Medicare clarifies coverage for incarcerated beneficiaries, issues refunds

Medicare is cleaning up the mess it made last summer when it denied claims and initiated recovery of previously paid claims based on faulty data from the Social Security Administration about supposedly "incarcerated" beneficiaries.

The Centers for Medicare & Medicaid Services (CMS) has announced that it is “actively addressing” the issue and produced a fact sheet to clarify the matter.

According to CMS, it has restored the original data on its Medicare Enrollment Data Base, and is basing any new claim denials for incarcerated beneficiaries based on that information. In the meantime, it said it had identified all of the claims that were incorrectly demanded or collected and completed the bulk of refunds to providers. It also changed its claims processing system.

The fact sheet clarifies when CMS considers patients to be “in custody” or “incarcerated,” making them ineligible for benefits, and that CMS is making its denial forms and notices more explicit in justifying a repayment. The fact sheet also explains how physicians can ensure a patient’s eligibility either through the electronic transaction for eligibility verification, the Medicare administrative contractor’s (MAC’s) online portal, or by calling the MAC’s hotline. Finally, the fact sheet outlines exceptions to the Medicare policy and instructs physicians how to submit claims for these exceptions. It also provides additional guidance and resources for affected physicians.

For additional information about this issue, including a link to frequently asked questions, please refer to the dedicated page on the CMS website.

– Kent Moore, Senior Strategist for Physician Payment for the American Academy of Family Physicians

Posted on Jan 24, 2014 by David Twiddy