[Federal Register Volume 59, Number 43 (Friday, March 4, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-4900]
[[Page Unknown]]
[Federal Register: March 4, 1994]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
42 CFR Parts 405 and 424
[BPD-610-F]
RIN 0938-AE06
Medicare Program; Diagnosis Codes on Physician Bills
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule implements certain provisions of section
1842(p) of the Social Security Act regarding diagnosis codes on
physician bills. Under this final rule, each bill or request for
payment for a service furnished by a physician under Medicare Part B
must include appropriate diagnostic coding for the diagnosis or the
symptoms of the illness or injury for which the Medicare beneficiary
received care.
DATES: Effective date: This final rule is effective April 4, 1994.
FOR FURTHER INFORMATION CONTACT:
Pat Brooks, R.R.A. (410) 966-5318.
SUPPLEMENTARY INFORMATION:
I. Background
Medical services are furnished to Medicare beneficiaries by
providers, suppliers, physicians, and other specified practitioners.
Title XVIII of the Social Security Act (the Act) defines the term
physician. Under section 1861(r) of the Act, the term physician,
subject to limitations concerning the scope of practice by each State
and other provisions of title XVIII of the Act, means a doctor of--(1)
Medicine or osteopathy; (2) Dental surgery or dental medicine; (3)
Podiatry; (4) Optometry; or (5) Chiropractic.
Under provisions of section 1848(g)(4) of the Act, as added by
section 6102(a) of the Omnibus Budget Reconciliation Act of 1989 (Pub.
L. 100-239), effective for services furnished on or after September 1,
1990, each physician must submit a standard claim form (HCFA-1500)
directly to the Medicare carrier on behalf of the beneficiary,
regardless of whether the physician provided the services on an
assignment-related basis. (Under Medicare Part B, a physician may bill
the patient directly for the physician's services, thus requiring the
beneficiary to seek reimbursement from Medicare. Alternatively, under
section 1842(b)(3)(B) of the Act, when a physician furnishes services
on an assignment-related basis, the physician bills Medicare directly
in exchange for the physician's agreement to accept the Medicare
approved amount as payment in full. (Rules concerning assignment of
claims are found at Secs. 424.55, 424.56 and 424.70 et seq.) The HCFA-
1500, which is also used by most third-party payers, including Medicaid
and other Federal government health insurance programs, is, in effect,
an itemized bill.
Before September 1, 1990, if a physician was not paid directly by
Medicare for physician services, the physician either billed the
Medicare beneficiary directly or billed another third-party payer. The
beneficiary then sought payment from Medicare for expenses incurred in
obtaining covered physician's services by submitting a Patient's
Request for Medicare Payment (HCFA-1490 S) to the carrier. This form
directs the beneficiary to attach itemized bills from his or her
physician to the form. In limited cases, as provided under section
1842(b)(6)(B) of the Act and 42 CFR part 424 when a third party made
payment to the physician, the third party sought reimbursement from
Medicare for this payment by submitting a Request for Medicare Payment
by Organizations which Qualify to Receive Payment for Paid Bills (HCFA-
1490 U). We required the physician to fill out Part II of this form,
which was similar to an itemized bill.
Previously, each bill or request for payment for physician services
furnished to a Medicare beneficiary had to include, among other
information, a narrative description of the diagnosis or the nature of
the illness or injury for which the beneficiary received care. Although
prior to April 1, 1989 there was no requirement for diagnostic coding
(that is, a description of the diagnosis or the nature of the illness
or injury in a numeric code), many physicians routinely provided this
information. In addition, all physicians provided a narrative
description of procedures, medical services, and supplies that were
furnished to a beneficiary.
II. Legislation Requiring Diagnostic Coding
Section 202(g) of the Medicare Catastrophic Coverage Act of 1988
(Pub. L. 100-360), enacted July 1, 1988, added paragraph (p) to section
1842 of the Act. Under the provisions of section 1842(p)(1) of the Act,
each bill or request for payment for physician services under Medicare
Part B must include the appropriate diagnostic code ``as established by
the Secretary'' for each item or service for which the Medicare
beneficiary received treatment.
The conference report that accompanied Public Law 100-360 explained
clearly the purpose of the requirement for physician diagnostic coding.
After rejecting a Senate provision that would have required the use of
diagnosis codes on all prescriptions, because they felt that the
requirement would have been ``unduly burdensome,'' the conferees agreed
to require diagnostic coding for physician services under Part B. They
explained their reasons for this requirement as follows: ``This
information would be available for immediate use for utilization review
of physician services and could be used in the future to facilitate
drug utilization review by merging Part B with drug claims data.'' H.R.
Conf. Rep. No. 661, 100th Cong., 2nd Sess. 191 (1988).
Section 1842(p)(2) of the Act authorizes a denial of payment for a
bill submitted by a physician on an assignment-related basis if it does
not include the appropriate diagnostic coding.
Section 1842(p)(3) of the Act directs the Secretary to impose
penalties if a physician who is not paid on an assignment-related basis
fails to provide the appropriate diagnostic coding on the bill to the
Medicare beneficiary. That is, section 1842(p)(3)(A) of the Act
provides for a civil money penalty not to exceed $2,000 if the
physician knowingly and willfully fails to provide the appropriate
diagnostic coding. Section 1842(p)(3)(B) of the Act provides for a
sanction under 1842(j)(2)(A) of the Act if the physician ``knowingly,
willfully, and in repeated cases fails, after being notified by the
Secretary of the obligations and requirements of this subsection,'' to
furnish appropriate diagnostic coding. Section 1842(p)(3) of the Act
does not prohibit the payment of an unassigned claim solely because the
physician did not provide diagnosis codes. As explained in section I of
the preamble, effective for services furnished on or after September 1,
1990, regardless of whether they provide services on an assignment
related basis, physicians submit claim forms directly to the Medicare
carrier. The provisions of section 1848 of the Act, as added by 6102(a)
of Public Law 101-239, do not affect the penalties set forth in this
rule for failure to include diagnostic coding on physician bills. This
final rule implements the provisions of section 1842 (p)(1) and (p)(2)
of the Act.
III. Provisions of the Proposed Rule
On July 21, 1989 we published a proposed rule (54 FR 30558) to
implement the provisions of section 1842(p)(1) of the Act. We proposed
that each bill or request for payment for physician services under Part
B would have to include appropriate diagnostic coding ``as established
by the Secretary,'' relating to the nature of the illness or injury for
which the Medicare beneficiary received care.
As noted above, generally, physician services furnished directly to
a beneficiary are paid under Medicare Part B. In addition, under the
regulations set forth at subpart D of 42 CFR part 405, we make payments
to hospitals under Part A for physician services related to the
supervision and teaching of interns and residents who participate in
the care of hospital inpatients. Also, the proposed rule did not apply
to suppliers or other providers whose services are covered under Part
B.
We proposed that a physician would be required to furnish diagnosis
codes instead of the narrative description that was previously
required. We proposed to deny payment for a bill or request for payment
for physician services furnished on an assignment-related basis if the
bill or request for payment does not contain the appropriate diagnostic
coding. This would not be true for a claim for physician services not
furnished on an assignment-related basis. In other words, if the
beneficiary seeks Medicare reimbursement for payment for physician
services, we proposed not to deny payment solely because the claim does
not contain diagnosis codes. If enough information were provided to
enable a carrier to process the claim, it would be processed without
the diagnosis codes. As explained in section II of the preamble,
section 1842(p)(3)(B) of the Act provides for a sanction under section
1842(j)(2)(A) of the Act if the physician ``knowingly, willfully, and
in repeated cases fails, after being notified by the Secretary of the
obligations and requirements of this subsection,'' to furnish
appropriate diagnostic coding.
We proposed to use the International Classification of Diseases,
Ninth Revision, Clinical Modification (ICD-9-CM) as the most
appropriate diagnostic coding system.
The ICD is a classification system developed by the World Health
Organization (WHO) for recording morbidity and mortality information
for statistical purposes, for indexing hospital records by diseases,
and for storing and retrieving data. Effective with the Twentieth World
Assembly of WHO, nomenclature regulations were adopted on May 22, 1967.
Article 21(b)(2) of these regulations specifies that ``members
compiling mortality and morbidity statistics shall do so in accordance
with the current revision of the International Statistical
Classification of Diseases, Injuries and Causes of Death as adapted
from time to time by the World Health Assembly. This Classification may
be cited as the `International Classification of Diseases'.'' The
United States is signatory to the WHO's agreements, which include the
above nomenclature regulations binding the United States to the use of
the ICD system for official government health statistical purposes. The
nomenclature regulations became effective on January 1, 1968.
The clinical modification of the ninth revision to ICD (that is,
ICD-9-CM) is a coding system for reporting diagnostic information and
procedures performed on patients in hospitals or other types of health
care delivery systems.
ICD-9-CM was developed under the guidance of the National Center
for Health Statistics (NCHS) to adapt the ninth revision of the ICD
classification system to the needs of hospitals in the United States.
The modifications were intended to provide a mechanism to present a
clinical picture of the patient. Thus, ICD-9-CM codes are more precise
than those included in ICD-9 since greater detail is needed to describe
the clinical picture of a patient than for statistical groupings and
trend analysis.
Effective January 1979, after nearly two years of development by
numerous national experts on clinical technical matters, the ICD-9-CM
became the single classification system intended for use by hospitals
in the United States. This system replaced several earlier related but
somewhat dissimilar classification systems. Once the ICD-9-CM
classification system was in place, several errors and omissions were
noted. Consequently, in September 1980 a second edition of ICD-9-CM was
published. The preface to the second edition noted that the continuous
maintenance of ICD-9-CM is the responsibility of the Federal
government. The preface also stated that no future modifications to
ICD-9-CM would be made by the Federal government without considering
the opinions of representatives of major users of the classification
system.
In September 1985, the ICD-9-CM Coordination and Maintenance
Committee (the Committee) was formed. This is a Federal
interdepartmental committee that maintains and updates the ICD-9-CM.
This includes approving new coding changes, developing errata, addenda,
and other modifications to the ICD-9-CM to reflect newly developed
procedures and technologies and newly identified diseases. The
Committee is also responsible for promoting the use of Federal and non-
Federal educational programs and other communication techniques with a
view toward standardizing coding applications and upgrading the quality
of the classification system.
The Committee is co-chaired by NCHS and HCFA. NCHS has primary
responsibility for the ICD-9-CM diagnosis codes included in Volume 1--
Diseases: Tabular List, and Volume 2--Diseases: Alphabetic Index. HCFA
has primary responsibility for the ICD-9-CM procedure codes included in
Volume 3--Procedures: Tabular List and Alphabetic Index.
The Committee encourages participation in the development of
diagnosis and procedure codes by health-related organizations,
organizations in the coding field, and other members of the public.
During each Federal fiscal year (FY), the Committee holds three public
meetings during which coding changes are discussed. Taking into account
the public comments made at each meeting and the public correspondence
received after each meeting, the Committee formulates recommendations,
which must be approved by the co-chair agency heads, the Administrator
of HCFA and the Director of NCHS, before adoption for general use.
Coding changes approved by the Committee and agency heads are published
annually in the Federal Register.
Only official volumes and addenda of ICD-9-CM are to be considered
in the assignment of diagnosis codes for Medicare patients. HCFA is not
responsible for mistakes made by businesses in the replication of these
official volumes and addenda, which are then sold to the public.
Official addenda have become effective on May 1, 1986, and subsequently
on October 1 of each year from 1986 through the present. Another
addendum, containing the Human Immunodeficiency Virus (HIV) Infection
Codes, became effective for Medicare patients discharged on or after
July 1, 1988.
Before publication of the proposed rule on July 21, 1989, the GPO
exhausted its supply of previously published addenda and announced that
it had no plans to reprint more copies. However, the private sector
continues to publish changes to the ICD-9-CM coding system annually by
October 1st. The GPO also announced that it would no longer provide
addenda except to subscription purchasers of the third edition. ICD-9-
CM, third edition, was published in March 1989; automatic addenda
updates expired in 1991. The third edition incorporates all addenda
that were previously published. We stated in the July 21, 1989 proposed
rule that if a physician had not yet obtained ICD-9-CM, second edition,
and had not updated the set with the addenda, he or she should obtain
the recently updated Volumes 1 and 2 (that include all the addenda) (54
FR 30560). The American Health Information Management Association
(AHIMA), previously known as the American Medical Records Association
(AMRA), the national professional association of medical records
practitioners, and the American Hospital Association (AHA) have
indicated that they intend to reprint these future addenda and make
them available for sale.
The price for Volumes 1 and 2 of ICD-9-CM, fourth edition, is
$65.00 for delivery within the United States and $81.25 for delivery
outside of the United States. A purchaser must furnish an address other
than a post office box because the volumes will be delivered only to a
place of business or a residence. When ordering, the purchaser should
enclose a check, money order, or Visa or Mastercard account name,
number, and expiration date. Checks should be made out to the
Superintendent of Documents.
Updated volumes 1 and 2 may be purchased by writing to the
following address: ICD-9-CM, Fourth Edition, Volumes 1 and 2, P.O. Box
371954, Pittsburgh, PA 15250-7954. (Telephone orders may be placed
through the GPO order desk at (202) 783-3238.)
Section 424.32 sets forth the basic requirements for all claims.
(The term ``claim'' is used when referring to the regulatory language
instead of the term ``bill or request for payment''.) In
Sec. 424.32(a), all claims (including those filed directly with
Medicare by physicians, beneficiaries or other persons or entities for
physician services furnished to Medicare beneficiaries) must be filed
in accordance with HCFA instructions. Section 424.34 provides
additional requirements for claims filed with Medicare by
beneficiaries. Under Sec. 424.34(b)(4), the itemized bill must include
a listing of services in sufficient detail to permit determination of
reasonable charges. We proposed to make the following changes to the
regulations text:
Revise Sec. 424.32(a) to state specifically that a claim
for physician services must include appropriate diagnostic coding using
ICD-9-CM.
Revise Sec. 424.34(b)(4) to state specifically that an
itemized bill furnished by a physician to a beneficiary for physician
services must include appropriate diagnostic coding using ICD-9-CM.
Add to Sec. 424.3 the definition of ICD-9-CM, which means
the International Classification of Diseases, Ninth Revision, Clinical
Modification.
Coding and reporting requirements and instructions for diagnostic
coding were developed in order to take into account circumstances
unique to care furnished by physicians. These coding and reporting
requirements and instructions for completing bills and requests for
payment were developed before publication of the proposed rule and were
distributed to the carriers on March 3, 1989. The carriers then mailed
this information, in the form of a Medicare Bulletin, to the physicians
whom they service. During preparation of these procedures and
instructions, we consulted with the American Medical Association (AMA)
and provided the AMA an opportunity to comment on the material.
In the proposed rule, we proposed a limited grace period during
which payments would not be denied and sanctions would not be imposed
for failure to use diagnosis codes. We provided for a 6-month grace
period until October 1, 1989 to allow physicians and their office staff
to obtain training and purchase books. On August 8, 1989, we notified
carriers of the extension of the grace period through a memorandum from
the HCFA Bureau of Program Operations. For the convenience of the
reader, we published the coding and reporting requirements as an
appendix to the proposed rule.
AHIMA offered nationwide training classes and training materials
for physician office staff for ICD-9-CM diagnostic coding, as did the
AMA.
Suggestions concerning modification of the ICD-9-CM codes, or
additions to the existing codes, may be submitted in writing to the
following address: National Center for Health Statistics, 6525 Belcrest
Road,room 9-58, Hyattsville, MD 20782.
In this final rule, we are adopting the requirements as stated in
the proposed rule without modification.
IV. Discussion of Public Comments
In response to the proposed rule, we received 35 timely items of
correspondence. Comments were received from physicians, professional
health-related organizations, universities and colleges, medical
facilities, state governments, laboratories, durable medical equipment
suppliers and pharmaceutical companies.
Although the majority of commenters were not opposed to the
diagnostic coding requirement in general, they were concerned with
certain aspects of the proposed rule.
A. Coding Issues
Comment: One commenter inquired about the possibility of an
indefinite delay of the ICD-9-CM diagnostic coding requirement. Another
commenter asserted that the diagnostic coding requirement should not be
implemented until final regulations are published, which should allow
for a training period of 60 days before any adverse actions.
Response: The original implementation date of April 1, 1989 was
extended by a 60-day grace period to allow physicians and their office
staffs to purchase coding books and to obtain coding training. This
grace period was further extended until October 1, 1989, at which time
we required all physicians to use ICD-9-CM codes on bills or requests
for payment. On August 8, 1989, we notified carriers of the extension
through a memorandum from the HCFA Bureau of Program Operations. In
total, we allowed a 6-month grace period. We believe we provided a
reasonable time period for physicians and their staffs to prepare for
the new coding requirements.
Comment: The American Psychiatric Association disagreed with HCFA
that the ICD-9-CM is the only classification system acceptable for
Medicare claims. They urged HCFA to allow the use of the Diagnostic and
Statistical Manual of Mental Disorders, Third Edition, Revised (DSM-
III-R) coding system for mental disorders. The American Medical
Association also supports the DSM-III-R coding system for use by
psychiatrists.
Response: DSM-III-R was designed to be compatible with ICD-9-CM,
but the two systems are not identical. Systems such as DSM-III-R
address only certain types of diagnoses, and cannot be used universally
by all types of practitioners to code all types of diagnoses on claims
submitted to Medicare. In fact, ICD-9-CM provides for greater
specificity in coding mental disorders that DSM-III-R. Within the
``mental disorders'' range (codes 290-319) there are an additional 218
specific codes available in ICD 9-CM that are not in DSM-III-R. Thus,
we continue to believe that the ICD-9-CM system is the only
comprehensive diagnostic coding system that is suitable for Medicare
claims.
Comment: The College of American Pathologists stated that the ICD-
9-CM coding system is limited in its description of disease states. The
commenter asserted that the Systematized Nomenclature of Medicine
(SNOMED), which it publishes, is more specific.
Response: The SNOMED is an excellent coding system. However, as
stated above, the Department of Health and Human Services is signatory
to the WHO's nomenclature regulations binding the United States to use
of the ICD for official government purposes. Even though ICD-9-CM has
recognized limitations, it can be updated as the need arises via the
ICD-9-CM Coordination and Maintenance Committee.
Comment: One laboratory recommended that the burden of furnishing
the proper diagnosis codes be placed on the physician ordering a test
rather than the supplier of the service. The commenter expressed a
concern that the laboratory performing the test should not be held
responsible for performing a test that Medicare later determines to be
not medically necessary.
Response: The proposed rule and this final rule address the
requirement for diagnostic coding of only physicians' bills. This new
coding requirement does not apply to bills from laboratories (except
for physician laboratory services--see Sec. 405.556).
Comment: One commenter suggested that referring physicians provide
a reason for the biopsy or referral. It requested that this practice be
encouraged and emphasized through carrier communication with the
physicians.
Response: We have always encouraged that the referring physician
communicate the reason for the referral or specimen so the proper
medical interpretation is made or test is performed. We will continue
to encourage carrier to convey this message to the physician community.
Comment: Three commenters were concerned that providing for only
four diagnostic codes on the form HCFA-1500 is insufficient in many
cases to adequately describe a patient's condition.
Response: Since the implementation of the diagnostic coding
requirement, we have received few complaints concerning the form HCFA-
1500. Thus, we believe that four diagnosis codes are sufficient in most
instances. We note that this regulation is not intended to change the
structure of the form HCFA-1500. Moreover, our contractors' claims
processing systems, as currently constructed, would not be able to
accommodate more than four diagnosis codes on a single claim.
The use of codes instead of a narrative description should enhance
the physician's ability to describe the patient's condition with
greater precision. If there are cases where the use of four codes is
not sufficient, we suspect that they would arise when more than one
procedure has been performed (for example, psychological counseling
provided to a trauma patient). In such cases, the physician could
submit one claim for the procedure that relates to four or fewer
diagnoses, and submit another claim for the other procedures with their
attendant diagnoses.
Comment: The American Ambulance Association requested that the
final rule specify that the coding requirements do not apply to
ambulance services.
Response: This final rule provides only that each bill or request
for payment for physician services must include diagnostic coding.
These provisions do not apply to ambulance services.
Comment: One commenter interpreted the proposed rule to imply that
physicians must now submit claims for services that they would not have
normally billed under the previous guidelines. The commenter requested
that HCFA clarify this point in the final rule.
Response: Although the ICD-9-CM coding system permits
classification of many services for which specific codes could be used,
the mere presence of an ICD-9-CM code does not, of itself, mean that a
bill or request for payment must include the code for that service. If
a physician generally would not have submitted a bill or request for
payment for a particular service prior to the physician diagnostic
coding requirement, the physician may not be required to submit a bill
for that service under the new rules. For instance, HCFA did not mean
to imply, under an example in the guidelines published in the proposed
rule (54 FR 30564), that a bill should be submitted for a service for
X.3, attention to surgical dressings and sutures, if this service is
included in the surgeon's global charge. However, if this service is
performed by another physician, unrelated to the surgeon, it might be
appropriate for the second surgeon to use this code to describe the
reason for the encounter.
Comment: One commenter suggested that HCFA clarify in the final
rule whether the new regulations supersede or supplement individual
carrier coding policies since there are conflicts between the new and
old coding practices.
Response: The requirements in this final rule supersede any
individual carrier coding policies. Those carrier coding policies have
been changed to comply with the requirements of this final rule.
Comment: Both the AMA and the American Society of Internal Medicine
stated that supplying codes for signs and symptoms without also
supplying codes indicating diagnoses that the physician has ruled out
will not accurately describe the patient's conditions and explain the
reasons for the care provided. Another commenter recommended that we
allow the use of ``suspected'' and ``rule out'' codes.
Response: The coding guidelines state that each visit must be coded
to describe the specific reason that the patient sought care or
treatment. The guidelines also state: ``Do not code diagnosis
documented as ``suspected,'' ``rule out,'' ``probable,'' or
``questionable'' as if they are established. Rather, code the condition
to the highest degree of certainty for that encounter/visit to reflect
symptoms, signs, abnormal test results, or other reasons for the
visit.'' To require coding of ``probable,'' ``suspected,''
``questionable,'' or ``rule out'' conditions as if the conditions
existed would lead to significant overcounting of conditions. This
inaccurate recording would distort data and would artificially distort
disease statistics. Therefore, physicians should report diagnosis codes
for symptoms and signs but should exclude codes for diagnoses that the
physician either suspects or rules out.
Comment: Several commenters asked how they should code for
situations in which a patient presents disabling symptoms but no
diagnosis exists for the patient. They recommended that the diagnosis
codes include codes for symptoms.
Response: Diagnosis codes should reflect the diagnosis, condition,
problem, or other reason for the encounter or visit shown in the
medical record to be chiefly responsible for the services provided.
However, the carrier will also accept codes for symptoms when no other
more definite code can be given to describe the reason for the visit of
the patient. This is explained further in guideline number four of the
Appendix--Claims Review and Adjudication Procedures, published with the
proposed rule (54 FR 30564, July 21, 1989).
Comment: Two commenters suggested that correlating the ICD-9-CM
diagnosis codes and the CPT-4 procedures codes is a redundant effort
since a procedure may be performed as the result of several conditions.
They urged that the requirement be deleted.
Response: Correlating the narrative diagnosis and the CPT-4
procedure code is a requirement of the Medicare carrier, and has been a
standard requirement for years. It has only been modified by the new
physician diagnostic coding requirements. Physicians must now correlate
the ICD-9-CM code, instead of the narrative, to the CPT-4 code.
Comment: One commenter stated that suppliers cannot be required to
include diagnostic coding on Part B bills even though they often
provide the diagnostic codes identified by the physician on bills for
equipment and supplies.
Response: We have never required suppliers to include diagnostic
coding on their Part B bills. Section 1842(p)(1) of the Act requires
physicians, as defined in section 1861(r) of the Act, and subject to
limitations concerning the scope of practice by each State and other
provisions of title XVIII of the Act, to furnish diagnostic coding.
That is, only doctors of medicine or osteopathy, dental surgery or
dental medicine, podiatry, optometry, or chiropractic must furnish
diagnostic coding. Durable medical equipment suppliers are not included
in this requirement.
Comment: One commenter inquired why his or her carrier included
messages in the explanation of the Medicare benefit worksheet regarding
both diagnostic coding requirements (ICD-9-CM) and procedural coding
requirements (CPT-4) since the proposed rule (54 FR 30559, July 21,
1989) stated that there is no current requirement for diagnostic
coding.
Response: The statement on page 54 FR 30559 referred to the policy
before implementation of section 1842(p)(1) of the Act that requires
physician diagnostic coding instead of the written narrative that was
previously required. We are now conforming the regulations to the
previously issued administrative instructions.
The CPT-4 coding (part of the HCFA Common Procedural Coding System)
describes physician services and supplies, not diagnoses. If either
fields 23 or 24c on the form HCFA-1500 are blank, the carrier will
communicate with the physician via the explanation of the Medicare
benefit worksheet requesting completion of this information.
Comment: A commenter asserted that as an incentive all bills or
requests for payment without ICD-9-CM codes should be rejected and that
properly coded bills and requests for payment should be expedited.
Response: The Act specifically provides for denial of payment for a
bill submitted by a physician on an assignment-related basis if it does
not include the appropriate diagnostic code. For a claim for an item or
service not submitted on an assignment-related basis, the Act
authorizes the Secretary to impose a civil money penalty, not to exceed
$2,000, against a physician seeking payment who knowingly and willfully
fails to promptly provide the appropriate diagnostic coding on the bill
to the Medicare beneficiary upon the request of the Secretary or a
carrier. If the physician knowingly, willfully, and in repeated cases
fails, after being notified by the Secretary of the statutorily
prescribed obligations, to include the requisite diagnostic codes, the
physician may also be subject to administrative sanctions. However, the
payment of an unassigned claim may not be prohibited solely because the
physician has not furnished the diagnosis codes.
We considered, but rejected, the idea of expediting properly coded
bills and requests for payment since we do not handle properly coded
bills for Part A services in a special manner. Properly coding bills is
a standard requirement to receive payment for services. However,
payment would occur more quickly for properly coded bills because there
would be no need for resubmission because of errors in coding.
Comment: A clinical laboratory stated that bills and requests for
payment with diagnostic coding can be processed electronically at a
much lower cost to Medicare than we projected in the proposed rule.
Response: The cost projections in the proposed rule for
electronically processed claims are the expected costs for physicians
to comply with the requirement for diagnostic coding on all bills and
requests for payment rather than the costs of the carriers in
processing the bills and requests for payment.
Comment: One association asked the implied meaning of the statement
``* * * (diagnostic coding) could be used for prepayment screens'' (54
FR 30559, July 21, 1989). The commenter asked where the ICD-9-CM and
CPT-4 information is being collected and what future plans are being
implemented for the use of the information. The association was
informed by its carrier that the carrier does not believe the ICD-9-CM
and CPT-4 codes will eventually be used for a prospective payment
system for physicians.
Response: Billing information is compiled by each carrier and then
electronically transmitted to HCFA's Bureau of Data Management and
Strategy in Baltimore, Maryland. This Bureau is largely responsible for
performing HCFA's mathematical and statistical programming and for
managing HCFA's statistical data bases to support program decisions by
various HCFA components. Current and possible applications for the ICD-
9-CM and CPT-4 coding information include answering research queries
from private sources, development of quality assurance monitoring
mechanisms, assessment of the impact of proposals that affect health
care financing programs, or special research and evaluation studies.
The Bureau uses diagnostic coding information to design and develop
periodic statistical tabulations to assess the characteristics of
beneficiaries and the utilization and cost of program benefits. The
CPT-4 codes also are now used for payment purposes under the fee
schedule for physician services.
Comment: One commenter was concerned about the increased costs for
manpower and the reformatting of her billing system associated with
implementation of the diagnostic coding requirement.
Response: We cannot predict the increased costs or manpower that an
individual office would incur as a result of the diagnostic coding
requirement. However, in the impact analysis to this final rule, we
discuss our estimate of the aggregate costs associated with coding
training and ICD-9-CM coding books. Also, as discussed in the impact
analysis, we now estimate that about 90 percent of physicians included
diagnostic coding on bills before it was required by section 1842(p) of
the Act. These physicians may not have experienced as significant an
increase in costs as physicians who did not code before the requirement
was established.
Comment: One commenter stated that since general practitioners care
for the whole patient, it is sometimes difficult to find an applicable
diagnosis even after looking through 2,000 pages of codes. The
physician recommended that we allow three digit codes to be used for
procedures for which physicians routinely charge less than $200.
Response: We are aware that general practitioners are responsible
for coding a wide range of diagnoses. To determine the correct code,
Volume 2, Index, must be consulted first. After the correct code has
been determined, Volume 1 is then referenced to determine if there are
other coding conventions that apply, such as ``Includes'' or
``Excludes'' notes.
We cannot accept the recommendation to allow the use of three digit
codes in any circumstance where an applicable four or five digit code
exists. Codes must be used to their highest level of specificity; this
may include some three digit codes. If diagnoses are coded to the
highest level, using the same data base for all bills and requests for
payment will permit meaningful trend analysis and data comparisons.
Comment: Several commenters stated that the estimate of 1 minute to
code a bill or request for payment is too short. The estimate does not
consider the time a physician spends with office staff to select the
correct diagnosis code.
Response: The estimate of 1 minute to code a bill or request for
payment was made by AHIMA based on their professional coding experience
and expertise. We believe that this is a realistic figure for several
reasons. First, there are many physicians who are specialists, and who
will use only a small portion of the coding manuals during their normal
course of business. We anticipate that these physicians and their
office staffs will quickly identify those parts of the coding books
that apply to their practice. Additionally, many offices have developed
reference lists pertaining to the codes frequently used in their
particular practices. Once this list has been developed, very little
physician involvement is required for the coding process.
The amount of time necessary for the physician to work with his or
her clerical staff in the selection of the correct diagnosis code(s)
was not factored into the estimate of 1 minute. That estimate reflected
the use of the code book or reference list and the documentation
process, whether manual or key entry. We anticipate that the diagnosis
code(s) will become as familiar to the office staffs as the recording
of the narrative diagnostic language, and that completion of the
billing form will proceed as smoothly as it did prior to the
implementation of this diagnostic coding requirement.
B. Patient Information and Confidentiality
Comment: The American Psychiatric Association (APA) stated that
there may be instances when the diagnosis information provided to the
patient (particularly in non-assigned claims) could have an adverse
impact on the patient and course of treatment. The APA suggests that
HCFA have an exceptions process that allows the physician to determine
whether diagnosis information should be directly provided to the
patient.
Response: We agree, and note that there is already an established
procedure for such situations. The physician should file the form HCFA-
1500 on behalf of the beneficiary as required by section 1848(g)(4) of
the Act. The form should include the appropriate diagnostic codes and
should be forwarded to the Medicare carrier. If a physician determines
that diagnostic information should not be released directly to a
patient, the physician may furnish bills to the patient without
diagnostic information. In addition to psychiatric diagnoses,
physicians also may choose to use this procedure for terminal illnesses
or other conditions of a sensitive nature.
Comment: The APA expressed a concern that HCFA should have a
mechanism in place to assure that diagnostic information is kept
confidential and not released to third parties except when permitted by
law. It recommended that the regulations be amended to include privacy
protection.
Response: We share the APA's concerns about the confidentiality of
patient information. To assure that the beneficiary is protected, when
we release medical data, the data do not include any patient-specific
identifiers. Patient-specific medical data in the custody of HCFA and
its intermediaries and carriers are fully protected by the Privacy Act
(5 U.S.C. 552a).
C. Utilization Review
Comment: A pharmaceutical company is concerned that utilization
review of physician services and future drug utilization review may be
less effective because of the limitation of four diagnostic codes on
the bill or request for payment.
Response: Utilization review of physician services will be enhanced
by the diagnostic coding requirement since the information can be
categorized by code and made available for immediate use. At this time,
we have no plans to implement a drug utilization review program using
the diagnostic coding information on the form HCFA-1500. We will
consider the effect of the four diagnostic code limitations if we
propose a drug utilization review program.
Comment: One commenter questioned the possibility of the physician
diagnostic coding requirement eventually becoming a tool to standardize
physician practice patterns nationwide without physician input.
Response: The information obtained from the ICD-9-CM codes will be
used for compiling statistical information. Any new requirements or
procedures would not be implemented without physician input and, if
appropriate, a notice of proposed rulemaking.
Comment: One commenter asserted that the ICD-9-CM coding system is
a bulky, unreliable system for gathering data.
Response: The ICD-9-CM coding system was developed under the
guidance of the National Center for Health Statistics for greater
specificity in reporting illnesses and injuries in the United States.
The ICD-9-CM coding system is the best system available for recording
the diagnoses of Medicare beneficiaries. The system is not considered
unreliable by most users; however, errors do occur as a result of
physicians' incorrect application of the codes.
To help make the coding system meet the needs of all users, we
welcome input from interested physicians, organizations and the public
through the ICD-9-CM Coordination and Maintenance Committee meetings.
Comment: One commenter asked for the name of an agency that can
give advice and answer questions concerning coding issues.
Response: The AHA is the official clearinghouse for questions
concerning the ICD-9-CM system. They accept written questions and will
provide a written reply. The AMA is also providing ICD-9-CM coding
advice to its members through their CPT Clearing House Hotline (312)
464-4737. In addition, each carrier has designated a contact person to
answer the concerns raised by the physicians they service. We encourage
close communication between a physician and the carrier to avoid coding
problems.
Comment: Several commenters expressed concern that requiring coding
to the fifth digit is burdensome and will require a more skilled person
to properly code the diagnoses. One commenter stated that prior to the
new physician diagnostic coding requirement, coding by physicians was
generally limited to three digits.
Response: We did not anticipate a significant burden upon
physicians as a result of coding to the fifth digit level when the
proposed rule was published, and have not had complaints from the
physician community since that time. We continue to believe that most
physicians or their office staff create reference lists of diagnoses
encountered most often. Since 1979, the ICD-9-CM coding system has been
in use and has contained five digit codes. Thus, we do not agree that
coding by physicians previously was limited to three digits.
Comment: One commenter asserted that it would be advantageous if
the format requirements for submitting bills or requests for payment
are published with the proposed rule.
Response: The Medicare Carriers Manual explains how to fill out
bills and requests for payment. Basically, the only format requirement
for the diagnostic coding is to put each appropriate code in the space
that is provided for those codes under the heading ``Nature of Illness
or Injury.''
The form HCFA-1500 and accompanying sections of the Carriers Manual
are already subject to public comment, pursuant to the Paperwork
Reduction Act of 1980. In accordance with that Act, OMB reviews the
form HCFA-1500 and its instructions at least once every 3 years. The
Department publishes a notice in the Federal Register that informs the
public of OMB's review and solicits comments for OMB's consideration in
the course of its review.
Comment: The AMA stated that pathologists have expressed a concern
that failure to list a second diagnosis after V72.6, Laboratory
examination, may lead to medical necessity review problems. The AMA
requested that we inform the carriers that V72.6 code meets the
Medicare coding requirements.
Response: We agree that in many instances one code (V72.6) will
explain the reason for the patient's encounter. Carriers should
identify a way of determining the proper coverage policy issue through
the use of a screen. We recommend that all laboratory claims begin with
the code V72.6, Laboratory examination. However, by supplying a second
code to describe the reason for the referral, the bill or request for
payment can clearly be identified as referrals to evaluate symptoms,
signs, or diagnoses, instead of being part of a routine physical
examination that is not covered by Medicare.
Comment: One commenter inquired about how the ``V'' codes should be
sequenced for diagnostic services on the bill or request for payment.
Response: Ancillary diagnostic services, which are coded beginning
with a ``V,'' are provided in laboratories and radiology offices if the
patient's main reason for the visit is to get an x-ray, (V72.5,
Radiological examination, not elsewhere classified), or to have a test
conducted (V72.6, Laboratory examination.) The condition for which the
patient sought treatment will be reflected in the additional diagnoses.
In coding ancillary diagnostic services, it may be helpful to question
the reason for the encounter. The reason for the encounter is that the
patient visited the laboratory or radiology office to have either an
analysis performed or an x-ray taken.
D. Training
Comment: One commenter stated that HCFA's estimate that 70 percent
of physicians and office staff will need ICD-9-CM coding training is a
gross underestimate.
Response: We do not believe that our estimate of 70 percent of
physicians and office staff in need of coding training was too low. In
fact, we believe that most physicians and office staff did not require
coding training. Immediately after implementation of the diagnostic
coding requirement, medical review at the intermediary level did not
reveal significant coding problems. Since that time, the majority of
physician bills using ICD-9-CM coding have passed intermediary edits
for accuracy. In addition, many physicians did not need training since
they submitted ICD-9-CM codes prior to April 1989 due to the
requirements of third party payers for non-Medicare patients. We
believe that the lack of coding problems indicates that, if anything,
we may have overestimated the proportion of physicians and office staff
that needed training.
Comment: One commenter suggested that HCFA require the Medicare
carriers to provide ICD-9-CM training and technical assistance to
physicians and providers.
Response: The Medicare carriers were required by HCFA to provide
initial ICD-9-CM coding training prior to the April 1, 1989
implementation date. A National Carriers Training program was held in
February 1989 in preparation for the training done in each State by
each carrier. The National Carriers Training was conducted by AHIMA,
with input on the program from the AMA. Subsequently, each carrier was
responsible for conducting its own training program on a state-by-state
basis. In many cases, carriers worked with the State medical societies
in conducting the training. Diagnostic coding training for physicians
and physician office staffs has been ongoing since the implementation
of this requirement, especially through courses and sessions sponsored
by the private sector. For further information concerning coding
training, physicians can contact their State medical society, the AMA,
AHIMA, their State component of the medical record or medical health
information association, or their carrier.
E. Sanctions Process and Civil Money Penalties
Comment: One commenter indicated that the sanction provisions for
noncompliance with the coding requirements are illogical since coding
bills or requesting payment with ICD-9-CM codes is essentially a
clerical function. The civil monetary penalties and sanction actions by
the Office of Inspector General are perceived as excessive since
clerical errors of omission and inaccurately coded diagnoses will be
inevitable. Another commenter recommended that the sanctions process
should not apply to the ICD-9-CM coding requirement.
Response: Coding is a task routinely delegated by physicians to
billing clerks or staff. However, this delegation does not relieve the
physician of the responsibility to submit bills or requests for payment
that meet the requirements of the law.
Comment: One medical association questioned whether the carrier
considers the remarks on the explanation of the Medicare benefit (EOMB)
form an advisement of a violation (for not including diagnostic coding
on a bill or request for payment) that will be referred to the OIG for
investigation and possible sanctions. The commenter asked why the
carrier includes a remark in the EOMB stating that they will process
this claim but will not process future claims. The association suggests
that the message on the EOMB should contain a more complete and
accurate statement.
Response: Messages that appear on the EOMB have been revised and
are more clear and explanatory. It is not our intent to put the
beneficiary at risk by not paying a bill or request for payment lacking
an ICD-9-CM code. For claims submitted by physicians who do not accept
assignment, the carrier will process the bill or request for payment as
usual, substituting a ``dummy'' code for the ICD-9-CM coding.
The carrier will collect physician-specific information about the
quantity of the dummy codes generated per physician. When a threshold
of ten bills or requests for payment is reached, the carrier is
instructed to contact the physician in order to explain the necessity
of providing diagnostic coding and to help with training. If the
physician subsequently knowingly, willfully, and in repeated cases
fails to supply the requested codes, the Office of the Inspector
General may invoke a civil money penalty.
F. Availability of the ICD-9-CM
Comment: Two commenters expressed concern that the Government
Printing Office (GPO) does not stock a sufficient supply of the ICD-9-
CM coding books, which results in a 4-to-8 week delay in receiving the
books.
Response: ICD-9-CM books are in stock at the special address
mentioned elsewhere in this preamble. We are aware of the potential
demand and have an adequate supply. All orders are sent by priority
mail.
V. Impact Analysis
Unless the Secretary certifies that a final rule will not have a
significant economic impact on a substantial number of small entities,
we generally prepare a regulatory flexibility analysis that is
consistent with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
through 612) . For purposes of the RFA, all physicians are considered
to be small entities.
The statutory requirement that physicians use diagnostic coding has
been in effect since April, 1989, and we believe that the vast majority
of physicians were already using ICD-9-CM coding even before that time.
Thus, the economic impact of this final rule on the physician community
should be minimal.
In the proposed rule, we prepared a voluntary impact analysis and
voluntary regulatory flexibility analysis because of our inability to
quantify with any degree of precision the estimated costs of these
provisions and the large number of physicians who were affected by the
provisions of section 1842(p) of the Act. These provisions require that
each bill or request for payment for a service furnished by a physician
include appropriate diagnostic coding related to the illness or injury
for which the Medicare beneficiary received treatment. Under section
1842(p) of the Act, a physician who is to be paid on an assignment-
related basis will not be paid if he or she fails to include
appropriate diagnostic coding on the bill. In this final rule we have
revised the impact analysis based on public comment.
With one exception, any effects of this final rule will be a direct
result of the legislative provisions in section 1842(p) of the Act. The
exception is a result of the discretion that section 1842(p)(1) of the
Act provides the Secretary in the choice of which system to use to code
diagnoses. We chose to use ICD-9-CM because it is the only
comprehensive coding system that includes all possible diagnoses for
Medicare beneficiaries. For that reason, it is already widely used by
physicians. Furthermore, we are already using ICD-9-CM in the Medicare
program for classifying DRGs for payment under the inpatient hospital
prospective payment system. Therefore, we believe that it is the
easiest coding system for physician use.
Before April 1, 1989, physicians were not required to provide ICD-
9-CM or any other type of diagnostic codes on their Medicare bills or
requests for payment. Therefore, we believe that physicians who were
not coding before the provisions of section 1842(p) of the Act were
affected through increased paperwork, the cost of training themselves
and their staff, and the probable need to purchase Volumes 1 and 2 of
the ICD-9-CM, fourth edition.
As of December 31, 1986, there were 569,160 physicians practicing
in the United States (Physician Characteristics and Distribution in the
U.S., 1986. Department of Data Release Services, Division of Survey and
Data Resources, American Medical Association, 1987). In the proposed
rule, we estimated that at least 30 percent of physicians used ICD-9-CM
codes before the requirements of section 1842(p) were established,
presumably because of requirements of other third party payers that
ICD-9-CM diagnosis or procedure codes be used on their claims. Thus, we
estimated that up to 70 percent of practicing physicians did not report
codes before the requirement was established (that is, approximately
398,000 physicians).
In this final rule, we have revised our estimate of the number of
physicians who reported ICD-9-CM codes before the requirements of
section 1842(p) of the Act were established. As stated in section III
of this preamble, we provided for a 6-month grace period following the
statutory implementation date of April 1, 1989, during which no claims
would be denied for lack of coding. The grace period ended on October
1, 1989. It has been our experience that, when grace periods are
established, providers usually do not comply with the required
provisions until the end of the grace period, presumably because of
lack of training or need for a preparation period. In this case,
however, approximately 90 percent of the claims were coded using ICD-9-
CM during the first month of the grace period, and the compliance rate
remained at approximately 90 percent for the duration of the grace
period. Moreover, intermediary review of these claims revealed no
significant coding problems. Since the number of physicians that
complied with the coding requirement remained stable throughout the
grace period, we believe that the number of physicians who reported
codes during the grace period is indicative of the number of physicians
who were reporting codes before the requirement was established.
Therefore, we now estimate that approximately 90 percent of physicians
reported ICD-9-CM codes before April, 1989 (that is, approximately,
512,000 physicians). The discussion below reflects this revised
estimate.
If all the physicians who did not report ICD-9-CM codes before
April 1989 needed new coding books, ICD-9-CM Volumes 1 and 2 at a cost
of $65.00 per set, the total cost would have been approximately
$3,700,000. In practice, however, we believe that not all of these
physicians needed to purchase new coding books. For example, some
physicians belonged to group practices, some worked for hospitals and
do not have their own patients, and some already owned coding books.
For purposes of this impact analysis, however, we assume that all
physicians who did not code before April, 1989 purchased new coding
books.
In the proposed rule, in calculating costs of training and coding
for physicians who did not code before April 1989, we estimated the
average wages of a physician's office staff person at $4.50 an hour. In
response to the July 21, 1989 proposed rule, we received several
comments stating that we had underestimated the average hourly wages
for a physician's office staff member. We agree that our estimate of
$4.50 per hour was too low. In this final rule, we are revising our
estimate of the hourly rate based on comments received on the proposed
rule and our examination of the hourly wages of physicians' office
staff in the monthly publication ``Employment and Earnings'' (U.S.
Department of Labor Bureau of Labor Statistics, ``Employment and
Earnings'' Vol. 37, No. 4, April 1990, p. 131 (Washington, DC)). Our
revised estimate of the typical wage for a staff person at the time the
requirement was established is $9.65 per hour.
Based on claims data, we believe there were approximately 320.1
million physician claims processed for the period from April 1, 1989 to
March 31, 1990. We estimated that the clerical cost of coding each
claim was $0.16 for a total of $51,216,000 for the first year that the
requirement was in effect. We arrived at the $0.16 figure by assuming
an hourly rate of the typical physician's office staff person to be
$9.65 per hour, as explained above. We believe that it takes 1 minute
to code a claim, therefore $9.65 divided by 60 minutes results in a
$0.16 cost per claim. However, we believe that 90 percent of the claims
were being coded prior to April 1, 1989. Thus, 10 percent of the cost
of coding claims (approximately $5,120,000) can be attributed to the
provision of section 1842(p) of the Act.
We anticipated that each physician that did not report ICD-9-CM
codes before April 1, 1989 would either send one or more persons for
training, or may have determined that formal training was not needed.
Some of those physicians may not have sent any staff since they are in
a group practice, (in which case, one staff member may represent
several physicians), or because they work for hospitals (in which case
they would not submit Part B claims.)
Below, in two examples, we are providing the extremes of estimated
training costs using the same methodology as set forth in the impact
analysis of the proposed rule. In the first example, we assume that all
physicians who did not code prior to April 1989 sent, on average, one
of their office staff to attend a half-day session sponsored by a
national firm. We anticipated that the cost of such a training session
could have been as high as $100.00. Thus, for this estimate, we are
assuming a cost of $100.00. Furthermore, we assume the physicians paid
an hourly rate of $9.65 per hour to their employees while they attended
the coding session. Given these assumptions, we estimated training
costs as follows:
(All estimates are rounded to the nearest $10,000.)
Half-day (4 hours) at $9.65 per hour=$38.60; $38.60 x
57,000 employees.......................................... $2,200,000
Session cost $100.00 x 57,000 employees.................... 5,700,000
------------
Total training costs................................... $7,900,000
In the second example, we assume that physicians who did not code
before the requirement was established in April 1989 sent, on average,
one of their office staff to coding sessions sponsored by carriers or
insurance companies at no cost. Assuming that the office employee was
paid $9.65 an hour, we estimated the total training costs as follows:
Half-day (4 hours) at $9.65 per hour=$38.60; $38.60 x
57,000 employees.......................................... $2,200,000
Session costs.............................................. 0
------------
Total training costs................................... $2,200,000
Below, we show the total estimated first year costs for the two
examples.
For the first example, the total estimated first year
costs consisted of:
Coding costs............................................... $5,120,000
Training................................................... 7,300,000
Books...................................................... 3,700,000
------------
Total.................................................. $16,720,000
For the second example, the total estimated first year
costs consisted of:
Coding costs............................................... $5,120,000
Training................................................... 2,200,000
Books...................................................... 3,700,000
------------
Total.................................................. $11,020,000
Therefore, we estimate that first year training costs were between
$11 million and $16 million. The cost of updated books will be an
ongoing expense. Training costs will be recurring to the extent that
staff turnover will occur. Coding costs will be ongoing. However, we
believe that coding time and costs will probably be reduced with
experience.
Section 1102(b) of the Act requires the Secretary to prepare a
regulatory impact analysis if a final rule will have a significant
impact on the operations of a substantial number of small rural
hospitals. Such an analysis must conform to the provisions of section
604 of the RFA. For purposes of section 1102(b) of the Act, we define a
small rural hospital as a hospital that is located outside of a
Metropolitan Statistical Area and has fewer than 50 beds.
We are not preparing a rural impact statement since we have
determined, and the Secretary certifies, that this final rule will not
have an impact on a significant number of small rural hospitals.
This final rule was reviewed by the Office of Management and
Budget.
V. Paperwork Reduction Act
Regulations at Sec. 424.32(a) and Sec. 424.34(b) contain
information collection and recordkeeping requirements that are subject
to review by the Office of Management and Budget under the Paperwork
Reduction Act of 1980 (44 U.S.C. 3501 through 3511). These regulations
and the information collection and record keeping requirements apply to
the requirement that a physician provide appropriate diagnostic coding
on each bill or request for payment for a physician service furnished
under Medicare Part B. Public reporting burden for this collection of
information is estimated to average one minute per submitted Part B
claim. This includes time spent reviewing instructions, searching
existing data sources, gathering and maintaining needed data, and
completing and reviewing the collection of information. The information
and record keeping requirements associated with this final rule have
been approved by the Office of Management and Budget in accordance with
the Paperwork Reduction Act of 1980 (approval number 0938-0008).
List of Subjects
42 CFR Part 405
Administrative practice and procedure, Health facilities, Health
professions, Kidney diseases, Medicare, Reporting and recordkeeping
requirements, Rural areas, X-rays.
42 CFR Part 424
Assignment of benefits, Physician certification, Claims for
payment, Emergency services, Plan of treatment.
I. 42 CFR part 405, subpart E is amended as set forth below:
PART 405--FEDERAL HEALTH INSURANCE FOR THE AGED AND DISABLED
Subpart E--Criteria for Determination of Reasonable Charges;
Payment for Services of Hospital Interns, Residents, and
Supervising Physicians
A. The authority citation for Subpart E continues to read as
follows:
Authority: Secs. 1102, 1814(b), 1832, 1833(a), 1834 (a) and (b),
1842 (b) and (h), 1848, 1861(b), (v), and (aa) 1862(a)(14), 1866(a),
1871, 1881, 1886, 1887, and 1889 of the Social Security Act as
amended (42 U.S.C. 1302, 1395f(b), 1395k, 1395l(a), 1395m (a) and
(b), 1395u (b) and (h), 1395 w-4, 1395x(b), (v), and (aa),
1395y(a)(14), 1395cc(a), 1395hh, 1395rr, 1395ww, 1395xx, and
1395zz).
B. In Sec. 405.512 paragraph (c) introductory text is republished
and paragraph (c)(8) is revised to read as follows:
Sec. 405.512 Carriers' procedural terminology and coding systems.
* * * * *
(c) Guidelines. The following considerations and guidelines are
taken into account in evaluating a carrier's proposal to change its
system of procedural terminology and coding:
* * * * *
(8) Compatibility of the proposed system with the carriers methods
for determining payment under the fee schedule for physicians' services
for services which are identified by a single element of terminology
but which may vary in content.
* * * * *
II. 42 CFR part 424 is amended as set forth below:
PART 424--CONDITIONS FOR MEDICARE PAYMENT
A. The authority citation for part 424 is revised to read as
follows:
Authority: Secs. 216(j), 1102, 1814, 1815(c), 1835, 1842 (b) and
(p), 1861, 1866(d), 1870 (e) and (f), 1871, and 1872 of the Social
Security Act (42 U.S.C. 416(j), 1302, 1395f, 1395g(c), 1395n, 1395u
(b) and (p), 1395x, 1395cc(d), 1395gg (e) and (f), 1395hh, and
1395ii)
Subpart A--General Provisions
B. In Sec. 424.3, the introductory text is republished and a
definition for ``ICD-9-CM'' is added in alphabetical order to read as
follows:
Sec. 424.3 Definitions.
As used in this part, unless the context indicates otherwise--
ICD-9-CM means International Classification of Diseases, Ninth
Revision, Clinical Modification.
* * * * *
Subpart C--Claims for Payment
C. In Sec. 424.32, paragraph (a) is revised to read as follows:
Sec. 424.32 Basic Requirements for all claims.
(a) A claim must meet the following requirements:
(1) A claim must be filed with the appropriate intermediary or
carrier on a form prescribed by HCFA in accordance with HCFA
instructions.
(2) A claim for physician services must include appropriate
diagnostic coding using ICD-9-CM.
(3) A claim must be signed by the beneficiary or the beneficiary's
representative (in accordance with Sec. 424.36(b)).
(4) A claim must be filed within the time limits specified in
Sec. 424.44.
* * * * *
D. In Sec. 424.34, the introductory text of paragraph (b) is
republished and paragraph (b)(4) is revised to read as follows:
Sec. 424.34 Additional requirements: Beneficiary's claim for direct
payment.
* * * * *
(b) Itemized bill from the hospital or supplier. The itemized bill
for the services, which may be receipted or unpaid, must include all
the following information:
* * * * *
(4) A listing of the services in sufficient detail to permit
determination of payment under the fee schedule for physicians'
services; for itemized bills from physicians, appropriate diagnostic
coding using ICD-9-CM must be used. (For example, a bill for ambulance
service must specify the pick-up and delivery points.)
* * * * *
(Catalog of Federal Domestic Assistance Program No. 93.773,
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
Dated: November 22, 1993
Bruce C. Vladeck,
Administrator, Health Care Financing Administration.
Dated: January 24, 1994.
Donna E. Shalala,
Secretary.
[FR Doc. 94-4900 Filed 3-3-94; 8:45 am]
BILLING CODE 4120-01-P