Home Health & Hospice Medicare A Newsline - CGS

Home Health & Hospice 

Medicare A Newsline 

Important Information from Cahaba Government Benefit Administrators ® , LLC (Cahaba) 

June 1, 2011 

Vol. 18, No. 9 Final Edition 

This bulletin should be shared with all health care practitioners and managerial 

members of the provider/supplier staff. Bulletins are available at no cost from our 

Web site at: www.cahabagba.com 

The Inside Story 

Special Bulletin: Important Jurisdiction 15 Information from Cahaba ...................... 2 

News from CMS 

News Flash Messages from CMS ........................ 2 

Correction: Home Health and Hospice 

Face-to-Face Encounter Requirements ................ 6 

Physician Certification and Recertification 

of Services Manual Changes ............................... 7 

CMS Announces National Version 5010 

Testing Day - Wednesday, June 15, 2011 ........... 9 

Implementation of Errata for Version 

5010 of HIPAA Transactions and Updates 

in 837I, 837P, and 835 Flat Files – Priority 

(Type) of Admission or Visit Code and 

Reason Code 11701 ........................................... 10 

Implementation of the PWK (Paperwork) 

Segment for X12N Version 5010—Revised...... 10 

CMS Individuals Authorized Access to 

CMS Computer Systems (IACS) 

Web Site ............................................................ 12 

Reporting of Recoupment for Overpayment 

on the Remittance Advice (RA)—Revised........ 13 

CMS Proposes to Expand Access to 

Seasonal Influenza Immunization ...................... 16 

Claim Adjustment Reason Code (CARC), 

Remittance Advice Remark Code (RARC), 

and Medicare Remit Easy Print (MREP) 

Update ............................................................... 17 

Corrections to Home Health Prospective 

Payment System (HH PPS) Outlier 

Limitation ........................................................... 19 

Home Health Requests for Anticipated 

Payment and Timely Claims Filing ..................... 22 

Manual Changes for Therapy Services in 

Home Health, Publication 100-02, Chapter 7 ...... 23 

Recently Enrolled Home Health Agencies 

(HHAs): Submit OASIS and HHCAHPS 

Data Promptly to Ensure Full Medicare 

Payment ............................................................... 26 

New HCPCS Q-Codes for 2010-2011 

Seasonal Influenza Vaccines—Revised ............... 28 

CY 2011 Home Health PPS (HH PPS) 

PC Pricer Update ................................................. 32 

Implementation of New Reasonable Useful 

Lifetime (RUL) Policy for Stationary and 

Portable Oxygen Equipment ................................ 32 

CMS Issues FY 2012 Hospice Wage Index 

Proposed Rule ...................................................... 34 

Key for Icons: 

Home Health Providers 

Hospice Providers 

The Medicare A Newsline provides information for those providers who submit claims to Cahaba Government Benefit 

Administrators ® , LLC as their Fiscal Intermediary or Regional Home Health Intermediary. The CPT codes, descriptors and 

other data only are copyright © 2011 American Medical Association. All rights reserved. Applicable FARS/DFARS apply.

Special Bulletin: Important Jurisdiction 15 Information from Cahaba 

Effective June 13, 2011, CIGNA Government Services (CGS) will assume the home health and hospice 

Medicare business as the new Part A/Part B Medicare Administrative Contractor (MAC) for Jurisdiction 

15 (J15). This affects all home health and hospice providers who currently submit claims to Cahaba. As 

a result, Cahaba has provided important J15 information in a Home Health & Hospice Medicare A 

Newsline, “Special Bulletin” dated, May 18, 2011, which can be found at 

https://www.cahabagba.com/rhhi/news/newsletter/20110518_special.pdf on our Web site. Please be sure 

to share this information with your staff. 

Cahaba and CGS have worked closely throughout the transition process to ensure a smooth transfer of 

business functions for home health and hospice providers. We appreciate the opportunity we have had 

working with our home health and hospice providers for so many years and wish you continued success in 

the future. 

News Flash Messages from CMS for Home Health and Hospice Providers 

Calendar Year 2011 is the Official 5010/D.0 Transition Year 

Medicare Fee-For-Service (FFS) and its business associates will implement the ASC X12, version 5010, 

and the National Council for Prescription Drug Program’s (NCPDP) version D.0 standards as of January 

1, 2012. To facilitate the implementation, Medicare has designated Calendar Year 2011 as the official 

5010/D.0 transition year. As such, Medicare Administrative Contractors (MACs) will be testing with 

their trading partners throughout Calendar Year 2011. Medicare encourages its providers, vendors, 

clearinghouses, and billing services to schedule testing with their local MAC as soon as possible. CMS 

also encourages you to stay current on 5010/D.0 news and helpful tools by visiting 

http://www.cms.gov/Versions5010andD0/ on its Web site. Test early, Test often! 

New “Signature Requirements” Fact Sheet 

A new publication titled “Signature Requirements” is now available in downloadable format from the 

Medicare Learning Network® at 

http://www.cms.gov/MLNProducts/downloads/Signature_Requirements_Fact_Sheet_ICN905364.pdf. 

This fact sheet is designed to provide education on Signature Requirements to healthcare providers, and 

includes information on the documentation needed to support a claim submitted to Medicare for medical 

services. 

Home Health & Hospice June 1, 2011 2 


Vol. 18, No. 9 Final Edition

Face-to-Face Encounter Requirements 

Effective April 1, 2011, the Centers for Medicare & Medicaid Services (CMS) expects home health 

agencies and hospices have fully established internal processes to comply with the face-to-face encounter 

requirements mandated by the Affordable Care Act for purposes of certification of a patient’s eligibility 

for Medicare home health services and of recertification for Medicare hospice services. CMS will 

continue to address industry questions concerning the new requirements, and will update information at 

http://www.cms.gov/center/hha.asp and http://www.cms.gov/center/hospice.asp on the CMS Web site. 

April 2011 Quarterly Provider Specific File Update 

The April 2011 quarterly Provider Specific Files (PSF) SAS data files and Text data files are now 

available on the CMS Web site. The SAS data files are available at: 

http://www.cms.hhs.gov/ProspMedicareFeeSvcPmtGen/04_psf_SAS.asp in the Downloads section and 

the Text data files are available on the CMS Web site at: 

http://www.cms.hhs.gov/ProspMedicareFeeSvcPmtGen/03_psf_text.asp in the Downloads section. If you 

use the Provider Specific Text or SAS File data, please go to the respective page above and download the 

latest version of the PSF Files. 

“Medicare Enrollment Guidelines for Ordering/Referring Providers” Fact Sheet 

Released 

A new publication titled “Medicare Enrollment Guidelines for Ordering/Referring Providers” is now 

available in downloadable format from the Medicare Learning Network ® at 

http://www.CMS.gov/MLNProducts/downloads/MedEnroll_OrderReferProv_FactSheet_ICN906223.pdf. 

This fact sheet is designed to provide education on the Medicare enrollment requirements for eligible 

ordering/referring providers, and includes information on the three basic requirements for ordering and 

referring and who may order and refer for Medicare Part A Home Health Agency, Part B, and DMEPOS 

beneficiary services. 




April 2011 Issue of Quarterly Provider Compliance Newsletter Released 

Just released! The next issue of the “Medicare Quarterly Provider Compliance Newsletter” is now 

available in downloadable format from the Medicare Learning Network® at 

http://www.CMS.gov/MLNProducts/downloads/MedQtrlyComp_Newsletter_ICN903696.pdf. This 

educational tool is designed to provide education on how to avoid common billing errors and other 

erroneous activities when dealing with the Medicare Program and is released on a quarterly basis. In this 

issue, a number of Recovery Audit findings that affect inpatient rehabilitation facilities, inpatient 

hospitals, physicians, non-physician practitioners, and outpatient hospitals are presented. The newsletter 

now features a series of tips and suggestions on relevant topics and an interactive index of previouslyissued 

newsletters, which can be found at: 

http://www.CMS.gov/MLNProducts/downloads/MedQtrlyCompNL_Archive.pdf 

“Fast Facts” Now Available on MLN Provider Compliance Web page 

As part of ongoing efforts by CMS to keep Medicare Fee-For-Service providers aware of new and 

improved educational products, CMS encourages you to visit the MLN Provider Compliance Web page at 

http://www.cms.gov/MLNProducts/45_ProviderCompliance.asp, containing educational FFS provider 

materials to help you understand – and avoid – common billing errors and other improper activities 

identified through claim review programs. You can now review quick tips on relevant provider 

compliance issues and corrective actions directly from this Web page. Be sure to bookmark this page and 

check back often as a new “fast fact” will be added each month! 

Revised Booklet: “The National Provider Identifier (NPI): What You Need to Know” 

Revised! The publication titled “The National Provider Identifier (NPI): What You Need to Know” 

(revised February 2011), is now available in downloadable format. This booklet was created to help you 

become more familiar with the NPI (established by final rule on January 23, 2004). Covered entities 

under HIPAA are required by regulation to use NPIs to identify healthcare providers in HIPAA standard 

transactions. This publication may be downloaded from 

http://www.CMS.gov/MLNProducts/downloads/NPIBooklet.pdf on the Centers for Medicare & Medicaid 

Services (CMS) Web site. 




“Home Health Prospective Payment System” Fact Sheet Available in Print 

The “Home Health Prospective Payment System” fact sheet (revised January 2011) is now available in 

print format from the Medicare Learning Network ® . This fact sheet is designed to provide education on 

the Home Health Prospective Payment System (HH PPS), including background information and 

consolidated billing requirements, coverage of HH services, elements of the HH PPS, and additional 

requirements. To place your order, visit http://www.CMS.gov/MLNGenInfo, scroll to ‘Related Links 

Inside CMS’ and select ‘MLN Product Ordering Page.’ 

“Hospital Outpatient Prospective Payment System” Fact Sheet Revised 

The revised publication titled “Hospital Outpatient Prospective Payment System” (revised March 2011) is 

now available in downloadable format from the Medicare Learning Network ® at 

http://www.CMS.gov/MLNProducts/downloads/HospitalOutpaysysfctsht.pdf. This fact sheet is designed 

to provide education on the Hospital Outpatient Prospective Payment System (OPPS) including 

background, ambulatory payment classifications, how payment rates are set, and payment rates under the 

OPPS. 

CY 2011 Outpatient Prospective Payment System (OPPS) Pricer File Update 

The Outpatient PPS Pricer Web page was recently updated to include the April 2011 update for outpatient 

provider data. Users may now access the April provider data update at 

http://www.cms.gov/PCPricer/OutPPS/list.asp by selecting 2011, and then downloading “2nd Quarter 

2011 Files” from the OPPS Pricer Web page. 




News from CMS for Home Health and Hospice Providers 

Correction: Home Health and Hospice Face-to-Face Encounter Requirements 

The Centers for Medicare & Medicaid Services resent this article to notify you of the corrected section 

citation. In the third paragraph, the correct section reference is 3132(b), not 3131(b). This article, 

“Face-to-Face Encounter Requirement,” was previously published in the May 1, 2011, Home Health & 

Hospice Medicare A Newsline. 

Effective Friday, April 1, 2011, CMS expects home health agencies and hospices have fully established 

internal processes to comply with the face-to-face encounter requirements mandated by the Affordable 

Care Act (ACA) for purposes of certification of a patient’s eligibility for Medicare home health services 

and of recertification for Medicare hospice services. 

Section 6407 of ACA established a face-to-face encounter requirement for certification of eligibility for 

Medicare home health services, by requiring the certifying physician to document that he or she, or a nonphysician 

practitioner working with the physician, has seen the patient. The encounter must occur within 

the 90 days prior to the start of care, or within the 30 days after the start of care. Documentation of such 

an encounter must be present on certifications for patients with starts of care on or after Saturday, January 

1, 2011. 

Similarly, section 3132(b) of ACA requires a hospice physician or nurse practitioner to have a face-to-face 

encounter with a hospice patient prior to the patient’s 180th-day recertification, and each subsequent 

recertification. The encounter must occur no more than 30 calendar days prior to the start of the hospice 

patient’s third benefit period. The provision applies to recertifications on and after Saturday, January 1, 

2011. 

On Thursday, December 23, 2010, due to concerns that some providers needed additional time to 

establish operational protocols necessary to comply with face-to-face encounter requirements mandated 

by ACA for purposes of certification of a patient’s eligibility for Medicare home health services and of 

recertification for Medicare hospice services, CMS announced that it will expect full compliance with the 

requirements, beginning with the second quarter of CY2011. 

Throughout the first quarter of 2011, CMS has continued outreach efforts to educate providers, 

physicians, and other stakeholders affected by these new requirements. CMS has posted guidance 

materials including a MLN Matters article, question-and-answer documents, training slides, and manual 

instructions, which are available via CMS’s Home Health Agency Center and Hospice Web pages. 

CMS’s Office of External Affairs and Regional Offices contacted state and local associations for 

physicians and home health agencies and advocacy groups to ensure awareness about the face-to-face 

encounter laws, and to distribute the educational materials. 

CMS will continue to address industry questions concerning the new requirements, and will update 

information on our Web sites at http://www.CMS.gov/center/hha.asp and 

http://www.CMS.gov/center/hospice.asp. 




Physician Certification and Recertification of Services Manual Changes 

The Centers for Medicare & Medicaid Services (CMS) issued Change Request (CR) 7377, which updates 

the Medicare General Information, Eligibility and Entitlement Manual (CMS Pub. 100-01, Ch. 4) with 

the following information. 

SUMMARY OF CHANGES: This manual update includes a face-to-face encounter requirement for 

home health and hospice certifications. 

EFFECTIVE DATE: January 1, 2011 IMPLEMENTATION DATE: May 12, 2011 

I. GENERAL INFORMATION 

A. Background: CMS is including the following clarifications to Chapter 4, Physician Certification and 

Recertification of Services, of Publication 100-01, the Medicare General Information, Eligibility and 

Entitlement Manual. 

Due to new provisions mandated by passage of the Affordable Care Act, there are new statutory 

requirements regarding face-to-face encounters for certifications applicable to the home health and 

hospice programs that must be updated in Chapter 4. 

B. Policy: Sections 6407 and 3132 of the Affordable Care Act require these face-to-face encounters with 

a physician for home health and hospice certifications. Details of the policy are provided in the 

above-mentioned chapter. 

Note from Cahaba: The revisions to Chapter 4 of the Medicare General Information, Eligibility and 

Entitlement Manual (CMS Pub. 100-01, Ch. 4) are provided below, as well as being included as an 

attachment to CR 7377, which can be found on the CMS Web site at: 

http://www.cms.gov/transmittals/downloads/R68GI.pdf 

30.1 - Content of the Physician's Certification 

(Rev.68, Issued: 04-22-11, Effective: 01-01-11, Implementation: 05-12-11) 

Under both the hospital insurance and the supplementary medical insurance programs, no payment can be 

made for covered home health services that a home health agency provides unless a physician certifies 

that: 

• The home health services are because the individual is confined to his/her home and needs 

intermittent skilled nursing care, physical therapy and/or speech-language pathology services, or 

continues to need occupational therapy; 

• A plan for furnishing such services to the individual has been established and is periodically 

reviewed by a physician; and 

• The services are or were furnished while the individual was under the care of a physician. 




Certifications must be obtained at the time the plan of care is established or as soon thereafter as possible. 

Effective January 1, 2011, as a requirement for payment, the certifying physician must document that he 

or she, or an allowed non-physician practitioner (NPP) working in collaboration with the certifying 

physician, had a face-to-face encounter with the patient in accordance with Pub. 100-02, the Medicare 

Benefit Policy Manual, Chapter 7 manual guidance, Section 30.5.1.1. 

The attending physician signs and dates the POC/certification prior to the claim being submitted for 

payment; rubber signature stamps are not acceptable. The form may be signed by another physician who 

is authorized by the attending physician to care for his/her patients in his/her absence. While the 

regulations specify that documents must be signed, they do not prohibit the transmission of the POC or 

oral order via facsimile machine. The Home Health Agency (HHA) is not required to have the original 

signature on file. However, the HHA is responsible for obtaining original signatures if an issue surfaces 

that would require verification of an original signature. 

The HHAs which maintain patient records by computer rather than hard copy may use electronic 

signatures. However, all such entries must be appropriately authenticated and dated. Authentication must 

include signatures, written initials, or computer secure entry by a unique identifier of a primary author 

who has reviewed and approved the entry. The HHA must have safeguards to prevent unauthorized 

access to the records and a process for reconstruction of the records upon request from the intermediary, 

state surveyor, or other authorized personnel, in the event of a system breakdown. 

See §10.1 for the effects of failure to certify or recertify. 

60 - Certification and Recertification by Physicians for Hospice Care 

(Rev. 68, Issued: 04-22-11, Effective: 01-01-11, Implementation: 05-12-11)) 

The hospice must obtain written certification of terminal illness for each period of hospice care received 

by an individual. For the initial 90-day period, the hospice must obtain written certification statements 

from the medical director of the hospice or the physician member of the hospice interdisciplinary group, 

and the individual's attending physician (if the individual has one). The certification must specify that the 

individual's prognosis is for a life expectancy of 6 months or less if the terminal illness runs its normal 

course. Recertification for subsequent periods only requires the written certification by the hospice 

medical director or the physician member of the hospice interdisciplinary group. Certifications and 

recertifications must be dated and signed by the physician and must include the benefit periods to which 

they apply. Certifications and recertifications must include a brief narrative explanation of the clinical 

findings that supports a life expectancy of 6 months or less. 

If written certification is not obtained within 2 calendar days of the initiation of hospice care, a verbal 

certification must be obtained within the 2 days. A written certification from the medical director of the 

hospice or the physician member of the interdisciplinary group must be on file in the beneficiary's record 

prior to the submission of a claim to the Medicare Contractor. If these requirements are not met, no 

payment may be made for the days prior to certification. Instead payment will begin with the day 

certification is obtained, i.e., the date verbal certification is obtained. 

Certifications and recertifications may be completed up to 15 days before the next benefit period begins. 

For recertifications on or after January 1, 2011, a hospice physician or hospice nurse practitioner must 

have a face-to-face encounter with each hospice patient prior to the beginning of the patient’s third 




enefit period, and prior to each subsequent benefit period. Failure to meet the face-to-face encounter 

requirements results in a failure by the hospice to meet the patient’s recertification of terminal illness 

eligibility requirement. The patient would cease to be eligible for the benefit. See Pub. 100-02, Medicare 

Benefit Policy Manual, Chapter 9, Section 20.1, Timing and Content of Certification 

CMS Announces National Version 5010 Testing Day - Wednesday, June 15, 2011 

The Version 5010 compliance date – Sunday, January 1, 2012 – is fast approaching. All HIPAA-covered 

entities should be taking steps now to get ready, including conducting external testing to ensure timely 

compliance. Are you prepared for the transition? Medicare Fee-for-Service (FFS) trading partners are 

encouraged to contact their Medicare Administrative Contractors (MACs) now and facilitate testing to 

gain a better understanding of MAC testing protocols and the transition to Version 5010. 

To assist in this effort, CMS, in conjunction with the Medicare FFS Program, announces a National 5010 

Testing Day to be held Wednesday, June 15, 2011. National 5010 Testing Day is an opportunity for 

trading partners to come together and test compliance efforts that are already underway with the added 

benefit of real-time help desk support and direct and immediate access to MACs. 

CMS encourages all trading partners to participate in the National 5010 Testing Day. This includes: 

• Providers; 

• Clearinghouses; and 

• Vendors 

More details concerning transactions to be tested are forthcoming from your local MAC. Additionally, 

there are several State Medicaid Agencies that will be participating in the National 5010 testing day; more 

details will follow from them as well. 

Again, CMS National 5010 Testing Day does not preclude trading partners from testing transactions 

immediately with their MAC. Don’t wait. You are encouraged to begin working with your MAC now to 

ensure timely compliance. Note that successful testing is required before a trading partner may be placed 

into production. 

We hope all trading partners will join us on Wednesday, June 15, 2011 and take advantage of this great 

opportunity to ensure testing and transition efforts are on track! For more information on HIPAA Version 

5010, please visit: http://www.CMS.gov/Versions5010andD0 




Implementation of Errata for Version 5010 of HIPAA Transactions and Updates in 

837I, 837P, and 835 Flat Files – Priority (Type) of Admission or Visit Code and 

Reason Code 11701 

The Centers for Medicare & Medicaid Services (CMS) does not have a version 4010A1 direct data entry 

and a separate version 5010 direct data entry. The Priority (Type) of Admission or Visit code is now 

required on all version 4010A1 institutional claims submitted or corrected via direct data entry, as well as 

on version 5010 institutional claims, regardless of how they are submitted. Providers that are unsure 

which code to use are to use code 9 (Information not Available). Additional Priority (Type) of Admission 

or Visit code values and descriptions are available from the National Uniform Billing Committee 

(http://www.nubc.org/) or from your servicing MAC. The Priority (Type) of Admission or Visit code is 

not required on 4010A1 institutional claims submitted or corrected via an 837. 

For more information on Version 5010, please visit: http://www.cms.gov/Versions5010andD0/ 

Note from Cahaba: The valid Type of Admission codes are: 

1 — Emergency 

2 — Urgent 

3 — Elective 

4 — Newborn 

5 — Trauma 

9 — Information not available 

When submitting billing transactions via direct data entry, enter the Type of Admission code in the TYPE 

field on Claim Page 01 of the Fiscal Intermediary Standard System (FISS). The Type of Admission code 

is not required on hospice Notice of Elections (NOEs). 

Implementation of the PWK (Paperwork) Segment for X12N Version 5010—Revised 

The Centers for Medicare & Medicaid Services (CMS) has issued a revision to the Medicare Learning 

Network (MLN) Matters article, “Implementation of the PWK (Paperwork) Segment for X12N Version 

5010,” which was published in the December 1, 2010, Home Health & Hospice Medicare A Newsline. 

This MLN Matters article and other CMS articles can be found on the CMS Web site at: 

http://www.cms.gov/MLNMattersArticles/ 

MLN Matters ® Number: MM7041 Revised Related Change Request (CR) #: 7041 

Related CR Release Date: April 20, 2011 Effective Date for Providers: July 1, 2011 

Related CR Transmittal #: R874OTN Implementation Date: July 5, 2011 




Note: This article was revised on April 21, 2011, to reflect a revised CR7041 issued on April 20, 

2011. In this article, the CR release date, transmittal number, and the Web address for accessing 

CR 7041 have been revised. Also, a reference to MLN Matters ® article SE1106 was added in the 

“Additional Information” section to give important reminders about the implementation of HIPAA 

5010 and D.O., including Fee-For-Service implementation schedule and readiness assessments. 

Provider Types Affected 

This article is for physicians, suppliers, and providers billing Medicare contractors (carriers, Part A/B 

Medicare administrative contractors (MACs), durable medical equipment (DME) MACs, and fiscal 

intermediaries (FIs) including regional home health intermediaries (RHHIs)). 

Provider Action Needed 

This article is based on CR 7041 which announces the implementation of the PWK (paperwork) segment 

for X12N Version 5010. Be sure your billing staff is aware of these changes. 

Background 

Since 2003, CMS has believed that a complete Health Insurance Portability & Accountability Act of 1996 

(HIPAA) implementation involves implementing the PWK (paperwork) segment. The PWK is a segment 

within the 837 Professional and Institutional electronic transactions. The PWK segment provides the 

“linkage” between electronic claims and additional documentation which is needed for claims 

adjudication. Although the PWK segment allows for an electronic submission of the additional 

documentation, this preliminary implementation will only allow for submission of additional 

documentation via mail and fax. 

The implementation of a dedicated PWK process, involving OCR/imaging technology, allows providers 

to continue using cost effective electronic data interchange (EDI) technology as well as providing cost 

savings for the Medicare program. Medicare contractors will be responsible for imaging, storage, and 

retrieval of the additional documentation for their claims examiners. Having the documentation available 

to claims examiners eliminates the need for costly automated development. 

Key Points for Medicare Billers: 

• Your Medicare contractor will implement the appropriate PWK fax/mail cover sheet for their line of 

business which must be used by trading partners when mailing or faxing additional documentation 

which is indicated in the PWK segment. Sample versions of the fax/mail cover sheets are attached to 

CR 7041, which is available at http://www.cms.gov/Transmittals/downloads/R874OTN.pdf on the 

CMS Web site. 

• Your Medicare contractor will provide the cover sheet to their trading partners via hardcopy and/or 

electronic download. 

• Submitters must send the additional documentation AFTER the claim has been electronically 

submitted with the PWK segment. 

• Submitters will need to accurately and completely record data on the fax/mail cover sheet that relates 

the faxed/mailed data to the PWK Loop on the claim. 

• Medicare contractors will manually return PWK data submissions (cover sheet and attached data) 

which are incomplete or incorrectly filled out. 

• Medicare contractors will allow seven calendar “waiting” days (from the date of receipt) for additional 

information to be faxed or ten calendar “waiting” days for additional information to be mailed. 




• Submitters must send ALL relevant PWK data at the same time for the same claim. 

• If the additional documentation is not received within the seven calendar waiting days (fax) or ten 

calendar waiting days for mailed submissions, your contractor will begin normal processing 

procedures on your claim. 

• Medicare will not crossover PWK data to the Coordination of Benefits contractor. 

Additional Information 

If you have any questions regarding this issue, refer to the “Contact Us” page of our Web site and select 

“Phone Us” under the “Home Health & Hospice (HH+H)” heading, to call the Provider Contact Center. 

The official instruction (CR 7041) issued to your MAC and/or FI/carrier is available at 

http://www.cms.gov/Transmittals/downloads/R874OTN.pdf on the CMS Web site. 

You may also want to review MLN Matters ® article MM7306 at 

http://www.cms.gov/MLNMattersArticles/downloads/MM7306.pdf on the CMS Web site. 

You may also want to review MLN Matters ® article SE1106 available at 

http://www.cms.gov/MLNMattersArticles/downloads/SE1106.pdf for important reminders about the 

implementation of HIPAA 5010 and D.O., including Fee-For-Service implementation schedule and 

readiness assessments. 

Disclaimer 

This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may 

contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a 

general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review 

the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents. CPT only 

copyright 2011 American Medical Association. 

CMS Individuals Authorized Access to CMS Computer Systems (IACS) Web Site 

The Centers for Medicare & Medicaid Services (CMS) now has a Web site to better service providers 

using IACS to access Provider Statistical and Reimbursement (PS&R) information. CMS wants 

providers to visit the new Web site instead of immediately contacting the IACS help desk regarding 

PS&R registration or access issues. This new Web site is located at www.eushelpdesk.com and is 

updated on a regular basis. 

For additional information about IACS, refer to the CMS Web site at: 

http://www.cms.gov/MAPDHelpDesk/07_IACS.asp#TopOfPage 




Reporting of Recoupment for Overpayment on the Remittance Advice (RA)— 

Revised 


Network (MLN) Matters article, “Reporting of Recoupment for Overpayment on the Remittance Advice 

(RA),” which was published in the April 1, 2011, Home Health & Hospice Medicare A Newsline. This 

MLN Matters article and other CMS articles can be found on the CMS Web site at: 


MLN Matters ® Number: MM6870 Revised Related Change Request (CR) #: 6870 

Related CR Release Date: March 4, 2011 Effective Date: July 1, 2010 

Related CR Transmittal #: R866OTN 

Implementation Date: July 6, 2010, except 

October 3, 2011, for claims processed by the FISS 

system used by FIs and A/B MACs 

Note: This article was revised on April 25, 2011, to correct a statement in the “Background” section that 

stated the RAC must report a recoupment in two steps. Actually, it is the remittance advice that reports 

the recoupment in two steps and the article has been corrected accordingly. All other information is the 

same. 


This article is for physicians, providers, and suppliers submitting claims to Medicare contractors (carriers, 

fiscal intermediaries (FIs), and/or A/B Medicare administrative contractors (A/B MACs)) for services 

provided to Medicare beneficiaries. (CR 6870 does not apply to suppliers billing durable medical 

equipment (DME) MACs.) 


This article is based on CR 6870 which instructs Medicare System Maintainers how to report recoupment 

when there is a time difference between the creation and the collection of the recoupment. 

Background 

In the Tax Relief and Health Care Act of 2006, Congress required a permanent and national Recovery 

Audit Contractor (RAC) program to be in place by January 1, 2010. The goal of the RAC Program is to 

identify improper payments made on claims of health care services provided to Medicare beneficiaries. 

The RACs review claims on a post-payment basis, and they can go back three years from the date the 

claim was paid. To minimize provider burden, the maximum look back date is October 1, 2007. 

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; Section 935) 

amended the Social Security Act (Title XVIII) and added to Section 1893 (The Medicare Integrity 

Program) a new paragraph (f) addressing this process. You can review Section 1893 

http://www.ssa.gov/OP_Home/ssact/title18/1893.htm on the Internet. The statute requires Medicare to 

change how certain overpayments are recouped. These new changes to recoupment and interest are tied 

to the Medicare fee-for-service claims appeal process and structure. 

Recoupment (under the provisions of Section 935 of the MMA) can begin no earlier than the 41st day 

from the date of the first demand letter, and can happen only when a valid request for a redetermination 




has not been received within that period of time. (See the Medicare Learning Network ® (MLN) Matters ® 

article related to CR 6183 at http://www.cms.gov/MLNMattersArticles/downloads/MM6183.pdf on the 

CMS Web site. 

Under the scenario just described, the Remittance Advice (RA) has to report the actual recoupment in two 

steps: 

• Step I: Reversal and Correction to report the new payment and negate the original payment (actual 

recoupment of money does not happen here); 

• Step II: Report the actual recoupment. 

Recovered amounts reduce the total payment and are clearly reported in the RA to providers. CMS has 

learned that it is not providing enough detail currently in the RA to enable providers to track and update 

their records to reconcile Medicare payments. The Front Matter 1.10.2.17 – Claim Overpayment 

Recovery – in ASC X12N/005010X221 provides a step by step process regarding how to report in the RA 

when funds are not recouped immediately, and a manual reporting (demand letter) is also done. 

CR 6870 instructs the Medicare System Maintainers (Fiscal Intermediary Standard System – FISS and 

Multi Carrier System – MCS) how to report on the RA when: 

• An overpayment is identified, and 

• Medicare actually recoups the overpayment. 

The refund request is sent to the debtor in the form of an overpayment demand letter, and the demand 

letter includes an Internal Control Number (ICN) or Document Control Number (DCN) for tracking 

purposes that is also reported on the RA to link back to the demand letter. The recoupment will be 

reported on the RA in the following manner: 

Step I: 

Claim Level: 

The original payment is taken back and the new payment is established 

Provider Level: 

PLB03-1 – PLB reason code FB (Forward Balance) 

PLB 03-2 shows the detail: 

Part A: PLB-03-2 

1-2: CS 

3-19: Adjustment DCN# 

20:30: HIC# 

Part B: PLB-03-2 

1-2: 00 

3-19: Adjustment ICN# 

20-30: HIC# 

PLB04 shows the adjustment amount to offset the net adjustment amount shown at the claim level. If the 

claim level net adjustment amount is positive, the PLB amount would be negative and vice versa. 




Step II: 

Claim Level: 

No additional information at this step 

Provider Level: 

PLB03-1 – PLB reason code WO (Overpayment Recovery) 

PLB 03-2 shows the detail: 

Part A: PLB-03-2 

1-2: CS 

3-19: Adjustment DCN# 

20:30: HIC# 

Part B: PLB-03-2 

1-2: 00 

3-19: Adjustment ICN# 

20-30: HIC# 

PLB04 shows the actual amount being recouped. 

CMS has decided to follow the same reporting protocol for all other recoupments in addition to the 935 

RAC recoupment mentioned above. 


CMS provides more information including an overview of and recent updates for the RAC program at 

http://www.cms.gov/RAC/ on the CMS Web site. You can find the guide “Understanding the Remittance 

Advice: A Guide for Medicare Providers, Physicians, Suppliers, and Billers” at 

http://www.cms.gov/MLNProducts/downloads/RA_Guide_Full_03-22-06.pdf on the CMS Web site. 

The official instruction, CR 6870, issued to your carrier, FI, and A/B MAC regarding this change may be 

viewed at http://www.cms.gov/Transmittals/downloads/R866OTN.pdf on the CMS Web site. 

You may also want to review MLN Matters ® article MM7068, which is available at 

http://www.cms.gov/MLNMattersArticles/downloads/MM7068.pdf on the CMS Web site. It instructs 

DME MACs to provide enough detail in the RA to enable DMEPOS suppliers to reconcile their claims. 



Disclaimer 









CMS Proposes to Expand Access to Seasonal Influenza Immunization 

Proposed Requirement Would Make Flu Shots Available to Patients at Most Commonly Visited 

Medicare-certified Health Care Facilities 

The Centers for Medicare & Medicaid Services (CMS) has proposed new requirements for 

Medicare-certified providers that are designed to expand access to seasonal influenza vaccination. 

The notice of proposed rulemaking would update the conditions of participation and conditions for 

coverage for a number of provider types, in an effort to increase access to the vaccine, increase the 

number of patients receiving annual vaccination against seasonal influenza, and to decrease flulinked 

morbidity and mortality. 

“Today’s proposed rule will expand Medicare beneficiaries’ options for where to receive a flu shot 

during flu season,” said CMS Administrator, Donald M. Berwick, M.D. “The new requirements 

would make flu shots available in more of the health care facilities that Medicare beneficiaries are 

most likely to visit, including hospitals and rural health clinics.” 

This proposed rule would require many Medicare providers and suppliers to offer all patients an annual 

influenza vaccination during flu season, unless medically contraindicated. As always, any patient would 

retain the right to decline any vaccination. This proposed requirement would extend to Medicarecertified: 

• Hospitals, including Short-term Acute Care, Psychiatric, Rehabilitation, Long-Term Care, 

Children’s, and Cancer; 

• Critical Access Hospitals (CAHs); 

• Rural Health Clinics (RHCs); 

• Federally Qualified Health Centers (FQHCs) and; 

• End-Stage Renal Disease (ESRD) Facilities that offer dialysis services. 

Today’s proposed rule would update the conditions of participation and conditions for coverage for all of 

the provider types above. These rules apply to health care organizations that seek to begin and continue 

participating in the Medicare and Medicaid programs. The conditions are health and safety standards that 

are the foundation for improving quality and protecting the health and safety of beneficiaries. CMS 

implements these standards through state departments of health and accrediting organizations recognized 

by CMS (through a process called "deeming"), which review provider practices to assure they meet or 

exceed the Medicare’s condition standards. 

In order to meet these proposed provisions, the providers and suppliers would need to develop and 

implement policies and procedures for offering and administering seasonal influenza vaccine. The 

proposed rule does allow for situations in which vaccine supplies may be unavailable or in short supply, 

and recognizes that providers and suppliers could not be held accountable for providing vaccine for all 

patients in such circumstances. 

Additionally, the proposed rule would require the included providers and suppliers to develop policies and 

procedures that would allow them to offer vaccinations for pandemic influenza, in case of a future 

pandemic influenza event for which a vaccine is developed. 




“This proposal will remove barriers for Medicare beneficiaries who want to receive annual flu 

shots as part of their preventive health routine,” said Dr. Berwick. “While CMS believes that flu 

vaccination is the best way to keep beneficiaries and their families safe and healthy during flu 

season, our proposal respects the rights of beneficiaries and their families to choose whether the 

flu shot is best for them. However, we hope that by expanding the breadth of places where flu 

shots are offered, beneficiaries will make the choice about whether to vaccinate based on health 

needs rather than convenience or availability.” 

CMS will accept public comments on the CMS proposed rule until July 5, 2011, and will 

respond to comments in a final rule to be published in the coming months. To submit 

comments, please visit http://www.regulations.gov and search for rule “CMS-3213-P.” 

Claim Adjustment Reason Code (CARC), Remittance Advice Remark Code (RARC), 

and Medicare Remit Easy Print (MREP) Update 

The Centers for Medicare & Medicaid Services (CMS) has provided the following Medicare Learning 

Network (MLN) Matters article. This MLN Matters article and other CMS articles can be found on the 

CMS Web site at: http://www.cms.gov/MLNMattersArticles/ 

MLN Matters ® Number: MM7369 Related Change Request (CR) #: 7369 

Related CR Release Date: May 6, 2011 Effective Date: July 1, 2011 

Related CR Transmittal #: R2213CP Implementation Date: July 5, 2011 


This article is for physicians, providers, and suppliers who submit claims to Medicare contractors 

(carriers, fiscal intermediaries (FIs), regional home health intermediaries (RHHIs), Medicare 

administrative contractors (MACs), and durable medical equipment Medicare administrative contractors 

(DME MACs)) for service provided to Medicare beneficiaries. 


CR 7369, from which this article is taken, announces the latest update of Remittance Advice Remark 

Codes (RARCs) and Claim Adjustment Reason Codes (CARCs) that are effective on July 1, 2011, for 

Medicare. Be sure your billing staff is aware of these changes. 

Background 

The reason and remark code sets must be used to report payment adjustments in remittance advice 

transactions. The reason codes are also used in some Coordination-of-Benefits (COB) transactions. The 

RARC list is maintained by CMS, and used by all payers. Additions, deactivations, and modifications to 

the list may be initiated by any health care organization. The RARC list is updated 3 times a year – in 

early March, July, and November, although the Committee meets every month. 




Both code lists are posted at http://www.wpc-edi.com/Codes on the Washington Publishing Company 

(WPC) Web site. The lists at the end of this article summarize the latest changes to these code lists, as 

announced in CR 7369. 


To see the official instruction (CR 7369) issued to your Medicare carrier, RHHI, DME MAC, FI and/or 

MAC, refer to http://www.cms.gov/Transmittals/downloads/R2213CP.pdf on the CMS Web site. 



CR 7369 Changes 

New Codes – CARC 

Code Current Narrative Effective Date Per 

WPC Posting 

236 This procedure or procedure/modifier combination is not compatible 

with another procedure or procedure/modifier combination provided 

on the same day according to the National Correct Coding Initiative. 

1/30/2011 

Modified Codes – CARC: 

None 

Deactivated Codes – CARC: 

None 

New Codes – RARC: 

Code Current Narrative Medicare Initiated 

N542 Missing income verification No 

N543 Incomplete/invalid income verification No 

Modified Codes – RARC: 

Code Modified Narrative Medicare Initiated 

M37 Not covered when the patient is under age 35. No 

M116 Processed under a demonstration project or program. Project 

No 

or program is ending and additional services may not be paid 

under this project or program. 

N62 Dates of service span multiple rate periods. Resubmit 

No 

separate claims. 

N356 Not covered when performed with, or subsequent to, a noncovered 

No 

service. 

N383 Not covered when deemed cosmetic. No 

N410 Not covered unless the prescription changes. No 

N428 Not covered when performed in this place of service. No 




Code Modified Narrative Medicare Initiated 

N429 Not covered when considered routine. No 

N431 Not covered with this procedure. No 

Deactivated Codes – RARC: 

None 

Disclaimer 






News from CMS for Home Health Providers 

Corrections to Home Health Prospective Payment System (HH PPS) Outlier 

Limitation 




MLN Matters ® Number: MM7395 Related Change Request (CR) #: CR 7395 

Related CR Release Date: May 6, 2011 Effective Date: January 1, 2010 

Related CR Transmittal #: R2209CP Implementation Date: October 3, 2011 


Home health agencies (HHAs) who bill regional home health intermediaries (RHHIs) for services 

provided to Medicare beneficiaries are affected. 

Provider Action Needed STOP – Impact to You 

Because of an error in the calculation of the Home Health Prospective Payment System (HH PPS) 10 

percent outlier limitation, the basic calculation of the outlier limitation since January 1, 2010, has been 

incorrect. As a result, your payment for Medicare home health services in 2010 may be incorrect. 

CAUTION – What You Need to Know 

CR 7395, from which this article is taken, contains no new policy. It corrects errors in the calculation of 

the HH PPS 10 percent outlier limitation, instructs RHHIs to perform claim adjustments to ensure 

provider payments are accurate, and expands the HH Pricer input record to allow for accurate calculation 

of the limit for HHAs with annual total Medicare payments over $100 million. 

GO – What You Need to Do 

You should ensure that your billing staffs are aware of these changes in the HHS PPS payment system. 




Background 

A limitation on outlier payments under HH PPS was finalized in the 2010 HH PPS final rule. Under these 

requirements, during claims processing for each HHA, Medicare systems accumulate both the overall 

total payments the HHA has received and the total outlier payments they have received. The totals are 

then compared to determine whether an HHA has been paid 10% of their total payments in outliers. 

Error in Basic Limitation Calculation 

Based on the guidance in the preliminary instructions to the RHHIs, the overall total HH PPS payment 

was derived by applying the sum of the payment amounts in value code 64 and 65 to the HHA’s total for 

each processed claim. This assumed that the value code 64 and 65 amounts, which represent the Part A 

and Part B payments for each episode, included the outlier amount in their values. CMS has since learned 

that this assumption is not correct. 

Specifically, the outlier amount shown on claims with value code 17 is not apportioned into the value 

code 64 and 65 amounts, but rather is apportioned into separate Part A and Part B outlier amounts in a 

separate process on the remittance advice. As a result, the basic calculation of the outlier limitation since 

January 1, 2010, has been in error. All HHAs’ total payment amounts have been understated, and certain 

HHAs have had payments withheld as exceeding the outlier limitation in error and were underpaid for 

Medicare home health services in 2010. 

CR 7395, from which this article is taken, corrects this error through the following guidance. Effective 

for dates of service on or after January 1, 2010, Medicare systems will apply the sum of the payment 

amounts in value codes 17, 64, and 65 on each processed claim to each HHA’s year-to-date total HH PPS 

payment amount. 

Error in Process of Accumulating Totals 

CMS has also identified a problem in the timing of updating the outlier totals. Currently, a provider’s 

year-to-date outlier payment totals, and overall payment totals, are not updated with claims containing 

outlier payments until all the claims in a daily processing batch are finalized in Medicare’s Fiscal 

Intermediary Shared System (FISS). This means that if multiple claims qualifying for outlier payment are 

processed in the same daily batch of claims, the outlier amount paid on the first claim is not reflected in 

the year-to-date totals when the next outlier claim is processed moments later in the same processing 

cycle. As a result, all claims processed in the same batch of claims would use the same year-to-date total 

amounts. 

Thus, when multiple outlier claims are in the same batch, the Medicare systems are not identifying all of 

the claims that should be identified as exceeding the 10% outlier limitation; and HHAs are being 

overpaid. (CMS suspects that the overpayments resulting from this timing problem have, to some degree, 

counterbalanced the underpayments resulting from the error in the basic calculation, masking both 

problems for much of 2010.) 

The following guidance in CR 7395 addresses this issue by requiring Medicare systems to update the 

amounts used when each paid claim is processed to completion (rather than the current process of 

updating the totals once in a processing cycle), to revise the quarterly outlier reconciliation process to 

identify any overpayments that still result and correct them, and to create a detail file of outlier payments 

that each HHA can view. 

Specifically, effective for claims with dates of service on or after January 1, 2010, Medicare systems will: 

• Update each HHA’s year-to-date outlier payments and year-to-date total HH PPS payment as each 

claim is processed in addition to the end of each processing day; 




• When sending an HHA’s PROV-OUTLIER-PAY-TOTAL and PROV-PAYMENT-TOTAL to the 

HH Pricer, Medicare will use the amounts updated by the most recent prior claim; 

• Adjust outliers claims paid in excess of the 10% outlier limitation as part of quarterly HH outlier 

reconciliation process; 

• Complete the current process of adjustments to claims with Pricer return code 02 before taking any 

steps to identify outlier claims paid in excess of the 10% limitation; 

• Read each HHA’s provider year-to-date outlier payment and total payment amount and identify any 

provider that has been paid more than 10% in outlier payments; 

• For each identified HHA, calculate the dollar amount of outlier payments that has been paid in excess 

of 10%; and 

• For each identified HHA, create a report of outlier claims currently in paid claims history with outlier 

payments up to, but not exceeding, the dollar amount calculated. 

Total Outlier Payment Field Size Limitation 

When the outlier limitation was initially implemented, the field that holds each provider’s total year-todate 

payments was created with eight positions to the left of the decimal point. This limits an HHA’s 

total Medicare payments for the year to $99,999,999.99. While this limitation does not create a problem 

for most HHAs, CMS has identified that there are HHAs with total payments in excess of $100 million 

dollars. To ensure accurate processing of the outlier limitation for such HHAs, the field will be expanded 

to nine positions to the left of the decimal point. 

Correcting Outlier Payments to Date 

In order to correct the payment errors that have resulted from the problems described above, Medicare 

will adjust any claim paid for dates of service since January 1, 2010, for which an outlier payment was 

made or for which an outlier payment was calculated and withheld. 

Specifically, effective for claims with dates of service on or after January 1, 2010, Medicare systems will: 

• As of January 3, 2012, reprocess all HH PPS claims where the outlier limitation may have been 

applied in error; and 

• Prior to adjusting any claims, add each HHA’s year-to-date outlier payments to their year-to-date total 

HH PPS payment for calendar years 2010 (and 2011 to date), and add each HHA’s year-to-date outlier 

payments to their year-to-date total HH PPS payment for calendar years 2010 and 2011 to date. 

For most HHAs, this adjustment process will result in the correction of an underpayment; however for a 

few, the adjustments will result in the collection of any overpayment not offset by other underpayment 

amounts. 


You can find the official instruction, CR 7395, issued to your RHHI by visiting 

http://www.cms.gov/Transmittals/downloads/R2209CP.pdf on the CMS Web site. 



Disclaimer 









Home Health Requests for Anticipated Payment and Timely Claims Filing 





Related CR Release Date: April 29, 2011 Effective Date: January 1, 2010 

Related CR Transmittal #: R2203CP Implementation Date: October 3, 2011 


This article is for home health agencies (HHAs) who bill Medicare regional home health intermediaries 

(RHHIs) or Medicare administrative contractors (A/B MACs) for services to Medicare beneficiaries. 


Since, by regulation, Requests for Anticipated Payments (RAPs) are not claims for purposes of Title 18 of 

the Social Security Act, timely filing enforcement will be bypassed for any RAP for which the associated 

Home Health Prospective Payment System (HH PPS) final claim could still be timely under Section 6404 

of the Affordable Care Act. RAPs for which the associated HH PPS final claim could not still be timely 

will continue to be rejected, to prevent payment of RAP amounts that would be subject to recovery later. 

Make sure your billing staff is aware of these changes and that HHA claims are filed timely. 

Background 

Section 6404 of the Affordable Care Act amended the claims timely filing requirements to reduce the 

maximum time period for submission of all Medicare Fee-for-Service claims to 1 calendar year after the 

date of service (DOS). These amendments apply to services furnished on or after January 1, 2010. See 

the MLN Matters ® articles MM6960, MM7080, and MM7270 at 

http://www.cms.gov/MLNMattersArticles/downloads/MM6960.pdf, 

http://www.cms.gov/MLNMattersArticles/downloads/MM7080.pdf, and 

http://www.cms.gov/MLNMattersArticles/downloads/MM7270.pdf, respectively, for details on the 

implementation of this requirement. 

MM7080, details of how this provision impacts policy regarding institutional claims that include span 

dates of service (i.e., a “From” and “Through” date span on the claim). The “Through” date on such 

claims is used to determine the date of service for claims filing timeliness. This policy had an unintended 

impact on billing HH PPS episodes of care. Under the HH PPS, each 60-day episode of care is billed in 

two parts. At the beginning of the episode, after the delivery of the first billable service, the home health 

agency (HHA) submits a RAP to receive a percentage of the payment anticipated for the episode. After 

the 60-day episode has ended, the HHA submits a final claim for the episode to receive the remainder of 

the payment due for all the covered services in the episode. 

The “From” and “Through” dates on the final HH PPS final claim reflect the actual dates of the start and 

end of the HH episode. Timely filing edits, which determine whether or not an episode is timely by 

comparing the final claim’s receipt date to the final claim’s “Through” date, are appropriate. A final 

claim receipt date over 1 calendar year from the final claim “Through” date is considered not to be timely. 




Medicare instructions require the “From” and “Through” dates on the RAP, however, to be the same date. 

The date the episode begins (the “From” date) is known when the RAP is submitted, but the date the 

episode ends may not yet be known because the patient may be discharged at any point during the 60 

days. Rather than submitting an artificial “Through” date or a future date that cannot be processed by 

Medicare systems, HHAs submit a “Through” date that matches the “From” date. 

This means the RAP will have an earlier “Through” date than its associated final claim. When Medicare 

systems have enforced timely filing based on the “Through” date, RAPs have been rejected as untimely 

when the associated final claim was still timely. CMS has determined that this is an error. The 

requirements in CR 7396 correct the error. 

Example: If a RAP has a “From” date of January 1, 2011, Medicare will use a calculated “Through” date 

of March 1, 2011, to determine if the timely filing edit applies. In so doing, if a RAP with the “From” 

date of January 1, 2011, is received on February 28, 2012, it will be processed. If that same RAP was 

received on March 2, 2012, it would be rejected as untimely. 

Note from Cahaba: Home health agencies need to take action for episodes with “FROM” dates on/after 

January 1, 2010, that were inappropriately rejected for timely filing guidelines with reason code 39011. 

Please review the instructions available on the “Provider Action: RAPs Incorrectly Rejected As 

Untimely—Reason Code 39011” Web page available at 

https://www.cahabagba.com/rhhi/news/20110421_raps.htm for more information. 


The official instruction, CR 7396, on this issue is available at 

http://www.cms.gov/Transmittals/downloads/R2203CP.pdf on the CMS Web site. 



Disclaimer 






Manual Changes for Therapy Services in Home Health, Publication 100-02, 

Chapter 7 








Related CR Release Date: May 6, 2011 Effective Date: April 1, 2011 

Related CR Transmittal #: R144BP Implementation Date: May 5, 2011 


Home health agencies (HHAs) submitting claims to fiscal intermediaries (FIs), therapists, physicians, 

non-physician practitioners, regional home health intermediaries (RHHIs), and A/B Medicare 

administrative contractors (A/B MACs) for therapy services provided to Medicare beneficiaries in the 

home health setting are affected by this article. 


The Calendar Year (CY) 2011 Final Rule for home health provisions related to therapy services provided 

in the home health setting and corresponding regulation text changes necessitate updates to Chapter 7 of 

the “Medicare Benefit Policy Manual” (Home Health Services). Therapy provisions for this rule are 

effective April 1, 2011. Be sure your staff is aware of these changes. 

Background 

As mentioned, the CY 2011 Final Rule for home health included requirements related to how and when 

therapy services are to be provided in the home health setting, as well as documentation requirements for 

these visits. Accordingly, the “Medicare/Benefit Policy Manual” is being updated via CR 7374 to 

document the policy revisions. Key changes of these updates are summarized as follows: 

Assessment, Measurement and Documentation of Therapy Effectiveness 

To ensure therapy services are effective, at defined points during a course of treatment for each therapy 

discipline for which services are provided, a qualified therapist (instead of an assistant) must perform the 

ordered therapy service. During this visit, the therapist must assess the patient using a method which 

allows for objective measurement of function and successive comparison of measurements. The therapist 

must document the measurement results in the clinical record. Specifically: 

Initial Therapy Assessment 

• For each therapy discipline for which services are provided, a qualified therapist (instead of an 

assistant) must assess the patient’s function using a method which objectively measures activities of 

daily living such as, but not limited to, eating, swallowing, bathing, dressing, toileting, walking, 

climbing stairs, using assistive devices, and mental and cognitive factors. The measurement results 

must be documented in the clinical record. 

• Where more than one discipline of therapy is being provided, a qualified therapist from each of the 

disciplines must functionally assess the patient. The therapist must document the measurement results 

which correspond to the therapist’s discipline and care plan goals, in the clinical record. 

Reassessment at Least Every 30 days (performed in conjunction with an ordered therapy service) 

• At least once every 30 days, for each therapy discipline for which services are provided, a qualified 

therapist (instead of an assistant) must provide the ordered therapy service, functionally reassess the 

patient, and compare the resultant measurement to prior assessment measurements. The therapist 

must document in the clinical record the measurement results along with the therapist’s determination 

of the effectiveness of therapy, or lack thereof. The 30-day clock begins with the first therapy service 

(of that discipline) and the clock resets with each therapist’s visit/assessment/measurement/ 

documentation (of that discipline). 




• Where more than one discipline of therapy is being provided, at least once every 30 days, a qualified 

therapist from each of the disciplines must provide the ordered therapy service, functionally reassess 

the patient, and compare the resultant measurement to prior assessment measurements. The therapist 

must document in the clinical record the measurement results along with the therapist’s determination 

of the effectiveness of therapy, or lack thereof. In multi-discipline therapy cases, the qualified 

therapist would reassess functional items (and measure and document) those which correspond to the 

therapist’s discipline and care plan goals. In cases where more than one discipline of therapy is being 

provided, the 30-day clock begins with the first therapy service (of that discipline) and the clock resets 

with each therapist’s visit/assessment/measurement/documentation (of that discipline). 

Reassessment Prior to the 14th and 20th Therapy Visit 

• If a patient’s course of therapy treatment reaches 13 therapy visits, for each therapy discipline for 

which services are provided, a qualified therapist (instead of an assistant) must provide the ordered 

13th therapy service, functionally reassess the patient, and compare the resultant measurement to prior 

measurements. The therapist must document in the clinical record the measurement results along with 

the therapist’s determination of the effectiveness of therapy, or lack thereof. 

• Similarly, if a patient’s course of therapy treatment reaches 19 therapy visits, a qualified therapist 

(instead of an assistant) must provide the ordered 19th therapy service, functionally reassess, measure 

and document the effectiveness of therapy, or lack thereof. 

• When the patient resides in a rural area or when documented circumstances outside the control of the 

therapist prevent the qualified therapist’s visit at exactly the 13th visit, the qualified therapist’s visit 

can occur after the 10th therapy visit, but no later than the 13th visit. Similarly, in rural areas or if 

documented exceptional circumstances exist, the qualified therapist’s visit can occur after the 16th 

therapy visit but no later than the 19th therapy visit. 

• Where more than one discipline of therapy is being provided, a qualified therapist from each of the 

disciplines must provide the ordered therapy service and functionally reassess, measure, and document 

the effectiveness of therapy or lack thereof close to but no later than the 13th and 19th therapy visit. 

The 13th and 19th therapy visit time-points relate to the sum total of therapy visits from all therapy 

disciplines. In multi-discipline therapy cases, the qualified therapist would reassess functional items 

and measure those which correspond to the therapist’s discipline and care plan goals. 

• Therapy services provided after the 13th and 19th visit (sum total of therapy visits from all therapy 

disciplines), are not covered until: 

o The qualified therapist(s) completes the assessment/measurement/documentation requirements; 

o The qualified therapist(s) determines if the goals of the plan of care have been achieved or if the 

plan of care may require updating. If needed, changes to therapy goals or an updated plan of care 

is sent to the physician for signature or discharge; and 

o If the measurement results do not reveal progress toward therapy goals and/or do not indicate that 

therapy is effective, but therapy continues, the qualified therapist(s) must document why the 

physician and therapist have determined therapy should be continued. 

Note: Services involving activities for the general welfare of any patient (e.g., general exercises to 

promote overall fitness or flexibility and activities to provide diversion or general motivation) do not 

constitute skilled therapy. Non-skilled individuals without the supervision of a therapist can perform 

those services. 




In order for therapy services to be covered, one of the following three conditions must be met: 

1. The skills of a qualified therapist are needed to restore patient function; 

2. The patient’s condition requires a qualified therapist to design or establish a maintenance program; or 

3. The skills of a qualified therapist are needed to perform maintenance therapy. 


For complete details on these manual changes, see the official instruction, CR 7374, issued to your FI, 

A/B MAC, and RHHI, which may be viewed at 

http://www.cms.gov/Transmittals/downloads/R144BP.pdf on the CMS Web site. 

Therapy Questions and Answers are now available on the Home Health Agency Center Web page of the 

CMS Web site (http://www.cms.gov/center/hha.asp). 



Disclaimer 






Recently Enrolled Home Health Agencies (HHAs): Submit OASIS and HHCAHPS 

Data Promptly to Ensure Full Medicare Payment 

The Centers for Medicare & Medicaid Services (CMS) has provided the following Special Edition (SE) 

Medicare Learning Network (MLN) Matters article. This MLN Matters article and other CMS articles can 

be found on the CMS Web site at: http://www.cms.gov/MLNMattersArticles/ 

MLN Matters ® Number: SE1115 

Related CR Release Date: NA 

Related CR Transmittal #: NA 

Related Change Request (CR) #: NA 

Effective Date: NA 

Implementation Date: NA 


This is an informational article for Medicare-certified home health agencies (HHAs) about the Outcome 

and Assessment Information Set (OASIS) and Home Health Care Consumer Assessment of Health 

Providers and Systems (CAHPS) data requirements. 


This article reminds recently enrolled HHAs of the deadlines associated with the current home health pay 

for reporting program. HHAs should submit required data timely to ensure they avoid reductions to their 

Calendar Year (CY) 2012 payments for home health services. 




Background 

Since 2006, the payment rates for HHAs that do not submit required quality data have been reduced by 

two percentage points for home health services provided in the following Calendar Year. CMS considers 

OASIS data submitted by HHAs during a specified reporting year as meeting the quality data reporting 

requirement. The reporting year for Calendar Year 2012 payment reductions began in July 1, 2010, and 

runs through June 30, 2011. CMS will continue to use that reporting timeframe, July 1, through June 30, 

for future years. 

HHAs also need to submit HHCAHPS data to receive their full annual payment update, beginning with 

CY 2012 payments. For the CY 2012 annual payment update, HHAs were to participate in a dry run in 

third quarter 2010, and continue monthly data collection beginning in October 2010, through March 2011. 

If agencies had less than 60 patients between April, 1, 2009, and March 31, 2010, then they are exempt 

from HHCAHPS participation for CY 2012, and they were to complete an HHCAHPS Participation 

Exemption Request form for CY 2012 on the HHCAHPS Web site, https://homehealthcahps.org on the 

Internet. HHAs first beginning HHCAHPS need to register for credentials and authorize their HHCAHPS 

survey vendor to do HHCAHPS on their behalf, by completing the relevant forms on 

https://homehealthcahps.org on the Internet. 

Be aware that: 

• HHAs with Medicare participation dates on or after May 1, 2011, are excluded from the OASIS 

reporting requirement for CY 2012; 

• HHAs with Medicare participation dates on or after April 1, 2011, are excluded from the HHCAHPS 

reporting requirement for CY 2012; and 

• Other recently enrolled HHAs, with participation dates earlier than May 1, must comply with the 

OASIS quality data reporting requirement and with the HHCAHPS reporting requirement if they 

served 60 or more patients in the period of April 1, 2009, and March 31, 2010. 

• HHAs that opened after April 1, 2010, will not have patients in the period of April 1, 2009, and March 

31, 2010, and therefore did not need to participate in HHCAHPS for the CY 2012 reporting 

requirement. 

CMS recognizes that HHAs whose initial surveys are completed in the early months of the year may not 

receive their retroactive notification of participation, containing their CMS Certification Number (CCN), 

from the CMS Regional Office until May or June. 

For these recently enrolled HHAs, it is important to act immediately after receiving their CCN. The HHA 

should immediately begin to submit OASIS data, as required by their Conditions of Participation, before 

June 30, 2011. Failure to do this will result in a two percent reduction in the HHA’s Calendar Year 2012 

payments. Similarly, newly certified HHAs should prepare as early as possible to participate in 

HHCAHPS. 

The HHA will have completed test OASIS transactions as part of the initial survey process. In order to 

complete these test transactions, the State Survey Agency will have provided the HHA with the agency 

Facility ID, and the HHA will have completed an OASIS Individual User Account Request form. In 

response to their account request, the HHA will have also received their personal login ID from the 

Quality Improvement Evaluation System Technical Support Office (QTSO) Help Desk. Immediately 

after receiving their CCN, the HHA should use their personal login ID to begin to submit OASIS 

production data files. 




Recently enrolled HHAs should note that the process of establishing an OASIS IDs and beginning to 

submit OASIS data is in no way dependent on establishing electronic data interchange connectivity with 

their Medicare claims processing contractor for purposes of billing. The process of requesting billing 

identifiers can and should begin simultaneously with the process of requesting a permanent OASIS 

submitter ID. 

CMS urges recently enrolled HHAs to take action to submit OASIS data before June 30, 2011, to prevent 

avoidable reductions to their Calendar Year 2012 payments for home health services. The quarterly data 

submission deadlines for HHCAHPS for CY 2012 are January 21, 2011, for the third quarter 2010 data; 

April 21, 2011, for the fourth quarter 2010 data; and July 21, 2011, for the first quarter 2011 data. 


If needed, OASIS Automation Coordinator contacts for each State are available from 

http://www.cms.gov/OASIS/07_AutomationCoord.asp on the CMS Web site. 

Note from Cahaba: Please contact your state OASIS Education Coordinator for questions regarding 

completing the OASIS. A listing is accessible at http://www.cms.gov/OASIS/06_EducationCoord.asp 

For questions regarding the HHCAHPS survey, please call 1-866-354-0985 or email questions to 

HHCAHPS@RTI.org 

Additional information regarding the quality data reporting requirement is available in the “Medicare 

Claims Processing Manual,” Chapter 10, Section 120, entitled “Payments to Home Health Agencies That 

Do Not Submit Required Quality Data.” 

HHAs may also want to review MLN Matters ® Article #SE1025, titled “CAHPS Update for HHAs,” 

which is available at http://www.cms.gov/MLNMattersArticles/downloads/SE1025.pdf on the CMS Web 

site. 

Disclaimer 






New HCPCS Q-Codes for 2010-2011 Seasonal Influenza Vaccines—Revised 


Network (MLN) Matters article, “New HCPCS Q-Codes for 2010-2011 Seasonal Influenza Vaccines,” 

which was published in the January 1, 2011, Home Health & Hospice Medicare A Newsline. This MLN 

Matters article and other CMS articles can be found on the CMS Web site at: 





MLN Matters ® Number: MM7234 Revised Related Change Request (CR): 7234 

Related CR Release Date: April 22, 2011 Effective Date: October 1, 2010 unless otherwise 

specified 

Related CR Transmittal #: R884OTN Implementation Date: January 3, 2011 

Note: This article was revised on April 25, 2011, to reflect a revised CR 7234 issued on April 22. 

The CR 7234 was revised to update the price of HCPCS Code Q2036 to $8.784 retroactive to 

October 1, 2010. This article was revised accordingly. 


This article is for physicians and providers submitting claims to Medicare contractors (carriers, fiscal 

intermediaries (FIs), and/or Part A/B Medicare administrative contractors (A/B MACs)) for influenza 

vaccines provided to Medicare beneficiaries. 


The article is based on CR 7234 which establishes separate billing codes for each brand-name 

influenza vaccine product under Common Procedure Terminology (CPT) code 90658 and describes 

the process for updating the new specific Healthcare Common Procedure Coding System (HCPCS) codes 

and their payment allowances for Medicare during the 2010-2011 influenza season. 

Background 

CMS has created specific HCPCS codes and payment allowances to replace CPT code 90658 for 

Medicare billing purposes for the 2010-2011 influenza season. 

Key Points of CR7234 

The following describes the process for updating these specific HCPCS codes for Medicare payment 

effective for dates of service on or after October 1, 2010. 

Effective for claims with dates of service on or after January 1, 2011, the following CPT code will no 

longer be payable for Medicare: 

CPT Short Description 

Code 

90658 Flu vaccine, 3 yrs & >, 

im 

Long Description 

Influenza virus vaccine, split virus, when administered to individuals 

3 years of age and older, for intramuscular use 

Effective for claims with dates of service on or after October 1, 2010, the following HCPCS codes will be 

payable for Medicare: 

HCPCS 

Code 

Q2035 

Q2036 

Short Description 

Afluria vacc, 3 yrs & 

>, im 

Flulaval vacc, 3 yrs & 

>, im 


Influenza virus vaccine, split virus, when administered to 

individuals 3 years of age and older, for intramuscular use (Afluria) 


individuals 3 years of age and older, for intramuscular use (Flulaval) 




HCPCS 

Code 

Q2037 

Q2038 

Q2039 

Short Description 

Fluvirin vacc, 3 yrs & 

>, im 

Fluzone vacc, 3 yrs & 

>, im 

NOS flu vacc, 3 yrs & 

>, im 



individuals 3 years of age and older, for intramuscular use (Fluvirin) 


individuals 3 years of age and older, for intramuscular use (Fluzone) 


individuals 3 years of age and older, for intramuscular use (Not 

Otherwise Specified) 

Take Note: CPT 90658 describes the regular dose vaccine that is supplied in a multi-dose vial for use in 

patients over 3 years of age. For dates of service on or after October 1, 2010, HCPCS codes Q2035, 

Q2036, Q2037, Q2038 and Q2039 (as listed in the table above) will replace the CPT code 90658 for 

Medicare payment purposes during the 2010 – 2011 influenza season. However, these HCPCS codes 

will not be recognized by the Medicare claims processing systems until January 1, 2011, when CPT 

code 90658 will no longer be recognized. 

This instruction does not affect any other CPT codes. It is very important to distinguish between the 

various CPT and HCPCS codes which describe the different formulations of the influenza vaccines (i.e. 

pediatric dose, regular dose, high dose, preservative free, etc.). As a reference, the quarterly Part B drug 

pricing files includes a set of National Drug Code (NDC) to HCPCS crosswalks available online at 

http://www.cms.gov/McrPartBDrugAvgSalesPrice/ on the Centers for Medicare & Medicaid Services 

(CMS) Web site. 

Billing 

In general, it is inappropriate for a provider to submit two claims for the same service on the same date. 

For dates of service between October 1, 2010, and December 31, 2010, the CPT 90658 and the Q-codes 

will be valid for billing; however, providers may not bill Medicare for both the CPT 90658 and any of the 

Q-codes for the same patient for the same date of service. Thus, if a provider vaccinates a beneficiary on 

any date between October 1, 2010, and December 31, 2010, the provider may either bill Medicare 

immediately using CPT 90658, or hold the claim and wait until January 1, 2011, to bill Medicare using 

the most appropriate Q-code. If a claim has already been submitted and processed using CPT 90658, then 

there is no need to use the Q-code for that same service. 

For dates of service on or after January 1, 2011, providers may only bill Medicare for one of the HCPCS 

codes that appropriately describes the specific vaccine product administered. 

Note from Cahaba: In a ListServ message dated May 20, 2011, Cahaba informed home health agencies 

(HHAs) that reason code 31596 currently displays inappropriately when billing Q codes for the influenza 

virus vaccine and the administration on flu roster bills entered via direct data entry (DDE), using the 

Fiscal Intermediary Standard System (FISS) ‘Roster Bill Entry’ Option 87 from the Claims Entry Menu. 

This issue has been reported to the FISS maintainer and a resolution to the issue is scheduled for 

implementation on July 5, 2011. Until the issue is resolved, HHAs may submit the influenza virus 

vaccine and the administration, individually via the ‘Home Health’ Option 26 from the Claims Entry 

Menu. Refer to the “Billing Individual Influenza And Pneumococcal Pneumonia Vaccines” Web page at 

https://www.cahabagba.com/rhhi/claims/home_health/flu_individual.htm for detailed instructions. 




Payment 

The Medicare Part B payment limits for influenza vaccines are 95 percent of the Average Wholesale Price 

(AWP) except where the vaccine is furnished in a setting that follows a cost-based or prospective payment 

system under Medicare. For example, where the vaccine is furnished in the hospital outpatient 

department, Rural Health Clinic (RHC), or Federally Qualified Health Center (FQHC), payment for the 

vaccine is based on reasonable cost. 

For dates of service on or after October 1, 2010, the Medicare Part B payment allowances in other 

situations are: 

HCPCS Code Allowance 

Q2036 $8.784 

Q2037 $13.253 

Q2038 $12.593 

No national payment limits are available for Q2035 and Q2039. The payment limits for these two 

codes will be determined by the local claims processing contractor. 

For dates of service on or after September 1, 2010, the corrected Medicare Part B payment allowance for 

CPT 90655 is $14.858. 

Important Notes: 

Annual Part B deductible and coinsurance amounts do not apply to these vaccines. All physicians, nonphysician 

practitioners and suppliers who administer the influenza virus vaccination and the 

pneumococcal vaccination must take assignment on the claim for the vaccine. 

Be aware that Medicare contractors will not search their files to adjust payment on claims paid incorrectly 

prior to implementing CR 7324. However, they will adjust such claims that you bring to their attention. 




For complete details regarding this CR please see the official instruction (CR 7234) issued to your 

Medicare A/B MAC, carrier or FI. That instruction may be viewed by going to 


CMS would like providers to be aware that educational products are available through the MLN 

Catalogue free of charge. The MLN Catalogue is available at 

http://www.cms.gov/MLNProducts/downloads/MLNCatalog.pdf on the CMS Web site. The specific 

products that may be of interest to providers who use the information in MM7234 are as follows: 

1. The Medicare Preventive Services Quick Reference Information Chart: Medicare Part B 

Immunization Billing (Influenza, Pneumococcal, and Hepatitis B) is available at 

http://www.cms.gov/MLNProducts/downloads/qr_immun_bill.pdf on the CMS Web site. 

2. The Adult Immunizations brochure provides a basic overview of Medicare’s influenza, pneumococcal 

and hepatitis B vaccine benefits and is available at 

http://www.cms.gov/MLNProducts/downloads/Adult_Immunization.pdf on the CMS Web site. 




Disclaimer 






CY 2011 Home Health PPS (HH PPS) PC Pricer Update 

The CY 2011 Home Health PPS (HH PPS) PC Pricer provider data has been updated with April 2011 

data and is now available for download. The HHA PC Pricers are on the Web page, 

http://www.cms.gov/PCPricer/05_HH.asp, under the Downloads section. If you use the CY 2011 HH 

PPS PC Pricer, please go to the page above and download the latest versions of the PC Pricer.F 

Implementation of New Reasonable Useful Lifetime (RUL) Policy for Stationary and 

Portable Oxygen Equipment 




MLN Matters ® Number: MM7213 Related Change Request (CR): 7213 

Related CR Release Date: April 8, 2011 Effective Date: May 8, 2011 

Related CR Transmittal #: R871OTN Implementation Date: May 8, 2011 


This article is for suppliers billing durable medical equipment Medicare administrative contractors (DME 

MACs) and/or regional home health intermediaries (RHHIs) for portable and stationary oxygen 

equipment for Medicare beneficiaries. 


CR 7213 implements changes to address situations in which a beneficiary has both portable and stationary 

oxygen equipment and the RUL for one piece of equipment expires before the RUL for the other piece of 

equipment has been reached. 

Background 

CR 7213 results in systems changes to establish new RUL policies for instances where the beneficiary has 

both portable and stationary oxygen equipment and the RUL for one piece of equipment expires before 

the RUL for the other piece of equipment has been reached. In most cases, a beneficiary who requires 




oth stationary and portable oxygen will have developed the need for both stationary and portable oxygen 

at the same time, will have received their stationary and portable oxygen equipment at the same time, and 

will be in a situation where the RUL for the stationary oxygen equipment ends at the same time that the 

RUL for the portable oxygen equipment ends. At the end of the RUL, the beneficiary can elect to obtain 

new oxygen equipment. 

Payment for portable oxygen equipment under Medicare is made as an add-on to the monthly payment 

amount for oxygen and oxygen equipment, which includes payment for stationary equipment, stationary 

oxygen contents, and portable oxygen contents. As a general rule, the same supplier that furnishes the 

stationary oxygen equipment to a beneficiary and receives the monthly payment for oxygen and oxygen 

equipment should also be furnishing the portable oxygen equipment to that beneficiary since a component 

of the payment for portable oxygen (portable oxygen contents) is included in the monthly payment 

amount for oxygen and oxygen equipment. A supplier of either stationary oxygen equipment or portable 

oxygen equipment that has furnished the equipment for 36 months of continuous use must continue to 

furnish the oxygen equipment to the beneficiary for the remainder of the RUL. Under the Durable 

Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) competitive bidding program, this 

responsibility does not transfer to a contract supplier if the supplier is not awarded a contract. When the 

RUL for oxygen equipment ends and the beneficiary elects to obtain replacement oxygen equipment, the 

replacement equipment must be furnished by a contract supplier and cannot be furnished by a noncontract 

supplier. 

At the start of a competitive bidding program, a supplier that is not awarded a contract for furnishing 

oxygen and oxygen equipment under the program may elect to continue or may be required to continue 

furnishing oxygen and oxygen equipment to beneficiaries they are currently serving: 

1. They may elect to be a grandfathered supplier for oxygen and oxygen equipment that has not yet 

reached the 36-month rental cap for all of their current customers who are Medicare beneficiaries 

residing in a DMEPOS Competitive Bidding Area (CBA); or 

2. They are required to continue furnishing oxygen and oxygen equipment for which they received the 

36th rental payment prior to the start of the program for the remainder of the RUL established for the 

equipment. 

Note: These new RUL policies outlined below apply to oxygen and oxygen equipment furnished to 

Medicare beneficiaries in general and are not restricted to oxygen and oxygen equipment furnished 

to beneficiaries residing in CBAs. 

Key Points of CR7213 

The following rules apply in situations where the beneficiary is using both stationary and portable oxygen 

equipment with different RUL end dates. 

• When the RUL of a beneficiary’s portable oxygen equipment differs from the RUL of the 

beneficiary’s stationary oxygen equipment, the RUL of the stationary oxygen equipment shall govern 

the application of RUL-based rules and processes for both types, stationary and portable, of oxygen 

equipment. 

• Until such time, as the end date of the RUL of the stationary oxygen equipment is reached, the 

supplier must continue to furnish both the portable and stationary oxygen equipment. 

o If the end date of the RUL of the portable oxygen equipment precedes the end date of the RUL of 

the stationary oxygen equipment, the end date of the RUL of the portable oxygen equipment is 

adjusted (extended) to coincide with the end date of the RUL of the stationary oxygen equipment. 




o If the end date of the RUL of the portable oxygen equipment follows the end date of the RUL of 

the stationary oxygen equipment, the end date of the RUL of the portable oxygen equipment is 

adjusted (shortened) to coincide with the end date of the RUL of the stationary oxygen equipment. 

• When the end date of the RUL of the stationary oxygen equipment occurs, the beneficiary may elect 

to obtain replacement of both the stationary and the portable oxygen equipment. 

• If the beneficiary elects to obtain replacement of the stationary and the portable oxygen equipment, 

both types of oxygen equipment must be replaced at the same time. 

• When the stationary and the portable oxygen equipment are replaced, a new 36-month rental period 

and new RUL is started for both the replacement stationary oxygen equipment and the replacement 

portable oxygen equipment. 

• Beginning January 1, 2011, a beneficiary who resides in a DMEPOS CBA may obtain replacement of 

both the stationary and portable oxygen systems only from a contract supplier having a competitive 

bidding contract for the CBA in which the beneficiary permanently resides. 

• A grandfathered supplier for oxygen and other grandfathered equipment as of January 1, 2011, who 

has continued to furnish such equipment that has not yet reached the 36-month rental cap, does not 

qualify to furnish replacement equipment once the end date of the RUL of the stationary equipment is 

reached, if the beneficiary resides in the CBA when the end of the RUL has been reached (unless the 

status of the grandfathered supplier has changed to a contract supplier for the current round of the 

DMEPOS competitive bidding program). 




For complete details regarding this CR please see the official instruction (CR 7213) issued to your 

Medicare RHHI or DME MAC. That instruction may be viewed by going to 


Disclaimer 






News from CMS for Hospice Providers 

CMS Issues FY 2012 Hospice Wage Index Proposed Rule 

The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule addressing the hospice 

wage index for fiscal year (FY) 2012. The proposed rule would increase Medicare payments to hospices 

by an estimated 2.3 percent for FY 2012 and establish a new quality reporting system authorized by the 

Affordable Care Act. 




Under the proposed quality reporting system, hospices would be required to submit data on quality 

measures to CMS or have their annual increase factor reduced by 2 percentage points, starting in FY 

2014. The proposed measures include one item endorsed by the National Quality Forum related to 

pain management and one structural measure related to participation in specific Quality Assessment 

and Performance Improvement (QAPI) programs. 

The rule also proposes to change the way hospice patients are counted for purposes of the 2012 cap 

year and beyond. Federal law requires that CMS impose a limit on the aggregate Medicare payments a 

hospice provider receives annually. This rule proposes to change the current calculation of the cap and 

also proposes that the new counting method be applied to past years in certain instances. In addition, 

the proposed rule would allow hospice providers who do not want to change their patient counting 

method to elect to continue using the current methodology. 

Finally, the proposed rule would modify the face-to-face encounter requirement for hospices, by 

proposing to remove the limitation that requires the hospice physician who performs the face-to-face 

encounter and attests to that encounter be the same physician who certifies the patient’s terminal 

illness. 

CMS will accept comments on the proposed rule until June 27, 2011. More details about this proposed 

rule will also be available at: http://www.cms.gov/apps/media/press_releases.asp 

Disclaimer 

This educational material was prepared as a tool to assist Medicare providers and other interested parties and is not intended 

to grant rights or impose obligations. Although every reasonable effort has been made to assure the accuracy of the 

information within this module, the ultimate responsibility for the correct submission of claims lies with the provider of 

services. Cahaba employees, agents, and staff make no representation, warranty, or guarantee that this compilation of 

Medicare information is error-free and will bear no responsibility or liability for the results or consequences of the use of 

these materials. This publication is a general summary that explains certain aspects of the Medicare Program, but is not a 

legal document. The official Medicare Program provisions are contained in the relevant laws, regulations, and rulings. 

We encourage users to review the specific statues, regulations and other interpretive materials for a full and accurate 

statement of their contents. Although this material is not copyrighted, CMS prohibits reproduction for profit making 

purposes. 

American Medical Association Notice and Disclaimer 

CPT codes, descriptors and other data only are copyright 2011 American Medical Association. All rights reserved. 

ICD-9 Notice 

The ICD-9-CM codes and descriptors used in this material are copyright 2011 under uniform copyright convention. All 

rights reserved.

Home Health & Hospice Medicare A Newsline - CGS

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