In the shifting seas of medical claims billing requirements, the general categories for claims denial are reasonably stable. We thought it might be helpful to review some of the major ones. Some are simple, some are impacted by the changing landscape of government mandates in general and the ACA (Obamacare) in particular:
1. Noncovered charges
2. Coding errors
3. Overlapping Claims
4. Duplicate claims
5. Expired time limit
Noncovered and Excluded Charges: Marketplace Plans
The Essential Mandates portion of the ACA governs all levels of the marketplace metal plans: Bronze, Silver, Gold and Platinum. Despite the publicity surrounding the conversion of marketplace coverages from private insurers to the various insurance exchanges, Excluded Charges are overall proving remarkably stable from year to year. 80% of the top ten of them remained unchanged from 2013 to 2014, according to an analysis by HealthPocket, which surveyed data from 3,094 health plans in the 2014 individual family health insurance market
The private health plans replaced by ACA metal plans mostly covered essential services such as office visits, tests, ER care, and hospitalization and therefore these services don’t appear among excluded items. Maternity care (Prenatal and postnatal care), though not covered by 81% of private plans, ranked 15th among uncovered services in 2013, so it isn’t reflected in 2014 ten top listing for the ACA’s marketplace plans.)
The attempt at consistency in the marketplace plans at the federal level isn’t reflected in the state exchanges, where the coverage of some services excluded by the federal plans by illustrates the current fragmented nature of marketplace coverages. 20 states’ exchanges cover infertility treatments, for example. Only by being conversant with the marketplace insurance coverage provisions of their individual states can practitioners know what services are covered.
1. Noncovered Charges: Medicare
Medicare is at least consistent and not subject to the coverage vagaries of the individual insurance marketplace.
Medicare-covered services are those services considered medically reasonable and necessary to the overall diagnosis or treatment of the beneficiary’s condition or to improve the functioning of a malformed body member.
The claims payment issues with Medicare lie not in what it covers for, but in the claims process itself, notably the ICD-9 ICD-10 diagnostic code conversion mandate, which is touched on below.
2. Coding Errors in General
Claims edit functions ensure that claims data submitted to a payer are correct. If it not, the claim is returned unpaid. Attributes that are verified include format, allowable values, required presence and data integrity. This processes determines whether or not the claim was properly coded by the provider.
The AMA issues an annual National Health Insurer Report Card that details claims accuracy and the costs of inaccuracy. Medical practices spent 14% of their income on ensuring that they’re paid. Claims returned to practices for “rework” i.e., error correction, by the top 7 commercial insurers in 2013 cost practices an average of $2.28 per claim to correct, with 10.7% of all claims returned for rework. The AMA study didn’t address ICD codes specifically, instead defining all Medicare claims submissions as “CMS,” which could include both ICD and CPT codes. (CMS Publication 100-04).
3. Duplicate Claims
A duplicate claim is one that’s resubmitted for a single encounter on the same date, by the same provider, for the same beneficiary, for the same service or item. It’s denied as a duplicate with error code CO18. Duplicates are one of the largest reasons for Medicare Part B claim denials, According Government Accountability Office (GAO) study its as much as 32%. CMS notes, however, that claims rejected as duplicates may be valid claims for payment, if the correct condition codes or modifiers are applied to demonstrate a claim isn’t really a duplicate.
4. Overlapping Claims
Not as straightforward as a duplicate claim, CMS defines an overlap as occurring: “... when the date of service or billing period of one claim seems to conflict with the date on another claim, indicating that one of the claims may be incorrect.” Some codes that can indicate an overlapping has occurred are:
N347: Your claim for a referred or purchased service cannot be paid because payment has already been made for this same service to another provider by a payment contractor representing the payer
M86: Service denied because payment already made for same/similar procedure within set time frame may be incorrect.
Overlaps require some research to resolve, especially when other provider’s involved.
5. Expired Time Limit
Some practices hold smaller claims and batch processes them later—sometimes too much later. All insurers have time limits on claims submissions. Medicare requires all claims be filed within 12 months following the date of service. Its rules as noted below do allow three possible areas of exception:
- Administrative Error: failure to meet a filing deadline caused by error or misrepresentation of an employee, the Medicare contractor, or agent. In these instances, Medicare will extend the timely filing limit through the last day of the sixth month following the month in which the beneficiary, provider, or supplier received notice that an error or misrepresentation was corrected.
- Retroactive Medicare Entitlement: Occurs when a beneficiary receives notification of retroactive Medicare entitlement to on or before the date the service was furnished. In such cases, Medicare will extend the timely filing limit through the last day of the sixth month following the month in which the beneficiary, provider, or supplier received notification of the retroactive Medicare entitlement.
- Retroactive Medicare Entitlement Involving State Medicaid Agencies: where a State Medicaid Agency recoups payment from a provider or supplier six months or more after the date the service was furnished to a dually eligible beneficiary. In these cases, Medicare will extend the timely filing limit through the last day of the sixth month following the month in which a State Medicaid Agency recovered the Medicaid payment from a provider or supplier.