[Federal Register: November 23, 2001 (Volume 66, Number 226)]
[Rules and Regulations]
[Page 58787-58836]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23no01-8]
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Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Part 410
Medicare Program; Negotiated Rulemaking: Coverage and Administrative
Policies for Clinical Diagnostic Laboratory Services; Final Rule
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 410
[CMS-3250-F]
RIN 0938-AL03
Medicare Program; Negotiated Rulemaking: Coverage and
Administrative Policies for Clinical Diagnostic Laboratory Services
AGENCY: Center for Medicare & Medicaid Services, (CMS) HHS.
ACTION: Final rule.
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SUMMARY: This final rule establishes national coverage and
administrative policies for clinical diagnostic laboratory services
payable under Medicare Part B to promote Medicare program integrity and
national uniformity, and simplify administrative requirements for
clinical diagnostic laboratory services. This rule addresses public
comments received on the proposed rule that was published March 10,
2000. A Negotiated Rulemaking Committee (the Committee) developed the
policies as directed by section 4554(b)(1) of the Balanced Budget Act
of 1997 (the BBA).
DATES: Effective November 25, 2002, except for sections 410.28(f),
410.32(d) redesignations, (d)(1) heading, (d)(4) and (e), which are
effective February 21, 2002. See the effective date section of the
preamble for a discussion of the effective dates for provisions that
were discussed in the preamble but not codified in the rule.
FOR FURTHER INFORMATION CONTACT: Jackie Sheridan, (410) 786-4635 (for
issues related to coverage policies). Brigid Davison, (410) 786-8794
(for issues related to documentation requirements). Dan Layne, (410)
786-3320 (for issues related to claims processing).
SUPPLEMENTARY INFORMATION: The sections contained within this document
have been constructed according to the framework outlined in the table
of contents that follows. We summarized pertinent material from our
proposed rule that was published on March 10, 2000 (65 FR 13082)
followed by public comments and our responses.
Table of Contents
I. Background
A. Current Statutory Authority and Medicare Policies
B. Recent Legislation
II. Provisions of the March 10, 2000 Proposed Rule
III. Comments and Responses
IV. Summary of Changes Based on the March 10, 2000 Proposed Rule
V. Collection of Information Requirements
VI. Regulatory Impact Analysis
I. Background
A. Current Statutory Authority and Medicare Policies
Section 1833 and 1861 of the Social Security Act (the Act) provides
for payment of, among other things, clinical diagnostic laboratory
services under Medicare Part B. Tests must be ordered either by a
physician, as described in Sec. 410.32(a), or by a qualified
nonphysician practitioner, as described in Sec. 410.32(a)(3). Tests may
be furnished by any of the entities listed in Sec. 410.32(d)(1). A
laboratory furnishing tests on human specimens must meet all applicable
requirements of the Clinical Laboratory Improvement Amendments of 1988
(CLIA) (Public Law 100-578), as set forth at 42 CFR part 493. Part 493
applies to laboratories seeking payment under the Medicare and Medicaid
programs.
Section 1862(a)(1)(A) of the Act, to which there are certain
explicit statutory exceptions, provides that no Medicare payment may be
made for expenses incurred for items or 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.
Moreover, section 1862(a)(7) of the Act excludes coverage ``where such
expenses are for routine physical checkups, eye examinations for the
purpose of prescribing, fitting, or changing eyeglasses, procedures
performed (during the course of any eye examination) to determine the
refractive state of the eyes, hearing aids or examination therefore, or
immunizations (except as otherwise allowed under section 1861(s)(10)
and paragraph (1)(B) or under paragraph (1)(F).
Under the above statutory authority, we have issued national
coverage decisions and policies in a variety of documents, such as
Centers for Medicare & Medicaid Services manual instructions, Federal
Register notices, and Centers for Medicare & Medicaid Services Rulings.
We have issued approximately 20 national coverage decisions pertaining
to clinical diagnostic laboratory services in the Medicare Coverage
Issues Manual (CMS Pub. 6). Medicare program manuals are posted on the
Internet at http://www.cms.gov/pubforms/progman.htm. Program
transmittals and program memoranda are posted at http://www.cms.gov/
pubforms/transmit/transmit.htm.
Under section 1842(a) of the Act, we contract with organizations to
perform bill processing and benefit payment functions for Medicare Part
B (Supplementary Medical Insurance). These Medicare contractors, who
process Part B claims from noninstitutional entities, are called
carriers. Under section 1816(a) of the Act, we contract with fiscal
intermediaries to perform claims processing and benefit payment
functions for Medicare Part (Hospital Insurance). Fiscal intermediaries
also process claims payable from the Medicare Part B trust fund that
are submitted by providers that participate in Medicare Part A, such as
hospitals and skilled nursing facilities. We use the term
``contractor(s)'' to mean carriers and fiscal intermediaries.
Medicare contractors review and adjudicate claims for services to
ensure that Medicare payments are made only for services that are
covered under Medicare Part A or Part B. In the absence of a specific
national coverage decision, coverage decisions are made at the
discretion of the local contractors. Frequently, local contractors
publish local medical review policies (LMRPs) to provide guidance to
the public and medical community that they service.
Contractors develop these local medical review policies by
considering medical literature, the advice of local medical societies
and medical consultants, and public comments. Our instructions
regarding the development of local medical review policies appear in
section 2.3 of the Program Integrity Manual (CMS Pub. 83).
These LMRPs explain when an item or service will (or will not) be
considered ``reasonable and necessary'' and thus eligible (or
ineligible) for coverage under the Medicare statute. If a contractor
develops an LMRP, its LMRP applies only within the area it serves.
While another contractor may come to a similar decision, we do not
require it to do so. An LMRP may not conflict with a national coverage
decision once the national coverage decision is effective. If a
national coverage decision conflicts with a previously established
LMRP, the contractor must change its LMRP to conform to the national
coverage decision. A contractor may, however, make an LMRP that
supplements a national coverage decision where the national coverage
decision is silent on an issue. The LMRP may not alter the national
coverage decision.
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B. Recent Legislation
Section 4554(b)(1) of the Balanced Budget Act of 1997 (BBA), Public
Law 105-33, mandates use of a negotiated rulemaking committee to
develop national coverage and administrative policies for clinical
diagnostic laboratory services payable under Medicare Part B by January
1, 1999. Section 4554(b)(2) of the BBA requires that these national
coverage policies be designed to promote program integrity and national
uniformity and simplify administrative requirements with respect to
clinical diagnostic laboratory services payable under Medicare Part B
in connection with the following:
Beneficiary information required to be submitted with each
claim or order for laboratory services.
The medical condition for which a laboratory tests is
reasonable and necessary (within the meaning of section 1862(a)(1)(A)
of the Act).
The appropriate use of procedure codes in billing for a
laboratory test, including the unbundling of laboratory services.
The medical documentation that is required by a Medicare
contractor at the time a claim is submitted for a laboratory test (in
accordance with section 1833(e) of the Act).
Recordkeeping requirements in addition to any information
required to be submitted with a claim, including physicians'
obligations regarding these requirements.
Procedures for filing claims and for providing remittances
by electronic media.
Limitations on frequency of coverage for the same services
performed on the same individual.
II. Provisions of the March 10, 2000 Proposed Rule
In the March 10, 2000 proposed rule, we set forth uniform national
coverage and administrative policies for clinical diagnostic laboratory
services payable under Medicare Part B. These proposed policies were
designed to promote Medicare program integrity and national uniformity
and simplify administrative requirements for clinical diagnostic
laboratory services. These regulations do not provide, or purport to
provide, any immunities or safe harbors. Additionally, these
regulations do not limit any criminal, civil, or administrative law
enforcement and overpayment actions. These Medicare policies apply to
all Medicare contractors processing Part B laboratory claims, including
fiscal intermediaries.
The preamble to the March 10, 2000 proposed rule discussed the
composition of the Committee, the guidelines the Committee followed in
making recommendations, and the consensus of the negotiating Committee.
Most of the provisions of the rule will be implemented through our
instructional issuance system rather than codified in regulations, but
were discussed in the preamble to the March 10, 2000 proposed rule
nonetheless. A summary of the preamble of the March 10, 2000 proposed
rule is as follows:
Information required with each claim.
--Claims processing requirements change regularly; therefore, we
encourage readers to refer to the claims processing sections of the
Medicare Carriers Manual (sections 3005 and 3999, exhibit 10) and
Medicare Fiscal Intermediary Manual (section 3605 and Addendum L) in
order to keep current regarding the specific policies related to data
elements. These manuals are posted on the Internet at http://
www.cms.gov/pubforms/progman.htm.
--We proposed not to require that diagnostic information be submitted
with every claim at this time. However, we encourage physicians to
voluntarily provide diagnosis information (either the reason for the
visit or the reason for the test) with the order, and we encourage
laboratories to submit information that they receive with the claim.
--In order to promote uniformity, we proposed that the date of service
for laboratory tests that is reported on the claim be the date the
tested specimen was collected. The person obtaining the specimen must
furnish the date of collection of the specimen to the entity billing
Medicare.
Medical conditions for which a test may be reasonable and
necessary.
--The March 10, 2000 proposed rule discussed the uniform process that
the Committee used in developing 23 national coverage decisions. We are
not codifying the national coverage decisions (NCDs) so that they could
be updated in a timely manner as appropriate to accommodate changes in
technology, coding, or national practice standards. We used the
following process to develop the NCDs:
++ Seeking input from relevant national medical specialty societies
and voluntary health agencies through the American Medical Association
representative.
++ Reviewing relevant scientific literature and practice
guidelines.
++ Reviewing existing local medical review policies, as well as any
existing relevant templates for local policies developed by a task
force of carrier medical directors.
++ Soliciting comments on the draft policies through an Internet
posting from November 4 through 11, 1998.
--The policies followed a uniform format that Included a narrative
description of the test, panel of tests, or group of tests addressed in
the NCD; clinical indications for which the test(s) may be considered
reasonable and necessary and not screening for Medicare purposes;
limitations on use of the test(s); and diagnosis codes from the
International Classification of Diseases, Ninth Revision, Clinical
Modification (ICD-9-CM codes); reasons for denial (the content of which
was not negotiated by the Committee); sources of information on which
the decision is based; and coding guidelines.
The ICD-9-CM codes were displayed in one of three sections. The
first section lists covered codes--those for which there is a
presumption of medical necessity but the claim may be subject to
review. The second section lists diagnosis codes that are never
covered. The third section lists codes that generally are not
considered to support a decision that the test is reasonable and
necessary, but for which there are limited exceptions. Additional
documentation could support a decision of medical necessity and must be
submitted by the ordering provider and accompany the claim.
The national coverage decisions apply nationwide and are binding on
all Medicare carriers, fiscal intermediaries, peer review
organizations, health maintenance organizations, competitive medical
plans, and health care prepayment plans for purposes of Medicare
coverage. In accordance with section 522 of the Medicare, Medicaid and
SCHIP Benefits Improvement and Protection Act of 2000 (BIPA),
Beneficiaries who file for review of NCDs on or after October 1, 2001
may appeal to the Department of Health and Human Services Appeals Board
for review.
--The policies may be updated and new laboratory policies developed
under the Medicare national coverage process that was published April
27, 1999 (see 64 FR 22619). A copy of this general notice is posted on
the Centers for Medicare & Medicaid Services Internet site at http://
www.cms.gov/coverage/8a1.htm
Appropriate use of procedure codes.
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--We clarified that the term screening or screen in Current Procedure
Terminology (CPT) Codes does not necessarily describe a test performed
in the absence of signs or symptoms of an illness, disease, or
condition.
--We clarified use of the -59 modifier as an indication for claims for
multiple billings of the same CPT code for the same beneficiary for the
same day when those services are medically necessary.
Documentation and recordkeeping requirements.
--We proposed adding language to the Code of Federal Regulations (CFR)
to clarify the documentation physicians and laboratories, respectively,
are required to maintain.
--We proposed CFR provisions clarifying that if the documentation
submitted by the entity submitting the claim is inadequate, we will
seek information directly from the ordering physician.
--We clarified that we do not require the signature of the ordering
physician on a requisition for laboratory tests. However, documentation
that the physician ordered the test must be available upon our request.
--We summarized the various record retention requirements that
presently exist.
Procedures for filing claims.
--We clarified that the entity submitting the claim may assign an
appropriate diagnosis code to a narrative, even if there is not an
exact match between the code descriptor and the narrative the
laboratory received from the ordering physician.
--We clarified that until standards permitting eight ICD-9-CM codes are
implemented, Medicare contractors, whose systems accept fewer than
eight ICD-9-CM codes in the diagnoses field, would permit the
laboratory to submit additional codes in the narrative field.
--We encourage matching of procedures to diagnoses, but we clarified
that claims would not be denied solely because there is no matching of
diagnosis and procedure codes on the claim form. In lieu of identifying
a noncovered service through matching noncovered diagnoses to specific
procedures on a claim, we also proposed that laboratories have the
option of submitting a separate claim for a procedure that is not
covered by Medicare.
Limitation on frequency.
--We proposed to issue instructions that state February 21, 2002 that
contractors may not use a frequency screen that could result in a
frequency-based denial unless information published by us or our
contractors includes an indication of the frequency that is generally
considered reasonable utilization of that test for Medicare purposes.
--We proposed to clarify the CFR provision by including the existing
requirements related to automatic denials from the manual in the CFR.
--We solicited new ideas for addressing the problem of notification of
beneficiaries of potential overutilization of testing.
--We proposed to issue instructions February 21, 2002 that all Medicare
contractors consistently use remittance advice language that identifies
the reason for denial as excess frequency when that is the reason for
denial.
We clarified that the limitation on liability provisions
that are currently found in section 1879 of the Act, 42 CFR part 411,
subpart K, section 7330 of the Medicare Carriers Manual, section 3440
through 3446.9 of the Fiscal Intermediary Manual, and any currently
applicable rules are equally applicable to laboratory services.
The changes we proposed to make to Sec. 410.32 are set forth as
follows:
We proposed to redesignate paragraph (d) introductory text
as paragraph (d)(1), and we proposed to add a heading.
We proposed to redesignate paragraphs (d)(1) through
(d)(7) as paragraphs (d)(1)(i) through (d)(1)(vii).
We proposed to add a new paragraph (d)(2) to Sec. 410.32
that would outline documentation and recordkeeping requirements related
to clinical diagnostic laboratory tests. The documentation and
recordkeeping requirements read as follows:
++ Paragraph (d)(2)(i) would specify that the physician (or
qualified nonphysician practitioner) who orders the service must
maintain documentation of medical necessity for the service in the
beneficiary's medical record.
++ Paragraph (d)(2)(ii) would require the entity submitting the
claim to maintain documentation it receives from the ordering physician
and information documenting that the claim submitted accurately
reflects the information it received from the ordering physician.
++ Paragraph (d)(2)(iii) would authorize the entity submitting the
claim to request additional diagnostic and other medical information
from the ordering physician to document that the services it bills are
reasonable and necessary. This request must be relevant to the medical
necessity of the specific test(s), and take into consideration current
applicable rules and regulations on patient confidentiality.
We proposed adding a new paragraph (d)(3) to Sec. 410.32
relating to claims review.
++ Paragraph (d)(3)(i) will specify that the entity submitting the
claim must provide documentation of the physician's order for the
service billed, showing accurate processing and submission of the
claim, and diagnostic or other medical information supplied to the
laboratory by the ordering physician or qualified nonphysician
practitioner, including any ICD-9-CM code or narrative description
supplied.
++ Paragraph (d)(3)(ii) will specify that if the documentation
submitted by the laboratory does not demonstrate that the service is
reasonable and necessary, we will provide the ordering physician
information sufficient to identify the claim being reviewed and request
from the ordering physician those parts of the beneficiary's medical
record that are relevant to the claim(s) being reviewed. If the
documentation is not provided timely, we will notify the billing entity
and deny the claim.
++ Paragraph (d)(3)(iii) will authorize the entity submitting the
claim to request additional diagnostic and other medical information
that is relevant to the medical necessity of the specific services from
the ordering physician consistent with applicable patient
confidentiality laws and regulations. h We proposed adding a new
paragraph (d)(4) to Sec. 410.32 to outline when we may deny a claim
without manual review.
++ Paragraph (d)(4)(i) will state that unless indicated in
paragraph (d)(4)(ii), we will not deny a claim for services that exceed
utilization parameters without reviewing all relevant documentation
submitted with the claim.
++ Paragraph (d)(4)(ii) will permit automatic denial of claims when
there is a national coverage decision, or LMRP that specifies the
circumstances under which the service is denied, or the statute
excludes Medicare coverage for the service, or the specific provider or
supplier has engaged in egregious overutilization of the service and
the claim is for that service.
III. Comments and Responses Based on the March 10, 2000 Proposed
Rule
We received responses from 61 commenters during the public comment
period. The commenters included many of the members of the negotiation
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committee; other national and State organizations, such as the American
Society of Hematology, and the Iowa Association of Pathologists;
representatives of various laboratories and hospitals; individual
physicians and other health care practitioners; a seniors' legal
advocate; and a Medicare contractor medical director.
Information Required With Each Claim
Comment: Eighteen commenters expressed concern that the proposed
rule did not specifically require physicians to provide information
necessary to support medical necessity. The commenters believe that
laboratories billing Medicare will have to collect information from
various sources to support medical necessity. The commenters proposed
that the final rule should clearly state that physicians are required
to provide the information necessary to support medical necessity with
the order, if that information is needed for claims processing.
Response: The Committee discussed when diagnostic information to
support medical necessity must be submitted with a claim. The
Committee's discussion focused on whether diagnostic information should
be required on claims for all tests, even those not addressed by a
national coverage policy or LMRP. Some Committee members emphasized
that providing information related to the reason for the patient visit
or for the test would be useful in evaluating patient outcomes and
quality of care and would ensure consistency and simplicity.
Physicians' representatives expressed concern, however, about the
burden that may be involved in providing the information. Laboratory
representatives expressed concern about laboratories' ability to be
paid if the physician does not provide the information.
The Committee concurred that this proposed rule would not
promulgate a requirement that diagnostic information be submitted with
every claim. While we recognize the concerns of the commenters, we
believe that such a requirement would present significant burdens on
some physicians. We will continue to study this issue and weigh the
benefits of requiring diagnostic information on every claim for
laboratory services against the burden that it would impose on
physicians and laboratories. We welcome the public to share with us any
specific suggestions they have for mitigating the burden on physicians
inherent with instituting a mandatory diagnostic information
requirement.
In addition, we encourage physicians voluntarily to provide
diagnostic information (either the reason for the visit or the reason
for the test) with the order. Likewise, we encourage laboratories to
submit information that they receive with the claim. Of course, if the
diagnostic information is required for claims payment, such as where
there is published national or local policy, physicians and
practitioners are required under section 4317(b) of the BBA to provide
diagnostic information at the time that the test is ordered.
Comment: One commenter expressed concern about the proper procedure
with which to handle patients who have no referring diagnosis but can
provide complaint, symptoms, or diagnosis. The commenter believes that
not having a process to handle those situations may result in the
patient experiencing delay or postponement of the service.
Response: For situations in which the patient does not present with
a referring diagnosis but is able to provide complaint, symptom(s), or
diagnosis, the proposed rule stated that the patient should be coded to
the highest level of specificity that corresponds to his/her state of
health. That is, the physician should provide this information (in
narrative or code) to the laboratory, and the laboratory should report
the complaint or symptom as one of the diagnoses on the claim. The
national coverage decisions in this final rule include appropriate ICD-
9-CM codes for relevant signs and symptoms in the sections entitled
``ICD-9-CM Codes Covered by Medicare Program.''
Comment: Twenty-eight commenters addressed the issue of date of
service, which is defined in the proposed rule as the date of specimen
collection. Twenty-one of the commenters generally agreed with the
proposed rule's definition, but made suggestions for additional
information or clarifications, such as the following in the definition:
include the time the specimen was collected; clarify how to handle
archived specimens and collections that span a 24-hour time period;
specify that the entity collecting the specimen be responsible for
reporting the date of service; and ensure that the laboratory is not
held liable if an inaccurate date was reported on Medicare claims.
One commenter suggested that laboratories should be given the
flexibility to also define date of service as the date of accession in
cases for which date of collection is not available.
Six commenters were not in favor of the proposed definition on date
of service and submitted suggestions about how the date of collection
may be redefined. Three commenters suggested that the definition be
changed to the date of accession. Two commenters suggested that the
definition be changed to the date the test results were reported. In
addition, one commenter suggested that laboratories be given the
flexibility to choose the date of service as either the date of
collection, date test results were reported or the date of accession in
the laboratory. One commenter suggested that we reserve the dates of
service issue for further study and not proceed with finalization of
the proposal in this rule.
Response: The date of service is a required data field for
laboratory claims. A laboratory service may take place over a period of
time. That is, the date the physician orders the test, the date the
specimen is collected from the patient, the date the laboratory
accesses the specimen, the date of the test, and the date results are
produced may not be the same. For example, often several days elapse
between taking a sample and producing results in microbiology tests
that are cultured. The Committee discussed what ``date of service''
laboratories must report on claims for clinical diagnostic laboratory
services. To ensure equitable treatment of beneficiaries and providers,
as well as to promote national claims processing consistency, it is
necessary that all laboratories report this date consistently.
We are committed to establishing a national coverage policy
regarding the date of service for Medicare claims that will promote
program integrity and national uniformity, yet minimize the burden on
laboratories. Laboratory representatives reported that some laboratory
computer systems are programmed to report the date of acquisition of
the specimen or the date of accession (the date the test is entered
into the computer system), in the date of service field on the claim
form. In addition, Medicare issued Program Memorandum A-95-4 in April
1995 that instructed hospital-based laboratories to report the date of
performance as the date of service for automated multi-channel tests.
We believe that the date of collection most closely relates to the
date the test was ordered and that the use of only one date of service
is consistent with the goal of promoting program integrity and national
uniformity. We also agree that in order to promote national uniformity,
the claims processing instruction implementing this provision needs to
include clarifications regarding handling of special circumstances,
such as archived specimens and tests requiring extended acquisition
time.
For specimen collections that span more than a 24-hour period, the
[[Page 58792]]
implementing instructions will clarify that the entity performing the
collection should define the date of service as the date the collection
began. For laboratory tests that require a specimen from stored
collections, the date of service should be defined as the date the
specimen was obtained from the archives.
One commenter suggested that the time of specimen collection also
be reported. We do not see the need for this information in processing
Medicare claims. Further, the computer software used by the industry
and us for claims processing does not include a field to report this
information. Thus, the addition of specimen collection time as a
required element on Medicare laboratory claims would result in a
substantial cost for all involved parties. The commenter did not
identify benefits from this addition that were commensurate with the
costs. Consequently, we are not adopting this change.
Several of the laboratory representatives commenting on this issue
expressed concerns with the potential problems that may arise when the
entity collecting the specimen fails to comply with the requirement to
supply the specimen collection date. The implementing instruction for
this provision will carefully emphasize the requirement to those
collecting specimens to report the date of collection. We are
optimistic that after adequate education from us and the Committee
member organizations, such as the American Medical Society and national
laboratory organizations, most of those collecting specimens for
laboratory testing will take care to report required information. We do
not believe that it is consistent with the statutory requirement to
promote national uniformity to permit a variety of means to report the
date of service.
We note, however, that we are providing a grace period of up to 12
months after the effective date of the final rule to accommodate any
system changes required by the policy changes or clarifications
resulting from the provisions of this rule. Entities that want to
obtain the benefit of a grace period to permit additional time to
implement computerized system changes must contact us in writing 90
days before the effective date of the provision(s) they are not able to
implement timely.
The request for a grace period must include a description of the
nature of the system change not able to be implemented timely, a
description of the actions the entity has taken in an effort to
implement timely, date upon that the entity will be able to implement
fully, and a workplan with a timeline providing a detailed description
of the acts which the entity shall undertake to accomplish full
implementation and the dates by which acts shall be performed. We will
review the submittal and advise the entity if we grant or deny the
request for a grace period. We may grant or deny the request for a
grace period at our discretion. Notwithstanding the foregoing, we may
terminate at any time any grace period already provided if we determine
that the entity has not acted in good faith or we determine the entity
has failed to perform any of the conditions upon which we agreed to
extend a grace period.
If we need additional time to implement system changes associated
with a particular provision of this rule on a nationwide basis, we well
issue a program memorandum detailing the rationale for the extension
and provide a new effective date.
Thus, laboratories will have up to 24 months (12 months delayed
effective date and up to 12 months grace period for system changes)
after publication of the final rule to achieve system modification to
submit claims in accordance with the final policy on date of service.
We believe this extended time before implementation will ease any
anticipated problems with the reporting of the specimen collection
date.
Medical Conditions for Which a Test May Be Reasonable and Necessary
Comment: One commenter expressed concern about designating the
coverage policies included in the addendum to the proposed rule as
national coverage determinations. The commenter requested that national
coverage determination status not be conferred to the 23 coverage
policies because this would render them unchallengeable.
Response: Section 4554 of the BBA specifies that the negotiated
rulemaking develop national coverage policies for clinical diagnostic
laboratory services. The statute goes on to state that the rules
consider the medical conditions for which a laboratory test is
reasonable and necessary (within the meaning of section 1862(a)(1)(A)
of the Act).
Our regulations do not use the term ``national coverage policies''
in developing policies that describe the medical conditions for which a
test is reasonable and necessary. Rather, Sec. 405.860 defines national
coverage decisions (NCDs) in this fashion. Specifically, the section of
the regulation states, ``CMS makes NCDs either granting, limiting, or
excluding Medicare coverage for a specific medical service, procedure,
or device. NCDs are made under section 1862(a)(1) of the Act or other
applicable provisions of the Act.'' We believe that the Congress by
requiring the Secretary to adopt ``national coverage and administrative
policies for clinical diagnostic laboratory tests under part B of title
XVIII,'' clearly intended the coverage policies developed under this
rule to be considered as NCDs. We believe that to not confer NCD status
on these policies would conflict with the statutory intent of section
4554(b) of the BBA.
We note, however, that the policies are developed to provide
flexibility in all but a very limited number of diagnoses. That is, the
policies have been constructed in a fashion to permit a Medicare
contractor to consider coverage of additional indications on a case-by-
case basis.
The Committee consensus includes the restatement of existing
Medicare program requirements that contractors consider all information
that is submitted with a claim. The policies include very few diagnoses
that may not be covered under any circumstances in the section entitled
``ICD-9-CM Codes Denied.'' Codes included in the list entitled ``Codes
That Do Not Support Medical Necessity'' may be covered when they are
accompanied by sufficient medical justification for the test for a
particular patient's condition.
Thus, the commenter's concern that NCD status would establish an
irrefutable barrier to coverage is not inherent in the NCDs as
negotiated. Moreover, section 522 of BIPA includes a provision to
provide for review of NCDs with regard to requests for review of NCDs
filed on or after October 1, 2001. Under the provisions of section 522
of BIPA, a beneficiary who is adversely affected by an NCD may request
a review with the Department of Health and Human Services Appeals Board
(DAB). The DAB may take evidence, consult with appropriate scientific
and clinical experts and will look at the reasonableness of the
determination. Final decisions of the DAB are subject to judicial
review. Thus, the policies will be reviewable.
Comment: One commenter expressed concern that the March 10, 2000
proposed rule did not specifically state that a laboratory is not
required to provide an advance beneficiary notice with respect to the
ICD-9-CM codes that are listed in the category ``ICD-9-CM Codes
Denied.''
Response: The diagnoses listed in the section entitled ``ICD-9-CM
Codes Denied'' are codes that are not covered by Medicare for a variety
of reasons. For example, some codes are excluded because they are
screening services;
[[Page 58793]]
others are listed because they are services to caretakers rather than
beneficiaries; another is based on the hearing aid exclusion. Advance
Beneficiary Notices (ABNs), with respect to laboratory services, are
required only for claims that the provider or supplier believes may not
be covered by Medicare based on section 1862(a)(1) of the Act
(reasonable and necessary exclusion).
Historically, Medicare's exclusion of screening services has been
attributed to section 1862(a)(7) of the Act. In a 1988 Program
Memorandum (AB-88-2), we stated that we consider the 1862(a)(7) of the
Act exclusion to be the basis for denial of screening services. Thus,
under current policy, providers or suppliers are not required to
provide the beneficiary with an ABN before to billing them for
screening tests that are provided for the diagnoses listed in the
section entitled ``ICD-9-CM Codes Denied.'' However, we believe that
advance notice to beneficiaries of that liability is prudent, and we
encourage providers and suppliers to voluntarily notify beneficiaries
that they will be liable for the cost of the tests.
We are, however, reconsidering whether to exclude screening tests
based on section 1862(a)(7) of the Act rather than section
1862(a)(1)(A) of the Act. We are concerned that it may not be in the
best interest of our beneficiaries to permit providers and suppliers to
bill them for screening services without advance notice. Should we
issue a change to the policy, laboratories will be required to issue
ABNs for services that are not covered based on the diagnoses in the
list that are screening services. Any such change would be
prospectively effective.
Comment: Two commenters addressed the fact that the 23 tests
identified in the national coverage decision represented 60 percent of
the volume of Medicare outpatient laboratory testing. The commenters
requested information about what percentage of Medicare outpatient
laboratory payments is represented by the 23 laboratory services.
Response: We performed an analysis on the 1999 bills that were
processed by the Medicare carriers. This database does not include the
laboratory claims processed by hospital-based laboratories. In this
data set, the 63 laboratory tests that make up the 23 services
represent 43 percent of carrier lab services and 51 percent of carrier
laboratory payments.
Comment: Two commenters expressed concern with the development of
policies using both an inclusionary and exclusionary basis. They noted
that using two different forms of logic in the development of computer
edits is costly. They suggested that we re-evaluate the benefits of
this approach relative to the benefits.
Response: We decided to display the diagnosis codes in the coverage
policy for blood tests on an exclusionary basis. That is, rather that
list the ICD-9-CM diagnosis codes than presumptively support medical
necessity of a blood count, they listed the codes for which a blood
count would not be presumptively medically necessary. We decided to use
the exclusionary approach for listing the codes when the list of codes
that supported medical necessity was considerably larger than the list
of those that did not. Thus, blood counts was the only test that was
developed using the exclusionary approach.
We note that the coverage policy for blood counts was developed in
the same manner as all other tests. That is, based on scientific
evidence, we listed those conditions that are indications for the test,
or the inclusionary approach. It was for reasons of administrative
simplicity that we displayed the codes in an exclusionary manner. Thus,
any organization developing its own internal edits is free to edit
using an inclusionary approach of computer logic by listing the codes
that are not displayed as excluded.
Comment: One commenter suggested that the narrative indications and
the ICD-9-CM codes contained in the policies needed to be reviewed for
consistency in all sections. The commenter believes that not all codes
that can be used for the indications have been included in the list for
``ICD-9-CM Codes Covered by Medicare Program.'' However, the commenter
did not make specific suggestions for changes.
Response: During the development of the proposed policies, we made
a valiant effort to ensure that the coding corresponded to the
indications included in the NCDs. This effort included development of
the initial list of codes by an interdisciplinary workgroup that
included at least one ICD-9-CM coding expert designated by the American
Health Information Management Association, as well as multiple
physicians, including Medicare contractor medical directors who are
familiar with coding from their claims analysis activities. After the
workgroup produced the draft NCDs, they were posted on the Internet for
public comments.
Several of the public comments related to coding suggestions, which
the Committee took under advisement in making its final
recommendations. We assigned a team of coders and physicians to review
the recommended policies as well before they were published as proposed
policies in the Federal Register.
In addition, to help ensure a complete listing of codes, we
specifically solicited comments on the policies from the public in the
preamble to the proposed rule. However, in that preamble we explicitly
stated that requests for changes should be accompanied by scientific
evidence supporting the request. We encouraged commenters ``to submit,
with their comments, copies of medical literature supporting their
recommendation for change * * *''
We received a number of comments regarding specific codes that
members of the public believe were appropriate changes to the lists.
None of the requests or comments regarding coding changes was
accompanied by supporting scientific evidence, however. As discussed
more fully in subsequent comments, we carefully reviewed each of these
suggestions using a team of our physicians and coding experts and made
appropriate decisions regarding their inclusion in the list based on
the indications described in the policies.
We believe the use of the Committee to develop the initial list of
covered codes, together with the opportunity for public comment both
during the Committee meetings and in response to the March 10, 2000
proposed rule provides adequate assurances that the list of codes is
appropriate. If members of the public have additional suggestions, we
invite them to use the national coverage process to request specific
changes for the future.
Comment: One commenter expressed concern with the language in the
``Reasons for Denial'' section relating to Food and Drug Administration
(FDA) approval or clearance of tests. The commenter believes that there
are additional exceptions beyond the Category B Investigation Device
Exemption (IDE) noted in the March 10, 2000 proposed rule. The
commenter suggested that the language provide for other exceptions.
Further, the commenter requested that we specify the procedures that
would apply to this section through an additional document that would
be subject to notice and comment.
Response: The last bullet in the Reasons for Denial section of the
proposed policies states that ``Tests that require FDA approval or
clearance will be denied as not reasonable and necessary if FDA
approval or clearance has not been obtained, except for those having a
Category B Investigational Device Exemption (IDE). Coverage of
[[Page 58794]]
Category B IDE devices is left to contractor discretion. (See 60 FR
48425, September 19, 1995).'' The purpose of including the reasons for
denial was to provide information that may be helpful to users of the
policy. We note that this section was not negotiated by the Committee
and included general policies of Medicare that apply to various types
of services rather than being specific to laboratory services.
Subsequent to the publication of the March 10, 2000 proposed rule
we published a policy on Medicare coverage of services under clinical
trials. This policy was published on our coverage web site on the
Internet
(http://www.cms.gov/coverage/8d.htm) and in Program Memorandum AB-00-89
and Coverage Issues Manual Section 30-1. The national coverage decision
that related to clinical trials provides for coverage of routine costs
incurred during certain clinical trials. Thus, as the commenter noted,
there are other exceptions to FDA approval. As part of implementation
of this policy, we will be modifying our regulations governing coverage
of IDEs that was referenced in this bullet. We believe it is
appropriate to remove this bullet from the reasons for denial section
at this time. We should point out, however, that we will continue to
consider FDA approval when appropriate in making coverage
determinations on Medicare claims.
Comment: One commenter noted that none of the coverage policies
considered family history as a medically necessary reason for a test.
The commenter believes that in a limited number of diseases family
history should be included as a basis for diagnostic testing, but did
not identify any specific conditions.
Response: The policies have been developed based on Medicare's
long-standing interpretation of sections 1862(a)(1)(A) and 1862(a)(7)
of the Act. Section 1862(a)(1)(A) of the Act provides that Medicare
payment may only be made for services that are reasonable and necessary
for the diagnosis or treatment of illness or injury. Section 1862(a)(7)
of the Act excludes Medicare coverage of routine physical checkups. We
have interpreted this to exclude routine testing provided during such a
physical checkup. Thus, all of the policies were developed based on the
concept that tests that are performed when no specific sign, symptom,
or diagnosis is present and when the patient has not been exposed to a
disease are excluded from coverage as screening services. (See Coding
Guideline #2.)
We, as well as many members of the Committee, recognize that there
may be many instances when testing of beneficiaries in the absence of
specific signs, symptoms, diagnosis, or exposure to disease is good
health care. The value of many preventive services and screening tests,
particularly in the case of family history of disease is well
documented. The exclusion of family history was not based on a belief
by the Committee or us that such testing should not be performed.
We are considering generating an internal request for a national
coverage decision addressing the role of family history as a medical
justification for a test being reasonable and necessary under our
national coverage decision process. National coverage decisions are
evidence-based decisions. If, after careful analysis, we believe there
is a basis for covering screening services, we will post a notice on
our coverage page on the Internet to allow the public an opportunity to
participate by submitting evidence for our further consideration.
Comment: One commenter expressed concern that certain pre-operative
tests were not included in the proposed policies. The commenter
explained that surgeons and other involved physicians will be bound by
unreasonable and inflexible protocols that impose barriers to prudent
management of an individual patient about to undergo surgery.
Response: The coverage policies negotiated by the Committee are
evidence-based policies. In situations in which the scientific evidence
supports the administration of tests, such as blood counts, prothrombin
time and partial thromboplastin time, before surgery, the policies
provide for coverage of these tests.
There are a number of other tests, however, that are routinely
administered to all patients about to undergo surgery in some
hospitals. We note that the value of that routine testing for all
patients undergoing all surgery is questionable. For example, a recent
study of pre-operative testing of cataract patients showed that the
routine testing did not affect the outcome of the patients. (The New
England Journal of Medicine 342 (2000): 168). Based on our discussion
with physicians on this issue, we have concluded that there is not
consensus among physicians regarding the appropriateness of furnishing
a broad spectrum of tests to seemingly well individuals merely because
they are about to undergo surgery.
We believe that the proposed policies developed by the Committee
appropriately handle the issue of pre-operative surgery given the
constraints of the law related to screening that are discussed above.
That is, tests furnished to patients who present with signs, symptoms,
or history of disease are covered for those conditions. Although
screening individuals without signs, symptoms, or past history may be
good medical practice, we do not believe it is a service that is
covered by the Medicare program.
However, we are interested in continuing to study this issue. We
encourage the public to use the national coverage process discussed
elsewhere in this document to forward to us any scientific literature
related to improvements in outcomes associated with administering
specific pre-operative laboratory tests routinely to Medicare patients.
Comment: One commenter expressed concern that the proposed policies
may not be appropriate for certain populations. The commenter was
particularly concerned that the proposed policies did not address the
specific needs of certain socioeconomic or ethnic groups.
Response: We acknowledge that the proposed policy does not
generally address specific socioeconomic or ethnic groups. Generally,
additional testing of particular socioeconomic or ethnic groups is
based on higher propensity for a disease state, which is considered
screening. Rather, the policies were designed to identify the specific
medical indications (signs, symptoms, or disease) for testing that were
supported by the scientific literature. However, the policies were not
designed to be an irrefutable list of diagnoses that may warrant a
particular test. Diagnoses, other than those listed in the section
entitled ``ICD-9-CM Codes Denied,'' or more frequent tests may be
covered on an individual basis when they are supported by medical
justification submitted with the claim.
Comment: One commenter suggested that the title of the list of
codes called ``ICD-9-CM Codes Denied'' be changed to ``ICD-9-CM Codes
Denied as Not a Benefit of Medicare'' to clarify that these are not
medical necessity denials.
Response: As noted above, we are re-evaluating our policy related
to screening services. Thus, we do not believe it is in the best
interest of the users of the policy to change the title of this section
at this time.
Comment: One commenter requested that the coding guidelines remain
in the Coding Clinic of the American Hospital Association (AHA), rather
than in the Federal Register. The commenter explained that AHA's Coding
Clinic for ICD-9-CM is a more flexible means of updating codes than is
the Federal Register, in which changes would be
[[Page 58795]]
subject to administrative processes such as notice and comment periods.
Response: Several of the coding guidelines from the AHA Coding
Clinic were printed in the proposed coverage policies for purposes of
providing assistance to the users of the policies. We believe that
repeating certain coding guidelines in the policies would clarify
coding policies for users and would be beneficial because users would
not need to consult alternative manuals for expeditious resolution of
common coding questions.
The incorporation of existing coding guidelines in the national
coverage determinations was not intended to imply that future changes
to the coding guidelines would be subject to publication in the Federal
Register or make composite coding guidelines subject to the
Administrative Procedure Act. If one of the coding guidelines that was
printed in the proposed policies is changed in the future, the revised
guideline may be incorporated into a national coverage decision through
the NCD coverage process without publication in the Federal Register.
Comment: One commenter expressed concern with coding guideline 2 on
screening services. The commenter believes that the V01 codes, contact
with or exposure to communicable diseases should be denied under all
circumstances as screening. Further, the commenter suggested
clarification of coding when a screening test shows an abnormal
finding.
Response: We believe that confirmed exposure to disease is not
considered a screening test in all circumstances. For example, the
proposed policy does not consider HIV testing of patients who have been
exposed to HIV through needlesticks from an HIV-positive patient as
screening. Further, Medicare Program Memorandum AB-99-04 details that
we do not consider testing for hepatitis C infection screening when it
is performed on patients who have been exposed to hepatitis C through a
blood transfusion from a patient that later is determined to have
hepatitis C. Thus, we are not adopting the commenter's first
recommendation.
We acknowledge that the appropriate coding for tests that were
ordered as screening, but show abnormal findings, is an issue that
needs clarification. We have learned that there are significant
differences in the common coding practices between hospitals and
nonhospital settings. We believe, however, that this issue is most
appropriately handled by the ICD-9-CM Coding Committee. The ICD-9-CM
Coding Committee is comprised of representatives from Centers for
Medicare & Medicaid Services, the AHA and the National Center for
Health Statistics, who are experts in the coding field. They are best
able to discuss the differences among the various uses of coding
guidelines and issue clarifications. We will ask the ICD-9-CM Coding
Committee to include this issue on an upcoming agenda. Clarification
will be published through the AHA Coding Clinic when the differences
are resolved.
Comment: One commenter made reference to coding guideline #5, which
refers to nonspecific codes. The commenter believes the guideline does
not define nonspecific codes, nor is the appropriate meaning of the
term clear. The commenter requested that the final rule clarify whether
the term ``non-specific codes'' refers to the ICD-9-CM code ``not
otherwise specified'' (codes ending in an 8) or ``unspecified'' (codes
ending in 9) or something else.
Response: Coding guideline #5 states, ``When a non-specific ICD-9-
CM code is submitted, the underlying sign, symptom, or condition must
be related to the indication for the test above.'' In including this
statement in the coding guideline, the Committee was not addressing the
``not otherwise specified'' or ``unspecified'' codes exclusively.
Rather, the list of covered codes frequently includes codes that are
very broad and encompass several related but different conditions, only
a few of which would justify the test in question.
For example, assume that a given code (X) is appropriate for three
conditions (A, B, and C). An indication for test 1 is condition A. The
coding guideline is intended to remind users that if you report code X
for test 1, it is expected that the patient have condition A. In other
words, if upon medical review of the chart, the contractor finds that
the patient only has condition B, which is not included in the
indications, it may deny the claim despite the fact that code X is
included in the list of codes that support medical necessity.
Comment: Many commenters suggested additional
ICD-9-CM diagnosis codes be added to the various policies. The
commenters generally did not provide rationale for the suggestions and
none of the requests were supported with scientific evidence as we
specifically requested in the preamble of the March 10, 2000 proposed
rule. In short, the commenters asserted the policies were incorrect or
incomplete without providing explanation or support for their concern.
Response: As described in the preamble to the March 10, 2000
proposed rule and in response to another comment above, the Committee
developed the policies in a systematic and uniform manner. The
Committee developed the narrative portion of the NCDs based on
scientific evidence. That is, the narrative indications for a test were
evidence based. Once the narrative indications were developed, the
Committee attempted to identify the ICD-9-CM codes that appropriately
translated the narrative.
The Committee provided a brief public comment period on the
policies as developed by the workgroups before the full Committee
discussion of the issue and before the rule was published by Centers
for Medicare & Medicaid Services on March 10, 2000. During this public
comment period, numerous suggestions for coding changes, similar to
those received during this public comment period, were made. In
considering these public comments, the Committee decided that unless
the coding changes were supported by medical evidence, the Committee
would continue to look to the narrative indications and make a
determination if the suggested code was an appropriate translation of
the narrative.
It is critical that the narrative indications for the proposed
policy and the ICD-9-CM codes that support medical necessity be
consistent. Thus, in order for us to add codes to the list of ICD-9-CM
codes that support medical necessity, those codes must either be
determined to be an appropriate translation of an existing indication,
or we must add a new indication for the test in the policy narrative.
The preamble to the March 10, 2000 proposed rule in soliciting public
comments on the policies clearly requested that any suggested changes
be accompanied by scientific literature supporting the change. Since
both the Medicare NCD process and the negotiating committee use
evidence-based decision making, it would not be appropriate to use
opinion-based decision making to change the proposed policies in
responding to the public comments. Therefore, we believe the approach
similar to that taken by the negotiating committee in handling the
comments it received from the public is a reasonable and appropriate
means of addressing the suggestion for coding changes that were
submitted to us during the public comment period on the March 10, 2000
proposed rule.
Since none of the suggested coding changes we received on the
proposed coverage policies was accompanied by scientific literature, we
looked to the
[[Page 58796]]
proposed narrative indications in determining if the code was an
appropriate addition to the ICD-9-CM list in the policy. We used a team
of our physicians and coding experts to evaluate each of the codes that
was suggested during the public comment period. The team carefully
studied the narrative descriptions of the indications for the test in
the proposed NCDs. When the suggested code was a reasonable application
of the existing narrative, we added the code to the list.
Our physicians acknowledged that many of the ICD-9-CM codes that
were suggested might be clinically understandable in certain
situations. However, gathering the scientific-evidence and conducting
the analysis necessary to make a reasonable determination as to the
appropriateness of adding indications to the proposed policies for each
of the multitude of codes suggested would be a daunting task and would
have resulted in unreasonable delay in the finalization of the
policies. We do not believe it is appropriate to further delay adoption
of the proposed policies to conduct this search for medical evidence to
support unsubstantiated suggestions. However, requestors are free to
use the national coverage decision process (published in the April 27,
1999 Federal Register (64 FR 22619) and on the Internet at
http://www.cms.gov/coverage/8a1.htm) to request further refinement of
the national coverage decisions.
The following codes were suggested for addition to specific
policies. We believe these codes are an appropriate translation of the
indications listed in the policy and we are adding them to the ICD-9-CM
codes covered by Medicare.
Blood glucose: 780.31, 781.0, 783.6
Digoxin: 429.2, 972.0
Fecal Occult Blood Test: 003.0, 003.1, 095.2, 095.3, 098.0, 098.7,
098.84, 139.8, 159.0-159.9, 569.82, 569.83, 596.1, 751.1
Gamma Glutamyl Transferase: 230.7, 230.9, 642.5, 782.4, 789.1, 790.4,
790.5, V42.7
Lipids: 278.00, 401.0-401.9, 402.00-402.91, 403.00-403.91, 404.00-
404.93, 405.01-405.99, V42.7
Prostate Specific Antigen: 236.5, 599.6, 788.30, 788.41, 788.43, 788.62
Human immunodeficiency virus testing (Diagnosis): 263.0, 263.1, 263.9,
486
Partial thromboplastin time: 362.30, 362.31, 362.32, 362.33, 362.34,
362.35, 362.36, 362.37, 410.0-.9, 456.8, 530.82,
Prothrombin time: 786.50, V12.51-V12.59
Iron studies: 579.8, 579.9, 713.0, 716.4-716.9, V56.0, V56.8
Thyroid: 290.3, 297.1, 333.99, 358.1, 359.5, 376.21, 376.22, 425.7
The following codes were suggested for changes to the NCDs.
Our physician staff and coding experts reviewed these codes. Based
on their clinical judgment and knowledge of coding guidelines, we do
not believe these codes appropriately stem from the indications
included in the respective policies.
Blood counts: 300.00, 300.01, 575.6, V45.89, 715.00-715.98, 716.00,
716.99
Blood glucose: 279.9, 357.2, 357.8, 785.1, 800.00-804.99, 805.00-
806.79, 850.00-854.19, V22.0-V22.2, V72.73-V72.84, V72.81
Iron studies: 253.5, 276.0, 276.1, 278, 282.0, 282.1, 282.2, 282.3,
282.4, 282.5, 282.60-282.63, 282.69, 282.7, 282.8, 282.9, 283.0-283.9,
289.0-289.9, 333.99, 564.5, 607.84, 708.8, 714.0-714.9, 715.0-715.9,
716.0-716.3, 733, 758.0, 758.1-758.9, 775.3, 780.4, 790.4
Partial thromboplastin time: 036, 040, 041, 050, 054, 056, 078.5, 081,
082, 083, 084, 085, 086, 087, 115, 117.3, 152.0-152.9, 162, 171, 174,
183, 185, 188.0-188.9, 198.1, 204, 205, 206, 207, 208, 239.4, 239.5,
250.1, 282, 283, 285.0, 287.3, 289.5, 290.40-290.43, 331.81, 345.3,
369.1-369.9, 377.53. 377.62, 386.2, 386.5, 394.0-394.9, 395.0, 395.2,
396.0-396.9, 397.0-397.9, 398.0, 398.90-398.99, 411.1, 411.81, 411.89,
413.0, 413.1, 413.9, 414.00-414.05, 414.8, 414.9, 415.0, 415.11,
415.99, 416.9, 424.0, 424.1, 424.90, 424.2, 424.3, 424.91, 425.0-425.9,
427.0-427.9, 436, 437, 440.0-440.9, 443.0-443.9, 447.6, 452, 459.2,
514, 555.0-555.9, 577.0, 671.9, 710, 746.00, 746.01-746.09, 746.1-
746.89, 747.1, 786.50, 789.1, 789.5, 940, 941, 942, 943, 944, 945, 946,
947, 948, 949, 958.1, 958.4, 991.6, 992.0, 994.1, 995.0, 996.85,
V12.51, V15.1, V42.2, V42.7, V43.2, V43.4, V43.60-V43.69
Prothrombin time: 036, 040, 050, 054, 056, 078.5, 081, 082, 083, 084,
085, 086, 087, 115, 117.3, 162, 171, 174, 183, 185, 204, 205, 206, 207,
208, 250.1, 282, 283, 287.3, 331.81, 410.0-410.9, 435.3, 427.5, 447.6,
577.0, 630, 710, 747.1, 785.5, 940, 941, 942, 943, 944, 945, 946, 947,
948, 949, 958.1, 958.4, 991.6, 994.1, 995.0, 996.85, V43.60-V43.69,
V72.81, V72.82, V72.83, V72.84
Thyroid: 198.82, 518.5, 611.6, 780.53-780.57, 786.05, 790.6, 790.94,
793.2, 995.0, V58.0
Digoxin: 402.00, 402.10, 402.90, 414.01, 412, 414.02, 414.03, 414.04,
414.05, 414.10, 414.11, 414.19, 557.1, 746.1-746.6, 746.81-746.89,
747.22, V78.8
Fecal Occult Blood: 003.20-003.24, 003.8, 003.9, 095.4-095.9, 096,
097.0, 097.1, 097.9, 098.10-098.19, 098.2, 098.3-098.39, 098.40-098.49,
098.50-098.59, 098.6, 098.81-098.83, 098.85, 098.89, 139.0, 139.1,
751.2, V12.79, V82.8
Gamma Glutamyl Transferase: 230.0-230.6, 231.0-231.9, 232.0-232.9,
233.0-233.8, 234.0, 234.9, 790.6, V11.3
Lipids: 427.0-427.2, 427.31, 427.32, 427.41, 427.42, 427.5, 427.60-
427.69, 436, 443.0, 443.1, 443.8, 443.89, 443.9, 574.00, 574.01.
574.10. 574.11, 574.20, 574.21, 574.30, 574.31, 574.40, 574.41, 574.50,
574.51, 574.60, 574.61, 574.70, 574.71, 574.80, 574.81, 574.90, 574.91,
575.2-575.8, 783.1, V67.51
Glycated Hemoglobin/Protein: 359.6
Prostate Specific Antigen: 188.8, 222.2, 584.5-584.9, 596.0-596.9,
599.1, 600, 606.0, V71.1, V76.44
Comment: One commenter submitted a list of pregnancy-related codes
for addition to the codes identified as medically necessary for human
chorionic gonadotropin (HCG), quantitative.
Response: In analyzing requests for additions of codes to the list,
we have generally looked to the indication section of the proposed
policies. The indication section of the HCG proposed policy states that
HCG is useful for diagnosis of pregnancy and pregnancy-associated
conditions. We note that the proposed policy is exclusively
quantitative HCG (CPT code 84702). The proposed policy is not
applicable for qualitative HCG. Based on review of scientific evidence,
such as textbooks (Clinical Interpretation of Laboratory Tests by
Frances K. Widen, M.D.) and advice of medical consultants, we believe
the language in the indications of the proposed policy relative to the
utility of quantitative hCG for diagnosing pregnancy is overly broad
and inaccurate. Pregnancy tests for the diagnosis of pregnancy use
qualitative methods of identifying HCG, rather than quantitative
methods. Quantitative HCG in pregnant patients is useful to monitor
patients with suspected complications of pregnancy, such as ectopic or
molar pregnancy.
We believe the Committee had this understanding of the policy in
that the list of covered codes included vaginal bleeding, molar
pregnancy, missed abortion, ectopic pregnancy, threatened abortion, and
pregnancy. Thus, the codes do not coincide with the language of the
test being useful for diagnosing pregnancy. That is, codes that
indicate suspected pregnancy, such as the
[[Page 58797]]
absence of menstruation, are not included.
Consequently, we are altering the indications for the policy for
HCG in this final rule to more precisely describe the utility of
quantitative HCG. The final policy will read, ``In addition, HCG is
useful for monitoring pregnant patients with vaginal bleeding,
hypertension and/or suspected fetal loss.'' Given this revised
indication, we believe the following codes suggested by the commenter
should be added to the list of codes covered by Medicare: 634.0, 636.0,
642.3, 642.4, 642.5, 642.6, 642.7, 642.9. The following codes,
suggested by the commenter are not being included at this time: 623.8,
626.0, 626.1, 646.5, 658.1, 658.2, 658.3, 658.4, 659.2, 659.3, V22.2.
Further, we are deleting codes V22.0 and V22.1 from the list of covered
codes. These codes indicate normal pregnancy. We do not believe that
quantitative HCG is reasonable and necessary for a pregnancy that is
confirmed as normal.
Comment: Seventeen commenters addressed the proposed NCD on the
collagen crosslinks test. Fifteen of the commenters generally expressed
support for adopting the NCD on the collagen crosslinks test in the
final rule but suggested clarification and revision in a number of
different areas. One other commenter questioned the clinical usefulness
and reliability of the test and concluded that Medicare should not
reimburse it.
Another commenter did not indicate whether or not he supported the
proposed national policy, but expressed the view that there were
internal inconsistencies in the policy that needed to be clarified
before publication in the final rule. Only one of the commenters
produced scientific evidence for their views; however, much of this
evidence had already been reviewed the rest of the negotiating
committee and us during the deliberations.
Response: There was considerable discussion at the November 1998
meeting of the negotiation Committee on this proposed policy as well.
It also noted that this was a field that was changing rapidly. We
believe that the evidence available supports the policy. Since the
field is rapidly changing and there are limited and inconsistent
findings in the literature, it is not surprising that we received
several inconsistent comments on this proposed policy. That is, some
commenters believe the policy is too restrictive, and others believe it
goes beyond what is supported by the science. We note, however, that
most of the commenters believe that the policy is basically sound, but
they were requesting refinements. After careful studying of the
comments and the limited additional scientific literature submitted by
the commenters, we do not believe that the public comments have
presented such a radically different view as to undermine the policy we
had proposed and which was recommended by the Committee.
Therefore, we are including the collagen crosslinks policy in the
final rule with only minor clarification as we explain in our response
to several of the more specific comments summarized below. We invite
commenters to use the NCD process that was published in the April 27,
1999 Federal Register (64 FR 22619) to request further changes in the
policy.
Comment: Some of the commenters expressed concern that the NCD on
the collagen crosslinks test did not recognize that these tests may be
useful in men who have degenerative bone loss. The commenters noted
that while the majority of bone loss patients are women, bone loss can
also affect men as well--especially those over 70 years of age.
Response: We agree that the collagen crosslinks test may be useful
in assessing or monitoring the treatment regimens of men who have
osteoporosis, Paget's disease, or are otherwise at risk for
degenerative bone loss. We did not intend to exclude, nor do we believe
that the proposed NCD should be interpreted to preclude men from
coverage of collagen crosslinks tests as long as one of the applicable
medical indications for coverage is met. Nonetheless, we have clarified
this point in the final rule by revising the fourth sentence of the
``Indications'' section of the NCD to provide that ``Coverage for bone
marker assays should be established * * * for younger beneficiaries and
for those men and women who might become fast losers because of some
other therapy such as glucocorticoids.''
Comment: Nine commenters indicated that the proposed NCD on the
collagen crosslinks test reflects that these tests may be performed on
urine, but not on serum samples. One of these commenters stated that
the FDA had approved the serum-based technique as ``substantially
equivalent'' to the urine-based version and offered documentation in
support of adding it to the urine-based collagen crosslinks test in the
final rule. Another commenter mentioned that the serum-based technique
might be a more reliable test of bone turnover than the urine test, but
suggested that there was insufficient information available to
determine whether either test was clinically useful for monitoring drug
therapy for individuals with or at risk for bone loss.
Response: We recognize that since the proposed Medicare NCD on
urine-based collagen was negotiated, the FDA approved the serum
collagen crosslinks test in February 1999 for the purpose of assessing
or monitoring drug therapy for individuals with or at risk for bone
loss. However, serum collagen crosslinks test was not part of the
negotiated rulemaking. We do not believe it is appropriate to include
additional tests that were not subject to negotiation in this final
rule. That is, the negotiated rulemaking committee carefully selected
the tests for which it wished to negotiate a coverage NCD.
The commenter noted that the FDA had determined that the serum-
based technique is ``substantially equivalent'' to the urine-based
version. The criteria the FDA uses in making determinations related to
substantial equivalency under section 510(k) of the Food, Drug and
Cosmetic Act is significantly different from the scientific evidence we
consider in making ``reasonable and necessary'' determinations under
Medicare. FDA does not require clinical data or outcomes studies in
making a determination of substantial equivalency for the purpose of
device approval under section 510(k) of the Food, Drug, and Cosmetic
Act. Medicare evidence-base decisions consider medical benefit and
clinical utility of an item or service in determining whether the item
or service is considered reasonable and necessary under the Medicare
program. Thus, a substantial equivalency approval under section 510(k)
of FDA is not sufficient for making determination concerning Medicare
coverage.
When sufficient clinical studies have been done on the serum tests,
we encourage the commenters to use the NCD process published in the
April 27, 1999 Federal Register to request inclusion of serum version
of the test in the collagen crosslinks NCD. In the meantime, in the
absence of an NCD on the serum collagen crosslink test, Medicare
contractors will have local discretion in deciding whether this type of
collagen crosslinks test is medically necessary for assessing or
monitoring bone loss therapy.
Comment: Fifteen commenters indicated that available scientific
evidence and clinical expert opinion support the view that contrary to
the first paragraph of the ``Indications'' section of the proposed NCD
on the coverage of collagen crosslinks tests, rapid bone loss
frequently does occur
[[Page 58798]]
after age 65. In view of their concerns, the commenters have
recommended that the first paragraph of the ``Indications section'' be
deleted or substantially revised in the final rule.
Response: In response to the commenters' concerns, we re-examined
the scientific evidence considered by the negotiating Committee and
that was submitted during the public comment period on the collagen
crosslinks proposed NCD. In the studies we reviewed, the sensitivity
and specificity of the biochemical markers was relatively low, and
there are wide confidence intervals associated with the results. We
believe these factors demonstrate the clinical utility of biochemical
markers only for patients who are rapid bone losers.
The commenters do not appear to dispute the determination that
collagen crosslinks are most clinically useful only for rapid bone
losers. Rather, the commenters believe that many patients over age 65
are considered rapid bone losers. While several practicing physicians
indicated that in their clinical judgment patients over age 65
frequently are rapid bone losers, this clinical judgment was not
supported with clinical studies to indicate the extent to which rapid
bone loss may be a significant problem for Medicare beneficiaries age
65 and older.
Further, in our review of the literature, we did not find
scientific evidence either supporting or disputing this assertion. In
the absence of evidence to support this clinical judgment, we are not
convinced that the policy negotiated by the Committee is inappropriate.
In short, we find no persuasive reason to revise the proposed policy.
Therefore, we believe that the first paragraph of the ``Indications''
section of the proposed NCD on this test should be included unchanged
in the final rule except for the clarification discussed above with
respect to men.
We would point out, however, that the age limitation is not an
absolute exclusion from coverage. The language in the NCD states,
``Generally speaking, collagen crosslink testing is useful mostly in
`fast losers' of bone. The age when these bone markers can help direct
therapy is often pre-Medicare. By the time a fast loser of bone reaches
age 65, she will most likely have been stabilized by appropriate
therapy or have lost so much bone mass that further testing is
useless.'' Thus, physicians who encounter an occasional patient age 65
and over for whom they have reason to believe collagen crosslinks
testing is clinically useful, may obtain Medicare coverage through
documentation that the service is reasonable and necessary for that
patient.
Comment: One commenter noted that there appears to be an
inconsistency in the proposed NCD for collagen crosslink tests because
the list of ICD-9 codes for this policy includes multiple myeloma, but
this condition is not included in the ``Indications'' section for this
policy. It is suggested that these two portions of the policy be made
consistent.
Response: We agree that the two portions of the policy should be
made consistent. The Committee operated under the ground rules that the
codes included under the ``List of ICD-9-CM Codes Covered by Medicare''
should be an appropriate representation of the narrative indications.
In addressing all requests for changes to the codes that were received
during the comment period, we have consistently held that the codes
must be a codification of a condition that was included in the
indication section of the NCD. Therefore, we have removed ICD-9-CM
codes 203.00 and 203.01 from the list of ICD-9-CM codes covered by
Medicare for collagen crosslinks. If commenters believe this is an
appropriate indication for collagen crosslinks, they may use the NCD
process described in the April 27, 1999 Federal Register to submit
scientific evidence in support of the change.
Comment: One commenter also stated that if the purpose of the
proposed NCD for collagen crosslink tests is to permit this test to be
used to diagnose the presence of osteoporosis or the risk of developing
it, we should determine how frequently this test may be used for this
purpose and whether collagen crosslinks and bone mineral density tests
may be done in the same period for diagnosing osteoporosis. Otherwise,
the commenter noted that the predisposing conditions for osteoporosis
should be deleted as acceptable conditions for coverage of this test,
and only the conditions for coverage of monitoring known osteoporosis
treatment should be allowed.
Response: The purpose of the proposed NCD for the collagen
crosslinks test was not to permit coverage of the test to diagnose the
presence of osteoporosis or the risk of developing it. Rather, the
purpose of the test, as stated in the proposed NCD, was to (1) identify
individuals with elevated bone resorption, who have osteoporosis in
whom response to treatment is being monitored, (2) predict response (as
assessed by bone measurements) to FDA-approved antiresorptive therapy
in postmenopausal women, and (3) assess response to treatment of
patients with osteoporosis, Paget's disease of the bone, or at risk for
osteoporosis for which treatment may include FDA approved
antiresorptive agents, anti-estrogens or selective estrogen receptor
moderators. We are including this language unchanged in the final rule.
It should be interpreted to mean that all covered indications for
collagen crosslinks in the final rule relate solely to the assessment
or monitoring of treatment regimens for postmenopausal women, patients
with osteoporosis, Paget's disease of the bone, or others who are at
risk for osteoporosis. None of the covered conditions relate to the
diagnosis of osteoporosis or the risk of developing osteoporosis.
Comment: Fifteen commenters expressed the view that the proposed
NCD on collagen crosslinks tests should be implemented immediately upon
publication of the final rule without the 12-month delay in the
effective date and the additional grace period of up to 12-months
beyond the effective date called for in the March 10, 2000 proposed
rule. One of the commenters stated that our reasoning in the March 10,
2000 proposed rule for the delayed implementation that referenced the
need for time to allow for educational efforts and computer systems
changes to be made for the various new policies was not applicable to
the collagen crosslinks test for several reasons. First, the commenter
suggested that the volume of Medicare collagen crosslink test claims
anticipated is so negligible that the immediate implementation of the
NCD on the test would not disrupt the Medicare claims process or cause
related education or computer systems problems. Second, the commenter
believes that the collagen crosslinks test has a unique legal status
that necessitates that it be excluded from the delay in the effective
date that has been proposed for all of the clinical diagnostic test
NCDs that have been developed. Specifically, the commenter suggested
that the collagen crosslinks test is subject to the provisions of
section 4106 of the BBA, which mandated national coverage for bone mass
measurements effective July 1, 1998.
Response: We continue to believe that the concerns expressed by the
negotiating committee relative to the need for the delayed effective
date to allow for important education and systems changes to be
completed is appropriate and should be applied in the final rule to all
of the 23 NCDs, including the one on collagen crosslink tests. We
recognize that the volume of Medicare collagen crosslink test claims
that may be anticipated may be small in comparison to the volume of
Medicare
[[Page 58799]]
claims for the other 22 clinical laboratory tests, but the lower volume
of claims expected will not preclude the need for important educational
efforts and systems changes to be made for the collagen crosslinks
test.
As for the commenter's suggestion that the collagen crosslinks test
has a unique legal status under section 4106 of the BBA that should
allow it to be excluded from the delay in the effective date of the
various policies, we disagree that this is the case. Section 4106(b) of
the BBA amended the law to provide that payment for bone mass
measurements that are covered under the new benefit must be made under
the Medicare physician fee schedule, as provided in section 1848(j)(3)
of the Act. We have interpreted these provisions in the interim final
rule that was published on June 24, 1998 (63 FR 34320) on coverage and
payment for bone mass measurements to mean that the scope of the
benefit includes bone densitometry or bone sonometry procedures that
are performed with devices that have been approved or cleared for
marketing by the FDA. We did not include coverage of crosslink tests
within the bone mass measurement benefit. Collagen crosslink tests are,
in fact, clinical laboratory tests that are paid for under the Medicare
clinical laboratory fee schedule, and Medicare coverage of these tests
has been addressed under section 4554 of the BBA, which, of course,
mandated this negotiated rulemaking process for the coverage of certain
clinical laboratory tests. Collagen crosslinks measure bone resorption
and are used to monitor the effectiveness of antiresorptive therapy. We
do not believe collagen crosslinks tests are appropriately considered
bone mass measurements.
Comment: Ten commenters suggested that we develop a specific
process for updating policies and to introduce additional national
coverage decisions without having to wait for the biennial review.
Response: It is not necessary to wait for the biennial review in
order to request changes in the Medicare national coverage decisions.
As we noted in the preamble to the March 10, 2000 proposed rule,
Medicare has announced a new process for making requests for new
Medicare national coverage decisions or for requesting changes to
current coverage decisions. The coverage process was delineated in a
notice in the Federal Register published April 27, 1999, and is
available on the Internet at http://www.cms.gov/coverage/8a1.htm
We should point out that the new coverage process includes an
opportunity for members of the public to participate in coverage
decisions. We post all pending coverage issues on the Internet and
welcome the submission of evidence related to every issue. In addition,
for some issues, we hold public meetings of the Medicare Coverage
Advisory Committee (MCAC) to assist us in assessing the evidence. We
have established a specific MCAC panel to address diagnostic issues,
such as clinical diagnostic laboratory tests.
We intend to solicit changes in the laboratory policies biennially,
as directed in section 4554 of the BBA. In addition, we will accept
requests for changes to current policies at any time, as long as they
comply with the requirements in the coverage notice.
Comment: One commenter was concerned that implementation of the
final rule may result in denial of payment for laboratory services that
are currently being paid by Medicare. The commenter suggested that a
laboratory should be able to rely on the existing local medical review
policies (LMRP) without fear of claims denial and potential government
enforcement action until the applicable contractor changes its LMRP or
until the proposed rule is effective.
Response: We agree with the commenter that the final rule should
not be enforced before its effective date. Contractors should be using
their existing local policies until these policies become effective.
Once these national coverage decisions become effective, contractors
will need to use these policies as they are published. LMRPs may not
conflict with the 23 national coverage decisions outlined. If a LMRP
conflicts with a national coverage decision, the contractor is required
to change it so it complies with the national coverage decision. When a
national coverage decision is silent on an issue, such as frequency
guidance, a contractor may develop an LMRP that supplements the
national coverage decision. However, the LMRP may not conflict with the
national coverage decision.
Appropriate Use of Procedure Code
Comment: Three commenters expressed the view that it is not
appropriate to use modifier -59 for medically necessary repeat clinical
laboratory tests for the same CPT code for the same beneficiary on the
same day because that modifier applies to physician procedures and not
clinical laboratory tests. They indicated that modifier -91 is
specifically designed for clinical laboratory tests, and is a more
appropriate modifier to use in billing for medically necessary repeat
tests of this type.
Response: The issue of use of modifiers -59 and -91 can be
confusing. Both modifiers have a place in coding repeat clinical
diagnostic laboratory tests. Modifier -91 is appropriate when in the
course of treatment of the patient it is necessary to repeat the same
laboratory test on the same day to obtain subsequent test results, such
as when a beneficiary requires repeated blood tests that were performed
at different intervals during the same day.
The commenters are correct that the new modifier -91 that was added
by the American Medical Association's CPT Editorial Panel, as part of
its year 2000 update, is specifically designed for the reporting of
that type of repeated test. For example, if an arterial blood sample is
drawn from a patient at three different intervals on the same day, and
the blood testing is performed three times that same day, then CPT code
82803, Gas, blood, any combination of pH, PCO2, P02, CO2, HC03
(including calculated oxygen saturation), should be reported as
follows: 82803, 82803-91, and 82803-91. We believe one of the examples
provided in the March 10, 2000 proposed rule--Biochemical studies
performed on different samples, for example, renins (CPT code 84244)--
is an example of when the modifier -91 is appropriate.
The purpose of the Committee consensus on the use of modifier -59
was to resolve coding situations that were presented to the Committee
by the microbiology community that do not meet the definition of
repeated tests for which modifier -91 is appropriate. They cited
situations, for example, in which samples or cultures are taken from a
patient from different anatomical sites, or even different wounds, and
then are tested the same day. We believe that the use of modifier -59
in reporting multiple claims submissions by a clinical laboratory for
the same CPT code for the same beneficiary on the same day is the
appropriate way to handle these situations and is consistent with
established CPT coding conventions. We have consulted with the American
Medical Association, the proprietors of the CPT coding system including
modifier, in ensuring that modifier -59 is the appropriate means of
indicating repeat laboratory test coding when there are two tests
involving different sites. As mentioned in the preamble to the March
10, 2000 proposed rule, a few examples of appropriate use of modifier
-59 would be the following:
[[Page 58800]]
Multiple blood cultures (CPT codes 87040 and 87103),
generally 2-3 collected from different sites to document etiology of
sepsis.
Multiple lesion samples collected from distinct anatomic
sites for culture for bacteria (CPT codes 87070 and 87075).
Comment: One commenter noted that it is the experience of its
organizations members that some Medicare contractors are not currently
accepting the use of modifier -59, and it is suggested that we should
issue an instruction to its contractors to ensure that they will accept
multiple claims submitted by laboratories using modifier -59.
Response: We agree that all Medicare contractors processing
laboratory claims should be accepting both modifier -59 and modifier
-91 when used appropriately in billing for medically necessary
laboratory services for the same CPT code for the same beneficiary on
the same day, as described above in our reply to the previous comment.
We will clarify the use of these two modifiers in the instructions that
we will be issuing to our contractors.
Comment: One commenter indicated that there was a need for us to
identify all of those clinical laboratory tests that frequently result
in multiple tests being billed.
Response: We do not believe that we have the expertise or
experience to attempt to identify all of the various clinical
laboratory tests that might warrant the use of modifier -59. If we were
to attempt this action and make errors in omission, laboratories would
not be able to receive payment when it may become necessary to perform
repeat testing on patients to attend to their specific medical needs.
We believe that it is sufficient to provide a few examples of
appropriate use of the modifier, which we will repeat in our
instructional issuance.
Moreover, the Committee believes that there was not sufficient time
and information available for them to attempt to identify all the
various clinical laboratory tests that might warrant use of modifier
-59. As a result, the Committee agreed that it would be sufficient to
provide a few examples are of appropriate use of the modifier. We agree
with the Committee that a few examples are sufficient to address the
concern with the -59 modifier. Moreover, we believe that any attempt on
our part to identify a comprehensive list of situations that would
warrant the use of the -59 modifier is likely to be incomplete due to
our lack of field experience and would thus generate additional
concerns.
Documentation and Recordkeeping Requirements
Comment: Three commenters expressed concern about the process by
which diagnostic information supporting medical necessity is to be
collected from the ordering physician. Two of the commenters suggested
that we publish a guideline for collecting additional information from
the ordering physician. Another commenter further suggested that our
guideline state the baseline effort required for obtaining
documentation by the entity submitting the claim. The commenter
suggested that claims should be denied only if the required effort for
obtaining the documentation has been met.
Response: We acknowledge the burden that accompanies the task of
collecting diagnostic information to support medical necessity.
However, the Act requires that Medicare only pay for services that are
reasonable and necessary. Medicare cannot pay for services that do not
meet this standard simply because the laboratory has expended a
specified amount of effort to obtain documentation. We have, however,
identified a process for requesting documentation that we believe
reduces the burden on the laboratories for collecting and submitting
information to us.
As part of the negotiated rulemaking process, the Committee
established a consensus to the guidelines for documentation that
appeared in the preamble to the March 10, 2000 proposed rule.
Specifically, the consensus statement and proposed rule provide that
the laboratory is responsible for maintaining information it receives
from the ordering practitioner, and the practitioner, is responsible
for maintaining the information in the medical record. Our initial
request for information is made to the entity submitting the claim.
That entity should submit whatever documentation it has in support of
the claim.
If the documentation provided by the entity submitting the claim
does not demonstrate that the service is reasonable and necessary, we
will take the following action: (1) Provide the ordering physician
information sufficient to identify the claim being reviewed; (2)
request from the ordering physician those parts of a beneficiary's
medical record that are relevant to the specific claim(s) being
reviewed; and (3) if the ordering physician does not supply the
documentation requested, inform the entity submitting the claim(s) that
the documentation has not been supplied and deny the claim.
Since the entity submitting the claim will be the entity to
experience a payment denial if documentation does not support the
medical necessity of the claim, we agreed laboratories should not be
precluded from requesting additional diagnostic or other medical
information from the ordering provider. In making requests for
additional information, laboratories must focus their request for
additional information on material relevant to medical necessity. In
addition, documentation requests must take into account applicable laws
and regulations related to patient confidentiality.
Comment: One commenter requested that we publish a quarterly
summary that specifies the total number of tests ordered and the total
number of tests not paid by Medicare due to lack of medical necessity
by the ordering physician.
Response: We question the utility of quarterly reports that specify
the total number of tests and total number denied due to lack of
medical necessity. We fail to see how this report would assist
laboratories without identification of the laboratories and/or
physicians involved. Furthermore, the commenter did not identify a
method of distribution of this information that would be beneficial and
reasonably priced. We are not convinced that the benefits of such a
report would outweigh the costs.
Laboratories are free to prepare any reports for their own use with
the payment information they receive. For example, laboratories can
link denial rates for failure to provide medical necessity information
to specific clients and target educational efforts toward those
specific problems.
Comment: Twenty-six commenters expressed concern that the March 10,
2000 proposed rule makes it possible for laboratories to be held liable
for claims denial due to the lack of information supporting medical
necessity. That is, the commenters were concerned that the laboratories
would be the entity experiencing the loss if the physician does not
submit the information supporting medical necessity. The commenters
believe that the March 10, 2000 proposed rule will result in unfairness
and financial hardships for the laboratory industry. Several commenters
suggested that in the final rule, laboratories should not be
financially responsible in this situation. Some commenters believe that
the situation may be best addressed if (1) we simultaneously notify
both the entity submitting the claim and the ordering physician that
additional information is
[[Page 58801]]
being requested; (2) we tracks which physicians have failed to comply
with requests for additional information; and (3) we identify a time
frame that specifies when responses to requests need to be made. One
commenter suggested that we create a database of medical records that
service providers may access for claims purposes.
Response: The commenters do not seem to recognize that the March
10, 2000 proposed rule does not change the current provisions for
liability on claims due to lack of information supporting medical
necessity. Section 1862(a)(1)(A) of the Act provides that,
notwithstanding any other provision of the Act, payment may not be made
for services that are not reasonable and necessary for the diagnosis or
treatment of illness or injury. Presently, all entities that bill the
Medicare program are held liable when they bill for services and are
not able to produce documentation of the medical necessity of the
service. Although the Committee discussed at length the special
circumstances related to laboratories, which frequently do not have
direct contact with the patient, the Committee recognized that the law
does not provide the authority to exempt laboratories from the
provision related to medical necessity.
In addition, we do not agree that the provision related to denial
of claims for laboratory services when documentation is not provided is
unfair. Rather, we believe it would be unfair to exempt laboratories
from this provision while continuing to require it for other providers
and suppliers. For example, durable medical equipment (DME) suppliers
frequently do not have direct contact with beneficiaries but are
dependent upon physician documentation of medical need in order to
receive payment.
Some commenters suggested that we simultaneously notify both the
entity submitting the claims and the ordering physician that additional
information is being requested. We are not accepting this suggestion
for several reasons. First, in many cases, we do not have the address
of the ordering physician at the time the initial request for
information is made. This information will be supplied by the entity
that submitted the claim following our initial request so that we can
directly request additional information from the physician as is
contemplated in Sec. 410.32(d)(3)(ii). Moreover, we believe that it
would be confusing to request information from both the ordering
physician and laboratory simultaneously because both the laboratory and
the physician could send information or both can believe that the other
is handling it. Finally, duplicate mailings to both the laboratory and
physician are costly to the program. This appears to be a cost without
benefit.
Some commenters suggested that we track which physicians have
failed to comply with requests for additional information. Similarly,
this is a suggestion that would result in significant cost to the
program if adopted. The commenters were not clear about how this
information ought to be used. We do not agree that tracking these
physicians would be beneficial. Several of the commenters suggested
that we identify a time frame between a request for documentation from
the carrier and denial of the claim for lack of documentation. We agree
that physicians should be advised of the period of time that they have
to respond to the Medicare contractor's request. Section 521 of the
BIPA requires that the carrier or fiscal intermediary must make initial
determinations on claims within 45 days of receipt of the claim.
Claims subject to additional information requests on prepayment
review must be handled within the statutory mandated time frame. In
cases for which the initial request would have been made to the entity
submitting the claim before the request to the physician, it is very
likely that there will be minimal time for the physician to respond.
Requests for additional information made on a postpayment basis is not
subject to the time frames contained in section 521 of BIPA. In issuing
instructions implementing this provision of the rule, we will instruct
the contractors to identify the date by which they need information on
claims that have not received an initial determination and provide 60
days notice before denying a claim for failure to supply requested
information when claims are identified for development based on
postpayment review.
Comment: One commenter addressed the process that would allow
physicians to justify additional tests that may not be deemed by local
medical review policy (LMRP) as medically necessary.
Response: Most local medical review policy is written in a fashion
similar to that employed by the Committee in development of the 23
national coverage decisions contained in the addendum to the March 10,
2000 proposed rule. That is, most LMRPs provide a list of codes for
which medical necessity is presumed, a list of codes that are not
covered, and a list of codes that are presumed not medically necessary.
Contractors are required to consider any documentation that is
submitted with the claim. Thus, a process already exists for physicians
to justify tests that are not presumed medically necessary. Further,
LMRPs are not binding upon the Administrative Law Judges that
adjudicate appeals of contractor denials. Physicians may use the appeal
process to seek payment for claims that the contractor determines are
not justified.
Comment: One commenter requested that a form be produced that would
allow physicians to justify additional clinical laboratory tests that
may not be considered medically necessary by the local LMRP.
Response: Under current Medicare guidelines, clinical laboratories
are already allowed, if they choose, to require that their ordering
physicians use a specified medical documentation form in support of
claims as the commenter has suggested. We, however, are obligated under
the Paperwork Reduction Act to limit the reporting burden placed upon
providers unless there is a demonstrated need for it to carry out the
provisions of the applicable law and regulations. Since clinical
laboratories already have the ability to require their clients to use a
specified medical documentation form, we do not believe that it is
necessary to require the use of such a form by all physicians for all
of the tests that they order for their Medicare beneficiaries. It is
possible for us to engage in this type of documentation gathering
through use of a national certificate of medical necessity for clinical
laboratory services. However, before we actively consider imposing this
type of reporting burden on the public, we believe we need to research
this proposal carefully.
Signature on Requisition
Comment: Twelve commenters addressed the March 10, 2000 proposed
rule's provision about signature requirements on requisitions. Seven of
the commenters were in agreement with the March 10, 2000 proposed rule
provision that a signature not be required on a claim and did not
submit suggestions to us. Two of the commenters requested that we
publish other means of indicating that a physician has ordered a
laboratory service. Three of the commenters expressed concern that the
March 10, 2000 proposed rule was in conflict with CLIA requirements
that a written authorization be obtained within 30 days of a verbal
request for the laboratory service. One suggested that we should
require USER ID instead of physician signature while another suggested
that another individual who has the authority to order for the
physician be required to sign the requisition in place of the
physician.
[[Page 58802]]
Response: Regulations set forth at Sec. 410.32(a) require that
diagnostic x-ray tests, diagnostic laboratory tests, and other
diagnostic tests must be ordered by the physician who is treating the
beneficiary for a specific medical problem and who uses the results in
the management of the beneficiary's specific medical problem. Some have
interpreted this regulation to require a physician's signature on the
requisition as documentation of the physician's order. While the
signature of a physician on a requisition is one way of documenting
that the treating physician ordered the test, it is not the only
permissible way of documenting that the test has been ordered. For
example, the physician may document the ordering of specific tests in
the patient's medical record. As stated in the preamble to the March
10, 2000 proposed rule, we will publish an instruction to Medicare
contractors clarifying that the signature of the ordering physician is
not required for Medicare purposes on a requisition for a clinical
diagnostic laboratory test.
We also do not agree with the commenters that the March 10, 2000
proposed rule conflicts with the CLIA requirements. Regulations
implementing the Clinical Laboratory Improvement Amendments of 1988
(CLIA) at Sec. 493.1105, relating to the requisition, specify that a
laboratory must perform services only at the written or electronic
request of an authorized person. Further, this section permits oral
requests for laboratory services only if the laboratory subsequently
requests written authorization for the testing within 30 days.
Authorization does not equate to physician signature; the CLIA
regulations provide, for example, that the patient's chart or medical
record may be used as the test requisition. The CLIA regulations
address this written authorization as a means of ensuring that
laboratories are not performing tests that were not authorized. They do
not address or conflict with the requirement that there be
documentation of the physician's order available upon request of the
Medicare contractor. Of course, if the physician signs the requisition
himself, it would satisfy both the requirement in Sec. 410.32(a) and
Sec. 405.1105.
Procedures for Filing Claims
The Committee discussed concerns expressed by various members of
the Committee and reached a consensus on the following three issues
relating to ``Procedures in Filing Claims.'' These included (1) Coding
of Narrative Diagnoses, (2) Limitation on Number of Diagnoses, and (3)
Matching of Diagnosis to Procedure. We received no comments from anyone
on these issues.
Limitation on Frequency
Comment: Three commenters cited the lack of frequency limitations
in many of the national coverage policies that had been developed in
the March 10, 2000 proposed rule. Two commenters requested that we
specify the allowed frequency limitations in all of the proposed
policies. One commenter expressed support only for screens that are
national in scope and suggested that in the absence of these national
frequency limitations, local contractors should not be permitted to
apply their own frequency limitations at that level.
Response: The Committee discussed this subject and agreed to set as
its goal the development of specific language on frequency limitations
for the various national coverage policies drafted whenever possible to
promote uniformity throughout the country. The Committee spent a great
deal of time and worked very diligently on this issue, but they were
unable to reach a consensus on specific frequency limitations for most
of the proposed national coverage policies.
We have continued to study the scientific evidence related to
frequency limitations, and we do not believe that the medical evidence
is sufficient to develop national frequency limitations for those
policies that do not contain them at present. Further, we note that the
public comments on the March 10, 2000 proposed rule did not include
information supporting the addition of any specific frequency
limitations to the national coverage policies. Contractors analyze data
to allow them to identify what is the prevalent practice in the area.
In the absence of scientific data to support national frequency
limitation, we have decided to defer to local contractors in this
regard who will base their determinations on the local practices.
In the absence of a national coverage policy on a particular
laboratory procedure that specifies a frequency limitation, Medicare's
local contractors are responsible for making individual coverage
determinations on the procedure, including, if they choose,
establishing appropriate local frequency limitations on the procedure.
The Committee discussed this issue and agreed that a frequency
limitation would not result in a frequency-based denial at the local
level unless information published by our contractor (or by us in the
case of a national frequency limitation) includes an indication of the
frequency that is generally considered reasonable use of that test for
Medicare payment purposes. The contractor must consult with appropriate
advisors, including medical specialty and other organizations, before
developing and publishing frequency information for a clinical
diagnostic laboratory test.
Comment: One commenter opposed the use of frequency screens that
result in automatic denials and believes that the use of these screens
conflicts with court cases that have held that their use contravenes
the Medicare statute. The commenter believes that this type of
frequency screen is used as an absolute denial mechanisms or
irrebuttable presumption that forecloses the opportunity for an
individualized determination of medical necessity and is, therefore,
illegal. The court decisions of Vorster v. Bowen, 709 F. Supp. 934
(C.D.Cal. 1989); and Fox v. Bowen, 656 F. Supp. 1236 (D.C.Conn. 1987)
are cited in support of the commenter's assertion.
Response: We believe the commenter has misunderstood the March 10,
2000 proposed rule with respect to Medicare policy on automatic denial
of laboratory claims as the policy applies to frequency screens. This
policy does not provide for automatic denials of laboratory claims
based on frequency. Rather, under the proposed policy, contractors will
provide frequency guidance before implementation of any frequency
screens. Entities submitting claims for laboratory services that exceed
the frequency guidance are encouraged to submit documentation of the
medical necessity of the service with the claim. Contractors will
review all documentation submitted before making a determination on the
claim.
We do not believe that this policy is in conflict with the court
cases that the commenter has referenced. On the contrary, the Court in
Vorster expressly determined that the Medicare statute and its
legislative history supported the use of utilization screens by
carriers in processing claims under Part B. In that case, the
plaintiff, a Medicare beneficiary, submitted claims for covered
chiropractic services to the carrier that were subsequently denied
entirely, based on application of a utilization screen. The plaintiff
then sought a review determination from the carrier and submitted
additional information to the carrier in support of her claim. The
carrier again denied the claims, and the beneficiary then filed suit,
alleging that the use of utilization screens was a violation of the
Medicare statute.
[[Page 58803]]
The Court in Vorster rejected the plaintiff's allegation that the
use of utilization screens violated the Medicare statute. According to
the Court in that case: The Congress instructed the Secretary to use
the expertise of private sector carriers in administering the Part B
plan, and has acknowledged that the efficient administration of the
Part B program includes review of utilization and the control of
unnecessary utilization of covered services. [Citations omitted.]
* * * * *
Based upon the foregoing legislative history, it appears that in
general, the Congress would approve the use of utilization screens in
processing claims. Vorster, 709 F. Supp. 940-41. The Court in Vorster
noted that the use of utilization screens would contravene the Medicare
statute if they were used as ``absolute denial mechanisms'' or as
``irrefutable presumptions, which foreclosed any meaningful opportunity
to receive an individualized determination of medical necessity.''
Vorster, 709 F. Supp. at 941. As we have stated above, however, the use
of utilization screens as contemplated in the policy does not act as
either an ``absolute denial mechanism'' or as an ``irrefutable
presumption which foreclose[s] any meaningful opportunity to receive an
individualized determination of medical necessity.''
We also do not think that the reasoning in the Fox v. Bowen case,
also cited by the commenter, is applicable to the proposed policy. The
Fox case involved a challenge to a denial of claims for physical
therapy services to skilled nursing facility patients. A fiscal
intermediary in that case had established parameters for determining
whether physical therapy services would be covered for patients in
skilled nursing facilities. The Court characterized those parameters as
``informal presumptions'' or ``rules of thumb,'' applied across the
board ``without regard to the therapeutic requirements of the
individual patient.'' Fox, 656 F. Supp. at 1248. The regulations
promulgated by the Secretary, and the manual that was provided to
assist intermediaries in making coverage determinations for physical
therapy services, however, contemplated clearly that beneficiaries
would receive an individualized assessment of need for physical therapy
services. Id. Because an intermediary's practice in that case did not
conform to the requirements of the regulations calling for an
individual assessment of need for covered services, the Court in Fox
determined that the practice was unlawful. We believe, therefore, that
the Fox case is inapplicable to the proposed policy. The proposed
policy does not constitute a denial of benefits based on ``informal
presumptions'' or ``rules of thumb'' applied across the board without
regard to the therapeutic requirements of the individual patient.
Comment: One commenter expressed concern that there is little
oversight of the LMRP development process, which often results in LMRPs
being developed without regard to our coverage guidelines. The
commenter indicated that, although the Medicare Carrier's Manual
requires, and the March 10, 2000 proposed rule suggests that LMRPs must
be based on medical literature and current clinical practice
guidelines, many are not. The commenter also stated that because there
is no public notice for the development of LMRPs, there is no
opportunity for beneficiaries to comment on them, and only limited
opportunity for affected practitioners to do so.
Response: An LMRP is primarily a program integrity tool. It is
developed to address identified or potential abuse, such as
overutilization. In the absence of national policy, it is generally
developed to specify criteria that describe whether the item or service
is covered and under what clinical circumstances it is considered to be
reasonable, necessary, and appropriate. The process for developing
LMRPs includes the following: (1) Development of a draft policy based
on review of medical literature and the contractor's understanding of
local practice; (2) soliciting comments from the medical community,
including the Contractor Advisory Committee (CAC); (3) responding to
and incorporating into a final policy the comments received; and (4)
notifying providers of the policy's effective date.
In accordance with our instructions to contractors, LMRPs must be
based on the strongest evidence available. The initial action in
gathering evidence in developing an LMRP must always be a search of
published scientific literature for any available evidence pertaining
to the item or service in question. We instruct contractors to heavily
weigh published authoritative evidence derived from randomized clinical
trials or other definitive studies. We also instruct contractors to
consider as evidence the consensus of expert medical opinion (that is,
recognized authorities in the field) or medical opinion derived from
consultation with medical associations or other health care experts. We
do advise them, however, that acceptance by individual providers or
groups of providers does not normally indicate general acceptance by
the medical community. Testimonials and limited case studies
distributed by sponsors with a financial interest in the outcome is not
sufficient evidence of general acceptance by the medical community.
Contractors are required to provide a minimum comment period of 45
days on proposed LMRPs. The 45-day period begins with distribution to
the CAC. Contractors are required to make their CAC meetings open to
the public, and all interested parties, including beneficiaries, may
attend and comment on the proposed policies. Further, the proposed
policy is not only distributed to the CAC, but also to representatives
of specialty societies, other than those represented on the CAC, when
appropriate. Contractors are instructed to remain sensitive to other
organizations or groups, which may have an interest in an issue. All
comments received are considered and responded to either through the
contractor's newsletter or individually to the commenter. The final
policy is announced in a contractor bulletin at least 30 days before
implementation.
Our regional staffs review the contractors' performance annually.
If the commenter has specific details regarding a contractor that is
not following the above requirements in the development of its local
policies, they should notify us so that it can be investigated.
Comment: Three commenters expressed concern with limitations that
might be imposed by the provision for automatic denial for egregious
utilization.
Response: After considering the comments, we believes that the
March 10, 2000 proposed rule was not sufficiently detailed in respect
to this provision to benefit from public comment. Consequently, we are
withdrawing the provision of automatic denial for egregious utilization
and will study the matter further.
Comment: One commenter believes that the use of frequency screens
that results in automatic denials will lead to underutilization of
Medicare-covered medically necessary services by encouraging
laboratories to give Advance Beneficiary Notices (ABNs) in every
situation.
Response: The commenter appears to have misunderstood the March 10,
2000 proposed rule with regard to automatic denials. The proposed
policy severely limits automatic denial based on frequency. The
proposed policy, which we are incorporating in this final rule,
provides that, except in limited and specified circumstances as
described in
[[Page 58804]]
these regulations, we will not deny a claim for services that exceed
utilization parameters without reviewing all relevant documentation
submitted with the claim. For example, before denying a claim,
contractors must review and consider justifications prepared by a
provider or supplier, primary and secondary diagnosis, and copies of
medical records that are submitted with the claim. Contractors may
automatically deny a claim without any manual review only if a national
coverage decision or LMRP specifies the circumstances under which a
service is denied and those circumstances exist, or the service is
specifically excluded from Medicare coverage by statute.
We do not believe that application of a Medicare policy on
automatic denial of laboratory claims, as described in these
regulations, will result in the underutilization of Medicare covered
services as the commenter suggested. To the extent that laboratories
and physicians may issue additional ABNs to these patients that they
would not do otherwise, we believe that this may, in fact, be helpful
to beneficiaries. The purpose of the ABN is to give beneficiaries
advance notice that a service may not be covered so that they have the
opportunity to make an informed choice on whether to have the service
or not.
Comment: Four commenters offered suggestions for how the Medicare
policy on Advance Beneficiary Notices (ABNs) should be clarified with
respect to situations when laboratory tests that are performed exceed
frequency limitations. They also made suggestions regarding when ABNs
need to be signed by beneficiaries under the Medicare limitation on
liability provisions.
Response: As we indicated in the preamble to the March 10, 2000
proposed rule, section IV, Other Topics Discussed by the Committee, the
Medicare provisions on limitation on liability (sometimes called waiver
of liability) were identified as falling outside the scope of the
clinical laboratory negotiations. The limitation on liability
provi