Medicare to ease covered procedure guessing game

Washington -- When a patient is in line for an expensive procedure that Medicare might not cover, the treating physician now can either warn the beneficiary that the government might not pay for it or take a chance and file a claim after administering the treatment. But soon the government will offer a third option.

Under a recently proposed federal rule, Medicare carriers will be required to list on their Web sites the 50 costliest services that the program might cover, as well as any plastic and dental surgeries that average at least $1,000 and have the potential for reimbursement.

If they get the say-so from patients contemplating these procedures, physicians could demand binding advance statements from the carriers as to whether they will pay for the services.

Such prior determinations could affect some patients' decisions about whether to proceed with the expensive surgeries that their doctors recommend. Patients who have nailed down a guarantee of federal payment will be more likely to go ahead with the procedure than beneficiaries whose funding source is in doubt, federal officials said.

Physicians and patients currently cannot receive prior determinations from Medicare. Doctors can minimize only their own financial risk by issuing advance beneficiary notices, or ABNs, that explain the possibility that the government will deny the claims. The notices also inform patients that they would be on their own when it comes to paying the bill.

The prospect of possibly shouldering the entire cost of an expensive procedure could be proving too much for some seniors and disabled people, Mark McClellan, MD, PhD, Centers for Medicare & Medicaid Services administrator, said in the proposed rule.

"Notwithstanding these ABNs, there is the potential that beneficiaries may be discouraged from obtaining services because they are uncertain whether or not Medicare contractors will deem them reasonable and necessary," he said.

Congress mandated the change in policy under the regulatory and contracting reform section of the 2003 Medicare overhaul. The new prior determination system will sunset five years from the day that a doctor first takes advantage of the option. During the five-year experiment, the Government Accountability Office will report on how many beneficiaries who receive ABNs take advantage of the new system.

In the past, policy-makers have taken steps to allow some Medicare services to be subject to a prior determination mandate, but government officials at the time dismissed the strategy as unworkable.

As CMS embarks on its new offer of clear coverage answers for physicians and patients, it anticipates that only 5,000 physicians per year will seek any prior determinations.

For one thing, the agency significantly limited the scope of the treatments covered by the new system, as Congress permitted CMS to do. Treatments can register in the cost-based top 50 list as long as at least 50 of each procedure are performed over the course of a year.

In one prior determination pilot study CMS conducted in Illinois, Michigan, Minnesota and Wisconsin, relatively rare procedures such as double lung transplants and liver trisegmentectomies made the list.

In addition, the final tally of procedures for which any physician may request a prior determination, which will vary by geographic area, in many cases will be less than 50.

For example, carriers won't need to list procedures for which a national or local coverage determination already spells out the circumstances under which Medicare will reimburse a doctor.

While CMS is reserving its right to add more services to the required list in the future, Dr. McClellan indicated that the agency is keeping the list small for now, because it is concerned about overwhelming carriers by permitting too many requests from doctors.

"Limiting prior determinations to these services is reasonable given the administrative cost to process each prior determination request," Dr. McClellan said.

The process also could be time-consuming for physicians.

CMS estimates that a physician would need to spend 15 minutes himself or herself on the clinical documentation that is required for the request.

Navigating the process also would be inappropriate for instances in which the physician believes the patient needs the treatment in question right away.

Noting that most of the costliest Medicare procedures covered by this issue are non-emergency surgeries, CMS will allow a carrier 45 days to make a prior determination or to let a physician know that more information is needed.

Medicare will continue to pay in some cases for non-covered services if both the physician and the patient had no reasonable expectation that the claim would be denied.

CMS is accepting comments on the proposed rule through Oct. 31, after which it will issue final regulations. Doctors and other interested parties can submit comments online (link).