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Medicare claim denial process begins Jan. 6

December 13, 2013

By Craig Palmer, ADA News staff

Washington—The Centers for Medicare & Medicaid Services will instruct contractors to turn on Phase 2 denial edits for claims from health care providers for particular Medicare-covered items or services for Medicare beneficiaries ordered or referred by other providers.

These edits will check the following claims for a valid individual National Provider Identifier and deny the claim when this information is invalid, CMS said in a notice posted at the CMS Medicare Learning Network website:

  • Claims from clinical laboratories for ordered tests;
  • Claims from imaging centers for ordered imaging procedures;
  • Claims from suppliers of durable medical equipment, prosthetics, orthotics and supplies for ordered DMEPOS, and
  • Claims from home health agencies.

The edits do not affect referrals from a doctor to a specialist as the Association recommended during the rule making process.

Phase 1 edits notified providers if the ordering or certifying practitioner was not enrolled or properly opted out of Medicare but did not deny payment. In Phase 2, if the ordering/referring provider does not pass the edits, the claim will be denied. This means that the Medicare billing provider will not be paid for the items or services that were furnished based on the order or referral, CMS said.

The Association offers member resources on Medicare enrollment and opt-out procedures at