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Cracking the Code

Alexander Miller

Dr. Miller, who is in private practice in Yorba Linda, California, represents the American Academy of Dermatology on the AMA-CPT Advisory Committee.

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You submit a bill to an insurer for medically necessary services and receive a partial payment or complete non-payment. Now what do you do?

There are several steps that one should take in determining appeal action. Who takes them will depend upon the office billing structure and on who is ultimately responsible for effectively managing insurance payment appeals. Steps to take include:

  • Recognize inappropriate non-payment or underpayment.
  • Read the reasons for payment denial in the explanation of benefits.
  • Identify the CPT codes that are inappropriately paid.
  • Check whether proper CPT codes and correlated ICD diagnosis codes were billed.
  • Assure that appropriate CPT modifiers were used.
  • Take effective re-billing or appeal steps.
  • Pursue the appeal to its full resolution.

Improper payment cannot be appealed without first identifying it. Every office should have a reliable mechanism in place for identifying mis-payment and people motivated and able to carry out effective appeals. Additionally, the billing medical provider should receive feedback on reimbursement levels, payment rejections, and appeals results. Such feedback is invaluable for the purpose of running a financially efficient and effective business. The billers, in turn, knowing that the managing physician is aware of their billing efficiency and outcomes, will be maximally motivated to produce clean, properly reimbursed bills. Lastly, the billing physicians and physician extenders will benefit from knowing insurance reimbursement patterns and circumstances under which legitimately necessary services may be non-payable or under-reimbursed, so that they may avoid such scenarios. If you do not know that something is happening, you will not know what it is, and you will remain in the dark, under-reimbursed.

The reasons for payment denial, as specified in the explanation of benefits, must be carefully read, and remedied. Insurers have various ways of revealing reasons for non-payment. Some, as Medicare, clearly identify the denied services and reference them to a specified reason. Other insurers are not always as forthcoming.

Once the mis-paid CPT codes are identified one should take steps to correct the bill if needed, either by resubmitting the improperly reimbursed portion or by filing an appeal. Each insurer specifies its own appeals processes. For Medicare, the appeals processes are clearly delineated and available on the Medicare contractor and CMS websites.[pagebreak]

A simple clerical error, such as when a CPT modifier was omitted, or when an ICD diagnostic code was improperly submitted, can be corrected via a telephone call to the Medicare contractor. More complicated denial reasons will require written appeals. Medicare defines a ladder of appeal levels, specified in the table to the right.

Each of the Medicare appeal forms includes a space for providing a written rationale for the appeal and requires a signature. Written and supplemental appeals data must be generated by a person who can effectively and convincingly provide the required information. It is wise to have a physician/medical professional write the narrative reasons justifying an appeal and to specify what, if any, ancillary data may need to be sent in support of the appeal. This may involve the phrasing of clinical information that only the treating health care professional is able to precisely state. Yes, it is a pain for a physician to have to personally deal with appeals, but it may determine the difference between a successful appeal and one that is rejected. Literature references can be helpful in some cases of payment denial, especially when appealing payments for expensive services such as Mohs surgery and reconstruction. In egregious cases of non-payment consider enlisting the patient in the appeals process by having them argue their case with the insurer. Patients may be able to enlist spokesmen for their cause, such as their union, and may be able to discover individuals within the insurance company hierarchy who may be more sympathetic to a reasonable appeal. Finally, the AAD has coding staff who offer assistance with coding and reimbursement questions, including claim denials and appeals; they can be contacted at ppm1@aad.org.

Track the results of appeals and avoid giving up if you feel that your services should be payable. Lastly, regular reviews of claims denials and the reasons for the denials may facilitate an avoidance of common claims filing mistakes, and will serve to track office billing efficiency.

Example 1: A rejected Medicare bill is appealed via a Redetermination form. In order to ensure that your contractor receives the appeal your biller faxes the form and also mails a copy.

Answer: Incorrect. Only one appeal should be sent. Sending an appeal by two separate means creates a duplicate appeal that requires dual processing, increases costs for the contractor, and delays resolution of the appeal.

Example 2: As no notice of an appeal decision is received from Medicare after one month you submit a second written appeal.

Answer: Incorrect. The Medicare Contractor has 60 days to complete an appeal decision. A second appeal submitted within the 60-day period may prolong the appeals process and certainly will not speed it up.

Example 3: After submitting a redetermination appeal to Medicare your biller discovers that pertinent supporting information was not sent. The biller then contacts the Provider Contact Center for advice.

Answer: Correct. Rather than submitting the information by itself or with another redetermination request, one should communicate with the Provider Contact Center. The Center representative should determine whether the information is needed, and if so, should work to help route it to the proper recipient. It is best to ensure that all supporting documentation is submitted with the original appeal, as that will ensure its optimal and timely processing.

Medicare appeals

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Medicare appeals