The Payer’s Rulebook: The Final Rule

In the revenue cycle world there are many rules O&P practices must follow—what you can bill, when and how to bill, and what is needed to justify reimbursement. When we don’t follow those rules, we don’t receive reimbursement. Payers have rules they are required to follow as well, and it is equally important for us to know their rules. If we don’t know their rules, how can we make sure they are following them? We have seen the effects of Medicare Advantage (MA) plans disobeying their rules for some time now, and the impact on patient care has been massive. Luckily, there are solutions to these issues in the form of a Final Rule that are applicable to coverage beginning on January 1. In April 2022, a year before the latest MA Final Rule was first published, the Office of Inspector General released a report indicating that some prior authorization requests denied by MA plans would have been covered under traditional Medicare coverage guidelines. In response to that report and concerns from stakeholders regarding MA organizations’ use of prior authorization processes, CMS proposed changes to the Medicare Advantage Program. On April 12, 2023, CMS published the Final Rule. The new regulations became effective on June 5, 2023, for coverage in 2024 and beyond. We will review four changes published in the Final Rule and what they mean for providers. Coverage The Final Rule of June 2000 established the requirement that MA plans base medical necessity determinations on Medicare’s coverage guidelines. It stated that MA plans’ internal policies cannot be used when Medicare has fully established coverage guidelines. This requirement was reiterated and clarified in the Contract Year 2024 Final Rule. If you receive a medical necessity denial from an MA plan that does not follow Medicare’s coverage policies, cite the Final Rule in the appeal. When Medicare does not have fully established coverage policies, MA plans can create internal policies. Those policies and the information used to create them must now be made publicly available. Prior Authorization If a patient switches from one MA plan to another or to an MA plan from traditional Medicare, there is now a 90-day transition period. This means that the new MA plan cannot require prior authorization for 90 days if the patient is in an active course of treatment. Because plan changes happen in the new year and authorizations may have already been approved, this scenario was a challenging one prior to the latest rule. If a MA plan requires a prior authorization, check the type of plan the patient has and the dates of the approved authorization. Also finalized was the rule that MA plans cannot deny coverage or payment based on medical necessity when a prior authorization was previously approved, unless there is good cause or evidence of fraud. If you receive a medical necessity denial for a claim with an approved authorization, that denial should be challenged in accordance with the Final Rule. Reviewer Qualifications It is now required that the healthcare professionals who review adverse determinations on prior authorizations have expertise in the appropriate field. If you receive a prior authorization denial, ask for the reviewer’s qualifications, and confirm they have O&P expertise. While the Final Rule does not address what action to take if the reviewer does not have appropriate expertise, we would recommend citing it and requesting someone else review the determination. Utilization Management Committee MA plans are now required to create a utilization management (UM) committee that is responsible for annually reviewing all UM policies to ensure their compliance. Ideally, these committees will prohibit the previous disruptions in care from continuing or happening again in the future. The new regulations from the Final Rule will have a big impact on how MA plans are processing prior authorizations and claims. Knowing the payer’s rulebook will help you navigate some of the common revenue cycle challenges when it comes to MA plans. Erin Cammarata is president and owner of CBS Medical Billing and Consulting. She can be contacted at erin@cbsmedicalbilling.com. Stacy Toner is a certified billing and coding specialist and the chief operations officer at CBS Medical Billing and Consulting.

The Payer’s Rulebook: The Final Rule

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