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News to Note – November, 2020

  • Occurrence span code 72 is added to an inpatient Medicare claim if the patient spent less than two midnights as an inpatient (e.g., with an inpatient order in place) but two or more midnights passed when including outpatient time (e.g., when an inpatient order was not yet in place).
    • As such, a patient in the Emergency Department (ED) or hospitalized receiving Observation services for one midnight who is then admitted as an inpatient, then discharged the next day, should get the code 72 on their claim. This makes sure auditors know the patient met the two-midnight benchmark and it also excludes the case from the Program for Evaluating Payment Patterns Electronic Report (PEPPER) one day stay data.
    • Recently, a question came up about a midnight spent at anther hospital. We know it counts for the two-midnight benchmark, but does that claim get a span code 72? ACPA Advisory Board member Dr. Ronald Hirsch asked the Centers for Medicare and Medicaid Services (CMS) and they responded it does not qualify, so keep that in mind.
  • On January 1st, CMS is adopting a new method for E&M code selection where Review of Systems documentation will no longer be required for codes 99202 to 99215, the office visit codes.
    • However, this does not apply to ED or hospital visit codes, and there is another wrinkle, too.
    • If a specialist is consulted in the hospital for a patient in outpatient status with observation services, the consultant uses office visit codes for their visit. Only the hospitalist uses observation codes. So, these consultants will need to know the patient’s admission status before they enter the room since what they ask and what they examine may actually be different for inpatients than for outpatients.
  • October 1st was the starting date for the requirement that providers send all medical records to their Quality Improvement Organization (QIO) electronically and not by mail or fax. Keep in mind that although it is a requirement, the only penalty for not complying and continuing to fax is that you don’t get a $3.00 payment per chart. The QIOs have to maintain fax lines for the providers who get a waived out of the requirement, so you can keep using them.
  • The time to submit your comments on the 2021 Outpatient Payment Proposed Rule has come and gone with 1,362 comments submitted. In contrast, the 2021 Physician Fee Schedule Proposed Rule has received over 44,000 comments.
    • The American Hospital Association (AHA) submitted comments about the outpatient rule, protesting the 340B drug cuts, the loosening of restrictions on physician-owned hospitals, and objecting to the elimination of the inpatient-only list. They were joined by the American Association of Hip and Knee Surgeons (AAHKS) in opposing the elimination of the list.
    • Both the AHA and the AAHKS used the same argument – many surgeries on the inpatient-only list have not been proven safe to be done on outpatients, especially Medicare beneficiaries who are older and have more comorbidities. However, there is no clinical difference between inpatient and outpatient surgery performed in the hospital.
    • Our Government Affairs Committee (GAC) asked for more clarification about who can be admitted as inpatient under the case-by-case exception (you can see the GAC’s comment to CMS here).
  • Recently, a group of researchers found that Medicaid recipients who are assigned to low-cost managed Medicaid plans receive a poorer quality of care and have poorer health outcomes than those patients assigned to higher cost plans. It is interesting that this report comes out just as hospitals are gearing up for price transparency. While not a perfect comparison, it may show that the price transparency push is really misguided unless it is coupled with some valid measures of the quality of care that will come along with that lower cost. You can read more about the study here.
  • Another study showed that Medicare patients who are discharged from the ED and see a physician within 30 days get hospitalized more often, but have lower mortality. Medicare is starting to look at hospital visits after outpatient encounters as a quality measure. Maybe more visits are a good thing and improve the quality of care even if they may increase cost.
  • There is a new payment structure from CMS for high-throughput COVID-19 testing.
    • As a review, testing for COVID-19 can be done as a point-of-care test where the sample is taken and tested immediately. But, it can also be collected and sent to a laboratory where testing is performed and the results reported back to the provider at a later time.
    • Currently, CMS pays $100 for the latter type of test. But, they just announced that starting January 1st, if the test results are not available to the provider within two calendar days of the specimen being collected, the payment will be reduced to $75.
    • The laboratory will need to report not only the code for the test itself, but also include an add on code – U0005 – to indicate that the results were provided within two calendar days. This may be the first time CMS has used a payment structure based on the timing of results.
    • Depending how you look at it, CMS is either penalizing laboratories who cannot produce fast results, or they are rewarding labs which can produce the result quickly. Either way, it will be interesting to see if this is a single use of this payment structure or whether we will see it adopted for other services in the future.
  • Coding edits for the Medicare Administrative Contractors (MACs) for payment with the CS modifier have been released.
    • The CS modifier is placed on evaluation and management services for COVID-19 visits and results in Medicare paying 100% of the allowed amount rather than the usual 80%.
    • Initially, there was great confusion about when this modifier should be used. Many providers attached it to any service provided during a visit including x-rays and other diagnostic testing. As such, there are many questions about what the future will hold.
      • What will happen to services that had the CS modifier added inappropriately and were paid at 100% prior to these recent edits being put in the system?
      • Will the MACs go back to the beginning of the Public Health Emergency and adjust all of those claims, recouping the extra 20% that they paid?
      • Will it be the responsibility of the provider to go back through all of their claims and refund the 20%?
      • If the 20% is refunded or recouped, how does the claim get submitted to a secondary insurance for coverage of that amount?
      • If the MACs do not recoup it and the hospitals do not refund it, will CMS give the RACs permission to audit claims for this? If they do, it's a potential windfall for them since it's an automated review and is certain to find many overpayments.
    • If any of you work in compliance or revenue integrity, it may be a good idea to review your facility’s use of the -CS modifier in the early days and see if you are at risk.

**The news above in addition to many other points of interest for Physician Advisors and other leaders in health care can be heard weekly during Dr. Ronald Hirsch’s Monday Rounds segment on’s Monitor Monday webcast/podcast. Learn More

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