New time limit for filing Medicare claims

Historically, as authorized by statute and the Centers for Medicare and Medicaid Services (CMS), physicians had a minimum time limit for filing Part B claims of 15 months and a potential maximum of 27 months after the service was furnished, depending on the month of the year when the service was furnished. Section 6404 of the Patient Protection and Affordable Care Act (PPACA) changed that by requiring that all claims for services furnished on or after Jan. 1, 2010, must be filed within one calendar year after the date of service, while claims for services furnished before Jan. 1, 2010, must be filed on or before Dec. 31, 2010. In its proposed rule on the 2011 Medicare physician fee schedule, which I mentioned in my previous post (see "Looking ahead to the 2011 Medicare physician fee schedule"), CMS proposes to amend its regulations to be consistent with the statutory changes imposed by the PPACA. 

In the past, CMS had one exception to the timely filing limit. That exception applied when the failure to file “...was caused by error or misrepresentation of an employee, intermediary, carrier, or agent of the Department that was performing Medicare functions and acting within the scope of its authority.” Consistent with the authority provided in Section 6404 of the PPACA, CMS proposes to create two new exceptions.

The first new exception would apply when CMS or one of its contractors determines that the following conditions have been met:

• At the time the service was furnished the beneficiary was not entitled to Medicare; and
• The beneficiary subsequently received notification of Medicare entitlement effective retroactively to or before the date of the furnished service.

The second new exception would apply when CMS or one of its contractors determines that all of the following conditions have been met:

• At the time the service was furnished the beneficiary was not entitled to Medicare;
• The beneficiary subsequently received notification of Medicare entitlement effective retroactively to or before the date of the furnished service; and
• A state Medicaid agency recovered the Medicaid payment for the furnished service from the provider or supplier 11 months or more after the date of service.

In the case of the first new exception, the time to file a claim would be extended through the last day of the 6th calendar month following the month in which the beneficiary received notification of Medicare entitlement effective retroactively to or before the date of the furnished service. In the case of the second new exception, the time to file a claim would be extended through the last day of the 6th calendar month following the month in which the state Medicaid agency recovered the Medicaid payment for the furnished service from the provider or supplier.

For the existing exception, the extension of time is the last day of the 6th calendar month following the month in which the error or misrepresentation is corrected. However, no extension of time will be granted when the request for this particular exception is made to CMS or one of its contractors more than four years after the date of service, consistent with current CMS policy. CMS does not propose to define “date of service” and instead intends to provide “sub-regulatory” guidance on what constitutes the date of service for different services.

CMS's proposals are generally consistent with PPACA, and the proposed additional exceptions are welcome. However, one has to question why CMS is only granting six months for the extended time limit that it proposes for each exception. The PPACA provision essentially provides physicians and others with a 12-month period in which to file claims for services for which they have reason to believe Medicare may be responsible. However, in the exceptions proposed by Medicare, the physician only has six months to file a claim after he or she becomes aware of Medicare’s responsibility. Consistency with PPACA would suggest that the time to file a claim under each exception should be extended through the last day of the 12th month following the month in which the exception applies.

Also, as regards the exception due to error or misrepresentation on the part of Medicare, one would think the extended time limit should be based on the month in which the error or misrepresentation is corrected and the physician has been notified of that fact. As proposed, the extended time limit begins when the error or misrepresentation is corrected, without apparent regard to whether the physician is aware of that fact. Recognizing that there may be some time between when the error or misrepresentation is corrected and when the physician is notified of this fact, it is at the latter point (i.e., the point at which the physician becomes aware of the correction) that the extended time limit should begin from a physician perspective.

Finally, there is a question that CMS does not address with respect to the exception based on retroactive beneficiary enrollment. Namely, the extended time limit commences with notification of the Medicare beneficiary regarding his or her retroactive entitlement effective date. However, if the beneficiary does not, in turn, notify the physician of the retroactive entitlement until after the extended claims filing time limit expires, does the beneficiary remain responsible for payment of the service? Hopefully, CMS will address this question in the final rule.

In the meantime, if you have yet to file a claim for dates of service before 2010, you have until the end of the year to do so, and the 12-month clock is ticking to file claims for services provided this year.