The Changing Medicare Landscape

By Kathy Dodson

With Medicare, "The only thing certain is change."

Due to provisions in several Medicare bills over the past few years, O&P is in the midst of changes regarding who pays claims, processes appeals and handles medical review.

In addition, the reviews and fair hearings of old are changing to redeterminations and reconsiderations, with new time and monetary requirements.

To help you, here is a summary.

Medicare contractors

Currently all your claims activity revolves around your DME Regional Carrier (DMERC). That's about to change. Here's the new set-up.

There are still four regions, A through D. However, instead of having a DMERC handle all claims functions for each region, these functions will be split among three different types of contractors.

For each region, you will deal with a DME Medicare Administrative Contractor (DMAC), a Program Safeguard Contractor (PSC), and a Qualified Independent Contractor (QIC). In some instances, one PSC or QIC will cover more than one region. The DMERCs, as heretofore known, will disappear once the transfer of functions to these new entities is complete.

The DMAC role

DME Medicare Administrative Contractors (DMACs) carry out the basic claims payment activities. For claims that do not need medical review and do not need to be appealed, you only deal with this contractor.

The DMAC for Region A will be National Heritage Insurance Company and for Region D will be Noridian Administrative Services. Regions B and C will remain with AdminaStar Federal and Palmetto GBA. The transfer to the new contractors for Regions A and D will be effective July 1.

What PSCs do

Program Safeguard Contractors (PSCs) handle medical policy development and medical review of claims. For claims needing additional review to determine if an item is medically necessary, claims information is sent from the DMAC to the PSC.

The PSC gathers information and makes a medical necessity determination. The claim is then sent back to the DMAC for final processing.

Also, the PSC will be home to the medical directors and will be responsible for the development and maintenance of new medical policies and benefit integrity—also called fraud and abuse—work.

O&P has one PSC already operating in Region A, called TriCenturion.

In the new arrangement, TriCenturion continues as the Region A PSC and takes on this role for Region B. Trust Solutions has been named as the PSC for Region C, while IntegriGuard has been named for Region D.

The QIC appeal

Many appeals will be handled by the Qualified Independent Contractor (QIC).

Once your claim has been processed by the DMAC, if you disagree with the disposition and you are unsuccessful in your first level of appeal, the QIC will handle further appeals.

It appears that there will only be one QIC for DMEPOS claims, so this contractor will handle appeals for all four regions. The contract has been awarded to Q2Administration or Q2A, a Palmetto GBA subsidiary.

Timeline

The timing of these changes varies.

The PSCs have been named and start their new duties on or about March 1. The QIC, which will work in conjunction with the DMACs, should be on board concurrent with DMAC operations.

Medicare should notify you in time to make any administrative changes necessary for your facility.

Region changes

There are also some minor changes in the composition of the Medicare regions.

These changes make the DMAC regions consistent with the boundaries of the other 15 MAC contractors that will process non-DMEPOS claims.

State changes are scheduled to take effect concurrent with the implementation of the DMACs. If your state is not listed below, you will remain in your current region.

Appeals

Another change as of Jan. 1 is a reform in the appeals process for Medicare.

Under the new appeals process, instead of requesting a review and then a fair hearing, as you do now, you request a redetermination and then, if necessary, a reconsideration. You also have less time to request the redetermination than in the past, but limits on the amount in controversy have been removed for the redetermination, reconsideration and Departmental Appeals Board review.

Other changes to the appeals process include eliminating the option for a telephone or in-person hearing at the reconsideration (old fair hearing) level. These will now all be "on the record," based only on written information. On a brighter note, the DMACs are not allowed to recoup outstanding overpayments until after the reconsideration decision is rendered. So, if you choose to appeal a denied or incorrectly paid claim, you no longer have to immediately refund the amount in question or have it taken from future payments.

Another change is when you request the reconsideration stage of review, you must supply all the evidence to support your appeal. This applies to all documentation, including physicians' notes, if applicable. If you neglect to supply some documents, you cannot submit them later if you want to continue your appeal to the ALJ level.

If the QIC does not process your reconsideration within 60 days of receipt, you have a new right to request the appeal be sent directly to the ALJ level, without waiting for the completion of the reconsideration process. This hopefully will shorten the timeframe for the overall process in many instances.

Future updates

Be sure to watch your DMERC/DMAC quarterly bulletins for information, timing and guidance on how these changes affect you.

AOPA will provide additional information through the AOPA In Advance newsletter.

Kathy Dodson is the senior director of government affairs for AOPA.