Non-covered Charges on Institutional Ambulance Claims

30.2.4 - Non-covered Charges on Institutional Ambulance Claims (Rev. 1921, Issued: 02-19-10, Effective: 04-01-10, Implementation: 04-05-10) Medicare law contains a restriction that miles beyond the closest available facility cannot be billed to Medicare. Non-covered miles beyond the closest facility are billed with HCPCS procedure code A0888 (“non-covered ambulance mileage per mile, e.g., for miles traveled beyond the closest appropriate facility”). These non-covered line items can be billed on claims also containing covered charges. Ambulance claims may use the -GY modifier on line items for such non-covered mileage, and liability for the service will be assigned correctly to the beneficiary. The method of billing all miles for the same trip, with covered and non-covered portions, on the same claim is preferable in this scenario. However, billing the non-covered mileage using condition code 21 claims is also permitted, if desired, as long as all line items on the claims are non-covered and the beneficiary is liable. Additionally, unless requested by the beneficiary or required by specific Medicare policy, services excluded by statute do not have to be billed to Medicare. When the scenario is point of pick up outside the United States, including U.S. territories but excepting some points in Canada and Mexico in some cases, mileage is also statutorily excluded from Medicare coverage. Such billings are more likely to be submitted on entirely non-covered claims using condition code 21. This scenario requires the use of a different message on the Medicare Summary Notice (MSN) sent to beneficiaries. Another scenario in which billing non-covered mileage to Medicare may occur is when the beneficiary dies after the ambulance has been called but before the ambulance arrives. The -QL modifier should be used on the base rate line in this scenario, in place of origin and destination modifiers, and the line is submitted with covered charges. The -QL modifier should also be used on the accompanying mileage line, if submitted, with non-covered charges. Submitting this non- covered mileage line is optional for providers. Non-covered charges may also apply is if there is a subsidy of mileage charges that are never charged to Medicare. Because there are no charges for Medicare to share in, the only billing option is to submit non-covered charges, if the provider bills Medicare at all (it is not required in such cases). These non-covered charges are unallowable, and should not be considered in settlement of cost reports. However, there is a difference in billing if such charges are subsidized, but otherwise would normally be charged to Medicare as the primary payer. In this latter case, CMS examination of existing rules relating to grants policy since October 1983, supported by Federal regulations (42CFR 405.423), generally requires providers to reduce their costs by the amount of grants and gifts restricted to pay for such costs. Thereafter, section 405.423 was deleted from the regulations. Thus, providers were no longer required to reduce their costs for restricted grants and gifts, and charges tied to such grants/gifts/subsidies should be submitted as covered charges. This is in keeping with Congress’s intent to encourage hospital philanthropy, allowing the provider receiving the subsidy to use it, and also requiring Medicare to share in the unreduced cost. Treatment of subsidized charges as non-covered Medicare charges serves to reduce Medicare payment on the Medicare cost report contrary to the 1983 change in policy. Medicare requires the use of the -TQ modifier so that CMS can track the instances of the subsidy scenario for non-covered charges. The -TQ should be used whether the subsidizing entity is governmental or voluntary. The -TQ modifier is not required in the case of covered charges submitted when a subsidy has been made, but charges are still normally made to Medicare as the primary payer. If providers believe they have been significantly or materially penalized in the past by the failure of their cost reports to consider covered charges occurring in the subsidy case, since Medicare had previous billing instructions that stated all charges in the case of a subsidy, not just charges when the entity providing the subsidy never charges another entity/primary payer, should be submitted as non-covered charges, they may contact their A/B MAC (A) about reopening the reports in question for which the time period in 42 CFR 405.1885 has not expired. A/B MACs (A) have the discretion to determine if the amount in question warrants reopening. The CMS does not expect many such cases to occur. Billing requirements for all these situations, including the use of modifiers, are presented in the chart below: Mileage Scenario HCPCS Modifiers* Liab- ility Billing Remit. Require -ments MSN Message STATUTE: Miles beyond closest facility, OR **Pick up point outside of U.S. A0888 on line item for the non- covered mileage -QM or -QN, origin/destin ation modifier, and -GY unless condition code 21 claim used Bene- ficiary Bill mileage line item with A0888 -GY and other modifiers as needed to establish liability, line item will be denied; OR bill service on condition code 21 claim, no -GY required, claim will be denied Group code PR, reason code 96 16.10 “Medicare does not pay for this item or service”; OR, “Medicare no paga por este artículo o servicio” Beneficiary dies after ambulance is called Most appropria te ambulanc e HCPCS mileage code (i.e., ground, air) -QL unless condition code -21 claim Pro- vider Bill mileage line item with -QL as non-covered, line item will be denied Group Code CO, reason code 96 16.58 “The provider billed this charge as non-covered. You do not have to pay this amount.” OR, “El proveedor facuró este cargo como no cubierto. Usted no tiene que pagar ests cantidad.” Mileage Scenario HCPCS Modifiers* Liab- ility Billing Remit. Require -ments MSN Message Subsidy or government owned Ambulance, Medicare NEVER billed*** A0888 on line item for the non- covered mileage -QM or -QN, origin/ destination modifier, and -TQ must be used for policy purposes Pro- vider Bill mileage line item with A0888, and modifiers as non-covered, line item will be denied Group Code CO, reason code 96 16.58 “The provider billed this charge as non-covered. You do not have to pay this amount.” OR, “El proveedor facuró este cargo como no cubierto. Usted no tiene que pagar ests cantidad.” * Current ambulance billing requirements state that either the -QM or -QN modifier must be used on services. The -QM is used when the “ambulance service is provided under arrangement by a provider of services,” and the -QN when the “ambulance service is provided directly by a provider of services.” Line items using either the -QM or -QN modifiers are not subject to the FISS edit associated with FISS reason code 31322 so that these lines items will process to completion. Origin/destination modifiers, also required by current instruction, combine two alpha characters: one for origin, one for destination, and are not non-covered by definition. ** This is the one scenario where the base rate is not paid in addition to mileage, and there are certain exceptions in Canada and Mexico where mileage is covered as described in existing ambulance instructions. ***If Medicare would normally have been billed, submit mileage charges as covered charges despite subsidies. Medicare systems may return claims to the provider if they do not comply with the requirements in the table.