05/09/2017

CGS Summary Article on Revised DMEPOS Payment Rates Included in the 21st Century Cures Act

Change Request (CR) 9968 provides instructions regarding the implementation of revised 2016 DMEPOS fee schedule amounts based on changes mandated by Section 16007 of the 21st Century Cures Act. These changes relate to the new Chapter 20, Section 20.6 (Phase-In for Competitive Bidding Rates in Areas Not in a Competitive Bid Area) of the "Medicare Claims Processing Manual," which is part of CR9968. Please make sure your billing staff is aware of these instructions.

CGS Jurisdiction C will begin adjusting approximately 40,000 claims each day for approximately 24 weeks. Those claims will be "mass adjusted" based on processing requirements defined by CMS as part of the extension of the transition to the fully adjusted DMEPOS payment rate explained in MLN Matters MM9968 published February 10, 2017. IMPORTANT NOTE: The adjusted claims will not be given any unique code to indicate that the adjustment is related to CR9968. Therefore, our advocates in the Provider Contact Center will not be able to tell you if a claim(s) is/are part of the mass adjustment required under CR9968.

Here's why the adjustments are happening: Legislation requires changes to the July and October 2016 fee schedule amounts for certain items. Section 1834(a)(1)(F)(ii) of the Social Security Act (the Act) mandates adjustments to the fee schedule amounts for certain DME items furnished on or after January 1, 2016, in areas that are not competitive bid areas, based on information from competitive bidding programs for DME.

CGS Jurisdiction C will reprocess affected claims and we will adjust claims that were previously paid. MM9968 explains the adjustment process:

"Section 16007 of the 21st Century Cures Act changes the 2016 fee schedule transition period so that payment based on 50 percent of the adjusted payment amount established using competitive bidding information and 50 percent of the unadjusted fee schedule amount extends from June 30, 2016, to December 31, 2016. Section 16007 also changes from July 1, 2016, to January 1, 2017, the date that payment based on 100 percent of the adjusted payment amounts in non-bid areas is effective.

To supplement Section 16007 for dates of service July 1, 2016, through December 31, 2016, the 50/50 blend fee schedules have been recalculated so that the adjusted portion of the payment blend utilizes July 1, 2016, adjusted fees. Also, the KE modifier fee schedules for items bid in the initial Round 1 Competitive Bidding Program (CBP) have been added back to the fee schedule file for this extended phase-in period. The KE modifier was added to the DMEPOS fee schedule file as part of the January 2009 fee schedule update and described items that were bid under the initial Round 1 CBP but were used with non-competitive bid base equipment. Suppliers should submit a request for reopening if their claim for dates of service between July 1, 2016, and December 31, 2016, should have been processed with the KE modifier.

The revised July 1, 2016, through December 31, 2016, DMEPOS and parenteral and enteral nutrition (PEN) fee schedule files will be made available to the DME MACs. The previously posted July 2016 and October 2016 DMEPOS and PEN public use files will be revised to reflect the new fee schedule amounts associated with the extension of the transition period. MACs will accept the KE modifier on the adjusted claims. In addition, for claims that the KE modifier would have been applicable to, the supplier may adjust the claim or notify MACs to adjust the claims after the mass adjustments for the 50/50 fee blend have been completed."

Jurisdiction C suppliers will not be permitted to request escalated processing of these claims.

CGS will share any additional information received from CMS regarding this mass adjustment initiative. Please monitor our Facebook posts as well as our ListServ for information.