Chapter 11: CMS-1500 and UB-04 Claims

Providers that submit the UB-04 claim (or UB-04 data elements in EDI format) include the following:

-Ambulance companies -Ambulatory surgery centers -Home health care agencies -Hospice organizations -Hospitals (emergency department, inpatient, and outpatient services) -Psychiatric drug/alcohol treatment facilities (inpatient and outpatient services) -Skilled nursing facilities -Subacute facilities -Rural health clinics -Stand-alone clinical/laboratory facilities -Walk-in clinics

HIPAA mandated the adoption of standard unique identifiers to improve the efficiency and effectiveness of the electronic transmission of health information for:

-Employers: national standard employer identifier number (EIN) -Health care providers: national provider identifier (NPI) -Individuals: national individual identifier (has been placed on hold)

After the CMS-1500 claim has been completed, check for these common errors:

1. Keyboarding errors or incorrectly entered information, as follows: -Procedure code number -Diagnosis code number -Policy identification numbers -Dates of service -Federal employer tax ID number (EIN) -Total amount due on a claim -Incomplete or incorrect name of the patient or policyholder (name must match the name on the policy; no nicknames) 2. Omission of the following: -Current diagnosis (because of failure to change the patient's default diagnosis in the computer program) -Required fourth-, fifth-, sixth-, and/or seventh-characters for ICD-10-CM -Procedure service dates -Hospital admission and/or discharge dates -Name and NPI of the referring provider -Required prior treatment authorization numbers -Units of service 3. Attachments without patient and policy identification information on each page. 4. Failure to properly align the claim form in the printer to ensure that each item fits within the proper field on the claim. 5. Handwritten items or messages on the claim other than required signatures. 6. Failure to properly link each procedure with the correct diagnosis (Block 24E). *Because the first character of each ICD-10-CM code is alphabetical and the letters I and O are used, carefully enter ICD-10-CM I and O codes (so that the number 1 and 0 are not mistakenly entered as the first characters).*

Supervising Physician

A supervising physician is a licensed physician in good standing who, according to state regulations, engages in the direct supervision of a nonphysician practitioner whose duties are encompassed by the supervising physician's scope of practice. A supervising physician is not required to be physically present in the patient's treatment room when services are provided; however, the supervising physician must be present in the office suite or facility to render assistance, if necessary.

National Provider Identifier (NPI)

A unique 10-digit number issued to individual providers (e.g., physicians, dentists, pharmacists) and health care organizations (e.g., group physician practices, hospitals, nursing facilities). Even if an individual provider moves, changes specialty, or changes practices, the provider will keep the same NPI (but most notify CMS to supply the new information). The NPI issued to a health care organization is also permanent except in rare situations when a health care provider does not wish to continue an associate with a previously used NPI. If an NPI is used fraudulently by another, a new NPI will be issued to the individual provider or health care organization affected.

CMS-1500 Block 24B - Place of Service

All payers require entry of a place of service (POS) code on the CMS-1500 claim. The POS code reported must be consistent with the CPT procedure/service code description, and it will be one or two digits, depending on the payer. When third-party payers and government programs (e.g., Medicaid) audit submitted claims, they require evidence of documentation in the patient's record about encounters and inpatient hospital visits. It is recommended that when a provider submits a claim for inpatient visits, a copy of hospital documentation (e.g., progress notes) supporting the visits be filled in the office patient record. Without such documentation, payers and government programs deny reimbursement for the visits.

When a procedure is performed more than once a day, enter the appropriate modifier(s) and consider submitting supporting documentation with the claim. Rules to follow when reporting multiple days/units include:

Anesthesia time Report elapsed time as one unit for each 15 minutes (or fraction thereof) of anesthesia time. Convert hours to minutes, first. Ex: Elapsed time 3 hours and 15 minutes, reported as 13 units (195 minutes divided by 15 minutes equals 13). Multiple procedures Enter the procedure code that will be reimbursed highest first, and then enter secondary procedure codes in descending order of charges. Enter a "1" in the units column for each procedure entered. Then enter any required modifiers to the secondary procedures (e.g., modifier 51 for multiple procedures). Inclusive dates of similar services Report the number of days indicated in the From and To blocks (CMS-1500 claim Block 24A); the number of days is reported in CMS-1500 claim Block 24G. Ex: The physician treated Mr. Greenstalk on 01/02 through 01/04 and performed a detailed inpatient subsequent exam each day. The same E/M code is reported on one line in Block 24 and a 3 is entered as units in Block 24G. Radiology services Enter a number greater than "1" when the same radiology study is performed more than once on the same day. Do not report the number of x-ray views taken for a specific study. Ex: 71048 Chest, four views Enter 1 in Block 24G of the CMS-1500 claim. The 1 is populated in Form Locator 46 of the UB-04 claim.

Reporting Diagnoses: ICD-10-CM Codes (Block 21 and UB-04)

Block 21 (CMS-1500) For CMS-1500 claims, diagnosis codes (without decimal points) are entered in Block 21 of the claim. A maximum of 12 ICD-10-CM codes may be entered on a single claim. In the ICD Ind (ICD indicator) box, enter 0 for ICD-10-CM. Do not use decimal points when entering ICD-10-CM codes for either CMS-1500 or UB-04 claims. If more than 12 diagnoses are required to justify the procedures and/or services on a claim, generate additional claims. In such cases, be sure that the diagnoses justify the medical necessity for performing the procedures/services reported on each claim. Diagnoses must be documented in the patient's record to validate medical necessity of procedures or services billed. UB-04 For the UB-04, ICD-10-CM diagnosis codes are populated without the decimal in Form Locators 66, 69, 70, 71, and 72. (ICD-10-PCS codes that are populated in Form Locator 74 do not contain decimals.) *Coders should be aware that some chronic conditions always affect patient care because they require medical management and should, therefore, be coded and reported on the CMS-1500 claim. Examples include diabetes mellitus and hypertension.*

Medically Unlikely Edits (MUE) Project

CMS implemented the medically unlikely edits (MUE) project as part of the NCCI to improve the accuracy of Medicare payments by detecting and denying unlikely Medicare claims on a prepayment basis. The project is CMS's response to the May 2006 Office of Inspector General (OIG) report, entitled Excessive Payments for Outpatient Services Processed by Mutual of Omaha, which reported errors due to inappropriate units of service, accounting for $2.8 million in outpatient service overpayments from one third-party payer. The OIG determined that the payer made these overpayments because sufficient edits were not in place to detect billing errors related to units of service. The following examples illustrate ways providers overstated the units of service on individual claims: -A provider billed 10,001 units of service for 1 CT scan as the result of a typing error. The payer was overpaid approximately $958,000. -A provider billed 141 units of service (the number of minutes in the operating room) for 1 shoulder arthroscopy procedure. The payer was overpaid approximately $97,000. -A provider billed 8 units of service (the number of 15-minute time increments in the operating room) for 1 cochlear implant procedure. The payer was overpaid approximately $67,000. MUEs are used to compare units of service with code numbers as reported on submitted claims: -CMS-1500: Block 24G (units of service) is compared with Block 24D (code number) on the same line. -UB-04: Form Locator 46 (service units) is compared with Form Locator 44 (HCPCS/RATE/HIPPS CODE).

Days or Units

CMS-1500 Block 24F contains charges for services or procedures, and Block 24G requires reporting of the number of encounters, units of service or supplies, amount of drug injected, and so on, for the procedure reported on the same line in Block 24D. Block 24G has room for only three digits. When entering charges in Block 24F, when 2 or greater is entered in Block 24G (as days or units), add together the charges for all units on that line. For example, if a service is $45 and Block 24G contains 2, enter $90 in Block 24F. Then, the total charge entered in Block 28 is calculated by adding together charges on each line of Block 24F. UB-04 claim Form Locator 46 requires reporting the number of service units. The most common number entered is "1" to represent the delivery of a single procedure/service. The entry of a number greater than "1" is required if identical procedures are reported on the same line. Do not confuse the number of units assigned on one line with the number of days the patient is in the hospital. Example: The patient is in the hospital for three days following an open cholecystectomy. The number of units assigned to the line reporting the surgery code is "1" (only one cholecystectomy was performed).

National Standard Employer Identifier

CMS-1500 claim Block 25 requires entry of either the provider's Social Security Number (SSN) or the employer tax identification number (EIN). If completing claims for a group practice, enter the practice's EIN in this block. Do not enter a hyphen or spaces. If the EIN is unavailable, enter the provider's SSN. Reporting correct EIN and/or SSN information is crucial because payers report reimbursement to the Internal Revenue Service (IRS) according to EIN or SSN.

Reporting the Billing Entity

CMS-1500 claim Block 33 requires entry of the name, address (including nine-digit zip code with the hyphen), and telephone number of the billing entity. The billing entity is the legal business name of the practice (e.g., Goodmedicine Clinic). In the case of a solo practitioner, the name of the practice may be entered as the name of the physician followed by initials the designate how the practice is incorporated (e.g., Irvin M. Gooddoc, M.D., PA). The phone number, including area code, should be entered on the same line as the printed works "& PH #." Below this line is a blank space for a three-line billing entity mailing address. The last line of CMS-1500 claim Block 33 is for entering the provider and/or group practice national provider number (NPI).

General Claims Information

CMS-1500 claims for professional services and UB-04 claims for institutional services are submitted for reimbursement according to the payment system established for each type of provider (e.g., physician fee-for-service payment, inpatient prospective payment system). The reverse of the CMS-1500 claim contains special instructions for government programs. Claims are submitted electronically to a third-party clearinghouse or payer using a computer with software that meets electronic filling requirements as established by the Health Insurance Portability and Accountability Act (HIPAA) claim standard. The claim is electronically transmitted as data packets. Upon receipt of data packets, a series of edits is conducted to determine whether claims meet basic requirements of the HIPAA administrative simplification standard. Any errors detected at this level result in rejection of the entire data packet. Claims in a data packet that pass initial edits are next edited against HIPAA claim standards implementation guide requirements. After the data packet passes the first two levels of edits, each claim is reviewed for compliance with coverage and payment policy requirements. Rejected data packets and individual claims are returned to the submitted (e.g., provider, billing company, clearinghouse) for correction and resubmission. Rejected or denied claims that are not compliant with coverage and payment policy requirements include errors that need to be corrected or reasons for denials. (Denied claims may initiate the appeals process.) Upon successful transmission, an acknowledgement report is generated and transmitted to the submitter of each claim. Electronic claims must meet requirements adopted as the national standard under HIPAA, which include the following: ANSI ASC X12N 837P (837P), ANSI ASC X12N 837I (837I), and National Council for Prescription Drug Programs (NCPCP) Telecommunication Standard. (Requirements are mandated for government claims, and many third-party payers have also adopted them.)

CMS-1500 Block 24D - Procedures and Services

CPT and HCPCS level II procedure and service codes and modifiers are reported in CMS-1500 Claim Block 24D. Below the heading in claim Block 24D is a parenthetical instruction that says (Explain Unusual Circumstances), which allows for entry of documentation from the patient's record. Do not report procedure and/or service codes if no fee was charged. When reporting more than one CPT Surgery code on a CMS-1500 claim, enter the code with the highest fee in line 1 of Block 24, and then enter additional codes (and modifiers) in descending order of charges. Be sure to completely enter data on each horizontal line before beginning to enter data on another line. Identical procedures or services can be reported on the same line if the following circumstances apply: -Procedures were performed on consecutive days in the same month. -The same code is assigned to the procedures/services reported. -Identical charges apply to the assigned code. -Block 24G (Days or Units) is completed.

CMS-1500 Block 24C - EMG

Check with the payer for their definition of emergency (EMG) treatment. If the payer requires completion of CMS-1500 claim Block 24C, and EMG treatment was provided, enter a Y. Otherwise, leave blank.

CMS-1500 Data Entry

Data entry for CMS-1500 claims includes requirements about the following: -Entering patient and policyholder names, provider names, and mailing addresses and telephone numbers. -Recovery of funds from responsible payers. -National provider identifier (NPI) and National standard employer identifier (EIN). -Assignment of benefits versus accept assignment. -Reporting ICD-10-CM diagnosis codes and HCPCS level II and CPT codes. -Reporting the billing entity. -All data entered on the claim must fit within the borders of the data field (X fits in the box). -Enter all alpha characters in uppercase (capital letters). -Do not enter the alpha character "O" for a zero (0). -Enter a space between the CPT or HCPCS code and its modifier (instead of a hyphen). If multiple modifiers are reported enter one space between each modifier. -Do not enter hyphens or spaces in the social security number, employer identification number (EIN), or national provider identifier (NPI). -Enter commas between the patient or policyholder's last name, first name, and middle initial. -Do not use punctuation in a patient's or policyholder's name, except for a hyphen in a compound name (GARDNER-BEY). -Do not enter a person's title or other designations, such as Sr., Jr., II, or III, unless printed on the patient's insurance ID card. -For CMS-1500 claims, enter two zeros in the cents column when a fee or a monetary total is expressed in whole dollars. Do not enter any leading zeros in front of the dollar amount. (Six dollars is entered as 6 00. Six thousand dollars is entered as 6000 00). -For CMS-1500 claims, birth dates are entered as eight digits with spaces between the digits representing the month, day, and the four-digit year (MM DD YYYY). CMS-1500 blocks 24A (MM DD YYYY) and 31 (MMDDYYYY) require entry of dates in a different format. Care should be taken to ensure that none of the digits fall on the vertical separations within the block. For UB-04 claims, birth dates are entered as eight digits WITHOUT spaces (MMDDYYYY). -For CMS-1500 claims, Block 3 requires entry of an X in the appropriate box, M (male) or F (female) to designate the patient's gender. For UB-04 claims, the patient's gender requires entry of the letter M or F in Form Locator 11; some third-party payers also allow the letter U (unknown) to be entered. (Medicare Code Editor software contains listings of male- and female-related diagnosis and procedure codes and corresponding text descriptions, and inconsistencies between a patient's gender and a diagnosis or procedure reported on the UB-04 result in claims denials. For example, a claim submitted for a male patient with cervical cancer as a diagnosis or hysterectomy as a procedure will be denied.) -For CMS-1500 claims, the third-party payer block is located from the upper center to the right margin of the form. Do not use punctuation or other symbols in the address. When entering a nine-digit zip code, include the hyphen (e.g., 12345-6789). For the UB-04 claim, Form Locator 80 populates third-party payer information. Line 1 - Name of third-party payer Line 2 - First line of address Line 3 - Second line of address, if necessary; otherwise, leave blank Line 4 - City, state (2 characters), and nine-digit zip code that include the hyphen. -For the CMS-1500 claim, list only one procedure per line, starting with line one of Block 24. (To report more than six procedures or services for the same date of service, generate a new CMS-1500 claim.) The UB-04 claim allows 22 procedures or services to be entered for the same date(s) of service in Form Locator 42.

Enter a valid four-digit TOB classification number.

Digit 1: Leading Zero Digit 2: Type of Facility 1 Hospital 2 Skilled nursing 3 Home health (includes HH PPS claims, for which CMS determines whether services are paid from the Medicare Part A or Part B) 4 Religious nonmedical (hospital) 5 Reserved for national assignment (discontinued 10/1/05) 6 Intermediate care 7 Clinic or hospital-based renal dialysis facility (requires assignment of special information as Digit 3 below) 8 Special facility or hospital ASC surgery (requires assignment of special information as Digit 3 below) 9 Reserved for national assignment Digit 3: Bill Classification, Except Clinics and Special Facilities 1 Inpatient (Medicare Part A) 2 Inpatient (Medicare Part B) 3 Outpatient 4 Other (Medicare Part B) 5 Intermediate Care-Level I 6 Intermediate Care-Level II 7 Reserved for national assignment (discontinued 10/1/05) 8 Swing bed 9 Reserved for national assignment Digit 3 (Clinics Only) 1 Rural health clinic (RHC) 2 Hospital-based or independent renal dialysis facility 3 Freestanding provider-based federally qualified health center (FQHC) 4 Other rehabilitation facility (ORF) 5 Comprehensive outpatient rehabilitation facility (CORF) 6 Community mental health center (CMHC) 7-8 Reserved for national assignment 9 Other Digit 3 (Special Facilities Only) 1 Hospice (non-hospital-based) 2 Hospice (hospital-based) 3 Ambulatory surgical center services to hospital outpatients 4 Freestanding birthing center 5 Critical access hospital 6-8 Reserved for national assignment 9 Other Digit 4 (Frequency-Definition) A Admission/election notice (hospice or religious nonmedical health care institution) B Termination/revocation notice (hospice/Medicare coordinated care demonstration or religious nonmedical health care institution) C Change of provider notice (hospice) D Health care institution void/cancel notice (hospice) E Change of ownership (hospice) F Beneficiary initiated adjustment claim G Common working file (CWF) initiated adjustment claim H CMS initiated adjustment claim I Internal adjustment claim (other than QIO or provider) J Initiated adjustment claim (other entities) K OIG initiated adjustment claim M Medicare as secondary payer (MSP) initiated adjustment claim P Quality improvement organization (QIO) adjustment claim Q Claim submitted for reconsideration/reopening outside of timely filing 0 Nonpayment/zero claims provider 1 Admit through discharge claim 2 Interim-first claim 3 Interim-continuing claim(s) 4 Interim-last claim 5 Late charge only (There is no code 6) 7 Replacement of prior claim 8 Void/cancel of a prior claim 9 Final claim for HH PPS episode Sample Bill Type Codes 011X Hospital Inpatient (Medicare Part A) 012X Hospital Inpatient (Medicare Part B) 013X Hospital outpatient 014X Hospital other (Medicare Part B) 018X Hospital swing bed 021X SNF inpatient 022X SNF inpatient (Medicare Part B) 023X SNF outpatient 028X SNF swing bed 032X Home health 033X Home health 034X Home health (Medicare Part B only) 041X Religious nonmedical health care institutions 071X Clinical rural health 072X Clinic ESRD 073X Federally qualified health centers 074X Clinic outpatient physical therapy (OPT) 075X Clinic CORF 076X Community mental health centers 081X Non-hospital-based hospice 082X Hospital-based hospice 083X Hospital outpatient (ASC) 085X Critical access hospital

FL6: Statement covers period (from-through) (REQUIRED)

Enter beginning and ending dates of the period included on this bill as MMDDYYYY.

FL47: Total charges (REQUIRED)

Enter charges for procedures/services reported as revenue codes (FL42) on each line. Be sure to consider the units of service (FL46) in your calculations. Enter the sum of all charges reported on the last line (same line as revenue code 0001).

FL42: Revenue code(s) (REQUIRED)

Enter four-character revenue code(s) to identify accommodation and/or ancillary charges. Revenue codes entered in FL42 explain charges entered in FL47. They are entered in ascending numeric sequence, and do not repeat on the same bill. (Sample revenue codes listed below.) 010X All-inclusive rate (e.g., 0100, 0101) 0 All-inclusive room and board plus ancillary 1 All-inclusive room and board For a comprehensive list of revenue codes, refer to Chapter 25 of the Medicare Claims Processing Manual

FL45: Service date (REQUIRED FOR OUTPATIENT CLAIMS)

Enter line item dates of service, including claims where "from" and "through" dates are the same for outpatient claims.

FL48: Noncovered charges (SITUATIONAL)

Enter noncovered charge(s) (e.g., copayment, day after active care ended) if related revenue codes were entered in FL42. (Do not enter negative charges.)

FL15: Point of origin for admission or visit (REQUIRED)

Enter one-digit source of admission or visit code: 1 Physician referral 2 Clinic referral 3 Managed care plan referral 4 Transfer from a hospital 5 Transfer from a skilled nursing facility 6 Transfer from another health care facility 7 Emergency room 8 Court/law enforcement 9 Information not available A Transfer from a critical access hospital B Transfer from another home health agency C Readmission to same home health agency D Transfer from hospital inpatient in the same facility resulting in a separate claim to the payer E-Z Reserved for national assignment

FL14: Type of admission/visit (REQUIRED FOR INPATIENT CLAIMS)

Enter one-digit type of admission/visit code: 1 Emergency 2 Urgent 3 Elective 4 Newborn 5 Trauma center 6-8 Reserved for national assignment 9 Information not available

FL8b: Patient name (REQUIRED)

Enter patient's last name, first name, and middle initial (if any). Use a comma to separate the names. When the patient's last name contains a prefix, do not enter a space after the prefix (e.g., VonSchmidt). When the patient's name contains a suffix, enter as LastName Suffix, FirstName (e.g., Smith III, James).

FL13: Admission hour (SITUATIONAL)

Enter the admission hour using military time (e.g., 03 for admission hour of 3:00 through 3:59am), if required by the payer.

FL3a: Patient control number (unique claim number) (REQUIRED)

Enter the alphanumeric control number if assigned by the provider and needed to facilitate retrieval of patient financial records and for posting payments.

FL16: Discharge hour (SITUATIONAL)

Enter the discharge hour using military time (e.g., 03 for admission hour of 3:00 though 3:59am), if required by the payer.

FL5: Federal tax number (REQUIRED)

Enter the facility's federal tax identification number in 00-0000000 format.

FL12: Admission start of care date (REQUIRED for inpatient and home health)

Enter the inpatient date of admission (or home health start-of-care date) as MMDDYYYY.

FL3b: Medical/health record number (SITUATIONAL)

Enter the medical record number if assigned by the provider and needed to facilitate the retrieval of patient records. Otherwise, leave blank.

FL50A-C: Payer name (REQUIRED)

Enter the name of the health insurance payer as follows: Line A (Primary Payer) Line B (Secondary Payer) Line C (Tertiary Payer)

FL43: Revenue description (NOT REQUIRED)

Enter the narrative description (or standard abbreviation) for each revenue code, reported in FL42, on the adjacent line in FL43. (This information assists clerical bill review by the facility/provider and payer.)

FL46: Service units (SITUATIONAL)

Enter the number of units that quantify services reported as revenue codes (FL42) (e.g., number of days for type of accommodations, number of pints of blood), if required by the payer. When HCPCS codes are reported for procedures/services, units equal the number of times the procedure/service reported was performed.

FL31-34: Occurrence code(s) and date(s) (SITUATIONAL)

Enter the occurrence code(s) and associated date(s) (MMDDYYYY) to report specific event(s) related to this billing period if condition code(s) were entered in FL18-28. Otherwise, leave blank. (Sample of occurrence codes listed below.) 01 = Accident/medical coverage 02 = No Fault Insurance Involved 03 = Accident/Tort Liability 04 = Accident Employment Related 05 = Accident No Medical/Liability Coverage 06 = Crime Victim For a comprehensive list of occurrence codes, refer to Chapter 25 of the Medicare Claims Processing Manual

FL35-36: Occurrence span code and dates (SITUATIONAL FOR INPATIENT CLAIMS)

Enter the occurrence span code(s) and beginning/ending dates defining a specific event relating to this billing period as MMDDYYYY for inpatient claims. (Sample of occurrence span codes listed below.) 70 Qualifying stay dates (Medicare Part A SNF level of care only) or non-utilization dates (for payer use on hospital bills only) 71 Hospital prior stay dates 72 First/last visit (occurring in this billing period where these dates are different from those in FL6) 74 Noncovered level of care 75 SNF level of care For a comprehensive list of occurrence span codes, refer to Chapter 25 of the Medicare Claims Processing Manual.

FL10: Patient birth date (REQUIRED)

Enter the patient's date of birth as MMDDYYYY. If birth date is unknown, enter zeros for all eight digits.

FL11: Patient sex (REQUIRED)

Enter the patient's gender as a one-character letter: M F

FL8a: Patient identifier (SITUATIONAL)

Enter the patient's payer identification (ID) number, which is the subscriber/insured ID number entered in FL60.

FL9a-e: Patient address (REQUIRED)

Enter the patient's street address in 9a. Enter the patient's city in 9b. Enter the patient's state in 9c. Enter the patient's five- or nine-digit zip code in 9d. Enter the patient's country code if the patient resides outside of the United States in 9e.

FL2: Billing provider's pay-to address (SITUATIONAL)

Enter the provider name, address, city, state, zip code, and identification number if the pay-to name and address information is different from the billing provider information in FL1. Otherwise, leave blank.

FL1: Billing provider name, address, and telephone number (REQUIRED)

Enter the provider name, city, state, zip code, telephone number, fax number, and country code. Either the provider's post office box number or street name and number may be included. The state can be abbreviated using standard post office abbreviations, and five- or nine-digit zip codes are acceptable. Payer compares FL1 information to data on file for provider number reported in FL51 (to verify provider identity).

FL38: Responsible party name and address (SITUATIONAL)

Enter the responsible part name and address, if required by the payer. Enter the responsible party last name, first name, and middle initial (if any). Use a comma to separate names. Enter the responsible party street address, city, state, and zip code.

FL29: Accident State (SITUATIONAL)

Enter the state (e.g., NY) in which an accident occurred, if required by the payer.

FL18-28: Condition codes (SITUATIONAL, including submission of adjusted and reopened claims)

Enter the two-digit code (in numerical order) that describes any of the following conditions or events that apply to this billing period, if required by the payer. Otherwise, leave blank. (Sample of condition codes listed below.) 02 Condition is employement-related 03 Patient covered by insurance not reflected here 04 Information only bill 05 Lien has been filed For a comprehensive list of condition codes, refer to Chapter 25 of the Medicare Claims Processing Manual

FL39-41: Value codes and amounts (REQUIRED)

Enter two-character value code(s) and dollar/unit amount(s). Codes and related dollar or unit amounts identify data of a monetary nature necessary for processing the claim. Negative amounts are not allowed, except in FL41. If more than one value code is entered for the same billing period, enter in ascending numeric sequence. Lines "a" through "d" allow for entry of up to four lines of data. Enter data in FL39a through FL41a before FL39b and FL41b, and so on. Codes used for Medicare claims are available from Medicare contractors. (Sample of value codes listed below.) 01 = Most common semi-private rooms 02 = Provider has no semi-private rooms 08 = Lifetime reserve amount in the first calendar year 45 = Accident hour 50 = Physical therapy visit A1 = Inpatient deductible Part A A2 = Inpatient coinsurance Part A A3 = Estimated responsibility Part A B1 = Outpatient deductible B2 = Outpatient coinsurance

FL17: Patient discharge status (REQUIRED)

Enter two-digit patient discharge status code: 01 Discharged to home or self-care (routine discharge) 02 Discharged/transferred to a short-term general hospital for inpatient care 03 Discharged/transferred to SNF with Medicare certification in anticipation of covered skilled care (effective 2/23/05) 04 Discharged/transferred to an intermediate care facility (ICF) 05 Discharged/transferred to another type of institution not defined elsewhere in this code list (effective 2/23/05)( (e.g., cancer hospitals excluded from Medicare PPS and children's hospitals) 06 Discharged/transferred to home under care of organized home health service organization in anticipation of covered skills care (effective 2/23/05) 07 Left against medical advice or discontinued care 08 Reserved for national assignment 09 Admitted as an inpatient to this hospital For inpatient status code 09, in situations where a patient is admitted before midnight of the third day following the day of an outpatient diagnostic service or service related to the reason for the admission, the outpatient services are considered inpatient. Therefore, code 09 would apply only to services that began longer than three days earlier or were unrelated to the reason for admission, such as observation following outpatient surgery, which results in admission. 10-19 Reserved for national assignment 21 Expired (or did not recover-religious nonmedical health care patient) Discharged/transferred to court/law enforcement 22-29 Reserved for national assignment 30 Still patient or expected to return for outpatient services 31-39 Reserved for national assignment 40 Expired at home (Hospice claims only) 41 Expired in a medical facility (e.g., hospital, SNF, ICF, or freestanding hospice) (Hospice claims only) 42 Expired-place unknown (Hospice claims only) 43 Discharged/transferred to a federal health care facility (effective 10/1/03) (e.g., Department of Defense hospital, Veteran's Administration hospital) 44-49 Reserved for national assignment 50 Discharged/transferred to hospice (home) 51 Discharged/transferred to hospice (medical facility) 52-60 Reserved for national assignment 61 Discharged/transferred within this institution to a hospital-based Medicare-approved swing bed 62 Discharged/transferred to an inpatient rehabilitation facility including distinct parts/units of a hospital 63 Discharged/transferred to long-term care hospital 64 Discharged/transferred to a nursing facility certified under Medicaid but not certified under Medicare 65 Discharged/transferred to a psychiatric hospital or psychiatric distinct part/unit of a hospital 66 Discharged/transferred to a critical access hospital (effective 1/1/06) 67-99 Reserved for national assignment

Insurance File Set-Up

Files should be organized in the following manner: 1. File open assigned cases by month and payer. (These claims have been sent to the payer, but processing is not complete.) 2. File closed assigned cases by year and payer. 3. File batched remittance advice notices. 4. File unassigned or nonparticipating claims by year and payer.

Recovery of Funds from Responsible Payers

For CMS-1500 claims, payers flag claims for investigation when an X is entered in one or more of the YES boxes in Block 10 of the CMS-1500 claim. For CMS-1500 and UB-04 claims, when an ICD-10-CM code begins with the letter V, W, X, or Y is reported in Block 21, payers also flag claims for review. Such an entry indicates that payment might be the responsibility of a workers' compensation payer; automobile insurance company; or homeowners, business, or other liability policy insurance company. Some payers reimburse the claim and outsource (to a vendor that specializes in "backend recovery") the pursuit of funds from the appropriate payer. Other payers deny payment until the provider submits documentation to support reimbursement processing by the payer (e.g., remittance advice from workers' compensation or other liability payer denying the claim). For the CMS-1500 claim, entering an X in any of the YES boxes in Block 10 of the form alerts the commercial payer that another insurance company might be liable for payment. The commercial payer will not consider the claim unless the provider submits a remittance advice from the liable party (e.g., automobile policy) indicating that the claim was denied. For employment-related conditions, another option is to attach a letter from the workers' compensation payer that documents rejection of payment for an on-the-job injury.

Practices that Bill "Incident To"

For CMS-1500 claims, when a nonphysician practitioner (NPP) in a group practice bills incident-to a physician, but that physician is out of the office on the day the NPP provides services to the patient, another physician in the same group can provide direct supervision to meet the incident-to requirements. For the CMS-1500 claim, when incident-to services are reported, the following entries are made: -Enter the ordering physician's name in Block 17 (note the supervising physician's name). (An ordering provider is a physician or NPP who orders services for the patient.) -Enter the applicable qualifier (in the space preceding the name) to identify which provider is being reported. *DN (referring provider) *DK (ordering provider) *DQ (supervising physician) -Enter the ordering physician's NPI in Block 17b. -Enter the supervising physician's NPI in block 24J. -Enter the supervising physician's name (or signature) in Block 31.

FL44: HCPCS/Rates/HIPPS Rate Codes (REQUIRED if applicable)

For outpatient claims, enter the HCPCS (CPT and/or HCPCS level II) code that describes outpatient services or procedures. Modifiers are separated by spaces after the HCPCS code. For inpatient claims, enter the accommodation rate. For SNF claims, enter the Health Insurance Prospective Payment System (HIPPS) rate code and the two-character assessment indicator (AI) to specify the type of assessment.

Assignment of Benefits vs. Accept Assignment

For the CMS-1500 claim, an area of confusion for health insurance specialists is differentiating between assignment of benefits and accept assignment. Patients sign Block 13 of the CMS-1500 claim to instruct the payer to directly reimburse the provider. This is called assignment of benefits. If the patient does not sign Block 13, the payer sends reimbursement to the patient and the patient is then responsible for reimbursing the provider. When the YES box in Block 27 contains an X, the provider agrees to accept as payment in full whatever the payer reimburses. This is called accept assignment. The provider can still collect deductible, copayment, and coinsurance amounts from the patient. If the NO box in Block 27 contains an X, the provider does not accept assignment. The provider can bill the patient for the amount not paid by the payer.

Entering Mailing Addresses

For the CMS-1500 claim, when entering a patient's and/or policyholder's (Blocks 5 and 7) mailing address, enter the street address on line 1. Enter the city and state on line 2. Enter the five- or nine-digit zip code on line 3 (because the patient's four digit extender for the zip code might be unknown). (Do not enter telephone numbers in Blocks 5 and 7 of the CMS-1500 because they are not included on electronic claims. If workers' compensation or another payer does require the telephone number, enter it without a hyphen or space.) For the UB-04 claim, the patient's address is populated in FLs 9a though 9e (with 9e populated with the four-digit zip code extension, if available). When the address in Blocks 5 and 7 of the CMS-1500 are identical, leave Block 7 blank. The patient's address refers to the patient's permanent residence. Do not enter a temporary address or a school address. For the CMS-1500 claim, when entering a provider's name, mailing address, and telephone number (Block 33), enter the provider's name on line 1, enter the provider's billing address on line 2, and enter the provider's city, state, and nine-digit zip code (including the hyphen) on line 3. Enter the telephone number in the area next to the Block title. For the UB-04 claim, the institution's name, address, and telephone number are populated in Form Locators 1 and 2. -Do not enter commas, periods, or other punctuation in the address.

Entering Provider Names

For the CMS-1500 claim, when entering the name of a provider, enter the first name, middle initial (if known), last name, and credentials (e.g., MARY SMITH MD). Do not enter any punctuation. The the CMS-1500 claim, enter SIGNATURE ON FILE or SOF for electronic claims transmissions if a certification letter is filed with the payer; the date is entered as MMDDYYYY (without spaces). For the UB-04 claim, the provider's name is populated in Form Locator 70 (with the NPI).

Entering Patient and Policyholder Names

For the CMS-1500 claim, when entering the patient's name in Block 2 and the policyholder's name in Block 4, separate the last name, first name, and middle initial with commas (e.g., DOE, JOHN, S). For UB-04 claims, when entering the patient's name in Form Locator 8 and the policyholder's name in Form Locator 58, separate the last name, first name, and middle initial with a space (e.g., DOE JOHN S). When the patient is the policyholder, enter the name in Blocks 2 and 4 (CMS-1500) and Form Locators 8 and 58 (UB-04).

ICD-10-CM external causes of morbidity

In ICD-10-CM, the majority of codes assigned to external causes of morbidity are located in Chapter 20. Other conditions stated as due to external causes are also classified elsewhere in ICD-10-CM's Chapters 1-22. For these other conditions, ICD-10-CM codes from Chapter 20 are also reported to provide additional information regarding external causes of the condition (e.g., place of occurrence).

UB-04 Claim Development and Implementation

Institutional and other selected providers submit UB-04 (CMS-1450) claim data to payers for reimbursement of patient services. The National Billing Committee (NUBC) is responsible for developing data elements reported on the UB-04 in cooperation with State Uniform Billing Committees (SUBCs).

ANSI ASC X12N 837P (837P)

Is the standard format used for submission of electronic claims for professional health care services. Professional providers include physicians and suppliers. A supplier is a physician or other health care practitioner or an entity other than a provider that furnishes health care services. Physicians submit Medicare claims to Medicare administrative contractors (MACs) (sometimes called carriers). Durable medical equipment (DME) suppliers submit Medicare claims to a DMEMAC.

FL30: Unlabeled (NOT USED)

Leave blank.

FL37: Untitled (NOT USED)

Leave blank.

FL49: Untitled (NOT USED)

Leave blank.

FL7: Unlabeled (NOT USED)

Leave blank.

National Uniform Billing Committee (NUBC)

Like the role of the National Uniform Claims Committee (NUCC) in the development of the CMS-1500 claim, the National Uniform Billing Committee (NUBC) is responsible for identifying and revising data elements (information entered into UB-04 form locators or submitted by institutions using electronic data interchange). (The claim was originally designed as the first uniform bill and called the UB-82 because of its 1982 implementation date. Then, the UB-92 was implemented in 1992.) The current claim is called UB-04 because it was developed in 2004 (although it was implemented in 2007). UB-04 revisions emphasized clarification of definitions for data elements and codes to eliminate ambiguity and to create consistency. The UB-04 also addressed emergency department (ED) coding and data collection issues to respond to concerns of state public health reporting systems. The NUBC continues to emphasize the need for data sources to continue to support public health data reporting needs.

Maintaining CMS-1500 Insurance Claim Files for the Medical Practice

Medicare Conditions of Participation (CoP) require providers to keep copies of any government insurance claims and copies of all attachments filed by the provider for a period of five years, unless state law specifies a longer period. "Providers and billing services filing claims electronically can comply with the federal regulation by retaining the source documents (routing slip, charge slip, encounter form, superbill) from which they generated the claim and the daily summary of claims transmitted and received for" these years. Although there are no specific laws covering retention of commercial or BlueCross BlueShield claims, health care provider contracts with specific insurance carriers may stipulate a specific time frame for all participating providers. It is good business practice to keep these claims until you are sure all transactions have been completed.

Reporting Diagnoses: ICD-10-CM Codes (multiple codes & accurate coding)

Sequencing Multiple Diagnoses For CMS-1500 claims, the first-listed code reported is the major reason the patient was treated by the health care provider. For the UB-04 claim, the principal diagnosis code is that condition, established after study, which was chiefly responsible for occasioning the patient's inpatient admission to the hospital. Secondary diagnoses codes are also entered and should be included on the claim only if they are necessary to justify procedures/services reported. Do not enter any diagnoses stated in the patient record that were not treated or medically managed (e.g., existing diagnosis that impacts treatment of a new diagnosis) during the encounter. Be sure code numbers are placed within the designated field on the claim. Accurate Coding For physician office and outpatient claims processing, never report a code for uncertain diagnoses, which include such terms as "rule out," "suspicious for," "probable," "ruled out," "possible," or "questionable." Instead, enter ICD-10-CM codes for the patient's sings or symptoms. For inpatient hospitalizations, it is acceptable to report codes for uncertain diagnoses when a definitive diagnosis has not been established. Be sure all diagnosis codes are reported to the highest degree of specificity known at the time of the treatment. If the computerized billing system displays a default diagnosis code (e.g., condition last treated) when entering a patient's claim information, determine if the code validates the current procedures/services reported. It may frequently be necessary to edit this code because, although the diagnosis may still be present, it may not have been treated or medically managed during the encounter.

CMS-1500 Block 24-Shaded Lines

Shaded rows were added to Block 24 because input from the health insurance industry indicated a need to report supplemental information about services reported, specifically in shaded Blocks 24A-24G. Supplemental information is entered on the shaded row above its corresponding service line. (Shaded rows are not intended to allow billing of 12 lines of service). The six service lines in Block 24 were also divided horizontally to accommodate entry of the NPI and another (e.g., proprietary) identifier. If another identifier is entered in shaded Block 24J, a corresponding identifying qualifier (e.g., G2 for commercial payer-assigned identifying number) is entered in Block 24I. The NPI is entered in unshaded Block 24J, and the other identifier (e.g., provider number assigned by commercial payer) is entered in shaded Block 24J.

Claims Attachments

Some claims require attachments, such as operative reports, discharge summaries, clinic notes, or letters, to aid in determination of the reimbursement to be paid by the third-party payer. Attachments are also required when CPT unlisted codes are reported. HIPAA administrative simplification regulations require all payers to accept claim attachments. Each claims attachment (medical report substantiating the medical condition) should include patient and policy identification information. Any letter written by the provider should contain clear and simple English rather than "medicalese." The letter can describe an unusual procedure, special operation, or a patient's medical condition that warranted performing surgery in a setting different from the CMS-stipulated site for that surgery.

Final Steps in Processing CMS-1500 Claims

Step 1. Double-check each claim for errors and omissions. Step 2. Add any necessary attachments. Step 3. Post submission of the claim to the patient's account. Step 4. Save the claim in the practice management software. Step 5. Submit the claim to the payer or clearinghouse.

Processing Secondary CMS-1500 Claims

The CMS-1500 claim contains blocks for entering primary and secondary payer information. For the CMS-1500 claim, when primary and secondary information is entered on the same CMS-1500 claim, primary insurance policy information is entered in Block 11 through 11c, and an X is entered in the YES box in Block 11d. The secondary insurance policy information is entered in Blocks 9-9d of the same claim. Medicare supplemental plans (Medigap plans) usually cover deductible, copayment, and coinsurance amounts that patients pay to receive health care through Medicare. When generating CMS-1500 claims from this text and the Workbook, a single CMS-1500 claim is generated when the patient's primary and secondary insurance policies are with the same payer (e.g., BlueCross BlueShield). Multiple claims are generated when the patient is covered by multiple insurance policies with different companies (e.g., Aetna and United Healthcare). For example, if the patient has both primary and secondary insurance with different payers, two claims are generated. The primary claim is completed according to step-by-step instructions, and the secondary claim is completed by following special instructions included in each chapter.

Summary

The CMS-1500 claim is generated by using medical practice management software. Entering data into the software using this technology greatly increases productivity associated with claims processing because the need to manually enter data from the claim into a computer is eliminated. The 10-digit national provider identifier (NPI) is issued to individual providers and health care organizations and replaces health care provider identifiers (e.g., PIN, UPIN) previously generated by health plans and government programs. The UB-04 claim contains data entry blocks called form locators (FLs) (similar to CMS-1500 claim blocks), which are used to input information about procedures or services provided to a patient. Revenue codes are four-digit codes preprinted on a facility's chargemaster (or encounter form) to indicate the location or type of service provided to an institutional patient, and they are reported on the UB-04 claim.

CMS-1500 and 837P

The CMS-1500 claim is submitted electronically after being generated by medical practice management software, and the 837P is the standard format used to electronically transmit health care claims. Because the CMS-1500 and 837P data elements for uniform electronic billing specifications are consistent, one processing system can handle both types of claims. Patient data from a physician's office practice management software is used to populate the CMS-1500 claim, and the claim is electronically transmitted from the computer to the third-party clearinghouse or the payer.

Example: Shaded Block 24

The CMS-1500 claim was submitted for dental care provided on October 15, YYYY. The shaded line above that date of service contains identifying qualifier ZZ, which indicates "provider name," followed by the name of the provider (Margaret Miller DDS). The ID qualifier G2, which indicates "commercial payer assigned identifier," is followed by identifier number 987654321. Such information is useful to the provider for internal data capture (as well as to payers that request such information).

Federal Privacy Act

The Federal Privacy Act of 1974 prohibits a payer from notifying the provider about payment or rejection of unassigned claims or payments sent directly to the patient/policyholder. If the provider is to assist the patient with the appeal of a claim, the patient must provide a copy of the explanation of benefits (EOB) received from the payer and a letter that explains the error. The letter is to be signed by the patient and policyholder, to give the payer permission to allow the provider to appeal the unassigned claim. The EOB and letter must accompany the provider's request for reconsideration of the claim. If the policyholder writes the appeal, the provider must supply the policyholder with the supporting documentation required to have the claim reconsidered.

NPI Application Process

The National Plan and Provider Enumeration System (NPPES) was developed by CMS to assign the unique health care provider and health plan identifiers and to serve as a database from which to extract data (e.g., health plan verification of provider NPI). Each health plan has a process by which NPI data will be accessed to verify the identity of providers who submit HIPAA transactions. Providers apply for an NPI by submitting the following: -Web-based application -Paper-based application -Electronic file (e.g., hospital submits an electronic file that contains information about all physician employees, such as emergency department physicians, pathologists, and radiologists)

UB-04 Claim

The UB-04 claim is an insurance claim or flat file used to bill institutional services, such as services performed in hospitals. It contains data entry blocks called form locators (FLs) (and was previously called the UB-92). These are similar to the CMS-1500 claim blocks used to input information about procedures or services provided to a patient in a physician's office. UB-04 claims data for Medicare Part A reimbursement is submitted to Medicare administrative contractors (MACs, replacing carriers, DMERCs, and fiscal intermediaries) and other third-party payers. Payments are processed for hospitals, skilled nursing facilities, home health and hospice agencies, dialysis facilities, rehabilitation facilities, and rural health clinics. UB-04 claims are usually automatically generated when chargemaster (or encounter form) and other data is transmitted from the electronic health record to the facility's billing department. (The CMS-1500 claim continues to be completed as data entry in many physician practices.) (Some institutions continue to complete the UB-04 claim by using data entry for submission to third-party payers for reimbursement). Physicians and other health care providers circle procedure/service CPT and HCPCS level codes that are pre-printed on a paper-based chargemaster (after which keyboarding specialists enter the codes into the facility's computer). Or, they select codes using a tablet computer or a computer terminal (and click to transmit the codes).

UB-04 (CMS-1450) and 837

The UB-04 claim, designated as the CMS-1450 by CMS, uses 837I as its standard format to electronically transmit health care claims. Data elements in the UB-04 for uniform electronic billing specifications are consistent with the hard copy data set. Patient data from an institution's electronic health record populates the UB-04 claim, which is electronically transmitted to the payer or a clearinghouse for processing.

FL4: Type of bill (TOB) (REQUIRED)

The four-digit alphanumeric TOB code provides three specific pieces of information after a leading zero. Digit 1 (the leading 0) is ignored by CMS. Digit 2 identifies the type of facility. Digit 3 classifies the type of care provided. Digit 4 indicates the sequences of this bill for this particular episode of care, and it is called a frequency code.

ANSI ASC X12N 837I (837I)

The standard format for submission of electronic claims for institutional health care services. Institutional providers include hospitals, skilled nursing facilities, end-stage renal disease providers, home health agencies, hospices, outpatient rehabilitation clinics, comprehensive mental health centers, critical access hospitals, federally qualified health centers, histocompatibility laboratories, Indian Health Service facilities, organ procurement organizations, religious non-medical health care institutions, and rural health clinics. Hospitals submit Medicare claims for inpatient admissions to Medicare administrative contractors [(MACs), previously called fiscal intermediaries].

CMS-1500 Modifiers

To accurately report a procedure or service, up to four CPT/HCPCS modifiers can be entered to the right of the solid vertical line in CMS-1500 Block 24D on the claim. The first modifier is entered between the solid vertical line and the dotted line. Example 1: Patient is admitted to the hospital on June 1. The doctor reports detailed subsequent hospital visits on June 2, 3, and 4. Date of service 0601YYYY (no spaces) is entered on a separate line in Block 24 because the CPT code is assigned for initial patient care (on the day of admission) is different from subsequent hospital visits (reported for June 2, 3, and 4 as 0602YYYY through 0604YYYY). If identical consecutive procedures fall within a two-month span, use two lines, one for the first month and one for the second. Example 2: Patient is admitted to the hospital on May 29. The doctor reports an initial E/M service on May 29 and subsequent E/M services on May 30, May 31, June 1, June 2, and June 3. When reporting consecutive days on one line, the first date is reported in 24A in the From column and the last day in the To column. The DAYS OR UNITS column (24G) should reflect the number of days reported in 24A. If additional modifier(s) are added, enter one blank space between modifiers. Do not enter a hyphen in front of the modifier.

Correcting and Supplementing UB-04 Claims

Two processes are used to correct and supplement a UB-04 claim. An adjustment claim is subject to normal claims processing timely filling requirements, such as submission within one year of the date of service. Form locators 4 (type of bill) and 18-28 (condition codes) are completed. A reopened claim is generated when the need for correction or supplementation is discovered after the claims processing timely filing limit. Claims determinations may be reopened within one year of the date of receipt of the initial determination for any reason. However, when reopened within one to four years of the date of receipt of the initial determination for any reason, good cause must be demonstrated. A reopened claim is also a separate and distinct process from the appeals process, and a reopening will not be granted if an appeal decision is pending or in process. Form locators 4 (type of bill) and 18-28 (condition codes) are completed.

Data Specifications for the UB-04

When reviewing data specifications for the UB-04, the NUBC balanced the payers' need to collect information against the burden of providers to report that information. In addition, the administrative simplification provisions of HIPAA are applied when developing data elements. Each data element required for reporting purposes is assigned to a unique UB-04 form locator (FL), which is the designated space on the claim identified by a unique number and title, such as the patient name in FL8.

CMS-1500 Block 24A - Dates of Service

When the CMS-1500 claim form was designed, space was allotted for a six-digit date pattern with spaces between the month, day, and four-digit year (MM DD YYYY).

Processing Assigned Paid Claims

When the remittance advice arrives from the payer, pull the claim(s) and review the payment(s). Make a notation of the amount of payment, remittance advice notice processing date, and applicable batch number on the claim. Claims with no processing errors and payment in full are marked "closed." They are moved to the closed assigned claims file. Single-payment remittance advice notices may be stabled to the claim before filing in the closed assigned claims file. Batched remittance advice notices are refiled and if, after comparing the remittance advice notices and the claim, an error in processing is found, the following steps should be taken: 1. Write an immediate appeal for reconsideration of the payment. 2. Make a copy of the original claim, the remittance advice notices, and the written appeal. 3. Generate a new CMS-1500 claim, and attach it to the remittance advice notices and the appeal. Make sure the date in Block 31 matches the date on the original claim. 4. Mail the appeal and claim to the payer. 5. Make a notation of the payment (including the check number) on the office copy of the claim. 6. Refile the claim and attachments in the assigned open claims file.

UB-04 Claims Submission

Whether completed manually or using onscreen software, the UB-04 claim contains 81 form locators for which required, not used, and situational instructions are provided. The data is entered according to third-party payer guidelines that contain instructions for completing the UB-04. The UB-04 (CMS-1450) and its data elements serve the needs of many third-party payers. Although some payers do not collect certain data elements, it is important to capture all NUBC-approved data elements for audit trail purposes. In addition, NUBC-approved data elements are reported by facilities that have established coordination of benefits agreements with the payers.

Rendering Provider

a physician or NPP who provides (or renders) care to patients. A supervising physician engages in the direct supervision of NPP who provide care to patients (NPP is the rendering provider). In an institutional setting, a hospitalist is a rendering physician. (A hospitalist is a dedicated inpatient physician who works exclusively in a hospital.

HIPAA covered entities

include health plans, health care clearinghouses, and health care providers that conduct electronic transactions. HIPAA mandated use of the NPI to identify health care providers in standard transactions, which include claims processing, patient eligibility inquiries and responses, claims status inquiries and responses, patient referrals, and generation of remittance advices. Health care providers (and organizations) that transmit health information electronically to submit claims data are required by HIPAA to obtain an NPI even if the provider (or organization) uses business associates (e.g., billing agencies) to prepare the transactions.

National Council for Prescription Drug Programs (NCPCP) Telecommunication Standard

is the standard format for retail pharmacy. (The 837P is used for retail pharmacy services, such as a pharmacist billing a payer for administration of a flu vaccination at a retail pharmacy store.) For example, a retail pharmacy submits Medicare claims to the patient's Medicare Part D sponsor, which is an organization that has one or more contract(s) with the Centers for Medicare and Medicaid Services to provide Part D (prescription drug) benefits to Medicare beneficiaries.

Diagnosis pointer letter

item letters A through L preprinted in Block 21 of the CMS-1500 claim. When a payer allows more than one diagnosis pointer letter to be entered from Block 21 to Block 24E of the CMS-1500 claim, do not enter a space or a comma between each letter (e.g., ABCD).

Data packets

unit of data routed between provider and billing company, clearinghouse, or payer using the Internet or other packet-exchange network. Claims are electronically transmitted as data packets.

Form Locator (FL) descriptions indicate

whether data entry for Medicare claims is required, not required, not used (leave FL blank), or situational (dependent on circumstances clarified in the FL instructions). Payer-specific instructions can be located by conducting Internet searches.