HCPCS Code Reporting Changes for Rural Health Clinics

by Debbie Mackaman, RHIA, CPCO, CCDS

This year, April will not only bring spring showers but could bring severe thunderstorms and maybe even a hail storm or two to rural health clinics (RHC), as CMS will require revenue code and HCPCS code reporting on April 1 date of service. In January, I wrote an article about changes to the Medicare Benefit Policy and Claims Processing Manuals that directly affected RHCs and I mentioned that more information would be coming out regarding the new reporting requirement.

CMS did not disappoint in creating more questions than answers during the Rural Health Open Door Forum call last week and in the guidance that has been published in the last few months. The two key documents that further explain the mandate are Transmittal 1596 and MLN Matters Article MM9269.

RHCs have been separately reporting HCPCS codes for preventive services since January 1, 2011. This requirement was put in place under the Affordable Care Act in order to waive the patient’s deductible and coinsurance. When reporting certain preventive services, the RHC reports the HCPCS code and its related charge on a separate line, usually with revenue code 0521. The billed amount for the preventive service is deducted from the total charge of the clinic visit. The patient pays the deductible and coinsurance for all costs related to the clinic visit while the amounts for the preventive service are waived by billing it on a separate line with the appropriate charge.

Beginning with April 1 dates of service, RHCs will be required to report a separate line for all services provided during a qualifying medical visit, preventive health visit, or mental health visit. CMS initially announced this requirement during the MPFS proposed and final rule making periods, stating it was bringing RHCs in line with other CMS regulations that all covered entities must report standard medical code sets for electronic health care transactions.

An encounter must include one of the services listed in the RHC Qualifying Visit List (see the transmittal or MLN Matters Article above for a list of HCPCS codes). The total charges for the encounter must be included on the qualifying visit line minus any charge for the covered preventive service. Payment and applicable coinsurance and/or deductible will be based on the qualifying visit line, just as it is under the current all-inclusive rate (AIR) payment methodology. No changes were made to the way in which an RHC is reimbursed for its services.

All other RHC services furnished during the encounter must be reported on a separate line with the appropriate revenue code and HCPCS code. But here is where one of the problems start: the separate line will also be required to include a charge for that item or service. The payment for these lines will already be included in the AIR and the patient will not be responsible for the deductible and coinsurance on these charges. However, the total charges on the claim may appear to be inflated or “double-billed” and during the Open Door Forum call the CMS representative concurred with that point of view.

After careful review of the transmittal and MLN Matters article, as well as listening to the CMS representative on the Open Door Forum call, it appears that CMS has asked the RHC to bill for the actual charge for the service twice on the same claim. If CMS plans to move ahead with implementation of HCPCS and revenue code reporting, it would make the most sense for all involved if the RHC can report an amount of $1.00 or less for the new charge reporting structure, which could be driven through a chargemaster process. Reporting actual charges on individual lines will be a problem for all RHCs and not just an individual provider’s internal billing issue, as alluded to on the call.

To view the complete article that appeared on Medicare Compliance Watch, click here.