Situation Report | March 29, 2021
The U.S. Centers for Medicare and Medicaid Services (CMS) has recently issued a new Medlearn (MLN) Matters Article MM12085 to inform Medicare-certified agencies about revisions to Medicare’s Common Working File (CWF) home health period sequence edits to no longer exclude Low Utilization Payment Adjustment (LUPA) claims.
Specifically, CMS’s CWF contains edits ensuring that Medicare pays home health claims in the correct episode or period of care sequence. Currently, these edits bypass LUPA claims. Before the implementation of the Patient Driven Groupings Model (PDGM), this bypass was correct. If the claim had 4 or fewer visits, it would correctly receive a LUPA payment regardless of whether it was an early or late episode.
However, under PDGM, the early or late Health Insurance Prospective Payment System (HIPPS) codes for a period of care can have different LUPA thresholds, ranging from 1 to 6 visits. The correct early or late HIPPS code must be assigned before Medicare systems can determine whether a LUPA payment should apply. In some cases, incorrect payments result if Medicare systems bypass period-of care-sequence edits for LUPA claims.
When Medicare agencies realize such claims are being impacted, the Medicare Administrative Contractor (MAC) — in this case, National Government Services (NGS) — can manually recode affected claims to correct the payment.
MM12085 corrects CWF editing to remove the LUPA bypass for home health claims with “from” dates on or after January 1, 2021. Once the MM12085 correction is in effect, manual recoding will no longer be necessary. MM12085 contains no new policy, but corrects the implementation of existing policy.