Elimination of LCDs Proposed

Original story posted on: August 28, 2017
This is the year of many Centers for Medicare & Medicaid Services (CMS) regulatory requirement changes. This includes the Merit-Based Incentive Program (MIPS), the next steps toward mandatory Authorized Use Criteria (AUC) implementation for advanced imaging, defining more explicitly what is and what is not “quality” care, etc. 

It is important to understand that all these programs intersect in various ways, although they are separate mandates. It may all sound completely appropriate on the surface, but if you look deeper, it could be set up for failure.

In the 2017 proposed physician fee schedule, CMS acknowledged commenter concerns regarding potential geographic AUC discrepancies, but said they believed these would be infrequent, and vigorously addressed. As most of us in the industry have known and often lamented for many years, geographic conflicts in local coverage determinations (LCDs) create significant problems. These discrepancies were compounded with the implementation of ICD-10 and the thousands of code changes since then. The exact same service provided in the same setting and for the same reasons will be allowed and paid in one Medicare Administrative Contractor (MAC) jurisdiction, but denied as not medically necessary in another. Clearly, this makes zero sense to providers and Medicare beneficiaries. How this could result in conflicting policies is obvious as we begin to dig into the details. The AUC could indicate that a specific exam for a specific indication is appropriate, but the claim could still be denied as not medically necessary. 

How, you may wonder, will this all work? Compliance with the AUC medically necessary criteria, check. Successful MIPS reporting, check. Excellent provider documentation, check. Accurate coding to the greatest level of specificity, check. 

Claim denied, check.

If we look at just one current MAC LCD, we can quite clearly see how these various programs are working at odds with one another and not together. Let’s make the assumption that AUC requirements are in place today. In just one example of many, say a patient sustains a right-side fracture of the zygoma and maxilla. That fact is clearly documented in the medical record, so there is no clinical documentation issue.

The diagnosis coding is specific for right-side fractures of the zygoma and maxilla. Now, let’s assume the provider checks with an AUC and a CT scan for complete evaluation of the fractures, as appropriate. The provider orders the CT and it is performed by the radiology department. 

The perfect ending to a perfect day? Not as long as an incomplete and deficient LCD determines payment. Sadly, the LCD only allows coverage if the fractures are unspecified, but not designated as right or left.

It is for this exact reason that the Healthcare Business and Management Association (HBMA) has long advocated for the elimination of LCDs. They can be in direct conflict with existing coding conventions requiring the highest level of specificity. They create denials that are clearly inappropriate. I think they provide an opportunity for providers to report codes that are not really the most accurate choice in an attempt to circumvent these issues and be fairly paid for medically necessary services. They may be the cause of many claims with unspecified codes. 

These LCD issues are not rare, and they will create more problems regarding inaccurate data for other CMS programs that are focused on the details of what services Medicare beneficiaries are receiving and why.

So does the right hand at CMS really know what the left hand is doing? It does not appear so. Has a deep dive into all these programs been done, and how and when they intersect and disagree? It does not appear so.

However, HBMA believes that today’s environment presents a golden opportunity to do exactly that. As we move to full program implementation, if the AUC criteria say a service is medically necessary, there should be no possibility of an LCD denial. Geographic discrepancies should be eliminated. Idiosyncratic interpretations of national coverage should come to an end. It should not be a responsibility of the provider to point out every LCD error and omission. That responsibility and accountability lie elsewhere. Let’s plan ahead and build cohesive programs that work together, not in silos. Let’s develop one definition of appropriate care and medical necessity, not many. 

The industry has the expertise to help with the development and implementation of a program that works to meet all the quality goals. What we have today is not that.
Disclaimer: Every reasonable effort was made to ensure the accuracy of this information at the time it was published. However, due to the nature of industry changes over time we cannot guarantee its validity after the year it was published.
Holly Louie, RN, BSN, CHBME

Holly Louie is the compliance officer for Practice Management Inc., a multi-specialty billing company in Boise, Idaho. Holly was the 2016 president of the Healthcare Business and Management Association (HBMA) and previously chaired the ICD-10 Committee. Holly is also a national healthcare consultant and testifying expert on matters related to physician coding, billing, and regulatory compliance. She has previously held compliance officer positions in local and international billing companies. Holly is a member of the ICD10monitor editor board and a popular guest on Talk Ten Tuesdays.

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