With the increase in sleep therapy over the past several years, many providers' top revenue generator is the E0601 (CPAP). However, analysis by RemitDATA shows that, on average, suppliers are receiving a 15.6 percent denial rate on that HCPCS code. The Jurisdiction A DME MAC (NHIC) recently completed a prepayment review of CPAP claims with paid dates from April 15 through June 20. The review was initiated due to a high volume of claim errors found by the Comprehensive Error Rate Testing (CERT) contractor.
The prepayment complex medical review included 100 claims submitted by 72 suppliers. Sixty-one claims were allowed and 39 were denied, resulting in a claim denial rate of 39 percent.
Based on the review of claims documentation, the DME MAC found the following were the primary reasons for denial:
Service determined to be medically unnecessary (36%)
- No initial face-to-face evaluation prior to sleep study or no face-to-face evaluations after 31st day
- No signature and/or date on sleep study
- No polysomnogram report
- Prescription illegible, poor copy quality
- Incorrect diagnosis
Duplicate submission (6%)
- Service denied as duplicate, previously considered
Rental period exceeded (3%)
- Service exceeded rental period, 15-month rental period met
Requested medical documentation not received (1%)
- Service denied as requested documentation not received
A common problem in this review is missing or incomplete records: no initial/follow-up face-to-face evaluations, no signature/date and missing polysomnogram reports. Before you submit your CPAP claims, check all requested documentation to make sure it is complete and that it meets the required documentation criteria.
Using this information to protect the integrity of the claims you submit is imperative in the current environment with regard to audits. It is the responsibility of the provider to prove the medical necessity of the claims the company submits. Review of the medical record for compliance is important to guarantee payment and reduce the possibility of payment recoupment.
Based on analysis of 8,945,016 claims processed for RemitDATA customers during the first quarter of 2010. Source: RemitDATA, 866/885-2974, www.remitdata.com
Read more Working Down Denials columns.
Sarah Hanna is a reimbursement consultant and vice president of ECS Billing & Consulting, Tiffin, Ohio, and specializes in proper billing protocols, Medicare coverage guidelines and billing office procedures. You can reach her at 419/448-5332 or sarahhanna@bright.net.
