Outpatient Physical Therapy Billing: How to ensure that your patient has been discharged from Medicare Part A services?

Have you ever treated a Medicare patient only to find out later that the patient was also being treated under a Home Health “Episode of Care”?

If so, you either do not receive payment at all or the payment that you did receive for your time and services was later recouped by Medicare. This type of denial can be one of the most frustrating and unfortunate denials to receive because as the clinician, you have done everything correctly.  You provided skilled care, your documentation was compliant and claims were billed appropriately.  However, the ball is often dropped as a result of the patient failing to mention that they were also being seen by a home health agency. The vast majority of geriatric patients do not understand that they cannot be treated under Part A (i.e. Home Health) and under Part B (i.e. outpatient therapy) at the same time. 

What systems can be put in place to lessen the chances of the N88 denial?

N88: “This payment is being made conditionally. An HHA episode of care notice has been filed for this patient. This payment will need to be recouped from you if we establish that the patient is concurrently receiving treatment under an HHA episode of care.” -CMS.gov

During your initial interaction when a Medicare patient calls to schedule, a good practice is to always ask the patient if they are currently being seen by any other medical providers in their home.  In some cases the patient may advise you incorrectly so it is important to always verify the eligibility status with Medicare.  This can be done either by having your staff call the Medicare IVR or by using a physical therapy billing system that automatically verifies the patients Medicare eligibility status through its direct connection with CMS. When an automatic Medicare eligibility check is performed to determine physical therapy eligibility, the system will quickly determine if the patient is actively enrolled in an active home health case under Medicare Part A and also provide the following valuable information to prevent lost revenue.

  1. Member ID Validation
  2. Medicare Deductible Amount Paid to Date
  3. Amount Used Towards Their Physical Therapy Cap
  4. Active Liability Case(s)
  5. Medicare Secondary Status

If it is determined that the patient does have an active home health episode of care on file with Medicare, additional follow up should be performed with the home health care agency. In some cases, the patient may have been discharged from home health early but the agency has not yet communicated the discharge status to CMS.

If you are not using a physical therapy billing system that automatically verifies the patients Medicare eligibility status, this process can certainly create extra work for you and/or your staff.  However, the physical therapy benefit verification process is highly effective to prevent unnecessary N88 denials and ensure that you are receiving maximum reimbursement for the services you provide.

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