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David McGill Blogger

Prosthetic Pre-Payment Claim Review Results from Region A

Posted by David McGill | December 03, 2015

NHIC, the DME MAC for Region A, has published quarterly results for its ongoing prepayment claim review of K3 prosthetic claims since November 2011. It recently provided the latest update. Here's what you need to know:

  • The review encompassed 118 claims from 89 suppliers between May 29th and September 3rd, 2015;
  • NHIC did not receive responses to additional documentation requests for 24% of the claims;
  • For the remaining claims, the claim denial rate was 41%;
  • 18% of the denied claims contained no supporting information in the physician's medical record;
  • 17% of the denied claims contained no statement or reason in either the physician's order or medical record justifying replacement of the prosthetic item being delivered.

What does this mean for you?

We have 3 key takeaways from the latest Region A results.

First, the overall claim denial rate of 41% is the lowest it has been since NHIC began its prepayment claim reviews 4 years ago. That is good news and it continues a general trend downward in the claim denial rate since these reviews started. That's the good news.

Claim Denial Rate.png

Second - the bad news - failures to respond to additional documentation requests have steadily crept upward over the last 4 quarters to a historic high of 25%.

No ADR Response.png

Responding to ADRs is not optional - if you fail to answer these requests, you risk jeopardizing your Medicare billing privileges. Always respond to an ADR!

Third, in the last two reporting periods NHIC has added a new category: claims that lack adequate documentation justifying replacement of the prosthetic device at issue. This suggests that NHIC is closely scrutinizing the need for a replacement versus less expensive repairs. Remember that in order to justify replacement, you must show either 1) that the patient's physiological condition has changed, (2) an irreparable change in the condition of the prosthetic device, or (3) the cost of repairs exceed 60% of the cost of the cost of replacement.

Based upon the most recent results, NHIC announced that it will continue its prepayment review of K3 prosthetic claims. We will keep you posted as future data becomes available. 

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