Don't let PECOS put your practice in a pickle

Many of you have received so many notices from medical supply and home health services advising physicians to update their Medicare enrollment information that you could paper an exam room with them. These notices are correct in stating that federal law requires that claims for supplies and for referred services contain the name and National Provider Identifier (NPI) of the ordering or referring physician and that Medicare contractors who pay these claims must confirm whether the ordering/referring physician has a valid enrollment record in the Provider Enrollment, Chain, and Ownership System (PECOS). However, these notices have also contained some misinformation and caused some confusion. I hope I can clear this up a bit.

First, PECOS is an enrollment system that the Centers for Medicare & Medicaid Services (CMS) adopted for enrolling physicians and other eligible providers in 2003. Physicians who enrolled in Medicare prior to 2003 may not have an enrollment record in PECOS and must go through the enrollment process again to create a PECOS record. CMS has recognized that there are issues with their enrollment process and that many physicians have had difficulty enrolling in PECOS online. In response, CMS has delayed the July 6 activation of edits that would have resulted in denial of claims for supplies or services ordered by a physician not enrolled in PECOS.

Second, physicians who have opted out of Medicare can order supplies and services for their Medicare patients. CMS requires that Medicare contractors establish a PECOS record for physicians with a valid opt-out affidavit. Physicians who have opted out can contact their Medicare contractor to verify their PECOS record.

Physicians who work in specific settings where their services are not typically billed to Medicare should follow CMS guidance when enrolling; the requirements are reduced. Examples of physicians who may take advantage of this guidance are those who practice in public health settings, Tricare, the Veterans Administration, federally qualified health centers and fellowship settings.

If you are not sure whether you have an active enrollment record in PECOS, you can contact your local Medicare contractor or check for your name and NPI on CMS' Ordering/Referring Report. Note that the Ordering/Referring Report will be continuously updated by CMS as many enrollment applications are still in process. If you know that you have recently received approval of your enrollment application from your Medicare contractor but your name is not on Ordering/Referring Report, you should feel comfortable ignoring any PECOS-enrollment-related supplier notices that you might continue to receive. However, if your application has not yet been approved, be sure your staff frequently check the status, as any missing information or documentation can result in your application being returned or eventually rejected.

This enormous undertaking of updating hundreds of thousands of Medicare enrollment applications is in part an effort to reduce the number of fraudulent claims filed under the names of unsuspecting physicians or even deceased or non-existent physicians. Hopefully, the current massive investments in investigating and ending fraud will lead to lesser burdens on the physicians, providers and suppliers who just want honest pay for providing necessary services.

On the other hand, it may just lend credence to Celine's third law: "It is only through honest politicians trying to change the world through laws that true tyranny can come into being through excessive legislation."