Scope of Claims Editing
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Scope of Claims Editing

It is a requirement that claims submitted to the Medicare Part B carrier, the Medicare administrative contractor (A/B MAC) or the durable medical equipment (DME) MAC that are the result of an order or referral must include the National Provider Identifier (NPI) and the name of the ordering or referring provider.  Physician and nonphysician practitioners who are eligible to order/refer must be enrolled in the Medicare Provider Enrollment, Chain and Ownership System (PECOS).

Medicare is expanding the current scope of editing for claims processed that require an ordering or referring provider. There are two phases to this implementation.

Phase 1 extends through April 4, 2010

Claims Submitted to the DME MAC During Phase 1

During this phase, claims processing edits are in place to verify the ordering/referring provider is in PECOS and is eligible to order or refer under Medicare guidelines.  If the provider is not in PECOS or is in PECOS but is not of the type/specialty to order or refer, the claim will continue to process.  The DMEPOS supplier will receive a warning message for claims submitted electronically.  The supplier will not receive a warning message for paper claims.

Claims Submitted to the Medicare Part B Carrier or A/B MAC During Phase 1

During this phase claims processing edits are in place to verify the ordering/referring provider is in PECOS and is eligible to order or refer under Medicare guidelines.  If the provider is not in PECOS the contractor will search the claims processing system for the ordering/referring provider. If the provider is not in PECOS or the claims processing system, the claim will continue to process.  The provider submitting the claim will receive a warning message on the remittance advice.

Phase 2 begins April 5, 2010 and continues thereafter.

Claims Submitted to the DME MAC During Phase 2

If you order/refer items for a beneficiary that will be billed to the DME MAC by a supplier of durable medical equipment, prosthetics, orthotics or supplies and you are not eligible to order/refer under Medicare guidelines OR you are not in PECOS as of April 5, 2010 the beneficiary's claims submitted to Medicare by the supplier will not be paid.  The DME MAC processing system does not contain the ordering/referring physicians' eligibility records and cannot verify the information if it is not in PECOS.

Claims Submitted to the Medicare Part B Carrier or A/B MAC During Phase 2

If the NPI and the name of the ordering/referring provider are on the claim the contractor will verify the provider is in PECOS and eligible to order or refer.  If the provider is not in PECOS the contractor will search the claims processing system for the ordering/referring provider.  A referring or ordering physician that is not enrolled with the Medicare contractor that is processing the claim will not be in the contractor's claims processing system.  Those claims that include the NPI and name of ordering/referring providers that cannot be found in PECOS OR found in the claims processing system will be rejected and not paid.

To ensure your reimbursement is not affected and your patients' DME claims are paid, follow these steps:

  1. Log on to www.cms.hhs.gov/MedicareProviderSupEnroll. In the box on the left, under Medicare Provider Supplier Enrollment, select the Ordering Referring Report.  Search for your National Provider Identifier (NPI) in the Medicare Ordering Referring File found in the Downloads section.  If your NPI and name are on the list you are in the Provider Enrollment Chain of Ownership System (PECOS).  You do not need to enroll in PECOS. If your NPI is not on the list or you want to confirm and review your enrollment in PECOS, go to step 2.
  1. Providers that are already in PECOS do not need to revalidate, enroll or submit an 855 application to the contractor at this time unless you receive a request from the contractor.  If you are not in PECOS or want to review your enrollment information you may do so by visiting the PECOS Web site at https://pecos.cms.hhs.gov/pecos/login.do .  You will need to create a User ID and Password if you have not accessed PECOS previously. For helpful guidance on PECOS please use this link http://www.cms.hhs.gov/MedicareProviderSupEnroll/04_InternetbasedPECOS.asp#TopOfPage

Two recommended documents to get you started with enrollment in PECOS are:

Internet Based PECOS – Getting Started Guide for Physicians and Nonphysician Practitioners

Internet Based PECOS – Enrollment Example

Tips for revalidating or enrolling:

  • If revalidating a Group Member, the CMS 855I and the CMS
  • If revalidating an Individual, the CMS 855I application must be submitted
  • If revalidating a Group or Organization, the CMS

Services that require an ordering/referring provider can be found in the CMS Medicare Claims Processing Manual, Publication 100-04, Chapter 26, Section 10.4 at http://www.cms.hhs.gov/Manuals/IOM/list.asp.

The Medicare Learning Network Matters articles released on this implementation are:

MM6417: Revised Final - Expansion of the Current Scope of Editing for Ordering/Referring Providers for Claims Processed by Medicare Carriers and Part B Medicare Administrative Contractors (MACs)

MM6421: Final - Expansion of the Current Scope of Editing for Ordering/Referring Providers for Durable Medical Equipment, Prosthetics, Orthotics, and Supplier (DMEPOS) Suppliers Claims Process by Durable Medical Equipment Medicare Administrative Contractors (DMEMACs)
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