Health insurance companies usually cover most medical services provided by physicians and hospitals, prescription drugs, wellness care, and medical devices. However, as medical billing companies know, Medicare and private payers do not cover certain items and services. A non-covered service in medical billing means one that is not covered by government and private payers.
Medicare Non-covered Services
The four categories of items and services that Medicare does not cover are:
- Medically unreasonable and unnecessary services and supplies
- Noncovered items and services
- Services and supplies denied as bundled or included in the basic allowance of another service
- Items and services reimbursable by other organizations or furnished without charge
Medicare does not cover services and supplies that are not considered to be medically necessary to diagnose and treat the patient’s condition. Such items include (but are not limited to):
- Hospital furnished services that, based on the beneficiary’s condition, could have been furnished in a lower-cost setting, such as the beneficiary’s home or a nursing home
- Hospital services exceeding Medicare length-of-stay limitations
- Evaluation and management services exceeding those considered medically reasonable and necessary
- Excessive therapy or diagnostic procedures
- Unrelated screening tests, examinations, and therapies that the beneficiary has no symptoms or diagnoses, except for certain screening tests, examinations, and therapies
- Unnecessary services based on the diagnosis of the beneficiary such as, acupuncture and transcendental meditation
To be covered by Medicare, services should meet specific medical necessity requirements in the statute, regulations, and manuals and specific medical necessity criteria defined by National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs), if any apply to the reported service. For every service billed, the physician should clearly indicate the specific sign, symptom, or beneficiary complaint that makes the service reasonable and necessary.
Exceptions or items and services that may be covered listed on www.cms.gov are: Medicare Preventive Services, Transitional Care Management, Chronic Care Management, and Advance Care Planning. CMS states: “Medicare may cover items and services administered to alleviate pain or discomfort, even if such use may increase the risk of death, if not furnished for the specific purpose of causing death”.
Medically Reasonable and Necessary
Medicare typically covers time-tested technologies and procedures. In order to qualify as medically “reasonable and necessary”, services and items should be proven safe and effective. They must meet the following criteria
- Consistent with the symptoms or diagnosis of the illness or injury under treatment.
- Necessary and consistent with generally accepted professional medical standards (e.g., not experimental or investigational)
- Not provided primarily for the convenience of the patient, the attending physician, or other physician or supplier.
- Furnished at the most appropriate level that can be provided safely and effectively to the patient.
Services that Medicare does not Cover
The benefits of health plans differ depending on the beneficiary’s needs, and depending on state regulations. That’s why it’s important for physicians to check their Medicare carriers’ website and stay up-to-date with their latest exclusion policies. However, the services that are usually not covered by most health plans are as follows:
- Cosmetic surgery: this includes any procedure performed to improve the patient’s appearance
- Dental services: Items and services relating to the care, treatment, filling, removal, or replacement of teeth or the structures directly supporting the teeth
- Foot care: certain services such as treatment of flat foot, supportive devices for feet, and hygienic and preventive maintenance care
- Hearing aids: Hearing aids or examination for purpose of prescribing, fitting or changing hearing aids, etc
- Custodial care: long-term care services and support
- Routine physical check-ups: eye examinations for prescribing, fitting or changing eyeglasses, various screenings, vaccinations specifically covered by statute, etc
- Personal comfort items and services
- Investigational devices
Collecting Payment for Non-covered Services
Under Medicare rules, it may be possible for a physician to bill the patient for services that Medicare does not cover. If a patient requests a service that Medicare does not consider medically reasonable and necessary, the payer’s website should be checked for coverage information on the service. If the patient’s policy is not clear on the matter, the physician should notify the patient before providing the service, that they may be responsible for the payment, that is, pay out-of-pocket for the service.
To bill the patient, the patient should be provided written notice. Known as the Advanced Beneficiary Notice of Noncoverage (ABN), this written notice will allow the patient to make an informed decision about whether to get the service and accept responsibility to pay for it out of pocket if Medicare does not pay. The ABN should list the following:
- Description of the Item or service
- Reasons why Medicare may not pay
- Estimated costs for the item or service
Not obtaining proper patient consent can terminate the physician’s right to bill the patient for non-covered services and could be regarded as a violation of the applicable payer agreement.
It is not necessary to notify a patient before providing a service that is not a Medicare benefit or in the list of Medicare’s non-covered services. In such cases, the physician can provide the patient with an ABN or other written informed notice of non-coverage as a matter of courtesy, to alert the patient that he or she will be financially liable for the services (www.rhematologyadvisor.com). Appropriate modifiers should be appended on claims to the patient for non-covered procedures and to support compliance reporting.
Comprehending and working within the guidelines of payers can be complex. Outsourcing medical billing to an experienced service provider can make this easier. Medical billing experts would be knowledgeable about and up-to-date with the rules of billing patients for services that payers do not cover and can help physicians collect payment for these non-covered services.