© Copyright 2007 American Health Information Management Association. All rights reserved.

Medical Necessity

Practical Tools for Seminar Learning

Disclaimer

i

The American Health Information Management Association makes no representation or guarantee with respect to the contents herein and specifically disclaims any implied guarantee of suitability for any specific purpose. AHIMA has no liability or responsibility to any person or entity with respect to any loss or damage caused by the use of this audio seminar, including but not limited to any loss of revenue, interruption of service, loss of business, or indirect damages resulting from the use of this program. AHIMA makes no guarantee that the use of this program will prevent differences of opinion or disputes with Medicare or other third party payers as to the amount that will be paid to providers of service.

How to earn one (1) CEU for participation

To earn one (1) continuing education unit, each participant must do the following: Step 1: Listen to the seminar, via Webcast link, audio CD, or MP3. Step 2: Complete the assessment quiz contained in this resource book.

Use the included answer key. Do not return the quiz to AHIMA. Save it for your records.

Step 3: EACH LISTENER must visit

http://campus.ahima.org/audio/fastfactsresources.html and complete the sign-in form and the seminar evaluation.

Step 4: After you complete the evaluation, you will receive your CE certificate which

you should print for your records. The certificate must be retained by each participant as a record of their participation, along with a copy of their completed quiz.

Faculty

ii

Dianne Wilkinson, RHIT Dianne Wilkinson is in her 38th year working in healthcare. The first 25 were in the hospital setting, working in medical records, quality assurance, JCAHO coordination, risk management, and utilization management. She earned her RHIT credential in 1980, her CPHQ (Certified Professional in Healthcare Quality) in 1988, and her CCP (Credentialed Compliance Professional) in 2004. In 1995 she was recruited to the physician office setting in her current position, Quality Manager/Compliance Officer for MedSouth Healthcare in Dyersburg, Tennessee. Ms. Wilkinson performs consulting services for physician clients in West and Middle Tennessee who outsource their compliance activities, especially the education and auditing/monitoring components. Ms. Wilkinson says she still passionately loves what she does for a living, just as she did when she began working in the healthcare field in 1969.

Table of Contents

Disclaimer ..................................................................................................................... i How to earn one (1) CEU for participation ......................................................................... i Faculty .........................................................................................................................ii Medical Necessity and Medicare: Some Facts................................................................... 1 Local Coverage Decisions (LCDs) ..................................................................................... 2 National Coverage Decisions (NCDs) ................................................................................ 2 What do LCDs and NCDs Mean to the Physician Practice: .................................................. 3 Challenges for Physicians Associated with Medicare Rules for LCDs/NCDs ........................... 3 Medical Necessity: Best Practices in Coding and Billing .................................................. 4-6 Medical Necessity: Best Practices in Documentation ...................................................... 6-8 Resource/Reference List ................................................................................................. 8 Helpful CMS Resources on Medical Necessity ........................................................ 9 AHIMA Audio Seminars ................................................................................................... 9 About assessment quiz ..................................................................................................10 Thank you for attending (with link for evaluation survey) .................................................10 Appendix ..................................................................................................................11 Resource List .......................................................................................................12 Attachments ........................................................................................................13 “Reasonable and Necessary” section of the OIG Final Compliance Program,

Guidance for Individual and Small Group Physician Practices Notice of Exclusions from Medicare Benefits (NEMB) Advance Beneficiary Notice Assessment Quiz CE Certificate and Sign-in Instructions Quiz Answer Key

Medical Necessity

1

Notes/Comments

Medical Necessity and Medicare: Some Facts

• Medicare defines medical necessity as a service provided for the diagnosis or treatment of an illness or injury or to improvethe functioning of a malformed body member (42 U.S.C. 1395y(a)(1)(A).

• Despite this very clinical definition, physicians should think of “medical necessity” as a billing term for Medicare patients rather than a clinical term.

• In 1996, an audit by the Office of the Inspector General showed that $23 billion was paid out in erroneous Medicare claims (approximately 14% of all Medicare fee-for-service claims). From then until now, about 70% of the amount paid in erroneous Medicare claims is due to documentation problems and failure to properly establish medical necessity for services billed.

Continued…

1

Medical Necessity and Medicare: Some Facts

• “Reasonable and necessary services” is identified as a key risk area in the O.I.G. Model Compliance Guidance for the Physician Office Setting issued in September 2000.

• While Medicare recognizes that many tests and procedures constitute “good medicine” and are appropriate for treatment, Medicare will only pay for services that meet Medicare’s definition of “reasonable and necessary”.

• It is a fair statement to say that most physicians probably do not understand all they should about Medicare’s rules regarding medical necessity of services performed and billed and the related documentation required (particularly about services with limitations of coverage).

(Continued)

2

Medical Necessity

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Notes/Comments

Coverage criteria within the Medicare Coverage Database—Local Coverage Decisions (LCDs)

• Established by Section 522 of the Benefits Improvement and Protection Act.

• A determination made at the Medicare carrier level (usually State by State) as to whether a service will be considered “reasonable and necessary”, and/or any coverage restrictions which might be imposed (e.g. by diagnosis, by frequency, etc.).

• Established by final rule effective December 7, 2003, CMS’ contractors began to issue LCDs rather than LMRPs (local medical review policies).

3

Coverage Criteria within the Medicare Coverage Database—National Coverage Decisions (NCDs)

• Are made through an evidence-based process, with opportunities for public participation, e.g. CMS’ own research supplemented by an outside technology assessment and/or consultation with the Medicare Coverage Advisory Committee.

• In the absence of a national coverage policy, an item or service may be covered at the discretion of the Medicare contractors based on a local coverage decision (LCD).

• The most commonly used NCDs for physicians are the Laboratory NCDs, developed as part of the Balanced Budget Act of 1997. These Laboratory NCDs were developed for 23 lab tests and are published with three lists for each NCD: Covered codes, non-covered codes, and codes that do not support medical necessity.

• The NCDs were published under the Administrative Procedures Act in the Federal Register of November 23, 2001.

• CMS updates the NCD code list as often as necessary to incorporate new codes, make corrections, etc. These updates can be downloaded from the CMS web site.

4

Medical Necessity

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Notes/Comments

What do LCDs and NCDs Mean to the Physician Practice?

• That many tests and procedures they want to order have coverage restrictions by Medicare.

• That if the physician just re-located from New York to Tennessee, he will not necessarily find the same tests and procedures that have restricted coverage in both States.

• A Medicare carrier’s list of current LCDs can change often; individual LCDs can be revised often; LCDs can be declared inactive, but for practical purposes should still be followed!

• Failure to stay current with your carrier’s LCDs puts you at risk for lost reimbursement; because if you receive a denial from Medicare due to medical necessity which cannot be appealed, and you have not obtained an Advance Beneficiary Notice (ABN) from your patient, your only option is a write-off.

• If a physician Practice is writing off large amounts due to medical necessity denials from Medicare, the patients are not paying forthese services; this perpetuates a common “myth” among Medicare patients… that Medicare covers “everything”.

5

Challenges for Physicians Associated with Medicare Rules for LCDs/NCDs:

• Since not all tests and procedures have limited Medicare coverage, the burden is on physicians to know on any given day which ones do (and are pertinent to their Practice) for their particular Medicare carrier.

• This involves the physician, or a nurse or other staff person, checking the carrier’s web site for current LCDs (and Lab staff staying abreast of current NCDs and keeping physicians informed). In a significant number of physician Practices, physicians are not staying current with their State’s LCDs. This will most certainly result in Medicare denials for medical necessity.

• Reviewing LCDs and obtaining the Advance Beneficiary Notice if needed must be done prior to rendering the service. Most physicians are not focusing on billing issues at the beginning of a patientencounter. At the end of the encounter, it’s too late.

• LCDs and NCDs are often revised; LCDs can be rendered inactive; new LCDs are published. Someone in the Practice needs to stay current with all this information from Medicare carriers and publish it to all physicians and pertinent staff. In my experience, this is not done as consistently as it should be.

6

Medical Necessity

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Notes/Comments

Medical Necessity: Best Practices in Coding and Billing

• Always choose diagnosis codes to the highest specificity possible.

• In coding diagnoses or conditions from a chart note, all diagnoses or conditions that were worked up, treated, or that impacted the patient’s care should be coded. Per ICD.9’s Diagnostic Coding and Reporting Guidelines for Outpatient Services (including provider-based office visits):

• The principal reason (diagnosis, symptom, etc.) for the visit should be sequenced first.

• Code all conditions that co-exist at the time of the encounter and require or affect patient care treatment or management (“V”codes may be used as secondary codes if they impacted current care or treatment).

• Chronic diseases treated on an ongoing basis may be coded and reported as many times as the patient receives treatment and care for the condition(s). Continued…

7

Medical Necessity: Best Practices in Coding and Billing

• Regarding CPT/HCPCS procedure codes, do not choose a code that reflects more work than was done and documented.

• Observe the National Correct Coding Initiative (NCCI) edits regarding codes that may be bundled (not paid separately).

• Do not choose three procedure codes in a code “family” when ONE of those codes would fully describe the work that was done and documented.

• Very important: Every test and/or procedure performed or ordered per the superbill should be linked to the diagnosis or condition which establishes medical necessity. This is most effectively done by the person who ordered the test/procedure.

(Continued)

Continued…8

Medical Necessity

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Notes/Comments

Medical Necessity: Best Practices in Coding and Billing

• Learn to code and bill preventive visits correctly, honoring thespecific coverage guidelines of Medicare and other payers. This is an area of billing that is always a challenge for physicians and coding/billing staff.

• Have a good working knowledge of CPT and HCPCS modifiers that affect your Practice. Especially know when to use –GA, -GY, and –GZ which apply specifically to Medicare coverage requirements.

• Be aware of hospital or nursing home policies, in place because of an accrediting or regulating entity, which may require action on the part of the physician (e.g., dictating a History and Physical), but which not be a billable service to Part B Medicare.

• For proceduralists, be aware of Medicare guidelines for billing an E&M service on the same day as a minor procedure. In order for the E&M service to be billable, it must be a significant service, OVER AND ABOVE the evaluation/management associated with the procedure itself. If that requirement is met, the E&M service may be billed with a -25 modifier; the use of the -25 modifier is always under scrutiny by Medicare.

(Continued)

Continued…9

Medical Necessity: Best Practices in Coding and Billing• Regarding billing Evaluation and Management services, be aware of

the following information recently shared with Medicare carriersfrom CMS which was gleaned from Comprehensive Error Rate Testing (CERT) reviews and other reviews of pre or post-claim documentation:

• Medical necessity of an E&M encounter is often visualized only when viewed through the prism of its characteristics captured in specific History of Present Illness (HPI) elements.

• Medical necessity of E&M services is generally expressed in two ways: Frequency of services and intensity of service (current CPT level).

• Medicare’s determination of medical necessity is separate from its determination that the E&M service was rendered as billed.

• Medicare determines medical necessity largely through the experience and judgment of clinical coders along with guidelines provided in CPT and by CMS; at audit, Medicare will deny or downcode E&M services that, in its judgment, exceed the patient’s documented needs.

• Medicare uses the history, exam, and decision-making to determine the physician’s cognitive work of the E&M service, based on such attributes asthe number, acuity, and severity/duration of problems addressed; the context of the encounter among all other services previously rendered for the same problem; the complexity of comorbidities that clearly influenced physician work; and the physical scope encompassed by the problems (number of physical systems affected by the problems).

(Continued)

Continued… 10

Medical Necessity

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Notes/Comments

Medical Necessity: Best Practices in Coding and Billing

• Best practice coding and billing summary statement:

Do all the clinical work necessary for the patient, based on thenature of presenting problem(s); document history, exam, and decision-making based on what was necessary to work up and/or treat the patient’s problem(s). Include all tests and procedures performed or ordered. Then code and bill from what was documented, assuring that the superbill is an accurate reflection of the chart note, and that all codes are accurate, appropriate modifiers are used, and that every test/procedure on the claim is linked to the appropriate diagnosis code that establishes medical necessity.

(Continued)

11

Medical Necessity: Best Practices in Documentation

• Ensure that the chart note includes the diagnosis or condition that establishes medical necessity for every test or procedure that was ordered or performed.

• Ensure that the superbill is an accurate reflection of the chart note as to diagnoses and procedures.

• If a separate requisition form is used to order a diagnostic test, as a supplement to the superbill, be sure that the diagnosis or condition listed on the requisition form to establish medical necessity matches the diagnosis or condition reflected in the chart note.

• Beware of using a “standard combo” of diagnosis code to CPT code because you know it is listed in an LCD as a covered diagnosis (e.g., a pattern of using “fatigue” linked to virtually all orders for CBC, when the chart notes do not mention fatigue… risky business!).

Continued…

12

Medical Necessity

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Notes/Comments

Medical Necessity: Best Practices in Documentation

• Most carriers have an LCD for removal of benign skin lesions. If more than one benign lesion is being treated, list them separately in the History of Present Illness, and describe each one as to whether medical necessity can be established (e.g., bleeding), or whether it must be categorized as cosmetic surgery and therefore non-covered by Medicare.

• Some LCDs, like the one for removal of benign skin lesions, require a -KX modifier indicating that documentation is on file in the medical record that establishes medical necessity. Part of your compliance activities should be auditing for this documentation when the -KX has been submitted on the claim.

• For an LCD involving a CPT code with specific requirements, be sure the chart note contains all the information called for by the code (e.g., trigger point injections… one code affects one or two muscle groups, another, which is higher-paying, affects three or more muscle groups).

(Continued)

Continued…

13

Medical Necessity: Best Practices in Documentation

• Regarding billing Evaluation and Management Services, medical necessity is the overarching criterion for payment in addition to the individual requirements of a CPT code…the volume of documentation should not be the primary influence upon which a specific level of service is billed (Carriers Manual, Part 3, 15501, B.).

• Years ago, Medicare often said to physicians, “you don’t have enough documentation to support your E&M level”. Now, we often hear, “the volume of your documentation appears to exceed the patient’s medical need”.

• Consequently, Medicare warns against cloned notes (whether electronic or not), checklists, pre-printed visit forms, or other tools that facilitate upcoding and that also result in notes that have little clinical validity and could adversely affect patientcare.

(Continued)

Continued…14

Medical Necessity

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Notes/Comments

Medical Necessity: Best Practices in Documentation

• All clinical work done for the patient should be documented, even if a lower E&M level is selected. The chart note is not primarily a billing document but should be an accurate reflection of all that was done during the encounter. Accurate and complete chart notes are the best protection from a quality assurance standpoint, a risk management standpoint, and a billing standpoint.

• Delinquent chart completion is an enemy to Medicare compliance. No one can remember all that was done during a patient encounter days or weeks after the fact. In particular, the documentation of medical necessity for all that was performed or ordered could suffer.

(Continued)

15

Resource/Reference List

Book• AHIMA Publication: Health Information Management Compliance: Guidelines

for Preventing Fraud and Abuse, Fourth Edition; by Sue Bowman. https://imis.ahima.org//orders/productDetail.cfm?pc=AB102107

Articles• “Reasonable and Necessary” section of the OIG Final Compliance Program

Guidance for Individual and Small Group Physician Practices (October 5, 2000; FR page 59439): www.oig.hhs.gov/fraud/complianceguidance.html

• "Comprehensive Error Rate Testing (CERT) Report," article from July, 2007 "Medicare Bulletin: Tennessee" by Cigna Government Services, regarding medical necessity of evaluation and management (E&M) services (pg. 1): www.cignamedicare.com/partb/pubs/mb/2007/07_07/PDFs/TN_07_07.pdf

• “Medical Record Cloning, ”article from March/April, 1999 "Medicare Bulletin: Tennessee" by Cigna Government Services (pg. 12): www.cignamedicare.com/partb/pubs/mb/1999/99_2/PDFs/b992tn.pdf

• “Phantom Double Plays, Histories and Physicals," article from December, 2001 "Medicare Bulletin" from Wisconsin Physicians Service (pp. 2-3): www.wpsmedicare.com/provider/pdfs/1201bltn.pdf

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Notes/Comments

Helpful CMS Resources on Medical Necessity

• Notice of Exclusions from Medicare Benefits (NEMB), which lists services that are statutorily non-covered, and therefore would never be considered “medically necessary” for Medicare payment (these services should be the patient’s responsibility to pay)www.cms.hhs.gov/BNI/Downloads/CMS20007English.pdf

• Example of a dedicated Advance Beneficiary Notice (ABN). Form Number: CMS R 131-Gwww.cms.hhs.gov/cmsforms/downloads/cmsr-131-g.pdf

• CMS Medicare Coverage Center: www.cms.hhs.gov/center/coverage.asp• Overview of Medicare Coverage Database:

www.cms.hhs.gov/mcd/overview.asp• Local Coverage Determinations:

www.cms.hhs.gov/DeterminationProcess/04_LCDs.asp• Lab National Coverage Decisions (NCDs):

www.cms.hhs.gov/CoverageGenInfo/04_LabNCDs.asp• Overview of Medicare Coverage Determination Process:

www.cms.hhs.gov/DeterminationProcess/• Example of an LCD for Bone Mass Measurement (#L5803, Cigna/Tennessee):

www.cms.hhs.gov/mcd/viewlcd.asp?lcd_id=5803&lcd_version=31&show=all17

AHIMA Audio Seminars

Visit our Web site http://campus.AHIMA.orgfor updated information on the current seminar schedule. While online, you can also register for live seminars or order CDs and Webcasts of past seminars.

© 2007 American Health Information Management Association

Medical Necessity

10

Notes/Comments

Assessment

To access the assessment quiz that follows this seminar, download the seminar’s resource book at

http://campus.ahima.org/audio/fastfactsresources.html

Thank you for attending!

Please visit the AHIMA Audio Seminars Web site to sign-in and complete your evaluation form online at:

http://campus.ahima.org/audio/fastfactsresources.html

Each person seeking CE credit must complete the sign-in form and evaluation in order to view and print their CE certificate.

Certificates will be awarded for AHIMA CEUs and ANCC Contact Hours.

Appendix

Resource List Attachments “Reasonable and Necessary” section of the OIG Final Compliance Program, Guidance for

Individual and Small Group Physician Practices Notice of Exclusions from Medicare Benefits (NEMB) Advance Beneficiary Notice Assessment Quiz CE Certificate and Sign-in Instructions Quiz Answer Key

Appendix

Resource List Attachments

“Reasonable and Necessary” section of the OIG Final Compliance Program, Guidance for Individual and Small Group Physician Practices (October 5, 2000; Federal Register pages 59439-40) http://www.oig.hhs.gov/fraud/complianceguidance.html

Notice of Exclusions from Medicare Benefits (NEMB); Form No. CMS-20007 (January 2003)

Advance Beneficiary Notice; Form No. CMS-R-131-G (June 2002)

Book

AHIMA Publication: Health Information Management Compliance: Guidelines for Preventing Fraud and Abuse, Fourth Edition; by Sue Bowman. https://imis.ahima.org//orders/productDetail.cfm?pc=AB102107

Articles

“Reasonable and Necessary” section of the OIG Final Compliance Program Guidance for Individual and Small Group Physician Practices (October 5, 2000; FR page 59439) http://www.oig.hhs.gov/fraud/complianceguidance.html

"Comprehensive Error Rate Testing (CERT) Report," article from July, 2007 "Medicare Bulletin: Tennessee" by Cigna Government Services, regarding medical necessity of evaluation and management (E&M) services (pg. 1) http://www.cignamedicare.com/partb/pubs/mb/2007/07_07/PDFs/TN_07_07.pdf

“Medical Record Cloning,” article from March/April, 1999 "Medicare Bulletin: Tennessee" by Cigna Government Services (pg. 12) http://www.cignamedicare.com/partb/pubs/mb/1999/99_2/PDFs/b992tn.pdf

“Phantom Double Plays, Histories and Physicals," article from December, 2001 "Medicare Bulletin" from Wisconsin Physicians Service (pp. 2-3) http://www.wpsmedicare.com/provider/pdfs/1201bltn.pdf

CMS

Medicare’s Notice of Exclusions from Medicare Benefits (NEMB), which lists services that are statutorily non-covered, and therefore would never be considered “medically necessary” for Medicare payment (These services should be the patient’s responsibility to pay) http://www.cms.hhs.gov/BNI/Downloads/CMS20007English.pdf

Example of a dedicated Advance Beneficiary Notice (ABN). Form Number: CMS R 131-G http://www.cms.hhs.gov/cmsforms/downloads/cmsr-131-g.pdf

CMS Medicare Coverage Center: http://www.cms.hhs.gov/center/coverage.asp

Overview of Medicare Coverage Database: http://www.cms.hhs.gov/mcd/overview.asp

Local Coverage Determinations: http://www.cms.hhs.gov/DeterminationProcess/04_LCDs.asp

Lab National Coverage Decisions (NCDs): http://www.cms.hhs.gov/CoverageGenInfo/04_LabNCDs.asp

Overview of Medicare Coverage Determination Process: http://www.cms.hhs.gov/DeterminationProcess/

Example of an LCD for Bone Mass Measurement (#L5803, Cigna/Tennessee) http://www.cms.hhs.gov/mcd/viewlcd.asp?lcd_id=5803&lcd_version=31&show=all

“Reasonable and Necessary” section of the OIG Final Compliance Program Guidance for Individual and Small Group Physician Practices (October 5, 2000; Federal Register pages 59439-40) Online at: www.oig.hhs.gov/fraud/complianceguidance.html Office of Inspector General's Compliance Program Guidance for Individual and Small Group Physician Practices: II(B) Step 2 (1)(b) b. Reasonable and Necessary Services.

A practice’s compliance program may provide guidance that claims are to be submitted only for services that the physician practice finds to be reasonable and necessary in the particular case. The OIG recognizes that physicians should be able to order any tests, including screening tests, they believe are appropriate for the treatment of their patients. However, a physician practice should be aware that Medicare will only pay for services that meet the Medicare definition of reasonable and necessary.23

Medicare (and many insurance plans) may deny payment for a service that is not reasonable and necessary according to the Medicare reimbursement rules. Thus, when a physician provides services to a Medicare beneficiary, he or she should only bill those services that meet the Medicare standard of being reasonable and necessary for the diagnosis and treatment of a patient. A physician practice can bill in order to receive a denial for services, but only if the denial is needed for reimbursement from the secondary payor. Upon request, the physician practice should be able to provide documentation, such as a patient’s medical records and physician’s orders, to support the appropriateness of a service that the physician has provided. Footnote: 23 ‘‘* * * for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.’’ 42 U.S.C. 1395y(a)(1)(A). Excerpt from: Federal Register / Vol. 65, No. 194 / Thursday, October 5, 2000 / Notices

NOTICE OF EXCLUSIONS FROM MEDICARE BENEFITS (NEMB)

There are items and services for which Medicare will not pay.

• Medicare does not pay for all of your health care costs. Medicare only pays for covered benefits. Some items and services are not Medicare benefits and Medicare will not pay for them.

• When you receive an item or service that is not a Medicare benefit, you are responsible to pay for it, personally or through any other insurance that you may have.

The purpose of this notice is to help you make an informed choice about whether or not you want to receive these items or services, knowing that you will have to pay for them yourself. Before you make a decision, you should read this entire notice carefully. Ask us to explain, if you don’t understand why Medicare won’t pay. Ask us how much these items or services will cost you (Estimated Cost: $_____________).

Medicare will not pay for: ________________________________________________

______________________________________________________________________;

□ 1. Because it does not meet the definition of any Medicare benefit.

□ 2. Because of the following exclusion * from Medicare benefits:

□ Personal comfort items. □ Routine physicals and most tests for screening. □ Most shots (vaccinations). □ Routine eye care, eyeglasses and examinations. □ Hearing aids and hearing examinations. □ Cosmetic surgery. □ Most outpatient prescription drugs. □ Dental care and dentures (in most cases). □ Orthopedic shoes and foot supports (orthotics). □ Routine foot care and flat foot care. □ Health care received outside of the USA. □ Services by immediate relatives. □ Services required as a result of war. □ Services under a physician’s private contract. □ Services paid for by a governmental entity that is not Medicare. □ Services for which the patient has no legal obligation to pay. □ Home health services furnished under a plan of care, if the agency does not submit the claim. □ Items and services excluded under the Assisted Suicide Funding Restriction Act of 1997. □ Items or services furnished in a competitive acquisition area by any entity that does not have a contract with the Department of Health and Human Services (except in a case of urgent need). □ Physicians’ services performed by a physician assistant, midwife, psychologist, or nurse anesthetist, when furnished to an inpatient, unless they are furnished under arrangements by the hospital. □ Items and services furnished to an individual who is a resident of a skilled nursing facility (a SNF) or of a part of a facility that includes a SNF, unless they are furnished under arrangements by the SNF. □ Services of an assistant at surgery without prior approval from the peer review organization. □ Outpatient occupational and physical therapy services furnished incident to a physician’s services.

* This is only a general summary of exclusions from Medicare benefits. It is not a legal document. The official Medicare program provisions are contained in relevant laws, regulations, and rulings.

Form No. CMS-20007 (January 2003)

Patient’s Name: Medicare # (HICN):

ADVANCE BENEFICIARY NOTICE (ABN)NOTE: You need to make a choice about receiving these health care items or services. We expect that Medicare will not pay for the item(s) or service(s) that are described below.Medicare does not pay for all of your health care costs. Medicare only pays for covered itemsand services when Medicare rules are met. The fact that Medicare may not pay for a particularitem or service does not mean that you should not receive it. There may be a good reason yourdoctor recommended it. Right now, in your case, Medicare probably will not pay for – Items or Services:

Because:

The purpose of this form is to help you make an informed choice about whether or not youwant to receive these items or services, knowing that you might have to pay for them yourself.Before you make a decision about your options, you should read this entire notice carefully. • Ask us to explain, if you don’t understand why Medicare probably won’t pay. • Ask us how much these items or services will cost you (Estimated Cost: $_________________),

in case you have to pay for them yourself or through other insurance.

PLEASE CHOOSE ONE OPTION. CHECK ONE BOX. SIGN & DATE YOUR CHOICE.

� Option 1. YES. I want to receive these items or services. I understand that Medicare will not decide whether to pay unless I receive these itemsor services. Please submit my claim to Medicare. I understand that you may bill me foritems or services and that I may have to pay the bill while Medicare is making its decision.If Medicare does pay, you will refund to me any payments I made to you that are due to me.If Medicare denies payment, I agree to be personally and fully responsible for payment.That is, I will pay personally, either out of pocket or through any other insurance that I have.I understand I can appeal Medicare’s decision.

� Option 2. NO. I have decided not to receive these items or services. I will not receive these items or services. I understand that you will not be able to submit aclaim to Medicare and that I will not be able to appeal your opinion that Medicare won’t pay.

_____________ _ _________________________________________ Date Signature of patient or person acting on patient’s behalf

NOTE: Your health information will be kept confidential. Any information that we collect about you on thisform will be kept confidential in our offices. If a claim is submitted to Medicare, your health information on this form may be shared with Medicare. Your health information which Medicare sees will be kept confidential by Medicare.

OMB Approval No. 0938-0566 Form No. CMS-R-131-G (June 2002)

Assessment Quiz – Medical Necessity

ANSWERS to this quiz are found on the last page of the seminar resource book, Practical Tools for Seminar Learning.

To earn continuing education credit of one (1) AHIMA CEU, Fast Facts Audio Seminar listeners must also complete this 10-question quiz. This CE credit is for attending the audio seminar AND completing this quiz. Please keep a copy of the completed quiz with your CE certificate. Do not send a copy to AHIMA.

1. True or false? In the interest of promoting

preventive care, Medicare covers all tests for screening. True False

2. True or false? Medicare rules state that

physicians are only to bill Medicare for covered services unless the claim is submitted in order to receive a denial so that the patient may be billed. True False

3. True or false? In the absence of a National

Coverage Decision, Medicare carriers are allowed to develop Local Coverage Decisions at their discretion. True False

4. True or false? The only risk that medical

necessity denials from Medicare pose to a Practice is the loss of revenue from write-offs. True False

5. True or false? Medical necessity, based on the

patient’s medical need, is the most important driver in the choice of E&M code selection. True False

6. True or false? Medicare rules prohibit the use of

templates and pre-printed office visit forms. True False

7. True or false? Medical necessity must be clearly

evident in the physician’s (or non-physician practitioner’s) documentation for all tests and procedures submitted on the claim. True False

8. True or false? It is the coder’s responsibility to determine why tests and procedures were ordered, based on the diagnosis list provided by the physician/NPP. True False

9. True or false? If a medical necessity denial is

received from Medicare, indicating that the patient is not responsible for payment, this can be corrected by calling the patient and obtaining his permission to bill him at that point, as long as his permission is obtained in writing. True False

10. True or false? Local Coverage Decisions (LCDs)

may vary from Medicare carrier to carrier as to coverage criteria. True False

Do not send a copy of completed quizzes to AHIMA. Please keep them with your CE certificate, for your records. Be sure to sign-in and complete your evaluation form, to receive your certificate, at

http://campus.ahima.org/audio/fastfactsresources.html.

To receive your

CE Certificate

visit http://campus.ahima.org/audio/fastfactsresources.html

click on the link to

“Sign In and Complete Online Evaluation” listed for this seminar.

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Each participant expecting to receive continuing education credit must complete the online evaluation and sign-in information,

in order to view and print the CE certificate.

Quiz Answer Key Fast Facts Audio Seminar: Medical Necessity 1: false; 2: true; 3: true; 4: false; 5: true; 6: false; 7: true; 8: false; 9: false; 10: true Do not send a copy of your completed Fast Facts Audio Seminar quiz to AHIMA. Please keep it with your CE certificate, for your records.