RULES AND REGULATIONS
Title 55--PUBLIC WELFARE
DEPARTMENT OF PUBLIC WELFARE
[55 PA. CODE CH. 1101]
Invoicing for Services
[32 Pa.B. 6364] The Department of Public Welfare (Department) adopts amendments to § 1101.68 (relating to invoicing for services) to read as set forth in Annex A, under the authority of section 201(2) of the Public Welfare Code (code) (62 P. S. § 201(2)).
Notice of proposed rulemaking is omitted in accordance with section 204(1)(iv) and (3) of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. § 1204(1)(iv) and (3)), known as the Commonwealth Documents Law (CDL), and 1 Pa. Code § 7.4(1)(iv) and (3) (relating to omission of notice of proposed rulemaking) because:
* The amendment relates to Commonwealth grants and benefits. The amendment deals with the requirements for claim submissions under the Medical Assistance (MA) Program.
* The Department finds that publication of this amendment as proposed is unnecessary and contrary to the public interest. The purpose of this amendment is to make the time limits for claim submissions uniform for all MA providers by extending the time period for MA nursing facility providers and intermediate care facility for the mentally retarded (ICF/MR) providers (referred to collectively as long-term care providers) to submit claim adjustments and to resubmit rejected claims. By allowing long-term care providers additional time to adjust and correct their claim submissions, the amendment will enable long-term care providers to receive payment for claims that would have otherwise been denied solely because the providers were unable to submit ''clean claims'' within the requisite time frames. The Department anticipates that the amendment will also reduce paperwork and administrative expense for both long-term care providers and the Department by decreasing the number of appeals related to rejected claims, as well as requests for regulatory exceptions.
Purpose of the Final-Omitted Rulemaking
The final-omitted rulemaking gives long-term care providers the same time limit for submitting claim adjustments and resubmissions of rejected claims as is currently permitted other MA provider types. The final-omitted rulemaking also clarifies when a long-term care provider's billing period begins and ends.
Need for the Final-Omitted Rulemaking
The Department is the Commonwealth agency responsible for the administration of the Commonwealth's MA Program, which provides coverage of basic health care services to medically and financially needy Commonwealth residents. To ensure timely and efficient processing of MA provider payment claims,1 the Department has established, through the promulgation of regulations, time limits and other requirements for claim submissions, commonly known as the ''180-day rule.'' See § 1101.68.
Under the 180-day rule, an MA provider must submit a correct original invoice to be received by the Department within 180 days of the date the provider renders service to an eligible MA recipient. If a provider other than a long-term care provider submits an invoice within the 180-day time frame, but the invoice is amended or is rejected by the Department as incorrectly completed, the provider may resubmit the claim or submit a corrected claim so long as the resubmission is received by the Department within 365 days of the date of service. See § 1101.68(b)(3). The current regulation gives long-term care providers less time than other providers to submit a ''clean claim.'' Section 1101.68 specifies that a long-term care provider must submit its original invoice and any resubmissions to be received by the Department within 180 days of the last day of the month in which service was provided. Id.2
At the time the 180-day rule was first adopted, the Department decided that a shorter time frame for claim submissions for long-term care providers was necessary to have timely information on MA paid days available for auditing and cost settlement purposes. In 1996, the Department adopted the case-mix prospective payment system for nursing facility services. Under this prospective payment system, the Department no longer retrospectively cost-settles payments to nursing facilities. Although the Department does audit nursing facility cost reports under the case-mix payment system, the audits are used solely to set per diem rates and peer group prices for future rate-setting periods and the Department does not need MA paid days information to conduct these audits. While the Department continues to reimburse ICF/MR providers using a retrospective cost-based payment system, the Department has concluded that extending the claim adjustment and resubmission time limits for ICF/MR providers will not impede the audits or cost settlements for these providers. Consequently, the Department has determined that, under current circumstances, the shorter time frame is no longer necessary and that long-term care providers should be afforded the same time limits for claim adjustments and resubmissions as other MA providers.
When the Department promulgated § 1101.68 in 1990, the Department stated that the regulation was intended ''to reduce the number of unnecessary exception requests by providers, which cause delays in the reimbursement system . . . to [require providers to] submit claims to the Department as soon as possible to ensure timely reimbursement . . . [and to] increase invoicing efficiency among the provider community.'' 20 Pa.B. 6165 and 6166 (December 15, 1990). The Department finds that this amendment is fully consistent with the regulation's intended goal.
Requirements
The final-omitted rulemaking will make the time limits for claim adjustments and resubmissions uniform for allMA providers by extending the time period for long-term care providers to submit claim adjustments and resubmit rejected claims. By allowing long-term care providers additional time to adjust and correct their claim submissions, the final-omitted rulemaking will enable long-term care providers to receive payment for claims that would have otherwise been denied solely because the providers were unable to submit ''clean claims'' within the requisite time frames.
The Department anticipates that the final-omitted rulemaking will reduce paperwork and administrative expense for both long-term care providers and the Department by decreasing the number of requests for regulatory exceptions, and by reducing the number of appeals related to rejected claims. While exception requests should only be submitted when one of the regulatory exception criteria is met, requests are sometimes made simply because a claim has been rejected. Since the final-omitted rulemaking should decrease the number of rejected claims, it should also decrease the number of exception requests.
Section 1101.68 is being amended to clarify and revise the claim submission requirements for long-term care providers. The final-omitted rulemaking amends subsection (b)(1) to clarify that long-term care providers have 180 days from the end date of a billing period to submit an original or initial invoice and clarify when a billing period begins and ends. The final-omitted rulemaking does not alter existing Departmental policy, but simply changes the language of the section to better reflect that policy. In addition, the final-omitted rulemaking revises subsection (b)(3) by extending the time limit within which long-term care providers must submit claim adjustments and resubmit rejected claims to the Department from 180 days of the monthly service end date to 365 days of the end date of a billing period.
Affected Organizations
The Department and long-term care providers are affected by the final-omitted rulemaking. As a result of the final-omitted rulemaking, the Department will extend the time frame for long-term care providers to submit claim adjustments and resubmit rejected claims.
Fiscal Impact
Commonwealth--The Department will experience increased costs because additional claims will be paid as a result of the extended time frames. However, the Department will also realize savings from claim adjustments returning overpayments. In addition, because the extended time frames should reduce the number of 180-day exception requests and denied claims, the Department's administrative costs related to the processing of 180-day exception requests and the litigation of rejected claims might also be reduced.
Political Subdivisions--County nursing homes may receive additional payments as a result of the extension of the time frames for the submission of claim adjustments and resubmissions. In addition, because the extended time frames should reduce the number of 180-day exception requests and denied claims, county homes' administrative costs related to the submission of 180-day exception requests and the litigation of rejected claims may also be reduced.
Private Sector--Private nursing facilities and ICFs/MR may receive additional payments as a result of the extension of the time frames for the submission of claim adjustments and resubmissions. In addition, because the extended time frames should reduce the number of 180-day exception requests and denied claims, the facilities' administrative costs related to the submission of 180-day exception requests and the litigation of rejected claims may also be reduced.
General Public--No impact is anticipated.
Paperwork Requirements
This final-omitted rulemaking will decrease the amount of paperwork generated by the Commonwealth and by long-term care facilities. Extending the time frame for the submission of claim adjustments and the resubmission of rejected claims to 365 days will decrease the number of 180-day exception requests received by the Department which result from long-term care facilities' failure to meet the 180-day submission requirements.
Effective Date
This final-omitted rulemaking shall be effective January 1, 2003.
Sunset Date
A sunset date is not anticipated. Regulations will continue to be reviewed on an ongoing basis by the Department and the Medical Assistance Advisory Committee (Committee).
Public Comments
The final-omitted rulemaking was discussed and comments were solicited at the Long-Term Care Subcommittee of the Committee on February 9, 2000, and at the meeting of the Committee on February 24, 2000. These meetings were open to the public. Comments received on the draft regulation were unanimously favorable.
Although this final-omitted rulemaking is being adopted without prior notice, interested persons are invited to submit their written comments within 30 days from the date of this publication for consideration by the Department as to whether the regulation should be revised in the future. Comments should be sent to the Department of Public Welfare, Office of Medical Assistance Programs, Attention: Regulations Coordinator, Room 515 Health and Welfare Building, Harrisburg, PA 17105. Persons with a disability may use the AT&T Relay Service, (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
Regulatory Review
Under section 5.1(c) of the Regulatory Review Act (71 P. S. § 745.5a(c)), on November 4, 2002, the Department submitted copies of this final-omitted rulemaking to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House Committee on Health and Human Services and the Senate Committee on Public Health and Welfare. On the same date, the final-omitted rulemaking was submitted to the Office of Attorney General for review and approval under the Commonwealth Attorneys Act (71 P. S. §§ 732-101--732-506).
Under section 5.1(d) of the Regulatory Review Act, on November 25, 2002, this final-omitted rulemaking was deemed approved by the House and Senate Committees. Under section 5.1(e) of the Regulatory Review Act, on December 12, 2002, IRRC met and approved this final-omitted rulemaking.
Findings
The Department finds that:
(1) Public notice of intention to adopt the amendment in this order is not required since the rulemaking relates to Commonwealth grants and benefits. Publication of proposed rulemaking is unnecessary and contrary to the public interest under section 204(1)(iv) and (3) of the CDL and the regulation thereunder, 1 Pa. Code § 7.4(1)(iv) and (3).
(2) The adoption of this rulemaking in the manner provided in this order is necessary and appropriate for the administration and enforcement of the code.
Order
The Department, acting under the authority of the code, orders that:
(a) The regulations of the Department, 55 Pa. Code Chapter 1101, are amended by amending § 1101.68 to read as set forth in Annex A.
(b) The Secretary of the Department shall submit this order and Annex A to the Attorney General and General Counsel for approval as to legality and form as required by law.
(c) The Secretary of the Department shall certify this order and Annex A and deposit them with in the Legislative Reference Bureau as required by law.
(d) This order shall be effective January 1, 2003.
FEATHER O. HOUSTOUN,
Secretary(Editor's Note: For the text of the order of the Independent Regulatory Review Commission, relating to this document, see 32 Pa.B. 6428 (December 28, 2002).)
Fiscal Note: 14-480. (1) General Fund; (2) Implementing Year 2002-03 is $944,000; (3) 1st Succeeding Year 2003-04 is $2,275,000; 2nd Succeeding Year 2004-05 is $2,275,000; 3rd Succeeding Year 2005-06 is $2,275,000; 4th Succeeding Year 2006-07 is $2,275,000; 5th Succeeding Year 2007-08 is $2,275,000; (4) 2001-02 Program--$761,877,000; 2000-01 Program--$722,565,000; 1999-00--$693,625,000; (7) Medical Assistance--Long Term Care; (8) recommends adoption. Funding for these changes is included in the 2002-03 budget.
Annex A
TITLE 55. PUBLIC WELFARE
PART III. MEDICAL ASSISTANCE MANUAL
CHAPTER 1101. GENERAL PROVISIONS
FEES AND PAYMENTS § 1101.68. Invoicing for services.
(a) Invoices. When billing for MA services or items, a provider shall use the invoices specified by the Department or its agents, according to billing and other instructions contained in the provider handbooks.
(b) Time frame. MA providers shall submit invoices correctly and in accordance with established time frames. For purposes of this section, time frames referred to are indicated in calendar days.
(1) A provider shall submit original or initial invoices to be received by the Department within a maximum of 180 days after the date the services were rendered or compensable items provided. Nursing facility providers and ICF/MR providers shall submit original or initial claims to be received by the Department within 180 days of the last day of a billing period. A billing period for nursing facility providers and ICF/MR providers covers the services provided to an eligible recipient during a calendar month and starts on the first day service is provided in that calendar month and ends on the last day service is provided in that calendar month.
(2) Departmental receipt of a claim is evidenced by appearance of the claim on a remittance advice (RA). The claim reference number (CRN) identifies when the claim was received by the Department. The first digit of the CRN indicates the year. The next three digits refer to the Julian Calendar date.
(3) Resubmission of a rejected original claim or a claim adjustment shall be received by the Department within 365 days of the date of service, except for nursing facility providers and ICF/MR providers. Resubmission of a rejected original claim or claim adjustment by a nursing facility provider or an ICF/MR provider shall be received by the Department within 365 days of the last day of each billing period.
(4) A claim which has been submitted to the Department not appearing within 45 days following that submission, should be resubmitted by the provider. Similarly, a claim which appears as a pend on a remittance advice and does not subsequently appear as an approved or rejected claim before the expiration of an additional 45 days should be resubmitted immediately by the provider.
(c) Invoice exception criteria. Invoices submitted after the 180-day period will be rejected unless they meet the criteria established in paragraph (1) or (2).
(1) Eligibility determination was requested within 60 days of the date of service and the Department has received an invoice exception request from the provider within 60 days of receipt of the eligibility determination.
(2) Payment from a third party was requested within 60 days of the date of service and the Department has received an invoice exception request from the provider within 60 days of receipt of the statement from the third party.
(d) Other invoice exception requirements. In addition to the requirements in subsection (c), the following requirements apply:
(1) A provider shall submit invoice exception requests in writing to the Office of Medical Assistance Programs.
(2) A request for an invoice exception shall include supporting documentation, including documentation to and from the CAO or third party. A correctly completed invoice shall accompany the request.
(3) The Department may request additional documentation to justify approval of an exception. If the requested documentation is not received within 30 days from the date of the Department's request, a decision will be made based on available information.
(4) Invoice exceptions will be granted on a one time basis. Exception claims rejected through the claims processing system due to provider error will not be granted additional exceptions. Claims may be resubmitted directly to the claims processing system in accordance withsubsection (b). The claim shall indicate the CRN of the exception claim on the invoice.
(5) No exceptions to the normal invoice processing deadlines will be granted other than under this section. In addition, if a provider's claim to the Department incurs a delay due to a third party or an eligibility determination, and the 180-day time frame has not elapsed, the provider shall still submit the claim through the normal claims processing system. A request for an exception to the 180-day time frame is not required whenever the provider can submit the claim within that 180-day period.
(6) No exceptions will be granted for claims which were submitted for normal processing within normal deadlines and rejected by the Department due to provider error.
1 The Commonwealth's MA Program is one of the largest Medicaid Programs in the Nation. During Federal Fiscal Year (FFY) 1998, for example, only three states (New York, California and Texas) had total Medicaid spending that exceeded the Commonwealth. See Kaiser Family Foundation, State Health Facts Online, Total (Federal and State) Medicaid Spending, FFY 1998; www.statehealthfacts.kff.org. On average, more than 1.4 million individuals were eligible to receive services each month through the MA Program from 58,801 fee-for-service (FFS) providers from July 1, 1999, to June 30, 2000 (FY 99-00). MA providers submitted more than 60 million FFS claims for payment to the Department in FY 99-00. The Department approved 83% of the submitted claims, and, on average, paid the providers' claims for payment within 30 days of submission. See Office of Medical Assistance Statistical Report Fiscal Year 1999-2000, www.dpw.state.pa.us/omap/geninf/statreport/ omapsr9900FFSsrvc.asp (last modified August 23, 2002).
2 If a provider submits a claim for payment beyond the 180-day time period, the Department will reject it unless the provider meets the requirements for an exception to the 180-day rule under § 1101.68(c) and (d). The exceptions to the 180-day rule are limited, and must involve either: (1) a delay in the determination of a patient's MA eligibility (§ 1101.68(c)(1)); or (2) a delay in the response to a request for payment from a third party (§ 1101.68(c)(2)). In addition, a provider must comply with certain other requirements to qualify for an exception to the 180-day rule. These amendments make no changes to the existing 180-day exception provisions contained in § 1101.68(c) and (d).
[Pa.B. Doc. No. 02-2312. Filed for public inspection December 27, 2002, 9:00 a.m.]
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