/EDI/DMERC/ASCA/ASCA.html.
Reference Chapter 24, Section 90 of the Centers for Medicare & Medicaid Services (CMS) InternetOnly Manual (IOM) Publication 100-04, Medicare Claims Processing Manual for further details on ASCA
at www.cms.hhs.gov/manuals/downloads/clm104c24.pdf.
ELECTRONIC FORMAT
Medicare durable medical equipment (DME) claims are submitted via direct transmission. The
acceptable Medicare HIPAA claims format is the ANSI X12N Version 4010A1 837 transaction and the
National Council for Prescription Drug Programs (NCPDP).
The Secretary of Health and Human Services has established, under part 162 of title 45 of the Code of
Federal Regulations, the NCPDP Telecommunications Standard Version 5.1 and Batch Standard 1.1 as
the standard for electronic retail pharmacy drug claims. This standard will be used by all health plans,
including DME MACs that process retail pharmacy drug transactions. All other claims submitted to
Medicare by pharmacies, other than retail pharmacy drug claims, must be submitted electronically in
the ANSI X12N Version 4010A1 837 Health Care Claim format, and must be submitted in a separate
transmission from the NCPDP retail drug claims.
HIPAA version implementation guides may be downloaded at www.wpc-edi.com.
2
[MARCH 2008]
The NCPDP implementation guide is available at www.ncpdp.org.
Suppliers should visit the Specification page on the National Government Services Web site
(www.NGSMedicare.com) prior to programming their system with the HIPAA compliant claim
transaction. The Specifications page contains:

current trading partner agreements;
companion documents;
supplemental guides; and
communications software.
To access the Specifications page, go to
www.adminastar.com/Providers/EDI/DMERC/Specifications/Specifications.html.
HOW TO BECOME AN ELECTRONIC SUBMITTER
Step 1
Acquire software for electronic submission. Several options are available:

Use a software vendor’s product. For a list of software vendors that have passed testing with
National Government Services, view the “Approved Entities” list at
www.adminastar.com/Providers/EDI/files/DMERCPassedANSIVendorList.pdf.

Write a software program, utilizing the ANSI X12N Version 4010A1 837 transaction and/or
NCPDP format for retail pharmacy drug claims. For more details see “Electronic Format”
section of this chapter.

Employ a billing service or clearinghouse. For a list of billing services that have passed testing with
National Government Services, view the “Approved Entities” list at
Note: If this option is selected, Steps 2 (applying for a sender ID) and 3 (testing) are not required.

Order the National Government Services software program, Express Plus. The application is
available on the National Government Services Web site or by contacting the Jurisdiction B DME
MAC EDI Help Desk. More details on this software are available under the “Express Plus” section
of this chapter.
Note: If this option is selected, Steps 2 (applying for a sender ID) and 3 (testing) are not required.
National Government Services e-commerce consultants assist the supplier in analyzing claim
submission needs. Depending on the needs of the supplier, software recommendations will be made.
The e-commerce consultants will help the supplier complete all steps necessary to become an
electronic submitter. A list of the e-commerce consultants and contact information is located at the
end of this chapter.
3
[MARCH 2008]
Step 2
Obtain an electronic sender ID with National Government Services.
Once a software package has been selected, the supplier must apply for an electronic sender ID. This
number may be used for any of the four DME MACs.
If the supplier chooses to use the same electronic sender ID to submit claims or download reports
with multiple DME MACs, it is necessary to register the sender ID with each DME MAC. Agreement
forms are available on the National Government Services Web site (www.NGSMedicare.com) or by
contacting the EDI Help Desk. To obtain a copy of the EDI agreement for new EDI submitters, go to
www.adminastar.com/Providers/EDI/DMERC/Agreements/Agreements.html.
Step 3
Test with National Government Services.
Testing is recommended, but not required for those suppliers that obtain software from approved
vendors. Testing is required for suppliers who write their own program.
TESTING PROCESS AND REQUIREMENTS
Testing is recommended, but not required for those suppliers that obtain software from approved
vendors.
Testing is required for suppliers, billing services and clearinghouses who currently use vendor
supported or proprietary software that have not passed testing with National Government Services or
is not listed on the National Government Services Approved Entities list. For the listing of software
vendors, billing services and clearinghouses that have passed testing with National Government
Services, view the “Approved Entities” list at
The following information describes the steps for testing with National Government Services once an
electronic sender ID is received.
1) The vendor or supplier will be contacted by a Jurisdiction B DME MAC EDI Help Desk technician.
The technician will request the following information:
The date of the first test file(s) to be transmitted
The type of DME claims to be tested (Example: Hospital beds, diabetic supplies, orthopedic
supplies)
The type of CMNs and/or DIFs to be tested
2) A “DME Open 837 Testing Checklist” will be forwarded via e-mail or fax to the tester. The
checklist must be completed and returned. The checklist will request:
the vendor company name;
4
[MARCH 2008]
the vendor testing contact name and telephone number; and
the electronic sender ID assigned by National Government Services.
3) Testing requirements:
Include twenty-five (25) claims that cover all of the following scenarios:
– Medicare Secondary Payer
– Claims with a narrative
– Claims without a narrative
– CMNs and DIFs (if applicable)
– National Drug Codes (NDC) (if applicable)
– Legal representative
– NCPDP (if applicable)
4) Once a test file(s) is received, the Jurisdiction B DME MAC EDI Help Desk technician will review
the files for errors.
If errors are present in the test files, the technician will contact and work with the tester until
an accepted test file is received.
If no errors are found in the test files, the technician will contact the tester to indicate that
they have met the testing guidelines listed on their checklist. The date the tester passed
testing will be noted in National Government Services’ records.
Note: The EDI Jurisdiction B DME MAC Help Desk may be contacted toll free at 877-273-4334, option 1 or
via e-mail at [email protected].
EXPRESS PLUS
Express Plus (National Government Services’ software program) offers quick, simple and accurate
electronic submissions of HIPAA compliant claims, CMNs, and DIFs for DME MAC suppliers. Express
Plus also allows suppliers to submit Medicare Secondary Payer (MSP) claims. Express Plus uses a
database that offers user maintained tables of patient demographics, diagnosis codes, Healthcare
Common Procedure Coding System (HCPCS) codes, rendering and referring physicians, and claims
information. Express Plus increases productivity because claim entry is fast and accurate. Express Plus
contains online edits that check each claim for accuracy. The following items and services are included
with the Express Plus software:

The Express Plus manual
The ability to submit claims electronically and receive reports, and
Jurisdiction B DME MAC EDI Help Desk assistance through a toll-free number
The hardware requirements necessary to operate Express Plus are:
Computer:
386DX or higher processor
IBM compatible computer with Windows 95 or greater
Note: Express Plus will not work on Windows 3.1
5
[MARCH 2008]
Hard Drive Space:
50 megabytes
Total Memory (RAM):
32 megabytes
Available Memory:
512K
Modem:
9600–28800 baud rate modem
Note: The communications software provided will not work with a “cable modem” or DSL line.
Printer:
Any make/model
CD-ROM Drive:
Express Plus is only provided on CD-ROM
To order the software, contact the EDI help desk or download the Express Plus agreement forms from
the National Government Services Web site at
Note: Express Plus does not have the capability to bill claims using the NCPDP format for retail pharmacy
drugs claims.
FRONT-END EDIT REPORT
An electronic submitter may dial in (via modem) and pick up a Front-End Edit Report. This report lists
how many claims were electronically accepted or rejected. It provides an explanation of all front-end
errors on any claim that may be electronically rejected. Claims that are rejected on the front end will
not enter the DME MAC claims processing system. It is the submitter’s responsibility to correct the
error(s) and retransmit any rejected claims.
The Front-End Edit Report also includes a CMN Reject Report. This report is attached to the Front-End
Edit Report and lists rejected Certificates of Medical Necessity (CMNs) and/or DME Information Forms
(DIFs) on accepted claims.
A complete list of all error codes, messages and report examples are available in the DME MAC ANSI
X12N 4010A1 Front-End Edit Error Manual on the National Government Services Web site at
www.adminastar.com/Providers/EDI/DMERC/Manuals/Manuals.html.
National Government Services also offers a computer-based training (CBT) course on Electronic
Front-End Edit Reports. The CBT, titled “Electronic Front-End Reports,” provides general guidelines on
how to avoid electronic front-end rejections. This CBT includes report examples and the steps to take
for each electronic report received. To access this CBT on the National Government Services Web site
go to www.adminastar.com/Providers/DMERC/Workshops/Workshops.html.
6
[MARCH 2008]
CLAIM STATUS INQUIRY/BENEFICIARY ELIGIBILITY
All suppliers submitting claims electronically are eligible for Claim Status Inquiry (CSI). This applies to
participating and nonparticipating suppliers. With access to CSI, submitters can view the status of all
claims as they appear in the DME MAC claims processing system. This includes paid, denied and pending
claims. The information can be searched by viewing all claims for a specific National Supplier
Clearinghouse (NSC) number, a beneficiary Health Insurance Claim Number (HICN), or date(s) of service.
Online eligibility is available through CSI. Online eligibility will provide information on a Medicare
beneficiary concerning prior year and current year deductible, MSP information, and health
maintenance organization (HMO) activity.
The CSI application is available on the National Government Services Web site at
A CSI user manual is available on the National Government Services Web site at
www.adminastar.com/Providers/EDI/DMERC/Manuals/Manuals.html.
ELECTRONIC REMITTANCE ADVICE
The electronic remittance advice (ERA) enables receipt of payment information in an electronic file.
This payment file is sent either weekly or daily depending upon the supplier’s need. Suppliers should
check with their software vendor to determine if their system has the capability to print and/or post an
ERA received by National Government Services. If software capability is in place, an ERA file created
by Medicare allows automatic posting to an accounts receivable system. Once ERA is in place, the
payment posting process is more efficient and accurate.
The Medicare Remit Easy Print (MREP) software is available for suppliers to view and print HIPAAcompliant ERAs from their own computer. If your current system does not have ERA capability, the
MREP software is available at no cost. This software is easy to use and will save suppliers currently
receiving standard paper remittances (SPR) time and money.
Note: SPR will no longer be mailed 45 days after the supplier number(s) has been setup for ERA. Suppliers
submitting through a billing service or clearinghouse or a sender ID that is currently receiving ERAs, will
no longer receive their SPRs effective with the completion of the ERA setup date.
Below are a few comments from suppliers currently receiving the benefits of ERAs:
“We just started using the Electronic Remittance Advice (ERA) one day and have enjoyed all the
benefits since. The conversion for us was simple and easy.”
“I did not think the ERA would have been as easy as it is. I am sorry I waited so long to get started.”
“ERA download went very smoothly with close communication with customer service. No
interruption in claim processing.”
7
[MARCH 2008]
“The ERA is relatively simple once the programming is in place. Cuts down on staff manually having
to post these transactions.”
“The conversion to ERA was painless. The reduced labor costs alone made the transition beneficial.
Within fourteen days of submitting a claim, we had the claim adjudicated and when applicable, on
its way to secondary processing. In the case of denials, we were able to act on them within days of
submission. This has enabled us to, according to DMERCs new reporting tool; submit approximately
99 percent of claims cleanly.”
Suppliers should confirm with their software vendor that their system has ERA capability.
Note: An EDI Enrollment form must be on file with National Government Services to receive an ERA.
For the Benefits, Frequently Asked Questions, Setup Instructions, to sign up for the ERA, or to
download MREP, go to www.adminastar.com/Providers/EDI/DMERC/ERA/ERA.html.
ELECTRONIC FUNDS TRANSFER
Electronically deposited funds are available in the supplier’s account the day after Medicare transmits
an electronic funds transfer (EFT) to the bank. Paper checks must be mailed, manually processed in
the supplier’s office, deposited, and cleared by the bank. This means the EFT will usually be available
to the supplier one week sooner than paper funds.
Note: CMS requires that all new and current suppliers submitting a CMS-588 application to the National
Supplier Clearinghouse for an additional location receive EFT
The EFT application is available on the National Government Service Web site at
JURISDICTION B DME MAC EDI HELP DESK
877-273-4334, Option 1
The Jurisdiction B DME MAC EDI Help Desk is available 8:00 a.m.–4:00 p.m. Eastern Time (ET),
Monday through Friday.
Note: The Jurisdiction B DME MAC Help Desk will be open until 6:00 p.m. ET for password reset calls only.
Jurisdiction B DME MAC Help Desk support is also available at [email protected].
Issues that can be addressed by the Jurisdiction B DME MAC EDI Help Desk include:

Acquiring a sender ID or Express Plus software
Access to CSI, ERA, or EFT
Connection to the National Government Services host
Retrieve or interpret Front-End Edit Reports
8
[MARCH 2008]

Recreate reports and ERAs
Clarification of format questions, and
Assistance with the National Government Services Express Plus program
PASSWORD RESET REQUESTS
Password resets for electronic submitters may be requested via telephone, online (Web site), or fax.
Please be sure to use only one of these methods for your password reset needs.
Telephone Password Reset Requests
The password reset team can be reached toll free at 877-273-4334.
Online Password Reset Requests
To have your password reset online, complete the required information found on the National
Government Services Web site at
www.adminastar.com/providers/edi/secure/passwordreset_enroll.cfm.
Fax Password Request Form
To obtain a copy of the Password Fax Request Form, go the National Government Services Web site at
www.adminastar.com/providers/edi/secure/passwordreset_enroll.cfm.
Once a password reset request has been submitted, a ticket number will be assigned and returned via
the e-mail address or fax number given when the password reset process was initiated. The supplier
will be assigned a temporary password within two business days of receipt; it will be communicated
back to the supplier in the same manner as the request was received.
E-COMMERCE CONSULTANTS
Suppliers should contact the e-commerce consultants to:

discuss EDI advantages; and
analyze claims submission needs.
Lisa Hare
Indiana, Kentucky, Ohio, and suppliers in Jurisdictions A and C
804-746-7082
[email protected]
Pat Graham
Illinois, Michigan, Minnesota, Wisconsin, and suppliers in Jurisdiction D
414-459-2613
[email protected]
9
[MARCH 2008]
NATIONAL GOVERNMENT SERVICES WEB SITE
www.NGSMedicare.com
(Then select AdminaStar Federal)
More details on the information provided in this chapter can be found in the EDI section of our Web
site. For additional EDI information, go to www.adminastar.com/Providers/EDI/DMERC/DMERC.html.
EDI LIST SERVE
An EDI List Serve is available through the National Government Services Web site. By subscribing to
the EDI List Serve, providers/suppliers will stay informed of EDI news, changes, and updates.
To subscribe, go to the National Government Services Web site at
www.adminastar.com/Providers/EDI/DMERC/ListServeSignUp.html
Once subscribed, providers/suppliers will receive e-mails containing the latest EDI information.
E-COMMERCE CONNECTION
The E-Commerce Connection online newsletter, created by the National Government Services
E-Commerce team, is published on a quarterly basis to make EDI information readily available for EDI
submitters, software vendors, billing services, and clearinghouses. Every E-Commerce Connection
issue contains useful tips on how to resolve electronic billing issues, up to date information regarding
HIPAA and EDI, National Government Services’ software products, an opportunity to meet an EDI
associate, and much more! Because National Government Services values the opinions of its
customers, a Feedback Survey is also included in each issue. This survey gives suppliers the
opportunity to comment and make suggestions for future issues.
Download a copy of the E-Commerce Connection—available in HTML and PDF formats at
www.adminastar.com/Providers/EDI/DMERC/ECommerceConnection.html.
10
Chapter 13: Level II HCPCS Codes and HCPCS Modifiers
[MARCH 2008]
13 Level II HCPCS Codes and HCPCS
Modifiers
Level II HCPCS CODES
Level II of the Healthcare Common Procedure Coding System (HCPCS) is a standardized coding
system that is used primarily to identify products, supplies and services not included in the CPT codes,
such as ambulance services and durable medical equipment, prosthetics, orthotics and supplies
(DMEPOS) when used outside a physician’s office. Because Medicare and other insurers cover a variety
of services, supplies and equipment that are not identified by CPT codes, the HCPCS Level II codes
were established for submitting claims for these items. The development and use of HCPCS Level II
codes began in the 1980s. HCPCS Level II codes are also referred to as alphanumeric codes because
they consist of a single alphabetical letter followed by four numeric digits, while CPT codes are
identified using five numeric digits. Suppliers must use HCPCS Level II codes to identify items/services
rendered to its Medicare beneficiaries when submitting claims to the durable medical equipment
Medicare administrative contractor (DME MAC) for payment.
National Government Services is the Jurisdiction B Durable Medical Equipment Medicare Administrative
Contractor (DME MAC). One role of the DME MAC is to create and maintain local coverage
determinations (LCDs), also referred to as medical policies, for certain DMEPOS items/services. Each
LCD contains information vital to the supplier community in determining whether the item/service
meets medical necessity guidelines. In addition, the LCDs offer HCPCS coding information as well as
coding guidelines in the LCD-related article. Suppliers should visit the National Government Services
Web site to view the LCDs and specific HCPCS requirements outlined therein. Suppliers may also view
a HCPCS code file (non-LCD specific) on the National Government Services Web site. To view the LCDs
and related HCPCS and/or HCPCS code file, go to www.NGSMedicare.com.
Structure of HCPCS File
Prior to utilizing the HCPCS file, suppliers should become familiar with the Structure of HCPCS file,
which provides an explanation of the HCPCS file table. This file is available at
www.adminastar.com/Providers/DMERC/HCPCSCodes/HCPCSCodes.html.
HCPCS Jurisdiction List
The Jurisdiction List indicates whether a code should be billed to the DME MAC or the local Medicare
carrier. This file is also available at
www.adminastar.com/Providers/DMERC/HCPCSCodes/HCPCSCodes.html.
Noncovered Items
The following HCPCS codes will be denied as noncovered when they are submitted to the DME MAC.
These items either do not meet the requirements for a benefit category processed by the DME MAC
(technical denial) or are statutorily excluded for reasons other than lack of medical necessity. These
1
[MARCH 2008]
items may be covered under other provisions of the law (e.g., as part of institutional care in a hospital
or nursing facility, as an item incident to a physician’s service, etc.). However, in these circumstances,
the claim would not be submitted to the DME MAC and/or would be submitted using a different code.
A4210
A4250
A4261
A4335
A4554
A4490
A4495
A4500
A4510
A4554
A4565
A4575
A4627
A4670
A6000
A9190
A9270
A9300
E0191
E0220
E0230
E0231
E0232
E0238
E0241
E0242
E0243
E0244
E0245
E0246
E0270
E0273
E0274
E0315
E0625
E0700
E0746
E1300
E1355
J1055
Needle-free injection device, each
Urine test or reagent strips or tablets (100 tablets or strips)
Cervical cap for contraceptive use
Disposable sheets and bags
Disposable underpads
Surgical stockings above knee length, each
Surgical stockings thigh length, each
Surgical stockings below knee length, each
Surgical stockings full length, each
Disposable underpads, all sizes, (e.g., chux’s)
Slings
Topical hyperbaric oxygen chamber, disposable
Spacer, bag or reservoir, with or without mask, for use with metered dose inhaler
Automatic blood pressure monitor
Non-contact wound warming wound cover for use with the non-contact wound warming
device and warming card
Personal comfort item
Noncovered item or service
Exercise equipment
Heel or elbow protector, each
Hot water bottle
Cap or collar
Non-contact wound warming device
Warming card for use with the non-contact wound warming device and non-contact
wound warming wound cover
Non-electric heat pad, moist
Bath tub wall rail, each
Bath tub rail, floor base
Toilet rail, each
Raised toilet seat
Tub stool or bench
Transfer tub rail attachment
Hospital bed, institutional type includes: oscillating, circulating and stryker frame with
mattress
Bed board
Over-bed table
Bed accessories and boards or tables, any type
Patient lift, kartop, bathroom or toilet
Safety equipment (e.g., belt, harness or vest)
Biofeedback therapy for the treatment of urinary incontinence
Whirlpool, non-portable (overtub type)
Stand rack
Injection, medroxyprogesterone acetate for contraceptive use, 150 mg
2
[MARCH 2008]
J3520
J3535
J3570
J7300
J8499
L3215
L3216
L3217
L3219
L3221
L3222
Q0144
V2025
V2600
V2610
V2615
V2760
V5008
V5010
V5011
V5014
V5020
V5030
V5299
V5336
Edetate disodium, per 150 mg
Drug administered through a metered dose inhaler
Laetrile, amygdalin, vitamin b17
Intrauterine copper contraceptive
Prescription drug, oral, non chemotherapeutic, NOS
Orthopedic footwear, ladies shoes, oxford
Orthopedic footwear, ladies shoes, depth inlay
Orthopedic footwear, ladies shoes, hightop, depth inlay
Orthopedic footwear, mens shoes, oxford
Orthopedic footwear, mens shoes, depth inlay
Orthopedic footwear, mens shoes, hightop, depth inlay
Azithromycin dihydrate, oral, capsules/powder, 1 gram
Deluxe frame
Hand held low vision aids and other nonspectacle mounted aids
Single lens spectacle mounted low vision aids
Telescopic and other compound lens system, including distance vision telescopic, near
vision telescopes and compound microscopic lens system
Scratch resistant coating, per lens
Hearing screening
Assessment for hearing aid
Fitting/orientation/checking of hearing aid
Repair/modification of a hearing aid
Conformity evaluation
Hearing aids
Hearing devices
Repair/modification of augmentative communicative system or device (excludes adaptive
hearing aid)
HCPCS MODIFIERS
In some instances, insurers instruct providers that a HCPCS code must be accompanied by a code modifier
to provide additional information regarding the service or item identified by the HCPCS code. Modifiers are
used when the information provided by a HCPCS code descriptor needs to be supplemented to identify
specific circumstances that may apply to an item or service. Following is a list of HCPCS modifiers.
HCPCS
Modifier
A1
A2
A3
A4
A5
A6
A7
A8
A9
Action
Code
Long Description
Dressing
Dressing
Dressing
Dressing
Dressing
Dressing
Dressing
Dressing
Dressing
for
for
for
for
for
for
for
for
for
01
one wound
two wounds
three wounds
four wounds
five wounds
six wounds
seven wounds
eight wounds
nine or more wounds
C
C
C
C
C
C
C
C
C
3
Code Add
Date
20020701
20020701
20020701
20020701
20020701
20020701
20020701
20020701
20020701
Action
Effective
Date
20020701
20020701
20020701
20020701
20020701
20020701
20020701
20020701
20020701
Term Date
[MARCH 2008]
HCPCS
Modifier
Action
Code
AU
AV
AW
AX
BA
BO
BP
BR
BU
CC
CR
EJ
EM
EY
FB
C
GA
GB
GK
GL
GS
C
Long Description
C
20030101
Action
Effective
Date
20030101
C
20030101
20030101
C
20030101
20030101
C
20030101
20030101
C
20030101
20030101
C
20030101
20030101
C
19920101
19970101
C
19920101
19970101
C
19920101
19970101
C
19900101
19970101
C
D
20050821
19910101
20050821
20000101
D
19910101
19970101
C
20030101
20030101
I
20060101
20070101
C
C
19950101
20020101
19970101
20020101
C
20020101
20020101
C
20020101
20020101
D
20060101
20070101
01
Item furnished in conjunction with a
urological, ostomy, or tracheostomy
supply
prosthetic device, prosthetic or
orthotic
surgical dressing
Item furnished in conjunction with
dialysis services
Item furnished in conjunction with
parenteral enteral nutrition (PEN)
services
Orally administered nutrition, not by
feeding tube
The beneficiary has been informed of
the purchase and rental options and
has elected to purchase the item
has elected to rent the item
after 30 days has not informed the
supplier of his/her decision
Procedure code change (use CC when
the procedure code submitted was
changed either for administrative
reasons or because an incorrect code
was filed)
Catastrophe/disaster related
Subsequent claims for a defined
course of therapy, e.g., EPO, sodium
hyaluronate, infliximab
Emergency reserve supply (for ESRD
benefit only)
No physician or other licensed health
care provider order for this item or
service
Item provided without cost to
provider, supplier or practitioner or
credit received for replaced device
(examples, but not limited to covered
under warranty, replaced due to
defect, free samples)
Waiver of liability statement on file
Claim being resubmitted for payment
because it is no longer covered under
a global payment demonstration
Actual item/service ordered by
physician, item associated with GA or
GZ modifier
Medically unnecessary upgrade provided
instead of standard item, no charge, no
advance beneficiary notice (ABN)
Dosage of EPO or Darbepoietin Alfa
has been reduced and maintained in
4
Code Add
Date
Term Date
[MARCH 2008]
HCPCS
Modifier
Action
Code
GY
GZ
JA
JB
K0
K1
K2
K3
K4
KA
KB
KC
KD
KF
A
A
Long Description
Code Add
Date
Action
Effective
Date
S
20020101
20020101
M
20020101
20020101
C
C
C
20070101
20070101
19930101
20070101
20070101
20030101
C
19930101
19970101
C
19930101
19970101
C
19930101
19970101
C
19930101
19970101
C
19940101
19970101
C
20030101
20030101
C
20050101
20050101
C
20040101
20040101
C
20040401
20040401
01
response to hematocrit or
hemoglobulin level
Item or service statutorily excluded or
does not meet the definition of any
Medicare benefit
Item or service expected to be denied
as not reasonable and necessary
Administered intravenously
Administered subcutaneously
Lower extremity prosthesis functional
level 0—does not have the ability or
potential to ambulate or transfer
safely with or without assistance and
a prosthesis does not enhance their
quality of life or mobility
level 1—has the ability or potential to
use a prosthesis for transfers or
ambulation on level surfaces at fixed
cadence. Typical of the limited and
unlimited household ambulator.
level 2—has the ability or potential for
ambulation with the ability to traverse
low level environmental barriers such
as curbs, stairs or uneven surfaces.
Typical of the limited community
ambulatory.
ambulation with variable cadence.
Typical of the community ambulator
who has the ability to transverse
most environmental barriers and may
have vocational, therapeutic or
exercise activity that demands
prosthetic utilization beyond simple
locomotion.
prosthetic ambulation that exceeds
the basic ambulation skills, exhibiting
high impact, stress, or energy levels,
typical of the prosthetic demands of
the child, active adult.
Add on option/accessory for
wheelchair
Beneficiary requested upgrade for
ABN, more than four modifiers
identified on claim
Replacement of special power
wheelchair interface
Drug or biological infused through
DME
Item designated by FDA as Class III
device
5
Term Date
[MARCH 2008]
HCPCS
Modifier
Action
Code
KH
KI
KJ
KL
KM
KN
KO
KP
KQ
KR
KS
KX
LL
LR
LS
LT
M2
MS
NR
NU
PL
QA
QE
QF
QG
QH
A
Long Description
C
19940101
Action
Effective
Date
19970101
C
19940101
19970101
C
19940101
19970101
C
C
20070701
19960101
20070701
20010101
C
19960101
20010101
C
C
19970401
19970401
19970401
19970401
C
19970401
19970401
C
D
20020101
19981001
20020101
19981001
C
C
20020701
19840101
20020701
19970101
C
D
C
19870101
19910101
19840101
19970101
19970101
19970101
C
C
20070101
19890101
20070101
19970101
C
19840101
19970101
C
C
C
C
19840101
19890101
19960101
19890101
19970101
19970101
19961001
19970101
C
19890101
19970101
C
19890101
19970101
C
19890101
19970101
D
20030101
20030101
01
DMEPOS item, initial claim, purchase
or first month rental
DMEPOS item, second or third month
rental
DMEPOS item, parenteral enteral
nutrition (PEN) pump or capped
rental, months four to fifteen
DMEPOS item, delivered via mail
Replacement of facial prosthesis
including new impression/moulage
Replacement of facial prosthesis
using previous master model
Single drug unit dose formulation
First drug of a multiple drug unit dose
formulation
Second or subsequent drug of a
multiple drug unit dose formulation
Rental item, billing for partial month
Glucose monitor supply for diabetic
beneficiary not treated with insulin
Specific required documentation on file
Lease/rental (use the LL modifier
when DME equipment rental is to be
applied against the purchase price)
Laboratory round trip
FDA-monitored intraocular lens implant
Left side (used to identify procedures
performed on the left side of the body)
Medicare secondary payer (MSP)
Six month maintenance and servicing
fee for reasonable and necessary
parts and labor which are not covered
under any manufacturer or supplier
warranty
New when rented (use the NR
modifier when DME which was new at
the time of rental is subsequently
purchased)
New equipment
Progressive addition lenses
FDA investigational device exemption
Prescribed amount of oxygen is less
than 1 liter per minute (lpm)
Prescribed amount of oxygen exceeds
4 liters per minute (lpm) and portable
oxygen is prescribed
Prescribed amount of oxygen is
greater than 4 liters per minute(lpm)
Oxygen conserving device is being
used with an oxygen delivery system
Services/items provided to a prisoner
or patient in state or local custody,
however the state or local
government, as applicable, meets the
requirements in 42 cfr 411.4 (b)
6
Code Add
Date
Term Date
[MARCH 2008]
HCPCS
Modifier
QR
QV
RP
RR
RT
UE
VP
Action
Code
Long Description
D
20060101
Action
Effective
Date
20060101
D
20000919
20000919
C
19840101
19970101
C
19840101
19970101
C
19840101
19970101
C
C
19840101
19840101
19970101
19970101
01
Item or service provided in a
Medicare specified study
Item or service provided as routine care
in a Medicare qualifying clinical trial
Replacement and repair—RP may be
used to indicate replacement of DME,
orthotic and prosthetic devices which
have been in use for sometime. The
claim shows the code for the part,
followed by the RP modifier and the
charge for the part.
Rental (use the RR modifier when
DME is to be rented)
Right side (used to identify
procedures performed on the right
side of the body)
Used durable medical equipment
Aphakic patient
Code Add
Date
Term Date
THE STATISTICAL ANALYSIS DURABLE MEDICAL
EQUIPMENT REGIONAL CARRIER
The Statistical Analysis Durable Medical Equipment Regional Carrier (SADMERC) is a national entity
that provides services under contract for the Centers for Medicare and Medicaid Services (CMS).
Palmetto GBA has been contracted by the CMS to serve as the SADMERC.
The SADMERC provides data analysis support to the four DME MACs and guidance to manufacturers
and suppliers on the proper use of the HCPCS, the means by which DMEPOS services are identified for
Medicare billing. Additionally, the SADMERC performs a variety of national pricing functions for
DMEPOS services, assists CMS with the DMEPOS fee schedules and analyzes DMEPOS fees to identify
unreasonable or excessive reimbursement amounts.
Manufacturers and suppliers should contact the SADMERC HCPCS Unit to obtain proper billing codes
for DMEPOS items. In addition to coding assistance, manufacturers and suppliers may also obtain fee
schedule prices.
A function of the SADMERC is to help determine the appropriate HCPCS code to use when submitting
claims to Medicare. A HCPCS code identifies the DMEPOS being billed.
Contact Information
SADMERC
P.O. Box 100143
Mail Code: AG-370
Phone: 877-735-1326
7
[MARCH 2008]
Hours Available:
9:00 a.m.–4:00 p.m. Monday, Tuesday, Thursday and Friday, Eastern Time (ET)
9:00 a.m.–6:00 p.m. Wednesday, ET
Additional information is available on the SADMERC Web site at www.palmettogba.com/sadmerc.
Durable Medical Equipment Coding System
The Durable Medical Equipment Coding System (DMECS) provides HCPCS coding assistance and
national pricing information via searches for:

HCPCS Level II codes and modifiers
DMEPOS products, and
CMS national fee schedules
The DMECS is available through the SADMERC (Palmetto GBA) and provides coding assistance to the
public that is reflective of DME MAC policies and guidelines. DMECS is designed to assist the public
with the coding of DMEPOS products for submission to the DME MAC.
DMECS currently has four interactive components that work together to provide HCPCS coding information.
1)
2)
3)
4)
Search
Search
Search
Search
by HCPCS Information
for Modifier
for Fee Schedule
DMEPOS Product Classification List
DMECS is available on the SADMERC Web site at www.palmettogba.com/dmecs.
8
Chapter 14: DMEPOS Payment Categories
[MARCH 2008]
14 DMEPOS Payment Categories
The durable medical equipment (DME) fee schedules include items of DME as well as supplies needed
to use the DME and are divided into the following categories:

Inexpensive or other routinely purchased DME
Items requiring frequent and substantial servicing
Customized items
Other prosthetic and orthotic devices
Capped rental items
Oxygen and oxygen equipment
Surgical dressings
Parenteral and enteral nutrition (PEN) (effective January 1, 2002)
Therapeutic shoes and inserts (effective January 1, 2005)
INEXPENSIVE OR OTHER ROUTINELY PURCHASED DME
This is defined as equipment whose purchase price does not exceed $150, or equipment that is
acquired at least 75 percent of the time by purchase. Equipment in this category may be purchased or
rented. Purchases are reimbursed in a lump sum, minus any previous rental payments. All claims for
purchase must specify whether the equipment is new (NU) or used (UE), using the appropriate
modifier. If the supplier fails to indicate whether the equipment is new or used on an assigned claim,
the durable medical equipment Medicare administrative contractor (DME MAC) will assume the
equipment is used. If a nonassigned claim does not specify whether the equipment is new or used,
the DME MAC will generate a development letter to the supplier for this information. If the equipment
is rented, monthly rental payments will be made as long as the item is supplied, or until the purchase
price is reached.
ITEMS REQUIRING FREQUENT AND SUBSTANTIAL
SERVICING
Equipment in this category is paid on a rental basis only. Payment is based on the monthly fee
schedule amounts until the medical necessity ends. No payment is made for the purchase of
equipment, maintenance and servicing, or for replacement of items in this category.
Supplies and accessories are not allowed separately.
CUSTOMIZED ITEMS
Coverage and allowable amounts for custom equipment will be decided by an individual evaluation
based on medical indication.
1
[MARCH 2008]
The beneficiary’s physician must prescribe the customized equipment and provide information
regarding the patient’s physical and medical status to warrant the need for the equipment.
Payment with respect to a covered item that is uniquely constructed or substantially modified to meet
the specific needs of an individual patient should be made in a lump-sum amount. The payment
amount for the purchase of a customized item is based upon the DME MACs individual consideration
for that item.
Suppliers must submit the following documentation for these items for coverage to be considered:

Detailed description of the item
Description of feature(s) that make this item unique
Acquisition or production cost of the item (i.e., line item cost of materials and/or labor)
Manufacturer name, product name and product number
The date of service for custom-made equipment is the actual date the beneficiary receives the item.
Do not use the date the item was ordered when billing Medicare.
OTHER PROSTHETIC AND ORTHOTIC DEVICES
These items consist of all prosthetic and orthotic devices excluding:

Certain customized items
Transcutaneous electrical nerve stimulators (TENS)
Parenteral/enteral nutritional supplies and equipment, and
Intraocular lenses
Other than these exceptions, prosthetic and orthotic devices will be paid on a lump-sum purchase basis.
TRANSCUTANEOUS ELECTRICAL NERVE STIMULATORS
For TENS, modifier RR must be entered on the claim when rented for a patient with acute
postoperative pain or as a trial for patients with chronic pain. For claims submitted with dates of
service on or after January 1, 2007, a Certificate of Medical Necessity (CMN) for a TENS rental will not
be required. A CMN is only required for a TENS purchase for claims with dates of service on or after
January 1, 2007.
If, after the trial period, the physician determines it would be of benefit for the patient to purchase the
TENS unit, a claim for purchase may be submitted. Payment for purchase is made in a lump sum.
Rental payments are not deducted from the purchase allowance.
2
[MARCH 2008]
PARENTERAL AND ENTERAL NUTRITION PUMPS
Parenteral and enteral nutrition (PEN) pumps are covered under the provisions of the prosthetic
benefit. However, payment policies for these pumps generally follow the rules for capped rental items.
The beneficiary has the option of either purchasing or renting the pump from the supplier. The DME
MAC will make no more than 15 rental payments. The beneficiary has the option of purchasing a PEN
pump with the initial claim or at any time during the rental period. However, PEN pump suppliers must
notify the beneficiary of the option to purchase the pump with the initial claim. The supplier must use
modifiers BR, BU, and BP when submitting claims for rental months 10–12. If the beneficiary decides
to purchase the pump after rental payments have been paid, the purchase allowance will be equal to
the used purchase allowance, minus the amount previously allowed for the rentals.
The 25 percent rental allowance reduction for months 4–15 does not apply to PEN pumps.
If the beneficiary chooses to rent the pump to the 15-month rental limit, the supplier is entitled to
periodic maintenance and servicing payments. Necessary maintenance and servicing of pumps may
include repairs and extensive maintenance that involves the breaking down of sealed components, or
performing tests that require specialized testing equipment not available to the beneficiary or nursing
home. The DME MAC will pay only for actual incidents of maintenance, servicing or replacements. For
enteral pumps, the DME MAC pays no more than ½ rental payment every six months, beginning six
months after the last rental period. For parenteral pumps, the DME MAC pays no more than 1/2 rental
payment every three months, beginning three months after the last rental period for the pump. The
supplier should keep written proof of maintenance and servicing of the pump on file. Claims for
replacement of parenteral/enteral pumps purchased more than eight years ago will be considered for
payment. Modifier MS (Maintenance and servicing) is used in this category.
Note: For additional details regarding payment for PEN, please reference the Centers for Medicare &
Medicaid Services (CMS) Internet-Only Manual (IOM) Publication 100-04, Medicare Claims Processing
Manual, Chapter 20, Section 30.7.1 (Payment for Parenteral and Enteral Pumps).
HOME DIALYSIS SUPPLIES
Before Medicare can approve home dialysis supplies for a beneficiary, a CMS-382 ESRD Beneficiary
Selection Form must be filed. The CMS-382 ESRD Beneficiary Selection Form is located at the end of
this chapter. If the beneficiary chooses to receive home dialysis supplies and equipment from a renal
dialysis facility (i.e., Method I), the claims submitted for payment will be processed by the Medicare
Part A fiscal intermediary. The DME MAC processes claims for beneficiaries who have chosen to
receive their supplies and equipment from an independent supplier (i.e., Method II). Suppliers should
obtain the original CMS-382 ESRD Beneficiary Selection Form and submit a copy to the Medicare fiscal
intermediary to update the selection records.
Note: The DME MAC does not record or update Method Selection changes.
3
[MARCH 2008]
CAPPED RENTAL ITEMS
Items in this category are paid on a monthly rental basis not to exceed a period of continuous use of
13 months.
Rental Fee Schedule
For the first three rental months, Medicare pays 80 percent of the Medicare allowed amount from the
Medicare fee schedule. For each of the remaining months of rental, the fee schedule amount
allowance will be reduced by 25 percent. For example: If the normal fee schedule allowance for an
item is $100, Medicare would allow $100 for the first three months of rental and then $75 for each
month after. After paying the rental fee schedule amount for 13 months, no further payment may be
made except for payments for maintenance and servicing.
Payments During a Period of Continuous Use
Payment for items in this category may not exceed a period of continuous use longer than 13 months.
After 13 months of rental have been paid, the beneficiary owns the DME item, and after that time
Medicare pays for reasonable and necessary maintenance and servicing (i.e., parts and labor not
covered by a supplier’s or manufacturer’s warranty) of the item. This provision applies to beneficiaries
renting an item for which the first rental month occurs on or after January 1, 2006.
Suppliers should continue to use modifiers KH, KI, and KJ in the manner as previously instructed for
capped rental DME. For claims with an initial date of service on or after January 1, 2006, suppliers are
no longer required to give beneficiaries a purchase option in the tenth month of rental. Healthcare
Common Procedure Coding System (HCPCS) modifiers BP, BR, and BU should not be submitted.
However, for rental periods that began prior to January 1, 2006 suppliers should use modifiers BP, BR,
and BU.
Capped rental items furnished to beneficiaries prior to January 1, 2006, will continue to be paid under
the payment rules in effect prior to the Deficit Reduction Act (DRA) of 2005 changes.
Note: This chart excludes Power Wheelchairs
Capped Rental (Excluding Power Wheelchairs) Flow Chart
Day 1 =
beneficiary
rents DME
Î
10th month =
supplier gives
beneficiary the
option to rent or
buy
No response from
beneficiary
Î
Payments made through
15th month
Beneficiary declines
purchase option
Î
Payments made through
15th month
Î
Rental paid through 13th
month—then supplier
transfers title to
beneficiary
Ò
Î
11th month
Î
Ô
Beneficiary accepts
purchase option
4
[MARCH 2008]
A period of continuous use allows for temporary interruptions in the use of equipment. Interruptions
must exceed 60 consecutive days plus the days remaining in the rental month in which the use ceases
(not calendar month, but the 30-day rental period) in order for a new 13-month rental period to begin.
When an interruption continues beyond the end of the rental month in which use ceases, no additional
payment will be made until the use of the item resumes. A new date of service will be established
when use resumes. Unreimbursed months of interruption will not apply toward the 13-month limit.
If the interruption is greater than 60 consecutive days (plus the days remaining in the rental month in
which need ceases), the supplier must inform the DME MAC if interruption occurs and provide
documentation for the reason it occurred. If notification is not received by the DME MAC, payments
will continue as though no interruption occurred. If the interruption reasons are justified, a new
13-month rental period may be started.
Capped Rental Situations
If equipment is changed to different but similar equipment, and the beneficiary’s condition has
substantially changed to support the medical necessity for the new item, a new 13-month period will
begin. Otherwise, the rental will continue to count against the current 13-month period and payment
will be based on the least expensive medically appropriate equipment. If the 13-month period has
already expired, no additional rental payment will be made for modified or substituted equipment in
the absence of substantial change in medical need.
If modification is added to existing equipment and there is a substantial change in medical need, the
13-month rental period for the original equipment continues and a new 13-month rental period begins
for the added equipment.
Change of Address
If the beneficiary moves during or after the 13-month period, either permanently or temporarily, it
does not result in a new rental episode.
Change in Suppliers
If the beneficiary changes suppliers during the 13-month rental period, a new rental period will not begin.
Replacement of Capped Rental Equipment
If a capped rental item of equipment has been in continuous use by the patient and if the item is lost
or irreparably damaged prior to the reasonable useful lifetime, which is five years, the patient may
elect to obtain a new piece of equipment. Payment for replacement capped rental equipment will be
made in accordance with the capped rental guidelines of this chapter or if the item is an electric
wheelchair, the item will be paid based in accordance with the electric wheelchair guidelines found in
this chapter.
Purchase Options for Power Wheelchairs
Suppliers must give beneficiaries entitled to electric wheelchairs the option of purchasing at the time
the supplier first furnishes the item. If the beneficiary chooses to purchase, payment will be made on
5
[MARCH 2008]
a lump sum purchase basis. If the beneficiary declines the purchase in the first month, payment will
be made on a rental basis through the 13th month. On the first day after 13 continuous rental months
have been paid, the supplier must transfer title of equipment to the beneficiary.
OXYGEN AND OXYGEN EQUIPMENT
Since 1989, suppliers have been paid a monthly payment amount for furnishing stationary oxygen
equipment and oxygen contents to Medicare beneficiaries. In addition, suppliers have been paid an
add-on fee for furnishing portable oxygen equipment to patients when medically necessary. These
payments were made for the duration of use of the equipment, provided that Medicare Part B
coverage and eligibility criteria were met.
However, Section 5101(b) of the Deficit Reduction Act (DRA) of 2005 established a 36-month (three
year) limit, or cap, on monthly payments for stationary and portable oxygen equipment. This cap
applies to oxygen equipment furnished on or after January 1, 2006, and applies to all claims for the
following HCPCS codes:
E0424
E0431
E0434
E0439
E1390
E1391
E1392
E1405
E1406
Stationary gaseous oxygen system
Portable gaseous oxygen system
Portable liquid oxygen system
Stationary liquid oxygen system
Oxygen concentrator, single delivery port
Oxygen concentrator, dual delivery port
Portable oxygen concentrator
Oxygen and water vapor enriching system with heated delivery
Oxygen and water vapor enriching system without heated delivery
Continuous use of DME as it applies to capped rental items is defined in the CMS IOM Publication 100-04,
Medicare Claims Processing Manual, Chapter 20, Section 30.5.4 and also applies to oxygen equipment for
the purpose of implementing the DRA Section 5105(b).
Payments for an item described above will terminate after a period of continuous use of 36 months.
The DME MAC will count as a month, the date the oxygen equipment was initially furnished to the day
before the same date in the following month and each rental month thereafter until the 36th month
anniversary is reached. On the first day after the 36th month anniversary for which payment has been
made, the supplier must transfer title for the stationary and/or portable oxygen equipment to the
beneficiary. On that same day that title for the equipment is transferred to the patient, monthly
payments can begin to be made for oxygen contents used with patient owned gaseous and liquid
oxygen equipment. The HCPCS codes for oxygen contents are:
E0441
E0442
E0443
E0444
Stationary gaseous contents used with patient owned gaseous stationary system
Stationary liquid contents used with patient owned liquid stationary system
Portable gaseous contents used with patient owned gaseous portable system
Portable liquid contents used with patient owned liquid portable system
6
[MARCH 2008]
The DME MAC will begin the 36-month count on January 1, 2006 for beneficiaries that were receiving
oxygen therapy prior to January 1, 2006. Months prior to January 2006 will not be included in the
36-month count.
The DME MAC will make payment for maintenance and servicing (i.e., parts and labor not covered by
a supplier’s or manufacturer’s warranty) of patient owned stationary or portable oxygen equipment
following the same rules and methods that apply to patient-owned equipment in the inexpensive or
routinely purchased DME and capped rental DME payment categories. These rules are located in the
CMS IOM Publication 100-02, Medicare Benefit Policy Manual, Chapter 14, Section 110.2. The billing
instructions located in CMS IOM Publication 100-04, Medicare Claims Processing Manual, Chapter 20,
Section 130.7 also apply to claims for maintenance and servicing of oxygen equipment. All other
existing rules regarding oxygen (e.g., break in service rules) continue to apply.
Fee schedule payments for stationary oxygen system rentals are all-inclusive and represent a monthly
allowance per beneficiary. This allowance includes payment for the equipment, contents, and accessories
furnished during a rental month.
Modifiers
The monthly payment amount for stationary oxygen is subject to adjustment depending on the amount of
oxygen prescribed (liters per minute, or LPM) and whether or not portable oxygen has been prescribed.

QE—Use if the prescribed amount of oxygen is less than 1 LPM
QF—Use if the prescribed amount of oxygen exceeds 4 LPM and portable oxygen is prescribed
QG—Use if the prescribed amount of oxygen is greater than 4 LPM
QH—Use if an oxygen conserving device is being used with an oxygen delivery system
Oxygen Contents/Units
When a stationary oxygen system is being rented, the monthly allowance includes payment for all
required contents. It would be considered “unbundling” if the supplier billed the beneficiary separately
for contents in this scenario. If the beneficiary owns an oxygen stationary system other than an
oxygen concentrator or uses a portable system only, payment may be made for contents. This is also
a monthly allowance so contents should only be billed once a month, not daily or weekly.
Although suppliers should document the proper units of service to indicate the amount of contents
provided, the content allowables are monthly fees and will not vary according to the number of units
provided. If the patient owns a stationary system and uses a portable system, the portable content fee
is never payable in addition to the regular content fee.
Oxygen Equipment and Contents Billing Chart
The following tables indicate what oxygen fee schedule component is billable/payable under various
transaction scenarios.
7
[MARCH 2008]
Situation: Beneficiary Uses a Stationary System Only
1) Rental
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
No*
No*
Portable Add-on Code
Portable Contents Code
No
No
No
No
No
No
Stationary Contents
Code
No*
E0441
E0442
No
No
No
No
No
No
2) Purchase
Type of System
Concentrator
Gaseous
Liquid
Situation: Beneficiary Uses Both a Stationary and Portable System
1) Rents Stationary/Rents Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
E0441
E0442
E0431, E0434
E0431, E0434
E0431, E0434
No*
No*
No*
No
No
No
No*
No*
No*
No
No
No
E0443, E0444
No*
No*
E0431, E0434
E0431
E0434
E0443, E0444
No**
No**
2) Rents Stationary/Owns Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
No*
No*
3) Owns Stationary/Owns Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
E0441
E0442
4) Owns Stationary/Rents Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
E0441
E0442
Situation: Beneficiary Uses a Portable System Only
1) Rents Portable System
Type of System
Gaseous
Liquid
Stationary Contents
Code
No
No
8
E0431
E0434
E0443
E0444
[MARCH 2008]
2) Owns Portable System
Type of System
Gaseous
Liquid
Stationary Contents
Code
No
No
No
No
E0443
E0444
* Contents are included in stationary system reimbursement.
** The portable contents reimbursement is included in the reimbursement for the stationary contents.
Guidelines for Oxygen and Oxygen Equipment prior to
January 1, 2006
Oxygen equipment is reimbursed on a rental basis only, for as long as the equipment is medically
necessary. The equipment rental allowance includes reimbursement for the oxygen contents. If the
contents are billed separately for a rented system, they will be denied as not separately payable.
Claims for the purchase of oxygen equipment will be denied as noncovered services.
Oxygen contents will only be reimbursed separately when the beneficiary owns an oxygen system, or
rents or owns only a portable oxygen system.
For gaseous or liquid systems or contents, one unit of service = one rental month. Do not report units
of service in cubic feet or pounds.
Concentrators
E1390
Oxygen concentrator, capable of delivering 85 percent or greater oxygen concentration at
the prescribed flow rate
If the beneficiary also rents a portable system, there should be a charge for a portable “add-on.”
There should not be an additional charge for the portable contents—reimbursement for the portable
contents will be included in the reimbursement for the stationary system.
Example: Beneficiary rents a concentrator and a gaseous portable system.
E1390RR
E0431RR
Concentrator
Gaseous portable system
Gaseous and Liquid Stationary Systems
E0424
E0439
Stationary compressed gaseous oxygen system, rental; includes contents (per unit),
regulator, flowmeter, humidifier, nebulizer, cannula or mask, and tubing
Stationary liquid oxygen system, rental; includes use of reservoir, contents (per unit),
regulator, flowmeter, humidifier, nebulizer, cannula or mask, and tubing
If the beneficiary also rents a portable system, there should be a charge for a portable “add-on.”
There should not be an additional charge for the portable contents. The portable contents
reimbursement will be included in the reimbursement for the stationary system.
9
[MARCH 2008]
Example: Beneficiary rents a liquid stationary system and a portable liquid system.
E0439RR
E0434RR
Stationary system
Portable system
Portable Oxygen Systems
E0431
E0434
Portable gaseous oxygen system, rental; includes regulator, flowmeter, humidifier,
cannula or mask, and tubing
Portable liquid oxygen system, rental; includes portable container, supply reservoir,
humidifier, flowmeter, refill adapter, contents gauge, cannula or mask, and tubing
These codes are to be used as an “add-on” when a portable system is rented with a concentrator, a
stationary gaseous, or a stationary liquid system.
Stationary Equipment Content Codes
E0441
E0442
Oxygen contents, gaseous, per unit, (for use with owned stationary gaseous systems or
when both a stationary and portable gaseous system are owned)
Oxygen contents, liquid, per unit, (for use with owned stationary liquid systems or when
both a stationary and portable liquid system are owned)
Oxygen contents for stationary equipment may only be reimbursed separately when the beneficiary
owns a stationary system or owns both stationary and portable systems.
Claims should be billed on a monthly basis (as with the equipment rental claims).
Portable Oxygen Contents
E0443
E0444
Portable oxygen contents, gaseous, per unit (for use only with portable gaseous systems
when no stationary gas or liquid system is used)
Portable oxygen contents, liquid, per unit (for use only with portable liquid systems when
no stationary gas or liquid system is used)
A portable contents fee can only be paid separately in the following situations:

When the beneficiary owns a concentrator and rents or owns a portable system
When the beneficiary rents or owns a portable system and no stationary equipment exists
Claims should be billed on a monthly basis.
When a claim for HCPCS code E0443 or E0444 is denied because payment is being made for a
stationary oxygen system, the denial will not be treated as a coverage denial. It is a charge reduction,
since the reason for the denial is that base price allowed charges for portable contents were included
in the calculation of the stationary contents and equipment fee. On assigned claims, any attempt by
the supplier to collect charges from the beneficiary for denied portable oxygen contents claims will be
considered an assignment violation.
10
[MARCH 2008]
Oxygen Modifiers
The monthly fee schedule reimbursement amount can be increased or decreased depending upon the
amount of oxygen prescribed (LPM) and whether or not portable oxygen has been used. To make the
proper payment adjustments, claims must indicate the appropriate HCPCS modifier as described
(where applicable).
If the prescribed amount of oxygen is from 1–4 LPM, no modifier is used.
QE
QF
QG
QH
If the prescribed amount of oxygen is less than 1 LPM, the monthly payment amount will
be reduced 50 percent by the system when this modifier is used. These claims will be
reviewed by the medical staff to ensure the home oxygen therapy coverage requirements
are met.
Prescribed amount of oxygen exceeds 4 liters per minute (LPM) and portable oxygen is
also prescribed.
If the prescribed amount of oxygen is greater than 4 LPM, the monthly payment amount
will be increased 50 percent by the system when this modifier is used. These claims will
be reviewed by the medical staff to ensure the home oxygen therapy coverage
requirements are met.
Use this modifier when the beneficiary is using an oxygen conservation device with the
oxygen system. There is no payment adjustment for use of this device.
Modifiers QE, QF, and QG may be used only with a stationary gaseous system (E0424), a stationary
liquid system (E0439), or a concentrator (E1390). They should not be used with the portable system
HCPCS codes (E0431 or E0434), or with the oxygen contents HCPCS codes (E0441–E0444).
Modifier QH may be used with any oxygen code.
Modifier RR would be used on equipment rental codes in addition to the Q modifiers (e.g., E0424RRQG).
Oxygen Accessories
Accessories, including but not limited to cannulas (A4615), humidifiers (E0555), masks (A4620, A4621),
mouthpieces (A4617), nebulizer for humidification (E0580), oxygen conserving devices (A9900), regulators
(E1353), transtracheal catheters (A9900) and tubing (A4616), are included in the allowance for rented
systems. The supplier must provide any accessory ordered by the physician. Accessories are separately
payable only when they are used with a patient-owned system that was purchased prior to June 1, 1989.
Accessories used with a patient-owned system that was purchased on or after June 1, 1989 will be denied
as noncovered.
Procedure Codes
A4615
A4616
A4617
A4619
A4620
A4621
11
E0455
E0555
E0580
E1353
E1355
[MARCH 2008]
Oxygen Equipment Help Chart
A) Situation: Beneficiary uses a stationary system only
1) Rental
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
No*
No*
No
No
No
No
No
No
No
No
No
No
No
No
2) Purchase
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No
E0441
E0442
B) Situation: Beneficiary uses both a stationary and portable system
1) Rents Stationary/Rents Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
No*
No*
E0431, E0434
E0431
E0431, E0434
No*
No*
No*
No
No
No
No*
No*
No*
No
No
No
E0443, E0444
No*
No*
E0431, E0434
E0431
E0434
E0443, E0444
No*
No*
2) Rents Stationary/Owns Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
No*
No*
3) Owns Stationary/Owns Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No*
E0441
E0442
4) Owns Stationary/Rents Portable
Type of System
Concentrator
Gaseous
Liquid
Stationary Contents
Code
No
E0441
E0442
* The portable contents reimbursement is included in the reimbursement for the stationary contents.
12
[MARCH 2008]
C) Situation: Beneficiary uses a portable system only
1) Rents Portable System
Type of System
Gaseous
Liquid
Stationary Contents
Code
No
No
E0431
E0434
E0443
E0444
No
No
E0443
E0444
2) Owns Portable System
Type of System
Gaseous
Liquid
Stationary Contents
Code
No
No
REPAIRS, MAINTENANCE AND REPLACEMENT
Under the circumstances specified below, payment may be made for repair, maintenance, and
replacement of medically required DME, including equipment which had been in use before the user
enrolled in Part B of the program. In addition, payments for repair and maintenance may not include
payment for parts and labor covered under a manufacturer's or supplier’s warranty.
A) Repairs
To repair means to fix or mend and to put the equipment back in good condition after damage or
wear. Repairs to equipment which a beneficiary owns are covered when necessary to make the
equipment serviceable. If the expense for repairs exceeds the estimated expense of purchasing or
renting another item of equipment for the remaining period of medical need, no payment can be made
for the amount of the excess. Repairs of rented equipment are not covered. This includes items in the
frequent and substantial servicing, oxygen equipment, capped rental and inexpensive or routinely
purchased payment categories which are being rented.
A new CMN and/or physician’s order is not needed for repairs.
B) Maintenance
Routine periodic servicing, such as testing, cleaning, regulating, and checking of the beneficiary’s
equipment, is not covered. The beneficiary is expected to perform such routine maintenance rather
than the supplier or some other person who charges the beneficiary. Normally, purchasers of DME are
given operating manuals which describe the type of servicing an owner may perform to properly
maintain the equipment. It is reasonable to expect that beneficiaries will perform this maintenance.
Thus, hiring a third party to do such work is for the convenience of the beneficiary and is not covered.
However, more extensive maintenance which, based on the manufacturers’ recommendations, is to be
performed by authorized technicians, is covered as repairs for medically necessary equipment which a
beneficiary owns. This might include, for example, breaking down sealed components and performing
tests which require specialized testing equipment not available to the beneficiary.
Maintenance of purchased items that require frequent and substantial servicing or oxygen equipment
is not covered.
13
[MARCH 2008]
When billing for maintenance and servicing claims suppliers must add the MS modifier to the HCPCS code.
The following is a description of modifier MS: Six month maintenance and servicing fee for reasonable and
necessary parts and labor which are not covered under any manufacturer or supplier warranty
C) Replacement
Replacement refers to the provision of an identical or nearly identical item. Equipment which the
beneficiary owns or is a capped rental item may be replaced in cases of loss or irreparable damage.
Irreparable damage refers to a specific accident or to a natural disaster (e.g., fire, flood, etc.).
Irreparable wear refers to deterioration sustained from day-to-day usage over time and a specific
event cannot be identified. Replacement of equipment due to irreparable wear takes into consideration
the reasonable useful lifetime of the equipment. If the equipment has been in continuous use by the
patient on either a rental or purchase basis for the equipment's useful lifetime, the beneficiary may
elect to obtain a new piece of equipment.
The reasonable useful lifetime of durable medical equipment is determined through program
instructions. In the absence of program instructions, carriers may determine the reasonable useful
lifetime of equipment, but in no case can it be less than five years.
Computation of the useful lifetime is based on when the equipment is delivered to the beneficiary, not
the age of the equipment. Replacement due to wear is not covered during the reasonable useful lifetime
of the equipment. During the reasonable useful lifetime, Medicare does cover repair up to the cost of
replacement (but not actual replacement) for medically necessary equipment owned by the beneficiary.
Replacement may be reimbursed when a new physician order and/or new CMN, when required, is
needed to reaffirm the medical necessity of the item.
Cases suggesting malicious damage, culpable neglect, or wrongful disposition of equipment should be
investigated and denied where the DME MAC determines that it is unreasonable to make program payment
under the circumstances. The DME MACs refer such cases to the zone program integrity contractor (ZPIC).
When filing a Medicare claim for replacement equipment prior to the reasonable useful lifetime of five
years, modifier RP must be submitted on the claim. When billing with the RP modifier, documentation
must be maintained in the beneficiary’s file and be available upon request from the DME MAC or the
ZPIC. The following documentation must be included, but is not limited to:

Reason for replacement
New CMN when required
Medical records
Police reports
Written explanations from the beneficiary
These guidelines do not apply to breast prosthesis or limb prosthesis. Please refer to each individual
local coverage determination and policy article on the National Government Services Web site at
www.adminastar.com/Providers/DMERC/MedicalPolicy/MedicalPolicy.cfm for the exception to the
reasonable useful requirements of five years for these items.
14
[MARCH 2008]
SAMPLE RENT/PURCHASE OPTION FOR POWER
WHEELCHAIRS LETTER
If you meet the Medicare coverage criteria for a power wheelchair prescribed by your physician,
Medicare may help pay for it. Upon delivery of the power wheelchair, Medicare requires (specify name
of supplier) to give you the option of either renting or purchasing the electric wheelchair.
If you choose to purchase the power wheelchair, upon approval, Medicare pays 80 percent of the
allowed purchase price in a lump sum amount. You are responsible for the 20 percent coinsurance
amounts and, for nonassigned claims, the balance between the Medicare allowed amount and the
supplier’s charge. However, you must elect to purchase the electric wheelchair at the time your
medical equipment supplier furnishes you the item.
If you choose to rent the power wheelchair and the Medicare coverage criteria are met, Medicare may
pay a monthly rental fee for a period not to exceed 13 months, after which ownership of the electric
wheelchair is transferred to you. During the rental period, you will be responsible for the 20 percent
coinsurance payment for each month of the rental period, and for nonassigned claims: you will be
responsible for the balance between the Medicare allowed amount and the supplier’s charge. Medicare
requires (specify name of supplier) to convert your rental agreement to a purchase agreement after
13 months of rental. This means once Medicare has made the final 13th rental payment, title to the
equipment is transferred to you and you will own the equipment.
Once the power wheelchair is purchased, you are responsible for 20 percent of the service charge
each time your equipment is actually serviced or repaired and, for nonassigned claims, the balance
between the Medicare allowed amount and the supplier’s charge.
Option:
______ Continued Rental
______ Purchase
Beneficiary Signature: ______________________________________________________________
Date: ______________________________________________________________________________
15
DEPARTMENT OF HEALTH & HUMAN SERVICES
CENTERS FOR MEDICARE & MEDICAID SERVICES
Form Approved
OMB No. 0938-0372
ESRD BENEFICIARY SELECTION (Home Patients Only)
PLEASE READ INSTRUCTIONS ON REVERSE BEFORE COMPLETING THIS FORM
1. NAME (Last, First, Middle Initial)
2. HEALTH INSURANCE CLAIM NUMBER (Medicare Claim Number)
3. DATE OF BIRTH (month/day/year)
4. SEX
o Male
o Female
5. PROVIDER NUMBER OF FACILITY PROVIDING HOME DIALYSIS TRAINING
5A. NAME AND ADDRESS OF FACILITY PROVIDING HOME DIALYSIS TRAINING
6. PROVIDER NUMBER OF FACILITY PROVIDING HOME DIALYSIS SUPPORT SERVICES
6A. NAME AND ADDRESS OF DIALYSIS FACILITY PROVIDING SUPPORT SERVICES
o
o
o
o
7. BENEFICIARY SELECTION, CHANGE OR CANCELLATION
Initial Selection
Cancellation
Routine Method Selection Change
o
o
o
8. TYPE OF DIALYSIS (Check One)
Hemodialysis
CAPD
CCPD
Method Exception (Refer to PRM, Part I-Chap. 27, §2740.2.D.) Intermediary approval required.
Reason for Exception __________________________________________________________________________
____________________________________________________________________________________________
9. DATE HOME DIALYSIS TRAINING IS COMPLETED
o
10. CHECK METHOD I OR II
METHOD I – The ESRD facility indicated in #6 will supply all the equipment, supplies, and support services
necessary for me to dialyze at home.
o
METHOD II – I will deal directly with one supplier for my home dialysis supplies and equipment, and my
support services will be provided by the dialysis facility indicated above.
11. NAME AND ADDRESS OF THE DURABLE MEDICAL EQUIPMENT SUPPLIER THAT WILL PROVIDE THE SUPPLIES
AND EQUIPMENT (Only appropriate if beneficiary chooses Method II)
12. If I have chosen Method II, by signing this form, I certify that I have only one Method II supplier. Further, I understand that if my
supplier does not take assignment, Medicare will not pay anything toward my supplier’s bill.
o Private Residence
o Skilled Nursing Facility
13. CHECK LOCATION WHERE HOME DIALYSIS IS PROVIDED
14. BENEFICIARY SIGNATURE
o Nursing Home
15. DATE BENEFICIARY SIGNS FORM (month/day/year)
16. DATE METHOD EXCEPTION TO BE EFFECTIVE (month/day/year)
(INITIAL SELECTION CHANGES, ROUTINE SELECTION CHANGES, AND CANCELLATIONS BECOME EFFECTIVE ON JANUARY 1 OF THE YEAR FOLLOWING THE YEAR IN WHICH THIS FORM IS SIGNED)
17. The dialysis facility providing the home dialysis training is responsible for supplying this form to Medicare beneficiaries who select home dialysis
and for sending the white copy of the completed form to the local Part A Intermediary (both Method I and Method II selections). Blank forms are
available from the Intermediary. The white copy of this form must be sent to:
THE LOCAL INTERMEDIARY
ATTN: MEDICARE PROGRAM ADMINISTRATOR
A copy of the form must also be sent to the dialysis facility providing support services and to the supplier if the beneficiary chooses Method II.
Form CMS-382 (01/05) EF 02/2005
1
INSTRUCTIONS FOR COMPLETING THE ESRD BENEFICIARY SELECTION FORM
METHOD CHANGES – Once you have made your
initial selection, your reimbursement must be handled
in that manner until December 31 of the year in which
you signed the ESRD Beneficiary Selection form. If
you wish to continue your initial selection beyond
December 31, you do NOT complete another ESRD
Beneficiary Selection form. You will automatically
continue to have your reimbursement handled in the
manner you selected. If you do not wish to continue
with your initial selection beyond December 31, you
MUST complete another ESRD Beneficiary Selection
form. This subsequent form must be signed, dated and
This form is to be filled out only by Medicare
postmarked PRIOR to January 1 of the year you wish
beneficiaries dialyzing at home and not by Medicare your selection change to be effective. This is the only
beneficiaries who are currently dialyzing in a facility. way changes are made, and this is the only reason you
should ever complete more than one ESRD
Your selection of either Method I or Method II in no
Beneficiary Selection form.
way inhibits your return to incenter treatment or selection
for any other treatment options should that be necessary.
PRIVACY ACT STATEMENT
METHOD I – The first method is for your dialysis
As required by 5 U.S.C. 552a (the Privacy Act of
facility to assume the responsibility for your care.
Under this method, the facility is required to provide 1974), you are advised that the Centers for Medicare
& Medicaid Services is authorized to collect the data
to you any and all dialysis equipment, supplies and
on this form by Section 1881(b)(1) of the Social
home support services that you need to dialyze at
home. It also is required to order, store, deliver, and
Security Act and 42 CFR 405.544. The purpose for
pay the manufacturers and suppliers for these items.
collecting this information is stated above. Your
Under this arrangement you are responsible to your
response to the questions on this form is not required
dialysis facility for the Medicare Part B deductible
by law. However, if you do not provide this informaand 20% coinsurance.
tion, requests for end-stage renal dialysis reimbursement may be denied or delayed until it is provided.
METHOD II – While your facility is responsible for You should be aware that the information you provide
assuring that you receive all items and services that
may be verified by a computer match (P.L. 100-503).
you require for home dialysis, the second method
allows you to deal directly with a single supplier for
Individually identifiable patient information will not
securing the necessary dialysis equipment and supplies. be disclosed except as provided for by the Privacy Act.
Then your supplier bills the Medicare program for
payment. Under this arrangement, you are responsible
to the supplier for the Medicare Part B deductible and
20% coinsurance.
Centers for Medicare & Medicaid Services regulations
provide two (2) ways that a Medicare beneficiary
dialyzing at home can choose to have the Medicare
program pay for his/her dialysis care (exclusive of
physician services). The purpose of the Beneficiary
Selection form is for you, the beneficiary, to select the
method that best suits your requirements. It is important
you choose one of these two methods, complete and
sign the form and return it to the dialysis facility that
supervises your care as soon as possible. You must
complete all sections of this form.
According to the Paperwork Reduction Act of 1995, no persons are required to respond to a collection of information unless it displays a valid OMB control
number. The valid OMB control number for this information collection is 0938-0372. The time required to complete this information collection is estimated
to average 5 minutes per response, including the time to review instructions, search existing data resources, gather the data needed, and complete and
review the information collection. If you have any comments concerning the accuracy of the time estimate(s) or suggestions for improving this form,
please write to CMS, Attn: PRA Reports Clearance Officer, 7500 Security Boulevard, Baltimore, Maryland 21244-1850.
Form CMS-382 (01/05) EF 02/2005
2
Chapter 15: Pricing
[MARCH 2007]
15 Pricing
The Medicare Pricing Department is responsible for the accurate and appropriate calculation and
implementation of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) prices.
Note: The beneficiary’s permanent address, rather than the location of the DMEPOS supplier, will
determine the amount allowed by Medicare for a particular service.
There are three DMEPOS payment methodologies:

Fee Schedules—applies to the allowed amount for inexpensive items, those items that require
frequent and substantial servicing, other prosthetic and orthotic devices, capped rental items,
and oxygen and oxygen supplies and parenteral and enteral nutrition (PEN). Fee schedule
amounts are updated annually.
Reasonable Charge—applies to the allowed amount for certain dialysis equipment and
supplies and therapeutic shoes claims. Reasonable charge amounts are updated annually.
Drug Pricing—applies to the allowed amount for immunotherapy, bronchodilator, and other
drugs. Most fees determined under drug pricing are subject to quarterly updates.
Note: Fee schedules can change as the result of Centers for Medicare & Medicaid Services (CMS) revisions
and/or through the application of inherent reasonableness, which is a review to determine if the existing
prices are appropriate. The factors used to determine inherent reasonableness include, but are not limited
to, price markup, differences in charges, costs and utilization.
FEE SCHEDULES
Most payments of durable medical equipment (DME) are based on a fee schedule. A standard fee is
established for each DMEPOS item by state. Payment is calculated using either the fee schedule
amount or the actual charge submitted on the claim, whichever is lower. The fee schedule allowances
include the application of national floors and ceilings.
The DME fee schedules include items of DME as well as supplies needed to use the DME and are
divided into the following categories:

Customized items
Other prosthetic and orthotic devices
Capped rental items
Oxygen and oxygen equipment
Surgical Dressings
Parenteral and enteral nutrition (PEN) (effective January 1, 2002)
Therapeutic shoes and Inserts (effective January 1, 2005)
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Chapter 15: Pricing
[MARCH 2007]
For each class of equipment, payment is based on fees established effective January 1, 1989, and
these fees are indexed annually. After application of the annual fee update for all categories of DME
except prosthetics and orthotics, the national floor and ceiling payment limits are applied. Alaska and
Hawaii are not subject to national floors and ceilings. Prosthetic and orthotic items and/or supplies are
subject to regional limits. Payment for surgical dressing fees is an exception and is calculated using a
1992 base period. The Balanced Budget Act of 1997 section 4315 authorized the secretary to
implement a fee schedule for parenteral and enteral nutrition (PEN) items and services. These items
were previously paid on a reasonable charge basis. The new PEN fee schedule is effective for claims
with dates of service on or after January 1, 2002.
Gap Filling
The fee schedule for items for which charge data is not available is calculated based on:

Fee schedule amounts for comparable equipment
Fee schedule amounts of other DME MACs, and
Supplier price lists
Where supplier price lists are used, efforts are made to obtain prices in effect during the base year
(1986–1987). Mail order catalogs are often used as sources of price information. A deflation factor is
applied if the price information is from a period other than the base period. This is done in order to
approximate the base year price for gap filling purposes.
The DMEPOS Fee Schedules can be located on the National Government Services, Inc. Web site at:
www.adminastar.com/Providers/DMERC/FeeSchedule/DMERCPricing.htm.
The DMEPOS Fee Schedules can also be located on the Centers for Medicare & Medicaid Services
(CMS) Web site at: www.cms.hhs.gov/DMEPOSFeeSched/01_overview.asp.
REASONABLE CHARGES
The manner in which reasonable charge allowances by Medicare are determined is stipulated by
Medicare law and not left to the discretion of the Medicare carrier. Medicare law specifically states that
the amount allowed by Medicare must be the lowest of:

The actual charge
The supplier’s customary charge or the 50th percentile of arrayed and weighted customary
charges in the absence of a customary charge for the specific service rendered
The prevailing charge, or
The Inflation-Indexed Charge (IIC)
Data regarding suppliers’ fees is obtained by compiling information from claims that have been submitted.
Records of all charges are kept on each claim processed during a calendar year. This information identifies
the supplier, the type of service, the area in which the service was rendered, and the charge for that
service. Effective with the 1995 reasonable charge updates, the data will be compiled using beneficiaries’
state of residency, rather than the area from which the service was rendered.
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Chapter 15: Pricing
[MARCH 2007]
Beginning January of each year, the data accumulated from July 1st of the second preceding year
through June 30th of the preceding year is arrayed to develop the current year’s Annual Pricing
Update of Medicare allowances. For example, data accumulated from July 1, 1999, to June 30, 2000,
is arrayed to develop the Annual Pricing Update of Medicare allowances for 2001. The annual update
reflects the changes in the fees most frequently charged by suppliers for a particular service, within a
specific locality, during the 12-month period ending June 30th of the previous year. This time frame is
referred to as the base year. The customary and reasonable charge effective for the new annual
pricing update does not necessarily reflect the fees currently being charged.
Customary Charges
The customary charge is the charge that best represents the most frequently charged amount by a
supplier for a particular service. In order to determine the customary charges for each individual
supplier, the actual charges the supplier has submitted for services rendered during the year ending
June 30th immediately preceding the start of the Annual Pricing Update (January of each year) for a
given service, are arrayed in ascending order and the median charge is calculated. If you do not have
at least three charges for a procedure code, then the 50th percentile of all other suppliers’ customary
charges weighted by frequency will be used as the customary charge.
The lowest actual charge, which is high enough to include the median of the arrayed charge data, is
then selected as the suppliers’ customary charge for the service. For example, if ABC supplier charges
$12 for a particular service 75 times during a calendar year and $15 twelve times for the same service,
$12 would best represent the actual charge made by that supplier.
The following is an example of how charges for a supplier would be arrayed in order to determine the
customary charge.
Charge
$10.00
$12.50
$14.00
$15.00
Frequency Billing
20 times
40 times
35 times
5 times
Cumulative Frequency
20
60
95
100
Based on the cumulative frequency of 100 submitted charges, the median charge would be the 50th
charge. In this example, the median charge submitted is $12.50. There must be at least three (3)
billed charges for the same procedure by the same supplier to establish a customary for that
procedure within the base year.
Prevailing Charges
The prevailing charge is the 75th percentile of all suppliers’ customary charges, within the beneficiary
state for a specific service or procedure, weighted by frequency. Prevailing charges are calculated in
much the same way as customary charges. The customary charge for each procedure is arrayed in
ascending order, and weighted by how often the supplier rendered the services as reflected by the
data used to calculate the customary charge. The prevailing charge is established at the 75th
percentile of these cumulative services. There must be at least four customary charges for a given
procedure to establish a prevailing charge for that service.
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Chapter 15: Pricing
[MARCH 2007]
The proper procedure for establishing prevailing charges is illustrated in the following example:
Number of Supplies Rendered by Suppliers
Customary Charge
$5.00
$6.00
$7.00
$8.00
Total
with Customary Charges as Indicated
27
30
25
18
100
Cumulative Services
27
57
82
100
In this example, 75 percent of the total of 100 supplies falls at the 75th supply. The 75th supply falls
within the cumulative frequency of 82 submitted supplies; therefore $7 becomes the prevailing charge.
Inflation-Indexed Charge for Nonphysician Services
The inflation-indexed charge (IIC) is the lowest of the reasonable charges for the previous Annual
Pricing Update year updated by an inflation index factor. [The inflation index factor is based on the
change in the Consumer Price Index (CPI).] The reasonable charges include the prevailing charge,
customary charge, lowest charge level (if applicable), and the IIC. The IIC calculation does not take
into account any reasonable charge limitation resulting from the application of comparability, inherent
reasonableness or the 50th percentile in the absence of a customary charge.
Lowest Charge Level
The lowest charge level (LCL) is calculated the same way that the prevailing charge is, except that the
LCL is based on the data derived from claims processed during the preceding months of July through
September prior to the annual fee screen pricing update. The charge at the 25th percentile is selected
as the LCL prevailing. LCL calculations must be derived based on at least 20 charges for an item and
no less than four suppliers within the locality.
Note: The only charges subject to the LCL limitations are PEN services.
DRUG PRICING
The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MPDIMA), changed the
basis for payment of drugs and biologicals not paid on a cost or prospective payment basis. The
different instructions for 2004 and 2005 dates of service are listed below.
Effective January 1, 2005, drugs and biologicals not paid on a cost or prospective payment basis will
be paid based on the new Average Sale Price (ASP) drug payment system. The new payment system
is based on quarterly data submitted to CMS by manufacturers. CMS will supply contractors with the
ASP drug pricing files for Medicare Part B/DME MAC drugs on a quarterly basis.
Beginning January 1, 2005, the payment allowance limits for Medicare Part B/DME MAC drugs and
biologicals that are not paid on a cost or prospective payment basis are 106 percent of the ASP. CMS
will update the payment allowance limits quarterly. There are exceptions to this general rule as
summarized below.
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Chapter 15: Pricing
[MARCH 2007]

The payment allowance limits for infusion drugs furnished through a covered item of durable
medical equipment on or after January 1, 2005 will continue to be 95 percent of the AWP
reflected in the published compendia as of October 1, 2003 regardless of whether or not the
durable medical equipment is implanted. The payment allowance limits will not be updated in
2005.
The payment allowance limits for drugs not included in the ASP Medicare Part B Drug Pricing
File are based on the published wholesale acquisition cost (WAC) or invoice pricing.
Effective for January 1, 2004–December 31, 2004, payments for drugs billed to the DME MACs
are based on 85 percent of the AWP for HCPCS payment amounts based on the April 1, 2003,
AWP fees. Exceptions to this calculation are as follows:
The payment limits for infusion drugs furnished through an item of durable medical equipment
on or after January 1, 2004, will be 95 percent of the October 1, 2003 AWP.
The payment limits for new drugs or biologicals will be 95 percent of the AWP. A new drug is
defined as an unlisted drug (not currently covered by a HCPCS code) that was FDA approved
subsequent to April 1, 2003. A drug would not be considered new if: The brand or manufacturer
of the drug changed; a new formulation of the vial size is developed; or the drug received a
new indication.
The payment limits for certain drugs studied by the Office of the Inspector General and
Government Accounting Office are based on the percentages of the April 1, 2003 AWPs
specified on Table 1 in the CMS Internet-Only Manual Publication 100-04, Medicare Claims
Processing Manual, chapter 17, section 20.
Payment limits determined under this instruction shall not be updated during 2004.
Written requests for ASP fees or reasonable charge fees (prevailing [per state] fees) or customary fees
(individual supplier’s fees) can be sent to the following address:
Freedom of Information (FOI)
P.O. Box 50454
INDIVIDUAL CONSIDERATION
Unusual services and items are generally reported to the carrier with miscellaneous HCPCS codes. It
will be necessary in these situations for the supplier to furnish documentation describing the service or
item, manufacturer name, product name and number and the suggested retail price. When necessary,
consultants’ advice will be obtained.
INHERENT REASONABLENESS
Where a review of customary and prevailing fees indicates excessive or deficient amounts, applying
inherent reasonableness may be appropriate. We will always publish notice of proposed inherent
reasonableness charges and provide a minimum of a 30-day comment period. This notice will include
the HCPCS code, the current prevailing charge and the proposed charge. We will also include source
documentation that supports the proposed charge. After comments are reviewed, we will publish a
final decision and responses to the issues raised in the comments.
5
Chapter 16: Medicare Benefit and Denial Categories
[MARCH 2008]
16 Medicare Benefit and Denial Categories
BENEFIT CATEGORIES
Medicare Part B covered services processed by the durable medical equipment Medicare administrative
contractor (DME MAC) fall into benefit categories as specified by the Social Security Act (the Act).
These benefit categories include:
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
12)
13)
14)
Durable medical equipment (DME)
Prosthetic devices
Braces (orthoses)
Arm prostheses
Leg prostheses
Eye prostheses
Home dialysis supplies and equipment
Surgical dressings
Immunosuppressive drugs
Erythropoietin for home dialysis patients
Therapeutic shoes for diabetics
Oral anticancer drugs
Oral antiemetic drugs (replacement for intravenous antiemetics)
Intravenous immune globulin for primary immunodeficiency
Some general definitions and coverage issues relating to DME, prosthetic devices and braces are listed
below. Detailed information relating to specific items may be found in each individual medical policy.
There are multiple individual policies for items described by benefit categories 1–3.
Items described by benefit categories 5–13 each have a unique medical policy. Refer to those policies
for information on definitions and coverage and payment rules.
Durable Medical Equipment
Durable medical equipment is equipment which; (a) can withstand repeated use, and (b) is primarily
and customarily used to serve a medical purpose, and (c) generally is not useful to a person in the
absence of an illness or injury, and (d) is appropriate for use in the home.
Supplies and accessories which are required for the effective use of medically necessary durable medical
equipment are covered. Supplies may include drugs and biologicals, which must be put directly into DME
(e.g., nebulizers, infusion pumps) in order to achieve the therapeutic benefit of equipment.
Medically necessary repairs, skilled maintenance and replacement of medically necessary durable
medical equipment are covered.
Refer to individual policies for specific information on definitions and coverage and payment rules.
1
[MARCH 2008]
Home Use of Durable Medical Equipment
Medicare law limits Part B payment for DME items/services used (delivered) in the patient’s home. If a
hospital is a participating hospital, and emergency hospital or a hospital which meets the requirements
of Section 1861(e)(1) of the Act, it does not qualify as the patient’s home.
The following apply when the individual is in a skilled nursing facility (SNF):

Where an institution is classified as a participating SNF, a Section 1819(a)(1) institution (i.e., an
institution primarily engaged in providing skilled nursing care and related services or rehabilitation
services for the rehabilitation of injured, disabled or sick persons, and is not primarily for the care
and treatment of mental diseases), or where a SNF has a part classified as participating and part
classified as meeting Section 1819(a)(1) of the Act, it cannot be considered the individual’s home.

If an institution has a part which is participating or a part which meets Section 1819(a)(1), and a
remaining part which does not meet Section 1819(a)(1), the institution may be considered the
individual’s home only if he/she was in the part which does not meet Section 1819(a)(1) of the Act.

If a DME rental start date coincides with the patient’s discharge date from an institution not
classified as a “home,” DME MACs pay for medically necessary DME.
Note: These rules apply only to DME claims. Orthotic and prosthetic devices are not subject to the “home
use” requirement for coverage and payment purposes.
Definition of Beneficiary’s Home for DME Purchase or Rental
Reference: Centers for Medicare & Medicaid Services (CMS) Internet-Only Manual (IOM) Publication 100-02,
Medicare Benefit Policy Manual, Chapter 15 (Covered Medical and Other Health Services), Section 110.1.d.
For purposes of rental and purchase of DME, a beneficiary’s home may be his/her own dwelling, an
apartment, a relative’s home, a home for the aged, or some other type of institution. However, an
institution may not be considered a beneficiary’s home if it:

meets at least the basic requirement in the definition of a hospital, i.e., it is primarily engaged in
providing by or under the supervision of physicians, to inpatients, diagnostic and therapeutic
services for medical diagnosis, treatment, and care of injured, disabled, and sick persons, or
rehabilitation services for the rehabilitation of injured, disabled, or sick persons; or
meets at least the basic requirement in the definition of a skilled nursing facility, i.e., it is primarily
engaged in providing to inpatients skilled nursing care and related services for patients who
require medical or nursing care, or rehabilitation services for the rehabilitation of injured, disabled,
or sick persons.
Thus, if an individual is a patient in an institution or distinct part of an institution which provides the
services described in the bullets above, the individual is not entitled to have separate Part B payment
made for rental or purchase of DME. This is because such an institution may not be considered the
individual’s home. The same concept applies even if the patient resides in a bed or portion of the
institution not certified for Medicare.
2
[MARCH 2008]
If the patient is at home for part of a month and, for part of the same month is in an institution that
cannot qualify as his or her home, or is outside the U.S., monthly payments may be made for the
entire month. Similarly, if DME is returned to the provider before the end of a payment month because
the beneficiary died in that month or because the equipment became unnecessary in that month,
payment may be made for the entire month.
Prosthetic Devices
Prosthetic devices are items that replace all or part of an internal body organ or replace all or part of
the function of a permanently inoperative or malfunctioning internal body organ. The test of
permanence is considered met if the medical record, including the judgment of the attending
physician, indicates that the condition is of long and indefinite duration.
Coverage under this benefit includes, but is not limited to, the following:

Breast prostheses
Facial prostheses
Ostomy supplies
Urological supplies in patients with permanent urinary incontinence, and
Glasses or contact lenses in patients with aphakia or pseudophakia
Medically necessary supplies that are required for the effective use of a medically necessary prosthetic
device are covered. Nutrients that are administered through repairs, adjustments and replacement of
medically necessary prosthetic devices are covered.
Refer to individual policies for specific information on definitions and coverage and payment rules.
Dental prostheses (i.e., dentures) are excluded from coverage. Claims for internal prostheses (e.g.,
intraoral devices, intraocular lenses, joint implants, etc.) are not processed by the DME MAC.
Braces (Orthoses)
A brace is a rigid or semi-rigid device, which is used for the purpose of supporting a weak or deformed
body member, or restricting or eliminating motion in a diseased or injured part of the body.
Medically necessary repairs and replacement of medically necessary braces are covered.
DENIAL CATEGORIES
The Medicare program provides coverage for a wide range of services that improve the health of the
elderly and disabled. Medicare, however, does not cover every service that is related to the health
care of its beneficiaries. Coverage and exclusion of services are defined in the Act, which in turn are
implemented through federal regulations, Medicare manuals, instructions from the Centers for
Medicare & Medicaid Services (CMS) and decisions by the individual DME MACs that administer the
Medicare program in each jurisdiction.
3
[MARCH 2008]
This section provides an overview of the denial categories for services billed to Medicare. It is
important to understand the basic concepts for proper submission and to understand supplier and
beneficiary liability issues. The Medicare program is complex and there are occasional exceptions to
some of the statements made below. Special coverage guidelines are published in the individual
medical policies, which can be found on the National Government Services Web site at
www.adminastar.com/Providers/DMERC/MedicalPolicy/MedicalPolicy.cfm and the quarterly Jurisdiction
B Connections.
Section 1861(s) of the Act defines the medical and other health services that are covered by Medicare.
Services that are not included in the benefit category definitions are considered benefit category
denials. While these services are often reasonable and important health care services, they are just
not included in the benefit package specified by the law.
Examples (not all-inclusive) of items in this category include:
1) Disposable supplies other than surgical dressings or supplies required for the effective use of
DME or prosthetic devices
2) Equipment that does not serve an exclusively medically therapeutic function
3) Most oral and injectable medications
Note: Denials for this reason are described by the term “noncovered” in the Medical Policy Information chapter.
Medical Necessity Denials
Section 1862(a)(1) of the Act excludes 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.” CMS issues national coverage determinations (NCDs) that are binding on all Medicare carrier
jurisdictions. In addition, the DME MAC has the authority and responsibility to make medical necessity
determinations on all aspects of medical practice not defined nationally.
Services that are considered investigational or experimental are denied under this exclusion. Preventative
services are excluded from coverage under this section of the Act because they do not diagnose or treat
an established condition (not because they are inherently unreasonable or unnecessary).
Note: Denials under this provision of the law are described by the term “not medically necessary” in the
Medical Policy Information chapter.
Other Statutory Exclusion Denials
Sections 1862(a)(2)–1862(a)(16) of the Act list other categories of services that are excluded from
coverage by Medicare. Those that may be related to durable medical equipment, prosthetics,
orthotics, and supplies (DMEPOS) items are as follows:
A) Routine services and appliances (Section 1862[a][7]). Some examples of items excluded from
coverage under this section are:
1) Eyeglasses and contact lenses except in those patients who have had cataract extraction or
have had their lens removed for other indications
2) Hearing aids
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[MARCH 2008]
B) Orthopedic shoes or other supportive devices for the feet. An exception is a shoe that is an
integral part of a leg brace. Another exception is a special shoe and inserts used for the
prevention or management of foot ulcers in diabetics.
C) Personal comfort items.
D) Services received outside of the United States.
E) Services for which another government program is primary (e.g., Veteran’s Administration).
F) Services provided to an immediate relative or members of the household.
G) Services relating to war injuries received after the beneficiary is eligible for Medicare coverage.
H) Services for which the beneficiary has no legal obligation to pay.
I) Services paid under Workers’ Compensation.
Note: Denials for these reasons are described as “noncovered” in the Medical Policy Information chapter.
Fragmented Coding
The Medicare allowance for an individual Healthcare Common Procedure Coding System (HCPCS) code
often includes several component items. An individual HCPCS code will be denied if it is determined that
the item described by that code is included in the allowance for another code that has also been billed.
In this case, even though the item provided may be covered—the payment for the code is being denied.
Note: Denials for this reason will be described as “not separately payable” in the Medical Policy chapter.
Other Denials
Duplicate Claims
If a claim is received for a service that has been previously processed, and a Medicare allowed amount
has been established, the second claim will be denied as a duplicate.
Incomplete Claims
Suppliers are required to submit completed CMS-1500 claim forms, or the most current version of
American National Standards Institute (ANSI) and/or National Council for Prescription Drug Programs
(NCPDP) electronic formats, for items provided to Medicare beneficiaries. Claims lacking beneficiary
information, diagnosis coding (where necessary), procedure coding, ordering physician’s name and
National Provider Identifier (NPI) or billing supplier information will be denied as incomplete claims.
However, these claims will be considered for payment when the missing information is supplied.
Reduction to the Least Costly Alternative
In certain circumstances, the DME MAC may determine that the item that was provided and billed
contains either deluxe features or a feature of a medical nature not required by the patient’s condition.
If there is a medically appropriate alternative item that is less costly than the item furnished, the
amount paid will be based on the allowance for the item that meets the patient’s medical needs. This
will result in a payment reduction rather than a complete denial.
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[MARCH 2008]
PREVENTION OF COMMON CLAIM SUBMISSION
ERRORS
The following chart identifies the most common claim submission errors, as well as helpful tips on how to
decrease the number of errors. Note that suppliers should always refer to their remittance advice to
determine the ANSI code assigned to the service line. ANSI codes are used to convey appeals information
and other claim-specific information, providing additional explanation for claim-level adjustments.
ANSI Code
CO-18
CO-151
OA-109
CO-16
CO-176
CO-173
PR-13
CO-22
PR-31
PR-27
Category
Duplicate claim
Payment denied/reduced because the payer deems the information submitted does
not support this level of service, this many services, this length of service, this
dosage, or this day’s supply.
Claim not covered by this payer/contractor. You must send the claim to the correct
payer/contractor.
Claim/service lacks information which is needed for adjudication.
Payment denied because the prescription is not current.
Payment adjusted because this service was not prescribed by a physician.
The date of death precedes the date of service.
Payment adjusted because this care may be covered by another payer per
coordination of benefits.
Claim denied as patient cannot be identified as our insured.
Expenses incurred after coverage terminated.
Denial Type
Duplicate
Same/similar
Jurisdiction
Return/Reject
Return/Reject
Return/Reject
Eligibility
MSP
Eligibility
Eligibility
ANSI Reason Code CO-18
Definition: Duplicate claims
Prevention Tips: The Jurisdiction B DME MAC receives a large quantity of claims that result in
duplicate denials. The duplicate claim submission is the number one claims submission error.
Generally, claim submission errors are services/items previously processed for the same patient, date
of service and/or HCPCS code.
Suppliers are reminded to allow 14 days for electronically submitted claims and 29 days for hard-copy
claims before resubmitting a claim to the DME MAC. Suppliers should utilize the Claim Status Inquiry (CSI)
or Interactive Voice Response (IVR) Unit at 877-299-7900 before resubmitting the claim for payment.
If a supplier has documentation to support that the services are not actual duplicate services, but
rather, medically necessary services that are in addition to the services submitted on the initial claim
and should be paid by Medicare, the supplier may submit an appeal request along with documentation
to support medical necessity. If the reason for denial was due to a minor error or omission, the
supplier may use the reopening process rather than filing an appeal. Refer to Chapter 19 of the
Jurisdiction B DME MAC Supplier Manual for reopening criteria.
Definition: Payment denied/reduced because the payer deems the information submitted does not
support this level of service, this many services, this length of service, this dosage, or this day’s supply.
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[MARCH 2008]
Prevention Tips: Suppliers should determine the patient’s history during the intake process to
determine if same or similar equipment was previously obtained. As an additional resource for this
information, suppliers may utilize the IVR Unit to obtain same/similar information.
If a claim denies because the patient has previously received same/similar equipment and the supplier
was unaware of the previous purchase, the supplier should refund the beneficiary or exercise his/her
appeal rights and request a redetermination. Redetermination requests should be submitted to the
following address:
Redeterminations
P.O. Box 6036
ANSI Reason Code OA-109
Definition: Claim not covered by this payer/contractor. You must send the claim to the correct
payer/contractor.
Prevention Tips: National Government Services is the Jurisdiction B DME MAC that processes
DMEPOS claims for the states of Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio, and Wisconsin.
DMEPOS jurisdiction is based on the beneficiaries address on file with the Social Security
Administration. Claims submitted to an incorrect DME MAC jurisdiction will receive this type of denial.
Suppliers should verify that the address you are using on the claim for the beneficiary is the same
address on file with Social Security Administration (SSA). This will help to ensure claims are sent to the
correct DME MAC jurisdiction for processing. Claims received at the Jurisdiction B DME MAC via
electronic submission for a beneficiary who resides in another Jurisdiction, will be automatically
transferred to the appropriate DME MAC based on the beneficiary’s address submitted on the
claim. A transferred claim will not be processed by the DME MAC Jurisdiction that received the
transferred claim, unless the supplier has a signed EDI enrollment form on file with that Jurisdiction.
Claims received at the Jurisdiction B DME MAC via electronic submission for a beneficiary who resides
in Jurisdiction B, will enter the processing system once accepted on the front end. If within the
processing system, it is determined that the address is incorrect and the beneficiary actually resides
outside of Jurisdiction B, the claims will be denied with this type of denial.
1st Example: An electronic claim is submitted to Jurisdiction B for John Doe in Virginia (VA). John
Doe’s address with SSA is Florida (FL). The claim passes the front-end and enters the processing
system. Since John Doe's address with SSA is FL, the claim will be denied with OA-109. The supplier
may resubmit the claim with the correct address of FL to Jurisdiction B. When the electronic claim is
submitted with the FL address to Jurisdiction B, it will be transferred to Jurisdiction C. The supplier will
need to have an EDI enrollment form on file with Jurisdiction C for them to accept that claim
electronically. Suppliers may also choose to bill that claim directly to Jurisdiction C, since the
beneficiary resides in that Jurisdiction.
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[MARCH 2008]
2nd Example: An electronic claim submitted to Jurisdiction B for John Doe in Florida (FL). John Doe's
address with SSA is FL. The electronic claim will be automatically transferred to Jurisdiction C and will
not enter the Jurisdiction B processing system. The supplier will need to have an EDI enrollment form
on file with Jurisdiction C for them to accept that claim electronically. Suppliers may also choose to bill
that claim directly to Jurisdiction C, since the beneficiary resides in that Jurisdiction.
Definition: Claim/service lacks information which is needed for adjudication.
Prevention Tips: Claims were submitted to the Jurisdiction B DME MAC that contained incomplete or
invalid information and cannot be processed as submitted. Refer to the Remark Code (REM) located
on the far-left side of the standard paper remittance (SPR) advice. The REM advises what information
is missing or incomplete on the claim. Resubmit a new claim with the missing/incomplete information.
Definition: Payment denied because the prescription is not current.
Prevention Tips: The Jurisdiction B DME MAC encourages suppliers to review the medical policies to
verify whether or not an initial, revised or recertification Certificate of Medical Necessity (CMN) is
required. When submitting claims that require a CMN, suppliers should ensure that all sections of the
CMN are completed prior to claim submission to the DME MAC. Suppliers should submit the CMN with
initial claim only and wait 24–48 hours before submitting any subsequent claims. The medical policies
are located on the National Government Services Web site at
Definition: Payment adjusted because this service was not prescribed by a physician.
Prevention Tips: The Jurisdiction B DME MAC encourages suppliers to review medical policies to
verify whether or not the items or services routinely provided to Medicare beneficiaries require an
initial, revised or recertification CMN. When submitting claims that require a CMN, suppliers should
ensure that all sections of the CMN are completed prior to submitting the claim to the DME MAC.
Suppliers should submit the CMN with the initial claim only and wait 24–48 hours before submitting
any subsequent claims. The medical policies are located on the National Government Services Web
site at www.adminastar.com/Providers/DMERC/MedicalPolicy/MedicalPolicy.cfm.
Definition: The date of death precedes the date of service.
Prevention Tips: Medicare Part B coverage was not valid when the patient received this item and/or
service. This means that expenses were incurred under on of the following circumstances:

After coverage was terminated
Prior to coverage
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[MARCH 2008]

The date of death precedes the date of service, or
Medicare was unable to identify the patient as an insurer
Suppliers should check the patient records for valid coverage dates and for correct patient information
prior to claim submission. Suppliers may resubmit claims denied in error only after the beneficiary’s
record has been updated with the correct information.
Definition: Payment adjusted because this care may be covered by another payer per coordination
of benefits.
Prevention Tips: The Jurisdiction B DME MAC records indicate that Medicare is the secondary payer.
Suppliers must send the claim to the correct payer/contractor first and then submit the claim to
Medicare with a copy of the primary payment notice. When claims are submitted to Medicare as
primary and another insurer is actually the primary payer, claims will be denied and suppliers will
receive the following denial message:
“Our records show that Medicare is your secondary payer. This claim must be sent to your primary
insurer first. Resubmit this claim with a copy of the primary payment notice.”
Suppliers who receive this edit must send the claims to the correct payer/contractor first and then
resubmit the claim to Medicare with a copy of the primary payment notice or the Explanation of
Benefits. If the beneficiary’s record/control file at the Common Working File (CWF) contains incorrect
or outdated payer information, which has caused the claim to deny for the above mentioned reason,
the supplier should advise the beneficiary to contact the Coordination of Benefits Contractor toll free at
800-999-1118 to have their Medicare Secondary Payer control file updated. The supplier should
resubmit the claim only after the payer information on the beneficiary’s record has been updated to
reflect the correct payer information.
ANSI Reason Code PR-31
Definition: Claim denied as patient cannot be identified as our insured.
service. This means that expenses were incurred under on of the following circumstances:

After coverage was terminated
Prior to coverage
The date of death precedes the date of service, or
Medicare was unable to identify the patient as an insurer
Suppliers should check the patient records for valid coverage dates and for correct patient information
prior to claim submission. Suppliers may resubmit claims denied in error, only after the beneficiary’s
record has been updated with the correct information.
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[MARCH 2008]
ANSI Reason Code PR-27
Definition: Expenses incurred after coverage terminated.
service. Expenses incurred after coverage was terminated, prior to coverage, or Medicare was unable
to identify the patient as an insurer. Suppliers should check the patient records for valid coverage
dates and for correct patient information prior to claim submission. Suppliers should utilize the CSI or
the IVR Unit at 877-299-7900 to validate patient eligibility. To find out more about CSI, visit the
National Government Services Web site at www.NGSMedicare.com:

Select
Select
Select
Select
Select
AdminaStar Federal
Providers & Other Partners
Electronic Data Interchange (EDI)
DME MAC Information
Overview of EDI Products and Services
10
Chapter 17: Supplier Remittance Notice
[MARCH 2007]
17 Supplier Remittance Notice
GENERAL INFORMATION
Once a claim has completed processing through the Medicare system, a supplier remittance notice is
generated for all suppliers for all claims, whether they file paper or electronic claims. For those
suppliers that file nonassigned claims, a supplier remittance notice will be sent and the beneficiary will
receive notice of adjudication on nonassigned claims in the form of the Medicare Summary Notice
(MSN). The supplier remittance notice includes a list of all claims paid or denied during a particular
payment period. Included with the supplier remittance notice is the Medicare check for those claims
that are approved for payment.
The standard paper remittance (SPR) notice is the product of the Centers for Medicare & Medicaid
Services’ (CMS) standardization of provider/supplier payment notification. This remittance form was
created to:

Provide a new remittance notice that is uniform in both content and format; and
Ease the transition to the electronic remittance notice media.
As part of the effort to eliminate any variations in the administration of Medicare across the country,
and to furnish a uniform level of information to all providers of health care about the decisions made
on their claims, a standardized set of codes have been created to explain how a claim has been
processed. Under the standard format, only codes approved by the American National Standards
Institute (ANSI) insurance subcommittee, and Medicare-specific supplemental messages approved by
CMS, may be used. ANSI is a nongovernmental association of which CMS is a member.
TIPS FOR READING THE REMITTANCE NOTICE

One claim is listed in each block of the remittance, and is separated from other claims with a line.
Claims are listed in alphabetical order by patient’s last name.
The columnar dollar amount fields for each line of the claim are totaled down and are displayed in
the CLAIM TOTALS fields; these lines cannot be totaled across.
ANSI Group, Reason, Remark and Medicare Outpatient Adjudication (MOA) codes are listed in the
key at the end of the remittance notice.
A TOTALS line that includes all claims on the remittance notice, as well as offsets and other
adjustments, is located at the end of the suppler remittance notice. The net pay field on this line
equals the amount of the check.
Claim Control Numbers
When claims are entered into the Medicare system, they are issued a tracking number known as a
Claim Control Number (CCN) (also referred to as the Internal Control Number [ICN]).
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[MARCH 2007]
The first five digits of the 14-digit ICN/CCN indicate the date (in Julian date format) when Medicare
received the claim. The Julian date is expressed by the first two digits being the year and the next
three digits are the sequential numbering of the days of the year. The CCN/ICN also indicates whether
the claim was submitted on paper or electronically or if it was electronically transferred from another
durable medical equipment Medicare administrative contractor (DME MAC) jurisdiction (6th digit).
Finally, the last digit of the CCN indicates if the claim is an initial claim or an adjusted claim. If the last
digit is 1 or higher, the claim has been adjusted.
ANSI and MOA Codes
Medicare uses codes to explain the determination of a claim. All Medicare contractors are required to
use ANSI codes. The DME MACs also use some Medicare specific codes called MOA codes. Each twodigit ANSI Reason code is preceded by one of the following three, two-letter ANSI group codes:

PR = Patient responsibility; it indicates that the patient is financially responsible for the claim or
claim line
CO = Contractual obligation; it means that the supplier is financially responsible for the claim or
claim line
OA = Other adjustment
The narrative description of each Remark code is given in the Glossary at the end of the supplier
remittance notice.
Note: Effective June 1, 2006, the CMS mandated the discontinuation of SPRs for suppliers that are set up
to receive the electronic remittance advice (ERA). As a result, suppliers receiving the ERA will no longer
receive the SPR 45 days after the ERA activation, and must rely solely on downloading the ERA files. This is
true whether the ERA is received directly or through a billing agent, clearinghouse or other entity
representing the supplier’s company. For more information on the suppression of SPRs, refer to CMS
Medicare Learning Network Matters article MM4376 at
www.cms.hhs.gov/MLNMattersArticles/downloads/MM4376.pdf.
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[MARCH 2007]
SAMPLE REMITTANCE NOTICE
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[MARCH 2007]
REMITTANCE NOTICE KEY
Field
Description
PROVIDER NAME AND ADDRESS
The name and address of the billing
supplier.
PROVIDER NUMBER
The supplier number of the billing supplier
and the number used to process the claims
listed.
PAGE NUMBER
This field lists the current page number and
the total number of pages of the remittance
notice.
DATE
The date the remittance notice was
generated. This date is the same as the
date on the check.
CHECK/EFT #
The number in this field corresponds to the
number on the check (if issued). The EFT #
is the bank tracer number.
STATEMENT #
System generated number for tracking.
PROVIDER BULLETIN
This field is reserved for a general notice
that is published to all suppliers on each
remittance notice.
PERF PROV
The supplier number of the performing
supplier.
SERV DATE
Service date as submitted on the claim. The
lines within each claim are in descending
order by the service date.
POS
Place of Service as billed on the claim.
NOS
Number (or units) of services as billed on
the claim.
PROC
The HCPCS procedure code as submitted on
the claim. If we change the code during
processing, the billed code is listed below
the approved code.
MODS
HCPCS modifiers which were submitted on
the claim.
BILLED
The supplier’s submitted charge.
ALLOWED
The Medicare allowed amount prior to any
deductions or offsets.
DEDUCT
The portion of the Medicare allowed amount
that was applied to the patient's deductible.
Remittance Notice Header:
Individual Claim Summary:
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[MARCH 2007]
Field
COINS
Description
The 20 percent coinsurance (based off the
allowed amount after deductible) which is
due by the patient.
PROV PD
The amount Medicare is paying to the
supplier.
RC-AMT
The Adjustment Reason Code amount.
These amounts are deducted from claim
payment and do not include the deductible
and coinsurance due by the patient. If there
is more than one code, additional
adjustment codes and remarks appear on
the next line.
NAME
The patient’s name on the claim.
HIC
The patient’s Medicare number.
AC
The patient’s account number that has been
assigned by the supplier. This number is
listed when submitted on an electronic
claim.
ICN
Internal Control Number. The CCN assigned
to the claim in Julian date form.
ASG
The assignment value of the claim. “Y”
indicates the claim is assigned, “N” means
the claim is nonassigned.
MOA
Medicare Outpatient Adjudication Remark
code. Up to five codes per line item may
appear. These codes define the processing
action taken on the line item of the claim.
REM
Remark Codes. Additional information
regarding the claim.
PT RESP
Patient responsibility. This column will
include amounts for noncovered services,
deductible and coinsurance.
CLAIM TOTALS
This is the claim total line for each column.
ADJUSTMENTS
Adjustments that are made to the allowed
amount for each individual claim and affect
the total net.
NET
Net amount paid for individual claim.
REMITTANCE TOTALS
The net amount of the supplier’s check. The
net amount is determined by:
Total Remittance Summary:

5
Claim Total Allowed
Amount
Deductible
Coinsurance
Reason Code Amounts
Previous Paid Interest
Other dollar amounts
[MARCH 2007]
Field
ADJS
Description
Adjustments which are made to the allowed
amount and affect the total net. These
include the fields below.
PREV PD
On adjusted claims, this is the amount
previously paid on the original claim.
PD TO PATIENT
Paid to patient. When the patient has paid
the supplier more than the applicable
coinsurance and deductible, that
overpayment is refunded to the patient
from the supplier’s payment.
INT
Interest that has accrued because a clean
claim did not complete processing within 30
days.
MSP
The amount paid by the primary insurer for
Medicare Secondary Payer (MSP) claims.
OTHER
Other adjustments to the supplier’s
payment. These could include a reduction
due to overpayment recovery offset, a
waiver offset, or IRS withholdings.
OFFSET
The Financial Control Number (FCN), Health
Insurance Claim Number (HICN) and dollar
amount regarding offset.
CODES
Detailed information defining the codes.
Glossary:
RESOURCES

CMS Web-based Training: Understanding the Remittance Advice for Professional Providers;
www.cms.hhs.gov/MLNproducts
6
Chapter 18: Medicare Summary Notice
[MARCH 2007]
18 Medicare Summary Notice
A Medicare Summary Notice (MSN) is sent to Medicare beneficiaries for each claim that is processed.
On nonassigned claims, the MSNs are issued as the claims are processed. On assigned claims, the
patient's MSN forms are mailed in 30-day cycles. Even though the supplier may have received
notification of payment, the patient may not have received their MSN. Refer to the sample MSN on the
following pages, as well as the corresponding details of the various numbered fields following the
sample notice.
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[MARCH 2007]
SAMPLE MSN
2
[MARCH 2007]
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[MARCH 2007]
SUMMARY OF NUMBERED FIELDS ON SAMPLE MSN
1) Date: Date the MSN was sent.
2) Customer Service Information: Who to contact with questions about the MSN. Provide your
Medicare number (3), the date of the MSN (1), and the date of the service you have a question
about (7).
3) Medicare Number: The number on your Medicare card.
4) Name and Address: If incorrect, contact the company listed in (2), and the Social Security
Administration immediately.
5) Be Informed: Messages about ways to protect yourself and Medicare from fraud and abuse.
6) Part B Medical Insurance – Assigned Claims: Type of service. See the back of MSN for
information about assignment. (Note: For unassigned services, this section is called “Part B
Medical Insurance – Unassigned Claims.”)
7) Dates of Service: Date service or supply was received. You may use these dates to compare
with the dates shown on the bill you receive from your doctor.
8) Claim Number: Number that identifies this specific claim.
9) Services Provided: Brief description of the service or supply received.
10) Amount Charged: Amount the provider billed Medicare.
11) Medicare Approved: Amount Medicare approves for this service or supply.
12) Medicare Paid Provider: Amount Medicare paid to the provider. (Please Note: For unassigned
services, this column is called “Medicare Paid You.”)
13) You May Be Billed: The total amount the provider may bill you, including deductibles,
coinsurance, and noncovered charges. Medicare supplement (Medigap) policies may pay all or
part of this amount.
14) See Notes Section: If letter appears, refer to (16) for an explanation.
15) Provider’s Name and Address: Doctor (may show clinic, group, and/or referring doctor) or
provider’s name and billing address. The referring doctor’s name may also be shown if the
service was ordered or referred by another doctor. The address shown is the billing address,
which may be different from where you received the services.
16) Notes Section: Explains letters in (14) for more detailed information about your claim.
17) Deductible Information: How much of your yearly deductible you have met.
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[MARCH 2007]
18) General Information: Important Medicare news and information.
19) Appeals Information: How and when to request an appeal.
RESOURCES
The Medicare & You national Medicare handbook provides more information about coverage and other
services. For a free copy, call 1-800-MEDICARE (1-800-633-4227), TTY 877-486-2048.
The “How To Read Your Medicare Summary Notice” booklet is available on the Medicare.gov Web site
at www.medicare.gov/Publications/Pubs/pdf/11055.pdf.
5
Chapter 19: Reopenings and Appeals
[MARCH 2008]
19 Reopenings and Appeals
REOPENINGS FOR MINOR ERRORS AND OMISSIONS
Where the supplier has made a minor error or omission in filing the claim, which in turn causes the
claim to be denied, the supplier should not request a redetermination. In the case where a minor error
or omission is involved, the supplier can request Medicare to reopen the claim so the error or omission
can be corrected, rather than having to go through the appeal process. Suppliers can request a
reopening for minor error or omissions either by telephone or in writing. Suppliers have one year to
request a reopening from the date on the remittance notice.
Examples of minor error or omissions include:

Mathematical or computational mistakes
Inaccurate data entry, or
Denial of claims as duplicates which the supplier believes were incorrectly identified as a duplicate
In situations where a provider, supplier or beneficiary requests a redetermination and the issue
involves a minor error or omission, the durable medical equipment Medicare administrative contractor
(DME MAC) will treat the request as a request for a reopening.
In situations where a provider, supplier, or beneficiary requests a reopening and the issue does not
involve a minor error or omission, the DME MAC will treat the request as a redetermination.
Detailed instructions for submitting requests for reopenings for minor errors or omissions by telephone
or in writing are provided below.
Telephone Requests for Reopenings
The DME MAC telephone reopening number is 317-841-1307.
1) Use the telephone reopening process to resolve minor errors or omissions involving:

units of service;
service dates;
Healthcare Common Procedure Code System (HCPCS) coding;
diagnosis codes and diagnosis reference;
modifiers;
place of service; and
claims incorrectly denied as duplicate charges.
2) Suppliers should wait to call the telephone reopening line until they have received their
Medicare remittance notice. No action can be taken until a final claim determination is issued.
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[MARCH 2008]
3) Suppliers should consult the Jurisdiction B DME MAC Supplier Manual and applicable medical
policy guidelines before contacting the telephone reopening number. Failure to have the
appropriate information available when contacting the telephone reopening line may result in an
unfavorable decision.
4) Questions about the status of a claim or general Medicare payment and coding questions should
not be directed through the telephone reopening line. Suppliers can obtain a claim status report
through the Interactive Voice Response (IVR) Unit or by using Claim Status Inquiry (CSI).
5) The supplier must have the following information available before placing the call for a
telephone reopening:

Their Medicare supplier number
The Medicare Claim Control Number (CCN) and reason for denial
Beneficiary name and Medicare Health Insurance Claim Number (HICN)
Any additional information to support why they believe the decision is not correct. This
includes having the correct procedure code(s), modifier(s), diagnoses, units of service, etc.
All medical information provided to the DME MAC must be documented in the patient’s file and
available to the DME MAC should an audit be required.
If a previous reopening decision has been issued, a redetermination must be made in writing. If a
previous redetermination decision has been issued, a reconsideration must be filed.
To effectively service all suppliers, each call will be limited to three claim issues.
Written Requests for Reopenings
Mail all written reopening requests to the following address:
DME MAC Redeterminations
P.O. Box 6036
Be sure to include the following information with the reopening request:

The beneficiary’s name
The beneficiary’s Medicare HICN
The specific services(s) and/or item(s) for which the reopening is being requested and the specific
date(s) of service, and
The name and signature of the person filing the request
Reopening requests for break in service issues, Certificate of Medical Necessity (CMN) extensions and
other CMN changes are not permitted. These types of requests usually require a supplier to submit or
fax copies of CMNs, delivery and pick-up information and other documentation before a final
determination can be made; therefore, these must also be submitted as a redetermination request.
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[MARCH 2008]
Phone counselors must devote significant time researching claim history and CMN status for these
issues. This process would tie up incoming phone lines and create long waits for other suppliers
attempting to use the telephone reopening lines.
APPEALS
Reference: Centers for Medicare & Medicaid Services (CMS) Internet-Only Manual (IOM) Publication
100-04, Medicare Claims Processing Manual, Chapter 29 at
www.cms.hhs.gov/manuals/downloads/clm104c29.pdf.
Who May File an Appeal
The Medicare program offers suppliers and beneficiaries the right to appeal claim determinations
made by the carrier. The purpose of the appeals process is to ensure the correct adjudication of
claims. Appeals activities conducted by Medicare carriers are governed by the CMS.
Suppliers who provide services to Medicare Part B beneficiaries may appeal an initial claim
reimbursement determination. Beneficiaries also have the right to appeal any claim determination.
Additionally, a beneficiary may name another party to act on his/her behalf (appointed representative)
to file an appeal, including a relative, friend, advocate, attorney, doctor or someone else. If the
beneficiary appoints someone to act for him/her, the beneficiary and his/her appointed representative
must sign, date and send us a statement naming the person acting on his/her behalf.
Appeals Process and Time Limits for Filing Appeal
The Medicare law consists of five possible appeal levels. The appellant must begin at the first level upon
receipt of an initial determination. Each level of appeal, after the initial determination, has procedural
steps that must be taken before the appeal can move to the next level. The following table summarizes
the types of appeal, the order in which appeals must be followed and the filing requirements for each.
Table 1: Summary of Appeal Levels, Filing Requirements and Time Limits
Appeal Level
Redetermination
Reconsideration
Administrative Law
Judge (ALJ) Hearing
Departmental Appeals
Board (DAB) Review
Federal Court
(Judicial) Review
Time Limit for Filing
Request
120 days from the date of receipt
of the initial determination
of the notice of the
redetermination
60 days after the date of receipt
of the reconsideration notice
of the ALJ decision/dismissal
of DAB decision or declination of
review by DAB
Where to File an Appeal
Monetary Threshold
Jurisdiction B DME MAC
Redeterminations
P.O. Box 6036
Qualified Independent Contractor
(QIC)
None
HHS Office of Medicare Hearings
and Appeals (OMHA) field office
Prior to January 1, 2008,
at least $110 remains in
controversy
DAB or ALJ Hearing Office
None
On or after January 1,
2008, at least $120
remains in controversy
None
Prior to January 1, 2008,
at least $1,130 remains
in controversy
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Appeal Level
Request
Where to File an Appeal
Monetary Threshold
On or after January 1,
2008, at least $1,180
remains in controversy
Levels of Appeal
Redeterminations
The first level appeal is referred to as a redetermination. All redeterminations must be completed
within 120 days of receipt.
A party dissatisfied with an initial claim determination may request a redetermination. A redetermination
is a second look at the claim and supporting documentation. If an initial determination on a claim has
not been made, there are no appeal rights on that claim. Suppliers should wait to file a redetermination
until they receive their Medicare remittance notice which provides the claim determination. A
redetermination is a new, independent and critical re-examination of a claim. It is conducted by
re-examining the information in the file and any additional documentation submitted with the request for
a redetermination.
The denial on a duplicate claim line item is not a denial of service. There are no appeal rights on the
duplicate submission. Appeal requests on duplicate claim denials will be treated as inquiries—not as an
appeal. The suppliers must request an appeal on the original denial (i.e., first claim submitted). The
DME MAC will look at the first claim submission to determine whether the request was filed timely.
The supplier may submit a fully completed Jurisdiction B DME MAC Request for Redetermination Form
when requesting a redetermination. If this form is not used, the supplier’s request must contain all the
following information:

The beneficiary’s name
The beneficiary’s Medicare HICN
The specific services(s) and/or item(s) for which the reopening is being requested and the specific
date(s) of service, and
The name and signature of the person filing the request
Incomplete requests will be dismissed with an explanation of the missing information. Suppliers will be
instructed to resubmit the request with all of the missing information.
When filing an appeal, a separate request is not required for each procedure code on the claim. All
requests for a specific beneficiary or claim number can be combined on one request.
Submit redetermination requests to the following address:
Jurisdiction B DME MAC Redeterminations
P.O. Box 6036
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In situations where a provider, supplier or beneficiary requests a redetermination and the issue
involves a minor error or omission, the DME MAC will treat the request as a request for a reopening.
In situations where a provider, supplier, or beneficiary requests a reopening and the issue does not
involve a minor error or omission, the DME MAC will treat the request as a redetermination.
Reconsideration
The second level of appeal is the reconsideration request. Section 1869 of the Social Security Act (the
Act) entitles any individual dissatisfied with the contactor’s redetermination to file a request for
reconsideration. This request must be submitted within 180 days of receipt of the redetermination. In
accordance with Section 1869(c) of the Act, (the item or service has been deemed not reasonable and
necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a
malformed body member) reconsiderations are to be processed within 60 days by entities called
qualified independent contractors (QICs). When a claim is denied on the basis of Section
1862(a)(1)(A) of the Act, the QIC reconsideration will consist of a panel of physicians and other health
professionals. When the panel reviews services or items rendered by a physician or ordered by a
physician, the panel will consist of at least one physician.
The QIC for all Part B durable medical equipment (DME) appeals is RiverTrust Solutions, Inc.
Reconsiderations should be filed to the QIC on the Reconsideration Request Form provided at the end
of this chapter. Reconsideration requests should be mailed to the following address:
RiverTrust Solutions, Inc.
P.O. Box 180208
Chattanooga, Tennessee 37401-7208
The date of filing, for requests submitted in writing, is defined as the date received by the QIC in their
corporate mailroom. If the party has filed the request in person with the QIC, the filing date is the
date of filing at such office, as evidenced by the receiving office’s date stamp on the request. If the
party has mailed the request for reconsideration to CMS, Social Security Administration, Railroad
Retirement Board office or another government agency in good faith within the time limit, and the
request did not reach the appropriate QIC until after the time frame to file a request expired, the QIC
considers good cause for late filing. (See Section 240, Chapter 29 of the CMS Internet-Only Manual
[IOM] Publication 100-04, Medicare Claims Processing Manual for additional information relating to
“good cause.”) Likewise, if the request is filed with CMS, Social Security Administration, Railroad
Retirement Board office or another government agency in person, the QIC considers good cause for
late filing.
Note: Any additional evidence should be submitted with the request for reconsideration and prior to the
reconsideration decision being issued. If all evidence is not submitted prior to the issuance of the
reconsideration decision, the supplier will not be able to submit any new evidence to the administrative
law judge for further appeal unless they can demonstrate good cause for withholding the evidence from
the QIC.
The QIC may extend the period for filing if it finds the appellant had good cause for not requesting the
reconsideration timely. (See Section 240, Chapter 29 of the CMS IOM Publication 100-04, Medicare
Claims Processing Manual for additional information relating to “good cause.”) In order for good cause to
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be considered, the appeal request must be in writing. If the QIC finds that the appellant did not have
good cause for not requesting reconsideration on time, it may, at its discretion, consider reopening.
Note: There is no monetary threshold to be met when filing a reconsideration request to the QIC.
Administrative Law Judge Hearing
The third level of appeal is an administrative law judge (ALJ) hearing. A hearing before an ALJ of the
Social Security Administration may be requested if the appellant is not satisfied with the QIC
determination. The ALJ hearing must be requested in writing within 60 days from the date of the QIC’s
decision. The request must specifically state that an ALJ hearing is desired and the request must be
signed. Suppliers should submit ALJ hearing requests to the following address:
Administrative Law Judge
Office of Medicare Hearing and Appeals – BP Tower
200 Public Square, Suite 1300
Cleveland, Ohio 44114
Note: Prior to January 1st, 2008, there must be at least $110 in controversy. On or after January 1st, 2008,
there must be at least $120 in controversy.
Departmental Appeals Board Review
If an appellant is dissatisfied with the ALJ decision, they may contact CMS directly for an appeals council
review. The appeals council review must be requested within 60 days of the date of the ALJ decision.
Federal Court Review
If an appellant is still dissatisfied with the decision and the amount in controversy exceeds $1130 prior
to January 1st, 2008, or on or after January 1st, 2008 the amount in controversy exceeds $1180, they
may request a hearing before the federal court.
The time limits for filing appeals vary according to the type of appeal and are noted in Table 1. The
time limits for filing a request for redetermination may be extended in certain situations if good cause
for late filing is shown. Some conditions that establish good cause include:
1) Incorrect or incomplete information about the subject claim and/or appeal furnished by official
sources (CMS, the DME MAC or the Social Security Administration) to the individual; and,
2) Unavoidable circumstances that prevented the individual from timely filing a request for
redetermination. Unavoidable circumstances encompass situations that are beyond the
individual’s control, such as major floods, fires, tornados and other natural catastrophes.
Note: Failure of a billing company or other consultant (that the provider, physician or other supplier has
retained) to submit appeals or other information timely does not constitute grounds for finding good cause
for the late filing.
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Appointment of Representative
A person/supplier/physician who files an appeal request on behalf of a beneficiary is not, by virtue of
filing the appeal, a representative. The Medicare beneficiary may appoint any individual, including an
attorney, to act as his/her representative in dealings with Medicare contractors. Although some parties
may pursue a claim or an appeal on their own, others will rely upon the assistance and expertise of
others. A representative may be appointed at any point in the appeals process. A representative may
help the beneficiary during the processing of a claim or claims, and/or any subsequent appeal. (See
the CMS IOM Publication 100-04, Medicare Claims Processing Manual, Chapter 29, Section 270.1.10
for information on disclosing information to third parties.) The appointment of a representative is valid
for one year from the date signed by both the party and the appointed representative.
To act as the beneficiary’s representative, a person/supplier/physician must submit a properly executed
appointment of representative. The following information must be included on an appointment of
representative form or written statement:

The name, address and phone number of the individual.
The individual’s Medicare number when the party making the appointment is the beneficiary.
A specific individual must be named as the representative. An organization or entity may not be
named as the representative, but rather a specific member of that organization or entity must be
named. The representative must sign and date the form and list his/her name, address and phone
number. A statement that he/she accepts the appointment needs to be included.
A statement that the party authorizes the representative to act on her or his behalf for the claims
at issue and a statement authorizing disclosure of individually identifying information to the
representative.
The signature of the party making the appointment and the date signed.
Note: A representative must sign the appointment within 30 calendar days of the party’s signature.
The appointment of representative is valid for one year from either: (1) The date signed by the party
making the appointment, or (2) The date the appointment is accepted by the representative—
whichever is later.
The appointment remains valid for any subsequent levels of appeal on the claim/service in question
unless the beneficiary specifically withdraws the representative’s authority. However, if during an
appeal the appointment of representative expires, a new form is necessary.
A suggested Appointment of Representative Form is located at the end of this chapter.
Documentation in the Appeals Process
The following clarifications are designed to assist suppliers who wish to appeal original claim denials
through the appeals process. Original claim denials are often upheld at the redetermination or
reconsideration level of appeal due to the lack of documentation supporting the medical necessity of
services rendered.
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Before requesting a redetermination or reconsideration, consult the Jurisdiction B DME MAC Supplier
Manual, supplier bulletins and all applicable medical policy and documentation guidelines for each
piece of equipment/supply being appealed. Failure to include all appropriate documentation with the
appeal may result in an unfavorable decision.
The appellant has the responsibility to provide information and/or documentation for supplier
submitted appeals. Decisions at these levels are based exclusively on the information and/or
documentation submitted with the case.
The examples below describe common denial situations presented through the appeals process:
1) Medical necessity of DMEPOS items. Medical necessity is established by copies of medical
records that address the condition of the patient and how the item in question fits into the
treatment plan of the patient. Depending on the item in question, the documentation would
include, for example, some of the following information:
The diagnosis relating to the limitations and or relating to the need for the equipment/supply
Complicating medical conditions
Functional abilities (e.g., ability to ambulate or transfer; the distance that the patient can
walk independently and/or with the assistance of a walker or other ambulatory aid; abilities
of the upper and lower extremities [including tone, range of motion limitations, etc.])
Amount of time in bed, chair or wheelchair
Frequency and type of activities outside the home,
Functional limitation,
Rehabilitation potential (including recent prior functional level)
Duration of the condition,
Description of and response to prior treatment experience with other equipment prognosis,
Physical examination findings, test results, etc.
CMN if required
Note: If a patient can bear weight to transfer from a bed to a chair or wheelchair, the patient is considered
nonambulatory.
2) Individual consideration pricing determinations.
If it is an item, the brand name and model name/number should be given and copies of the
invoice and/or catalogue with prices should be included.
If it is a custom made item, include a detailed description and/or photograph.
If it is a service (e.g., repair, custom item), list the labor time and the major materials used
and their cost.
In addition to the documentation types described above, copies of the doctor’s orders or narrative
explanations by the supplier/physician may assist in clarifying the medical necessity of items/services
provided. Handwritten documentation must be legible to be effective in the appeal process.
3) Same or similar equipment. It is the responsibility of the beneficiary and supplier to
coordinate with all the involved parties to ensure that equipment is only provided when it is
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medically necessary and to determine the equipment provided the patient is not a duplication of
previously obtained equipment.
Note: The following guidelines pertain to claim submission to the Jurisdiction B DME MAC.
If a supplier is billing for a new capped rental period, the code must have modifier KH and an initial
CMN must accompany the claim if a CMN is required for the code. When the DME MAC receives a
claim for a capped rental code that has been previously approved and there has been any interruption
of billing to the DME MAC, the presumption is that there has been no interruption in medical necessity
for the item—unless it is clearly documented. Therefore, if there is a 60-plus day interruption of billing
for a capped rental code (whether or not that code requires a CMN), and the supplier thinks that
starting a new capped rental period is justifiable, narrative documentation must accompany the claim.
The documentation must include, but is not limited to:
1) a pick up slip from other supplier(s);
2) a delivery slip from current supplier; (Note: If pick up and delivery slips are not submitted,
Medicare will continue to allow payment to the other supplier.)
3) a description of the patient’s prior medical condition which necessitated the previous item;
4) a statement explaining when and why the medical necessity for the previous item ended; and
5) a statement explaining the patient’s new or changed medical condition and when the new need
began. (This information must be entered in the NTE [Note] segment of an electronic claim or
attached to a paper claim.
Though suppliers should always try to determine whether a beneficiary has had the same or related
equipment before, there are situations in which a supplier may submit an initial claim for a capped
rental item not knowing that another supplier has previously been approved for the same or related
code. Since in this situation additional narrative documentation justifying the start of a new capped
rental period will not have been sent with the claim, the DME MAC will presume that there has been
no substantial change in the medical necessity for the item.
If coverage criteria for the item are met, the code will be approved, but the modifier will be changed
from KH to KI or KJ as appropriate to indicate that it is being processed and paid as a continuation of
a previous capped rental situation. If the new supplier disagrees with this determination, they can
obtain the information described above and submit the claim as an appeal.
9
Jurisdiction B DME MAC Request for Redetermination Form
Supplier Name: _________________________________________________ Supplier Number: ________________
Supplier Address: __________________________________________________________________________________
Supplier Telephone Number: ________________________________________________________________________
Name of Person Requesting the Redetermination: ______________________________________________________
Type of Claim: (Check one)
___ Diabetic Supplies
___ Eyewear/Lenses/
Frames
___ Ostomy/Urological
___ Oxygen/Nebulizer/
CPAP
___ Suction/Trach Supplies ___ Surgical Dressings
___ Hospital Beds/
Support Surfaces
___ Parenteral/Enteral
___ Infusion Drugs/
Pumps
___ Prosthetics/
Orthotics/Splints
___ Wheelchairs/Seat Lifts/ ___ Other Supplies/
POV
Equipment
Claim Information
Beneﬁciary
Medicare #
Claim
Control #
Service Date(s)
Date of Initial
Determination
Reason for Request
Please be speciﬁc. Describe the service and the action you want Medicare to take. Attach any documentation to
support your request: ________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
___________________________________________________________________________________________________
Supplier Signature: ______________________________________________ Date: ____________________________
Mail Completed Form To: Jurisdiction B DME MAC Redetermination
P.O. Box 6036
Page: 1 of 1
Jurisdiction B DME MAC Reconsideration Request Form
Redetermination/Appeals Number: Instructions
If you wish to appeal the redetermination decision, please complete the information below and mail this form (or a copy of this form) along with a copy of the redetermination decision to the following address: RiverTrust Solutions, Inc. P.O. Box 180208 Chattanooga, Tennessee 37401‐7208 Claim Information
1. Name of beneficiary: _____________________________________________________________________________ 2. Medicare Number:_______________________________________________________________________________ 3. Provider Name: _________________________________________________________________________________ 4. Person appealing the decision: Beneficiary Provider/Supplier Representative of Service 5. Address of the person appealing: __________________________________________________________________ _______________________________________________________________________________________________ 6. Item or service you wish to appeal:_________________________________________________________________ _______________________________________________________________________________________________ 7. Date of service: From: ___________________ To: _____________________ 8. Does this appeal involve an overpayment? Yes No 9. Why do you disagree, or, what are your reasons for your appeal? (Attach additional pages if necessary.) _______________________________________________________________________________________________ _______________________________________________________________________________________________ 10. You may also include any supporting material to assist your appeal. Examples of supporting materials include: Medical records Office records/progress notes Copy of the claim Treatment plan Certificate of Medical Necessity 11. Printed name of person appealing: _________________________________________________________________ 12. Signature of person appealing: ____________________________________________________________________ Contractor Number: _______________________ (This is optional for contractors with only one location for Qualified Independent Contractors to request case files.) National Government Services, Inc. Page: 1 of 1 DEPARTMENT OF HEALTH AND HUMAN SERVICES
CENTERS FOR MEDICARE & MEDICAID SERVICES
Form Approved
OMB no. 09380950
APPOINTMENT OF REPRESENTATIVE
NAME OF BENEFICIARY
MEDICARE NUMBER
SECTION I: APPOINTMENT OF REPRESENTATIVE
To be completed by the beneficiary:
I appoint this individual: ___________________________________ to act as my representative in connection with my
claim or asserted right under Title XVIII of the Social Security Act (the “Act”) and related provisions of Title XI of the
Act. I authorize this individual to make any request; to present or to elicit evidence; to obtain appeals information; and
to receive any notice in connection with my appeal, wholly in my stead. I understand that personal medical information
related to my appeal may be disclosed to the representative indicated below.
SIGNATURE OF BENEFICIARY
DATE
STREET ADDRESS
PHONE NUMBER (AREA CODE)
CITY
STATE
ZIP
SECTION II: ACCEPTANCE OF APPOINTMENT To be completed by the representative:
I, ________________________________, hereby accept the above appointment. I certify that I have not been disqualified,
suspended, or prohibited from practice before the Department of Health and Human Services; that I am not, as a current or
former employee of the United States, disqualified from acting as the beneficiary’s representative; and that I recognize that
any fee may be subject to review and approval by the Secretary.
I am a / an__________________________________________________________________________________________
(PROFESSIONAL STATUS OR RELATIONSHIP TO THE PARTY, E.G. ATTORNEY, RELATIVE, ETC.) SIGNATURE
DATE
STREET ADDRESS
PHONE NUMBER (AREA CODE)
CITY
STATE
ZIP
SECTION III: WAIVER OF FEE FOR REPRESENTATION
Instructions: This form should be filled out if the representative waives a fee for such representation.
(Note that providers or suppliers may not charge a fee for representation and thus, all providers or suppliers that furnished the items or services at issue must complete this section.)
I waive my right to charge and collect a fee for representing __________________________________________________
before the Secretary of the Department of Health and Human Services.
SIGNATURE
DATE
SECTION IV: WAIVER OF PAYMENT FOR ITEMS OR SERVICES AT ISSUE
Instructions: Providers or suppliers that furnished the items or services at issue must complete this
section if the appeal involves a question of liability under section 1879(a)(2) of the Act. (Section 1879(a)(2)
generally addresses whether a provider/supplier or beneficiary did not know, and could not reasonably be expected to
know, that the items or services at issue would not be covered by Medicare.)
I waive my right to collect payment from the beneficiary for furnished items or services at issue involving 1879(a)(2) of the Act.
SIGNATURE
Form CMS1696 (07/05) EF (07/2205)
DATE
CHARGING OF FEES FOR REPRESENTING BENEFICIARIES BEFORE THE SECRETARY OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES
An attorney, or other representative for a beneficiary, who wishes to charge a fee for services rendered in connection
with an appeal before the Department of Health and Human Services (DHHS) at the Administrative Law Judge (ALJ)
or Medicare Appeals Council (MAC) level is required by law to obtain approval of the fee in accordance with 42 CFR
§405.910(f). A claim that has been remanded by a court to the Secretary for further administrative proceedings is considered to be before the Secretary after the remand by the court. The form, “Petition to Obtain Representative Fee” elicits the information required for a fee petition. It should be completed by the representative and filed with DHHS. Where a representative has rendered services in a claim before
DHHS, the regulations require that the amount of the fee to be charged, if any, for services performed before the
Secretary of DHHS be specified. If any fee is to be charged for such services, a petition for approval of that amount
must be submitted. An approval of a fee is not required where the appellant is a provider or supplier or where the fee is for services (1) rendered in an official capacity such as that of legal guardian, committee, or similar courtappointed office and the court
has approved the fee in question; (2) in representing the beneficiary before the federal district court of above, or (3)
in representing the beneficiary in appeals below the ALJ level. If the representative wishes to waive a fee, he or she
may do so. Section III on the front of this form can be used for that purpose. In some instances, as indicated on the
form, the fee must be waived for representation.
AUTHORIZATION OF FEE
The requirement for the approval of fees ensures that representative will receive fair value for the services performed
before DHHS on behalf of a claimant while at the same time giving a measure of security to the beneficiaries. In
approving a requested fee, the ALJ or MAC considers the nature and type of services performed, the complexity of the
case, the level of skill and competence required in rendition of the services, the amount of time spent on the case, the
results achieved, the level of administrative review to which the representative carried the appeal and the amount of the
fee requested by the representative. CONFLICT OF INTEREST
Sections 203, 205 and 207 of Title XVIII of the United States Code make it a criminal offense for certain officers,
employees and former officers and employees of the United States to render certain services in matters affecting the
Government or to aid or assist in the prosecution of claims against the United States. Individuals with a conflict of
interest are excluded from being representatives of beneficiaries before DHHS.
According to the Paperwork Reduction Act of 1995, no persons are required to respond to a collection of information unless it displays a valid OMB control number.
The valid OMB control number for this information collection is 09380950. The time required to prepare and distribute this collection is 15 minutes per notice,
including the time to select the preprinted form, complete it and deliver it to the beneficiary. If you have comments concerning the accuracy of the time estimates or
suggestions for improving this form, please write to CMS, PRA Clearance Officer, 7500 Security Boulevard, Baltimore, Maryland 212441850.
Form CMS1696 (07/05) EF (07/2205)
DEPARTMENT OF HEALTH AND HUMAN SERVICES
OFFICE OF MEDICARE HEARINGS AND APPEALS
REQUEST FOR MEDICARE HEARING BY AN ADMINISTRATIVE LAW JUDGE ❏ Part A
Effective July 1, 2005. For use by party to a reconsideration determination issued by a Qualified Independent Contractor (QIC) ❏ Part B
(Amount in controversy must be $100 or more.)
Send copies of this completed form to:
Original — Office of Medicare Hearings and Appeals Field Office specified in the QIC Reconsideration Notice
Copy — Appellant Copy — All other parties
Failure to send a copy of this completed request to the other parties to the appeal will delay the start date of your appeal.
Did you send all required copies?
❏ Yes ❏ No
Appellant
(The party appealing the reconsideration determination)
Beneficiary
Provider or Supplier
(Leave blank if same as the appellant.)
Address
(Leave blank if same as the appellant.)
Address
City
State
Area Code/Telephone Number
Zip Code
E-mail Address
City
State
Zip Code
E-mail Address
Document control number assigned by the QIC
Health Insurance (Medicare) Claim Number
Dates of Service
From
QIC that made the reconsideration determination
To
I DISAGREE WITH THE DETERMINATION MADE ON MY APPEAL BECAUSE:
____________________________________________________________________________________________________________________
____________________________________________________________________________________________________________________
You have a right to be represented at the hearing. If you are not represented but would like to be, your Office of Medicare Hearings and Appeals
Field Office will give you a list of legal referral and service organizations. (If you are represented and have not already done so, complete form CMS-1696.)
Check
Only One
Statement:
❏
❏
I wish to have a hearing.
I do not wish to have a hearing and I request that a
decision be made on the basis of the evidence in my
case. (Complete form HHS-723, “Waiver of Right to an
ALJ Hearing.”)
Check
Only One
Statement:
❏ I have additional evidence to submit.
❏ I have no additional evidence to submit.
If you have additional evidence to submit, please attach the evidence or attach
a statement explaining what you intend to submit and when you intend to submit
it. If you are a provider, supplier, or beneficiary represented by a provider or supplier,
the evidence must be accompanied by a good cause statement explaining why
the evidence is being submitted for the first time at the ALJ level.
The appellant should complete No. 1 and the representative, if any, should complete No. 2. If a representative is not present to sign, print
his or her name in No. 2. Where applicable, check to indicate if appellant will accompany the representative at the hearing. ❏ Yes ❏ No
1. (Appellant’s Signature)
Date
State
Date
❏ Attorney
❏ Non-Attorney
Address
Address
City
2. (Representative’s Signature/Name)
Zip Code
E-mail Address
City
State
Zip Code
E-mail Address
Answer the following questions that apply:
A) Does request involve multiple claims? (If yes, a list of all the claims must be attached.)
B) Does request involve multiple beneficiaries? (If yes, a list of beneficiaries, their HICNs and the dates of service.)
C) Did the beneficiary assign his or her appeal rights to you as the provider/supplier?
❏ Yes ❏ No
❏ Yes ❏ No
❏ Yes ❏ No
(If yes, you must complete and attach form CMS-20031. Failure to do so will prevent approval of the assignment.)
Must be completed by the provider/supplier if representing the beneficiary:
I waive my rights to charge and collect a fee for representing ________________________________________________before the Office of
(Beneficiary name)
Medicare Hearings and Appeals.
Signature of provider/supplier representing beneficiary
CMS-20034 A/B U3 (08/05) EF 08/2005
ATTACH A COPY OF THE RECONSIDERATION DETERMINATION
(IF AVAILABLE) TO THIS COPY.
Date
Must be completed by the provider/supplier if representing the beneficiary, they furnished the item(s) or services(s) at issue, and the appeal
involves a question of liability under section 1879(a)(2) of the Social Security Act:
I waive my right to collect payment from the beneficiary for the furnished items or services at issue involving 1879(a)(2) of the Social Security Act.
Signature of provider/supplier representing beneficiary
Date
TO BE COMPLETED BY THE OFFICE OF MEDICARE HEARINGS AND APPEALS
Is this request filed timely?
❏ Yes ❏ No
If no, attach appellant’s explanation for delay. If there is no explanation, send a Notice of Late Filing of Request for ALJ Hearing to the
appellant and representative, if applicable, to request such an explanation.
Request received on
Field Office
Employee
Assigned on
Assigned by
Assigned to
Special response case?
❏ Yes ❏ No
If yes, explain why and state the targeted adjudication deadline.
_______________________________________________________________________________________________________________
___________________________________________________________________________________
Interpreter/translator needed (including sign language)
❏ Yes ❏ No
If yes, type needed:
_______________________________________________________________________________________________________________
___________________________________________________________________________________
If appellant not represented, has a list of legal referral and service organizations been provided.
❏ Yes ❏ No
PRIVACY ACT STATEMENT
The legal authority for the collection of information on this form is authorized by the Social Security Act (section 1155 of Title XI and sections
1852(g)(5), 1860D-4(h)(1), 1869(b)(1), and 1876 of Title XVIII). The information provided will be used to further document your appeal.
Submission of the information requested on this form is voluntary, but failure to provide all or any part of the requested information may affect
the determination of your appeal. Information you furnish on this form may be disclosed by the Office of Medicare Hearings and Appeals to
another person or governmental agency only with respect to the Medicare Program and to comply with Federal laws requiring the disclosure of
information or the exchange of information between the Department of Health and Human Services and other agencies.
CMS-20034 A/B U3 (08/05) EF 08/2005
Chapter 20: Overpayments
[MARCH 2008]
20 Overpayments
DME MAC INITIATED DEMAND LETTERS
When it has been determined that a supplier has been overpaid, a refund request will be sent to the
supplier. An initial demand letter (i.e., overpayment letter) is issued and includes:

the
the
the
the
the
patient name;
patient’s Health Insurance Claim number (HICN);
Claim Control Number (CCN);
Document Control Number (DCN); and
reason for the recovery action.
The demand letter will identify the services that triggered the overpayment process. Two items in the
demand letter warrant immediate attention; one is the 11-digit DCN. The supplier must reference the
DCN in any communication with the DME MAC. The DCN is used to track the refund.
A self-addressed envelope is enclosed with this demand letter that contains the code of the Medicare
person handling the request. Use this envelope so that proper action will be taken.
The supplier has 30 days from the date of the demand letter to refund the DME MAC. If the DME MAC
has not received the refund within this 30-day period, interest begins to be added to the refund amount.
A second demand letter is sent between the 30th and 45th day. If full payment is not received by the
40th day from the date of the initial demand letter, the offset process (deducting from the supplier’s
Medicare check) is started. Future payments will be offset until the overpayment is recouped.
If the offset procedure has begun and payment is subsequently received, interest will be deducted, the
amount that had already been applied by offset will be deducted and the balance returned to the supplier.
Note: When the offset is less than $10, the offset is begun on the 40th day. In this case, a second demand
letter is not sent.
THE OFFSET PROCESS
If a refund is not received before the deadline date, an offset begins. Medicare will reduce any future
payments by the amount of the refund. Medicare will also take interest on the overdue amount. The
minimum interest charged is accrued every 30 days on the refund amount. The offset will be reported
to the supplier on the remittance notice by a Financial Control Number (FCN). No other written notices
will be sent. The FCN on the remittance notice will match the DCN on the refund request letter. No
other details identifying the offset will be given on the remittance notice. The offset and interest
charges will continue until the full refund amount is recouped.
Note: The FCN is found in the “Offset Detail” line of the supplier remittance notice.
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[MARCH 2008]
IMMEDIATE OFFSET BY FAX
The Overpayment and Recovery Unit (ORU) has developed an offset form for suppliers to utilize when
an overpayment has been identified and the supplier wishes for the DME MAC to take the money back
via an offset versus sending in the overpayment. This form can also be utilized for voluntary refund
requests. This form must be completed in its entirety and fax to: 317-913-6164. A copy of this offset
form can be found at the end of this chapter, or by accessing the National Government Services Web
site at www.adminastar.com/Providers/DMERC/MedicareManuals/files/OffsetRequestForm.pdf.
Note: If a supplier has requested an immediate offset but there are no claims for the recoupment within
thirty days, interest will be assessed and a second letter will be sent. The collection process will continue
until the full amount is collected.
APPEALING A REFUND
When a refund request is received, the supplier should refund the amount requested and then file an
appeal. This will avoid an offset with interest charges.
If the overpayment letter is dated on or after January 1, 2006, regardless of the dollar amount, the
supplier must submit a redetermination request. The only time the supplier would need to request a
reconsideration, which is the second level of the appeals process, is if the overpayment resulted from
a redetermination request. If the refund resulted from a redetermination request, a reconsideration
must be filed to RiverTrust Solutions, Inc. To contact RiverTrust Solutions, visit their Web site at
www.rivertrustsolutions.com. The following address must be used to submit a reconsideration request:
P.O. Box 180208
The overpayment letter will have detailed instructions on how to file for an appeal.
SUPPLIER VOLUNTARY REFUNDS
All voluntary refunds should be sent to the ORU at National Government Services as soon as
discovered. A voluntary refund form has been developed to simplify the return of refunds, and is
located at the end of this chapter. Even though the refund check involves more than one Medicare
patient, a separate form should be completed for each patient. The form should be copied and
included anytime refunds are made to Medicare.
When submitting a voluntary refund, please make the check payable to National Government Services. If a
provider does not use the suggested Voluntary Refund Form, the following information must be included:

A supplier number
A copy of the supplier remittance
– If no supplier remittance is available, provide the date(s) of service(s) and include the
procedure code(s)
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[MARCH 2008]

Reason for the refund (be specific as to the reason)
Patient’s name and HIC number, i.e., Medicare identification number
Note: Please send all Medicare Secondary Payer (MSP) refund checks and refund correspondence to the
following address and utilize the appropriate MSP refund form located in the Medicare Secondary Payer
chapter of this manual.
Medicare MSP DME MAC
Lockbox #660065
(Refund checks and refund correspondence)
LOST OR MUTILATED CHECKS
When a check is lost, a written request for replacement should be sent to the ORU after 90 days has
elapsed from the date of issue. The ORU will review bank records and upon identification that the
check has not been cashed, they will stop payment and reissue a check. When a check has been
damaged in the mail and cannot be cashed, the check should be returned to the ORU for reissue. The
ORU address is:
ORU—DME MAC—Indiana
Lockbox # 660078
To access an overview of the overpayment process, quarterly tips and forms, visit the ORU page on
the National Government Services Web site at www.adminastar.com/Providers/DMERC/PCU/PCU.htm.
CHANGE OF ADDRESS
When a supplier changes their address, the National Supplier Clearinghouse (NSC) must be notified.
The NSC may be reached at 866-238-9652, or visit their Web site at www.PalmettoGBA.com/NSC.
The NSC will update address files at the DME MAC. If the address file is not updated, cash flow will be
interrupted. Medicare checks will not be forwarded by the post office. Returned checks are voided and
the money placed in escrow. The DME MAC notifies the NSC of the returned check and the NSC,
depending on the situation, will contact the supplier by phone or letter. If the supplier does not
respond to the NSC within 30 days, the supplier’s NSC number is inactivated. No payments will be
issued until the NSC updates the DME MAC records. When the supplier contacts the NSC, the
suspension will be lifted and the supplier must contact Provider Assistance for payment to be reissued
along with the remittance notices.
3
Overpayment Recovery Unit Jurisdiction B DME MAC
Voluntary Refund Form
To Be Completed By Medicare Contractor
Date: ___________________________________________ Contractor Deposit Control #: _____________________________________________
Date of Deposit: _________________________________ Contractor Contact Name: _________________________________________________
Phone #: ________________________________________ Contractor Fax: ___________________________________________________________
Contractor Address: __________________________________________________________________________________________________________
To Be Completed By Provider/Physician/Supplier, Or Other Entity
Please complete and forward to your Medicare contractor. This form, or a similar document containing the following information, should accompany every unsolicited/voluntary refund so that receipt of check is properly recorded and applied. Physician/Supplier or Other Entity Name: _____________________________________________________________________________________
Address: ____________________________________________________________________________________________________________________
Provider/Physician/Supplier # or NPI #: ____________________________ Tax ID #: _________________________________________________
Contact Person: __________________________________________________ Phone #: _________________________________________________
Amount of Check $: __________________________ Check #: _________________________ Check Date: ______________________________
Refund Information
For each claim, provide the following: Patient Name: ___________________________________________________ HICN: ___________________________________________________ Date of Service: __________________________________________________ Medicare Claim Number: __________________________________ Claim Amount Refunded $: _______________________________________ Reason Code for Claim Adjustment: _______________________________ (Reason codes are listed below. Use one reason per claim.) (Please list all claim numbers involved. Attach separate sheet, if necessary) Note: If specific patient/Health Insurance Claim (HIC)/claim #/claim amount data not available for all claims due to statistical sampling, please indicate methodology and formula used to determine amount and reason for overpayment:____________________________________________ Note: If specific patient/HIC/claim # information is not provided, no appeal rights can be afforded with respect to this refund. Providers/physicians/suppliers, and other entities who are submitting a refund under the Office of the Inspector General’s (OIG’s) Self‐Disclosure Protocol are not afforded appeal rights as stated in the signed agreement presented by the OIG. For Institutional Facilities Only: Cost report year(s): _________________________________ (If multiple cost report years are involved, provide a breakdown by amount and corresponding cost report year.) For OIG Reporting Requirements
Do you have a Corporate Integrity Agreement with OIG? Are you a participant in the OIG Self‐Disclosure Protocol? Reason Codes
Billing/Clerical: 01 – Corrected date of service 02 – Duplicate 03 – Corrected CPT code 04 – Not our patient(s) 05 – Modifier add/remove 06 – Billed in error Mail Completed Form To
Yes Yes No No MSP/Other Payer Involvement: 07 – MSP group health plan insurance 08 – MSP no‐fault insurance 09 – MSP liability insurance 10 – MSP, Workers’ Comp. (including Black Lung) 11 – Veterans Administration Miscellaneous: 12 – Insufficient documentation 13 – Patient enrolled in HMO 14 – Services not rendered 15 – Medical necessity 16 – Other; be specific: ___________ _______________________________ National Government Services, Inc. Jurisdiction B DME MAC P.O. Box 660078 Indianapolis, Indiana 46266‐0078 National Government Services, Inc. Page: 1 of 1 Form #: Overpayment Recovery Unit Jurisdiction B DME MAC
Offset Request Form
Instructions
This form should be used to initiate a request for immediate offset of an overpayment. There are two types of overpayments: (1) Demanded (i.e., Medicare identified), and (2) Voluntary (i.e., provider identified). Please fill out the appropriate section in its entirety and fax the completed form to (317) 913‐6164. Type of Refund
Medicare identified—Section I (demand letter has been received) Provider identified—Section II (no letter has been received) I. Complete This Section for Medicare Identified Refunds
Date of Request: _______________________________Amount of Overpayment $:____________________________ Claim Control Number: ________________________Accounts Receivable (AR) Number: ____________________ Notes: • All of the above information can be found on the Medicare demand letter. • Please make sure you attach a copy of the first page of the original demand letter. II. Complete This Section for Provider Identified Refunds
Date of Service:________________________________Beneficiary HICN:____________________________________ Claim Control Number: ________________________Amount of Overpayment $:____________________________ Specific Reason for Refund: _________________________________________________________________________ Notes: • All of the information in the section above is required to ensure proper processing. • Please make sure you attach a completed copy of the Voluntary Refund Form for each request. This form can be found on the National Government Services Web site at www.NGSMedicare.com. • A demand letter will be generated once this request has been fulfilled. You may disregard that letter. Provider Information (Required)
Name: ________________________________________________ Provider #:__________________________________ Address: ______________________________________________ NPI #: ______________________________________ City/State/Zip:______________________________________________________________________________________ Contact Name: ________________________________________ Phone #: ____________________________________ Signature of Requestor: _____________________________________________________________________________ National Government Services, Inc. Page: 1 of 1 Form #: Jurisdiction B DME MAC Supplier Manual
Chapter 21: Customer Care
[MARCH 2008]
21 Customer Care
Suppliers with questions regarding claim filing, status, or general Medicare inquiries may contact the
Jurisdiction B Durable Medical Equipment Medicare Administrative Contractor (DME MAC) either by
telephone or in writing.
INTERACTIVE VOICE RESPONSE SYSTEM
The Jurisdiction B DME MAC Customer Care Department telecommunications system is equipped with
an Interactive Voice Response (IVR) system. The IVR system enables the supplier to obtain
information by pressing various numbers on their touch-tone telephone. Suppliers can obtain the
following information from the IVR unit:

Claim status
Last three checks issued or checks issued by date
Check beneficiary eligibility
Claim offset information
Voluntary refund status
Appeal rights information and appeal status
Obtain Certificate of Medical Necessity (CMN) information located in the Common Working File (CWF)
Healthcare Common Procedure Coding System (HCPCS) pricing information
The Jurisdiction B DME MAC Customer Care IVR system is available from 6:00 a.m.–7:00 p.m. Eastern
Time (ET), Monday through Friday, and 7:00 a.m.–3:00 p.m. ET most Saturdays. However, The IVR
unit is not available during system upgrades or routine maintenance. The IVR can be accessed toll free
at 877-299-7900. An IVR guide is located on the National Government Services Web site at
www.adminastar.com/AboutUs/ContactUs/Telephone/IVR/DMERCProvider.html.
CUSTOMER CARE CONTACT CENTER
The Customer Care Contact Center is available to assist suppliers with questions they may have
concerning billing, coverage, benefits, claims, etc., for their Medicare patients. The telephone unit is a
resource for those urgent matters which need an immediate response, those easily and quickly
answered questions, or for the problems that are too complicated to write. Every attempt is made to
service as many suppliers as possible each day. Therefore, the number of inquiries made by phone is
limited to three per call so that the telephone lines are not tied up taking lists of questions.
Each time a telephone or written inquiry is made to the Jurisdiction B DME MAC Customer Care
Contact Center, the supplier, provider, clearinghouse, billing agency, etc., is required to meet the
authenticating elements outlined in the Disclosure Desk Reference. This process helps to protect the
privacy of Medicare beneficiaries, and ensures that any protected health information (PHI) is disclosed
to providers only when appropriate.
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[MARCH 2008]
Note: For a complete outline of the authenticating elements, please refer to the Centers for Medicare &
Medicaid Services (CMS) Internet-Only Manual (IOM) Publication 100-09, Medicare Contractor Beneficiary
and Provider Communications Manual, Chapter 6, Sections 80–80.5.
The Customer Care Contact Center is available from 8:30 a.m.–5:30 p.m. ET, Monday through Friday.
The toll-free number for the contact center is 866-590-6727.
The Customer Care Contact Center is closed on the following holidays:

New Year’s Day
Martin Luther King, Jr. Day
Memorial Day
Independence Day
Labor Day
Thanksgiving Day and the day after Thanksgiving, and
Christmas Day
The Customer Care Contact Center may also be closed on the following legal holidays: Columbus
Day and Veteran’s Day.
In order to ensure customer care representatives (CCRs) are fully informed on the most recent
Medicare regulations and changes, and to better serve the supplier, CMS allows Medicare contractors
to close for training purposes for up to eight hours per month. After careful review of the supplier
Customer Care call inquiry logs, National Government Services has determined the best time to close
for training is Friday mornings from 9:00–11:00 a.m. ET, or 8:00–10:00 a.m. Central Time (CT).
Therefore, CCRs will not be available during this time frame each week. However, the IVR unit will
remain operational to provide suppliers with information that does not require CCR assistance.
National Government Services will advise suppliers via the Web site, Listserv message and IVR unit of
any changes to this schedule. Suppliers are encouraged to plan their business needs accordingly.
A calendar listing the most current dates of these closures will be posted monthly to the “What’s New”
page on the National Government Services Web site, and a Listserv message will be sent advising of
these dates. The “What’s New” page of the National Government Services Web site can be found at
www.adminastar.com/News/DMERCNews/DMERCNews.cfm.
TELEPHONE INQUIRIES
As a result of CMS Change Request 3376—and in an effort to continually improve the customer service
provided to the supplier community—the Jurisdiction B DME MAC Customer Care Contact Center uses
a three-tiered system for answering supplier telephone inquiries. This new system allows questions
received from suppliers to be answered as quickly and accurately as possible. Calls are now answered
by Level 1 and 2 CCRs and by the provider relations research specialist (PRRS).
All telephone inquiries will initially be answered by a Level 1 CCR. The Level 1 CCR can assist the
supplier with a wide range of basic questions, primarily:
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[MARCH 2008]

inquiries that cannot be answered by the IVR unit;
inquiries that do not require substantial research; and
inquiries that can easily can be answered during the initial call.
Level 1 CCRs will assist callers with the following types of inquiries:

CMS-1500 claim form completion
IVR unit education (i.e., claim status, beneficiary eligibility, Certificate of Medical Necessity [CMN]
information)
Basic policy questions (Jurisdiction B DME MAC Supplier Manual, bulletins, reference guides)
Basic letter questions (Additional Documentation Request [ADR], appeals, Overpayment and
Recovery Unit, Medicare Secondary Payer [MSP])
Web site navigation (www.cms.gov, www.NGSMedicare.com)
Provider eligibility
Pricing and fee schedules
Basic claim research, including:
– Return/rejects
– Beneficiary eligibility
– Duplicate denials
– Verifying hospice and home health claims through the CWF
– Additional Documentation Request questions
– Modifier requirements
– Health maintenance organization involvement
– MSP involvement
– Medical necessity
– Procedure code versus modifier
– Place of service versus provider
– Bundling
– Noncovered services
– End-stage renal disease research through the CWF
– Crossover claims
– Ordering duplicate remittance notices
– Basic appeals research
– Basic fraud and abuse research
– Basic financial research (paid, mutilated, stop-pay)
– Patient responsibility, and
– Electronic medial claim submission
Depending on the nature of the issue, calls may be referred to a Level 2 CCR. If the Level 2 CCR is not
able to resolve the issue immediately, they have ten business days from the day the inquiry is referred
from Level 1 to respond. Level 2 CCRs provide additional experience and expertise, enabling them to
answer more complex claim and CMN inquiries and in-depth financial and policy research.
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[MARCH 2008]
Level 2 CCRs will assist callers with the following types of inquiries:

Call backs from Level 1 inquiries
Research complex denials (denials that are missing action codes, denials that have complex
medical policy involvement, denials that have unclear audits/edits)
Financial issues including research offsets, research returned checks, withholdings, research
refund requests (locating the Health Insurance Claim number [HICN] and beneficiary name,
locating the date of service involved, explain why a refund is being requested), etc.
Complex CMN issues
Complex payments and/or denials
Policy information
After the resources available in Level 1 and Level 2 have been exhausted, callers will be referred to
Level 3 of the process, which is the PRRS. The PRRS has 45 business days from the day the inquiry is
referred from Level 2 to respond, and will handle issues that require additional time and a higher
degree of expertise and/or research.
Some of the inquiries that a PRRS will assist callers with include:

Complex policy research
Jurisdiction B DME MAC supplier e-mails and questions sent via the Web site
Web site navigation
Listserv article clarification (i.e., National Government Services, Medicare Learning Network [MLN]
Matters articles, CMS and DME MAC specific)
WRITTEN INQUIRIES
When submitting an inquiry in writing, please be sure to include the following information:
1)
2)
3)
4)
5)
6)
7)
Beneficiary’s name
Medicare HICN
Service date(s)
Service/supply rendered
Charges for the supply/service
Outline of the problem or questions (be specific)
Copy of the original remittance, if applicable
Written inquires should be mailed to the following address:
Jurisdiction B DME MAC Correspondence
P.O. Box 6036
Note: Please see the Appeals chapter for Medicare Redetermination requests.
4
Chapter 22: Resources
[MARCH 2008]
22 Resources
JURISDICTION B DME MAC CONTACT INFORMATION
Administrative Law Judge
Office of Medicare Hearing and Appeals–BP Tower
200 Public Square, Suite 1300
Cleveland, Ohio 44114
(refund checks and refund correspondence)
Medicare MSP DME MAC
Lockbox #660065
Beneficiary Help Line
1-800-MEDICARE
(1-800-633-4227)
(correspondence only)
P.O. Box 6036
TDD Line for Hearing Impaired:
317-841-4677
Electronic Data Interchange
877- 273-4334
8:00 a.m.–4:00 p.m. Eastern Standard Time (ET) M−F
8:00 a.m.–6:00 p.m. ET for password reset calls only
Advanced Determination of Medicare Coverage
Attn: Medical Review—ADMC
P.O. Box 6036
E-Commerce:
Fax: 317-595-4759
Helpdesk:
804-746-7082 (Lisa Hare)
414-774-4556 (Pat Graham)
Written Correspondence
P.O. Box 6036
Reconsiderations
(For reconsiderations on or after December 1, 2006)
P.O. Box 180208
For overnight deliveries:
801 Pine Street
Chattanooga, Tennessee 37402
Redeterminations
P.O. Box 6036
Fraud and Abuse
TriCenturion
P.O. Box 100282
803-264-7700
Refunds
Overpayment Recovery Unit
ORU—DME MAC—Indiana
Lockbox #660078
National Government Services, Inc. Web Site
www.NGSMedicare.com
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[MARCH 2008]
Freedom of Information (FOI)
P.O. Box 50454
Customer Care Contact Center
866-590-6727
8:30 a.m.–5:30 p.m. ET
Telephone Reopenings
317-841-1307
8:00 a.m.–4:00 p.m. ET
Interactive Voice Response (IVR) Unit
877-299-7900
6:00 a.m.–7:00 p.m. ET
Coordination of Benefits
Medicare—Coordination of Benefits
P.O. Box 5041
New York, New York 10274-5041
1-800-999-1118
Claim Filing Addresses:
All DMEPOS Claims
P.O. Box 7027
DMEPOS Additional Documentation Requests (ADRs)
P.O. Box 7027
Additional Resources:
National Supplier Clearinghouse (NSC)
Palmetto GBA
AG-495
P.O. Box 100142
Jurisdiction A
National Heritage Insurance Company
75 Sgt. William Terry Drive
Hingham, Massachusetts 02043
866-419-9458
8:00 a.m.–4:00 p.m. ET, M–F
www.medicarenhic.com
866-238-9652
8:00 a.m.–8:00 p.m. ET
www.PalmettoGBA.com/NSC.
Jurisdiction C
CIGNA Government Services
P.O. Box 20010
Nashville, Tennessee 37202
Jurisdiction D
Noridian Administrative Services
901 40th Street South; Suite 1
Fargo, North Dakota 58103
866-270-4909
9:00 a.m.–5:00 p.m. ET
www.cignagovernmentservices.com
866-243-7272
8:00 a.m.–5:30 p.m. Central Standard Time (CT)
www.noridianmedicare.com
Federal Black Lung Claims
CSC Correspondence Unit
P.O. Box 740
Lanham, Maryland 20706
Office of Investigation
Department of Health and Human Services
Office of Inspector General
105 West Adams
Chicago, Illinois 60603
U.S. Government Printing Office
Superintendent of Documents
Rail Road Retirement Board
800-808-0772
(choose option 5 for local information)
To order claim forms call:
202-512-1800
8:00 a.m.–4:30 p.m. ET
2
[MARCH 2008]
JURISDICTION B DME MAC FORMS INDEX
Supplier
Manual
Reference
Online Link
CMS-R-131-6
Advance
Beneficiary
Notice
Chapter 9
www.cms.hhs.gov/BNI/Downloads/CMSR131G.pdf
Advanced
Determination of
Medicare Coverage
Request Form
Chapter 8
http://www.adminastar.com/Providers/DMERC/Forms/files/ADMCForm.pdf
Certificate of
Medical
Necessity Forms
Chapter 6
www.adminastar.com/Providers/DMERC/Forms/cmns.htm
CMS-1500
Claim Form
Chapter 11
www.cms.hhs.gov/cmsforms/downloads/CMS1500805.pdf
CMS-382 ESRD
Beneficiary
Selection Form
Chapter 14
www.adminastar.com/Providers/DMERC/MedicareManuals/files/CMS382ESRDBeneSelectionForm.pdf
Order Form for
Region B/
Jurisdiction B
Supplier
Publications
Not
Applicable
www.adminastar.com/Providers/DMERC/MedicareManuals/files/september2006OrderForm.pdf
Medicare
Redetermination
Request Form
Chapter 19
www.adminastar.com/Providers/DMERC/Forms/files/Redetermination%20Form.pdf
Medicare
Reconsideration
Request Form
Chapter 19
www.adminastar.com/Providers/DMERC/Forms/files/Reconsideration%20Form.pdf
CMS-20034
Request for
Medicare
Hearing by An
Administrative
Law Judge
Chapter 19
www.adminastar.com/Providers/DMERC/MedicareManuals/files/ALJRequestForm.pdf
CMS-1696
Appointment of
Representative
Sample Form
Chapter 19
www.cms.hhs.gov/cmsforms/downloads/cms1696.pdf
Form Name
3
[MARCH 2008]
Supplier
Manual
Reference
Online Link
ORU Voluntary
Refund Form
Chapter 20
www.adminastar.com/Providers/DMERC/Forms/files/PCU_Voluntary%20Refund%20Form.pdf
ORU Offset
Request Form
Chapter 20
www.adminastar.com/Providers/DMERC/Forms/files/PCU_Offset%20Request%20Form.pdf
Medicare
Secondary
Payer Voluntary
Refund Form
Chapter 4
www.adminastar.com/Providers/DMERC/MedicareManuals/files/MSPvoluntaryrefundform.pdf
Medicare
Secondary
Payer Offset
Request Form
Chapter 4
www.adminastar.com/Providers/DMERC/MedicareManuals/files/MSPOffsetbyfaxform.pdf
CMS-855S
Medicare
Enrollment
Application
Form
Not
Applicable
www.cms.hhs.gov/cmsforms/downloads/cms855s.pdf
CMS-533
Electronic Funds
Transfer Form
Not
Applicable
www.cms.hhs.gov/cmsforms/downloads/CMS588.pdf
Documentation
Inventory Form
Not
Applicable
www.adminastar.com/Providers/DMERC/Forms/files/JurisdictionBCMSDIF.pdf
Form Name
4
[MARCH 2008]
ACRONYMS
AARP
ADMC
ADP
ADR
ALJ
AMA
ANSI
AOB
ASCA
ASP
AWP
BBA
BBRA
BIPA
CCN
CERT
CMN
CMR
CMS
CMS-1500
CMS-1696
CMS-20034
CMS-382
CMS-5011B
CMS-533
CMS-855S
CMS-R-131-6
CO
COB
CPT
CPT-4
CFR
CSI
CWF
DAB
DCN
DIF
DME
DME MAC
DMEPOS
DMERC
DO
DOJ
DOS
American Association of Retired Persons
Advanced Determination of Medicare Coverage
Automated data processing
Additional documentation request
Administrative law judge
American Medical Association
American National Standards Institute
Assignment of benefits
Administrative Simplification Compliance Act
Average sales price
Average wholesale price
Balanced Budget Act of 1997
Balanced Budget Refinement Act of 1999
Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act of 2000
Claim Control Number
Comprehensive Error Rate Testing
Certificate of Medical Necessity
Comprehensive medical review
Centers for Medicare & Medicaid Services
Health insurance claim form
Appointment of Representative Form
Request for Part B Medicare Hearing By an Administrative Law Judge
ESRD Beneficiary Selection Form
Request for Part B Medicare Hearing by an Administrative Law Judge
Electronic Funds Transfer form
Medicare Supplier Number Application form
Advance Beneficiary Notice form
Contracting officer
Coordination of benefits
Claims processing timeliness
Current procedural terminology
Code of Federal Regulations
Claim Status Inquiry
Common Working File
Departmental appeals board
Document Control Number
DME Information Form
Durable medical equipment
Durable medical equipment Medicare administrative contractor
durable medical equipment, prosthetics, orthotics, and supplies
Durable medical equipment regional carrier
Doctor of osteopathy
Department of Justice
Date of service
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[MARCH 2008]
DPM
DRA
EDI
EFT
EGHP
EIN
ERA
ESRD
FBI
FCN
FI
FOI
HCPCS
HHA
HHS
HICN
HIPAA
HME
HMO
ICD-9-CM
ICN
IIC
IOM
IRP
IRS
IV
IVR
LCD
LCL
LGHP
MD
MHO
MMA
MREP
MSN
MSP
NCD
NCPDP
NF
NOC
NON-PAR
NPI
NSC
NSF
OAS
OBRA
OD
Doctor of podiatric medicine
Deficit Reduction Act of 2005
Electronic data interchange
Electronic funds transfer
Employer group health plans
Employer identification number
Electronic remittance advice
End-stage renal disease
Federal Bureau of Investigations
Financial Control Number
Fiscal intermediary
Freedom of Information
Healthcare Common Procedure Coding System
Home health agency
Health and Human Services
Health Insurance Claim Number
Health Insurance Portability and Accountability Act of 1996
Home medical equipment
Health maintenance organization
International Classification of Diseases, Clinical Modification, 9th Revision
Internal Claim Number
Inflation-indexed charges
CMS Internet-Only Manual System
Internal Revenue Service
Intravenous
Interactive Voice Response system
Local coverage determination
Lowest charge level
Large group health plan
Doctor of medicine
Medicare hearing officer
Medicare Modernization Act of 2003
Medicare Remit Easy Print Software
Medicare Summary Notice
National coverage determination
National Council for Prescription Drug Programs
Nursing facility
Not otherwise classified
Nonparticipating provider
National provider identifier
National standard format
Office of Audit Service of the Department of Health and Human Services
Omnibus Budget Reconciliation Act
Optometrist (doctor of optometry)
6
[MARCH 2008]
OI
OIG
OIFO
ORU
OTR
PAR
PEN
PHI
PIN
PMD
POTR
POV
QIC
RA
RHHI
RICO
RO
SADMERC
SNF
SPR
SSA
SSN
TENS
UPIN
VA
WAC
WC
ZPIC
Office of Investigations
Office of the Inspector General
Office of Investigations Field Office (OIG)
Overpayment Recovery Unit
On-the-record hearing
Participating provider
Protected health information
Provider Identification Number
Power mobility device
Preliminary on-the-record hearing
Power operated vehicle
Qualified independent contractor
Remittance advice
Regional home health intermediary
Racketeering Influenced Corrupt Organization
Regional office (CMS)
Statistical Analysis DMERC
Skilled nursing facility
Standard paper remittance
Social Security Administration
Social Security Number
Transcutaneous electrical nerve stimulator
Unique Provider Identification Number
Wholesale acquisition cost
Zone program integrity contractor
7