CMS: Providers may need to reimburse beneficiaries due to inaccurate therapy denial codes

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Therapy providers should review therapy cap denials for 2013 and refund any beneficiary payments for these services, according to a Medicare newsletter released Thursday.

Payment liability for therapy cap-related denials shifted from beneficiaries to providers as of Jan. 1, 2013. Claims processing systems still have not adjusted to this change, CMS said in the newsletter.

“Medicare systems were not updated in time to accurately represent this change on provider remittance advices (RAs),” the newsletter stated. “Medicare contractors may have already processed therapy cap denials for services provided in 2013. These denials incorrectly report on RAs beneficiary liability (Group Code ‘PR') when liability legally rests with the provider (Group Code ‘CO').”

The payment amount on these claims is correct, so MACs will not adjust the claims just to update the problem codes, as this would create potential balance sheet “disruptions” for providers, CMS said. However, the agency directed providers to review any therapy cap denials dating back to Jan. 1 and refund beneficiaries who were wrongly held liable and made payments.

System “constraints” are preventing an immediate update to these codes, according to CMS. For institutional claims, the correct liability codes will appear beginning on June 24.

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