Business Briefs: Confusion Reigns: 2014 Coding, Coverage, & Payment for CTPs

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  The 2014 packaging of cellular and/or tissue-based products for wounds (CTPs) [old term “skin substitute”] by the Centers for Medicare & Medicaid Services (CMS) has tested the revenue cycle acumen of hospital-based outpatient wound care department (HOPD) teams throughout the country. Not a day goes by that this author does not answer at least a dozen phone calls pertaining to this topic. Therefore, the editorial board of Today’s Wound Clinic decided to conduct a survey to learn whether or not HOPD clinical and financial teams are “dotting all their I’s and crossing all their T’s” to implement this new packaged payment change. (For full analysis on this survey by TWC editorial board experts, please see page 12.)   After answering hundreds of questions and reviewing the survey responses, this author can sum up the success of CTP packaging implementation among wound care clinics across the country in two words: Confusion reigns!

  Following are some of the wise and questionable decisions that HOPD teams have made in relation to CTPs:

A) Wise Decisions

    • Continued to use CTPs with published measurable clinical evidence that the patient, HOPD, and payer can afford.
    • Ordered a variety of CTP sizes (rather than one size) to minimize wastage as the wound closes.
    • Added new Healthcare Common Procedure Coding System (HCPCS) codes for the application of “low cost” CTPs to the charge description master (CDM) and paper/electronic charge sheets.
    • Continued to bill Medicare for “Q” codes and add-on codes.
    • Contacted private payers, Medicare Advantage Plans, Medicaid, TRICARE, etc. to learn if they will be using the new HCPCS codes C5271-C5278 or if they will continue to use 15271-15278; made accommodations in the CDM for these situations.
    • Refined the CDM to reflect the correct charge per sq cm of the CTPs they use.
    • Ran “dummy” claims to be sure the claims reflect all the correct application codes, add-on codes, and CTP codes; all the correct units; and all the correct charges.
    • Educated patients about their coinsurance responsibilities.
    • Reviewed the local coverage determination (LCD) revisions their Medicare Administrative Contractor (MAC) released regarding coverage of CTPs.
    • Implemented a tracking program to show the positive and negative clinical impacts of packaging of CTPs.
    • Implemented a tracking program to show the positive and negative financial impacts of the packaging of CTPs.

B) Questionable Decisions
    • Continued to use CTPs that cost more than the Medicare allowable rate.
    • Ignored budgets and ordered all “high cost” CTPs.
    • Started to use CTPs that are not covered by their MAC.
    • Started to use products that do not have published clinical evidence.
    • Started denying access to CTPs.
    • Admitted patients to hospitals for skin grafts rather than using CTPs in the HOPD.
    • Did not update the CDM and paper/electronic charge sheets to accommodate coding and payment changes.
    • Did not make accommodations for private payers who may still use 15271-15278 for application of “low cost” CTPs.
    • Removed the “Q” codes and add-on codes from the CDM because Medicare does not pay separately for them.
    • Began billing surgical dressings with the codes for the application of “low cost” CTPs.
    • Stopped using “JW” modifier when required by their MAC.
    • Assumed Q4100 was covered by all MACs.

  This list could go on and on . . . To calm the confusion, the remainder of this article will discuss key considerations that HOPD teams must address when implementing packaged Medicare payment of CTPs.

Clinical Considerations to Implement Packaged Payment

  HOPD personnel and qualified healthcare professionals (QHPs) who work in HOPDs should review the CTPs that are ordered and applied in the HOPD. Published clinical evidence and clinical practice guidelines should be “top of mind” for QHPs.

  With the plethora of CTPs on the market, QHPs should always contact the medical affairs department of CTP manufacturers to obtain reprints of published clinical trials and should research ongoing clinical trials that must be listed on www.clinicaltrials.gov. QHPs should select the “right” product with the “right” evidence for the “right patients” at the “right” time. This should include selecting the “right” size product for the wound as it decreases in size. NOTE: The aforementioned survey showed numerous QHPs have switched to products without proof of published clinical evidence. Some even switched to products that claimed to be CTPs but have been assigned surgical dressing codes by CMS. The survey also showed that many HOPDs only order one size of product, which leads to a lot of wastage. HOPD teams should review the products with published clinical evidence available in a variety of sizes.

Financial Considerations to Implement Packaged Payment

  HOPD personnel and QHPs should also consider the price of the CTPs (for the patient, the HOPD, and the payer). The new packaged Medicare payment makes it financially cumbersome to consistently use CTPs that cost more than the Medicare allowable. QHPs should work with their HOPDs to balance the use of “high cost” and “low cost” CTPs.

  HOPDs should work with their revenue cycle team to:
  1. Update the CDM with the correct charge per sq cm for each CTP used in the HOPD.
NOTE: Our survey showed many HOPDs have not correctly adjusted their charges for the CTPs.
Remember: The 2014 charges for the CTPs to Medicare will determine the packaged payment rate for HOPDs in 2016. HOPD revenue cycle teams need to pay serious attention to setting the charges correctly to reflect their actual costs and overhead and to verify the correct charges actually make their way onto Medicare claims.
Caution: Upon reviewing the 2012 Medicare claims data (which set the 2014 Medicare allowable packaged rates for the application of the CTPs), it was found that HOPDs actually only billed for 60% of the cost of CTPs. If that continues in 2014, the packaged payment rates will reduce further in 2016.

  2. Ensure they are correctly reporting the number of sq cm opened for the patient encounter and that the correct number of units is submitted on the Medicare claims.
NOTE: Our survey showed: A) that many HOPDs are still incorrectly reporting a unit of “1” when they should be reporting the total number of sq cm opened for the patient and B) that the HOPD has not established a process to audit the submitted claims. These major errors cause two “negative” things to happen:
    1. The MACs pay the HOPD for only 1 sq cm rather than for the total number of sq cm opened for the patient and
    2. CMS receives incorrect charge data on which to pay the claim and to set the future Medicare packaged payment allowable rates.

  3. Adjust their CTP charges when manufacturers release price changes.
NOTE: Our survey showed some HOPDs are lackadaisical about updating the CDM to reflect price changes. Some even report they only make changes to the CDM on an annual basis. Once again, this provides incorrect pricing information to CMS.

  4. Select the right size product for the wound as it gets smaller and document wastage in the medical record and on the claim form (if required by their MAC). QHPs and HOPD personnel should research their MAC’s direction pertaining to wastage.
NOTE: Our survey showed QHPs are not following their MAC’s directions for documenting wastage in the medical record and reporting/not reporting wastage on the Medicare claim form.

  5. Collect the patient’s coinsurance, either from the patient or from the secondary payer, for the application of the CTP.
NOTE: Our survey showed HOPDs are not consistently collecting patient coinsurance. In fact, some HOPDs reported that they look to the CTP manufacturer to pay for the coinsurance directly or in-kind. The hospital’s contract with Medicare states that the hospital will hold the Medicare beneficiary responsible for the coinsurance. Therefore, HOPDs should not look to the CTP manufacturers to pay for the coinsurance directly or in-kind.

Coding Considerations to Implement Packaged Payment

  HOPDs should update their CDM and paper/electronic charge sheets with codes for the application of “high cost” CTPs (15271-15278) and “low cost” CTPs (C5271-C5278). They should continue to use the add-on codes and the “Q” codes for the CTPs. They should work with their revenue cycle team to handle coding for payers who do not intend to use the C5271-C5278 codes. They should not use C5271-C5278 for the application of products that have surgical dressing codes.

  HOPDs should also verify that the correct units opened for the patient are reported on their paper/electronic charge sheets, that the CDM is set up to correctly handle those units, and that the claim contains the correct number of units. The only way to verify this is to either run “dummy” claims or to conduct audits on paid/denied Medicare claims for CTPs.
  NOTE: Our survey showed many HOPDs have switched to CTPs that map to the new “low cost” HCPCS application codes. However, many HOPDs reported they did not add the new C5271-C5278 codes to their CDM. In addition, the survey showed many HOPDs ceased reporting the “Q” codes for the products. Both of those errors will prove to be disastrous: Their claims will be denied and their Medicare allowables will drop in 2016.

Payment Considerations to Implement Packaged Payment

  HOPDs should update their charges for 15271-15278 to reflect their true costs for labor, supplies, dressings, etc. when the QHP applies “high cost” CTPs. In addition, they should establish charges for C5217-C5278 to reflect their true costs for labor, supplies, dressings, etc. when the QHP applies “low cost” CTPs.

  When submitting their claims to Medicare, HOPDs should take great care that the “Q” codes for the CTPs designated by Medicare as “high cost” are submitted with 15271-15278; if they are not, the claim will not be paid. Likewise, HOPDs should take great care that the “Q” codes for the CTPs designated by Medicare as “low cost” are submitted with C5271-C5278, as this will prevent claims denial. The correct charge for the entire CTP piece purchased for the patient should be submitted to Medicare even though the payment for the product is packaged into the application payment.

  HOPDs should also still include the add-on codes along with the correct number of units and the correct charges when CTPs are applied to wounds larger than the base codes (25 sq cm or 100 sq cm). NOTE: Our survey showed many HOPDs have not: 1) updated the charges in their CDM, 2) continued to include the charges for the CTPs on their claims, and 3) continued to include the charges for the add-on codes on their claims. In addition, very few HOPDs have established a process to verify that the correct codes, units, and charges are actually on the claims.

  Additionally, numerous HOPDs have begun using products that have not been designated by Medicare as “high cost” or “low cost” CTPs. Those claims will be denied. Finally, most HOPDs have failed to discuss the packaged payment system with their patients. When the patients start seeing their claims and their new coinsurance amounts, they may be upset that they were not informed.

Coverage Considerations to Implement Packaged Payment

  Everyone knows the existence of a code and a payment rate is not a guarantee of Medicare coverage. HOPDs should monitor their MAC website for CTP coverage changes. As of TWC press time, several MACs had updated their LCDs, one MAC had retired its LCDs and listed the non-covered CTPs in the “non-covered services” LCD, and the other MACs had remained silent about the packaged payment changes. (Keep looking for their coverage guideline updates.) Three themes are resonating in the updated LCDs:
  Documentation of medical necessity and use of the product according to FDA label instructions is of utmost importance.
  Minimizing wastage and documentation of wastage is very important to the MACs.
  The MACs intend to monitor appropriate usage through post-payment reviews.

  Therefore, selecting the “right product” with the “right evidence” in the “right size” for the “right patient” at the “right time” has never been more important.
NOTE: Our survey showed many HOPDs believe they can ignore their MAC’s LCD and use any CTP now that Medicare payment for the CTP is packaged. Nothing is further from the truth. The MAC’s coverage rules should still be your “rule book.”

Kathleen D. Schaum is president and founder of Kathleen D. Schaum & Associates Inc., Lake Worth, FL. She may be reached at kathleendschaum@bellsouth.net.