LEEDer Group Inc.
8508 North West 66th St.
Miami, Florida 33166 USA

Phone Toll-free: 866.814.0192 or 305.436.5030
Fax Toll-free: 866.818.0373 or 305.436.0086
E-mail Address: orders {at] LEEDerGroup [dot] com

2012-06 Phase 2 of Ordering and Referring Requirement

Phase 2 of Ordering and Referring Requirement

MLN Matters® Number: SE1221 Related Change Request (CR) #: N/A Related CR Release Date: N/A Effective Date: N/A Related CR Transmittal #: N/A Implementation Date: N/A

  • Provider Types Affected
    This MLN Matters® Special Edition Article is intended for:
    Physicians and non-physician practitioners (including interns, residents, fellows and those who are employed by the Department of Veterans Affairs (DVA) or the Public Health Service (PHS)) who order or refer items or services for Medicare beneficiaries
    Part B providers (including Portable X-Ray services) and suppliers of Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) who submit claims to Carriers, Part A/B Medicare Administrative Contractors (MACs), and DME MACs for items or services that they furnished as the result of an order or a referral
    Part A Home Health Agency (HHA) services who submit claims to RHHIs, Fiscal Intermediaries (FIs) (who still maintain an HHA workload) and Part A/B MACs
  • Provider Action Needed: Impact to You
    The Centers for Medicare & Medicaid Services (CMS) will soon begin denying Part B, DME and Part A HHA claims that fail the Ordering/Referring Provider edits. These edits ensure that physicians and others who are eligible to order and refer items or services have established their Medicare enrollment records and are of a specialty that is eligible to order and refer. CMS will provide 60-day advanced notice prior to turning on the Ordering/Referring edits. CMS does not have a date at this time.
  • What You Need to Know
    CMS shall authorize A/B MACs and DME MACs to begin editing Medicare claims with Phase 2 Ordering/Referring edits. This means that the Billing Provider will not be paid for the items or services that were furnished based on the order or referral from a provider who does not have a Medicare enrollment record.
  • What You Need to Do
    If you order or refer items or services for Medicare beneficiaries and you do not have a Medicare enrollment record, you need to submit an enrollment application to Medicare. You can do this using Internet-based PECOS or by completing the paper enrollment application (CMS-855O).
  • Background
    The Social Security Act (the Act) requires that all physicians and non-physician practitioners be uniquely identified for all claims for services that are ordered or referred. Effective January 1, 1992, a physician or supplier that bills Medicare for a service or item must show the name and unique identifier of the attending physician on the claim if that service or item was the result of an order or referral. Effective May 23, 2008, the unique identifier was determined to be the National Provider Identifier (NPI).
    CMS began expanding the claims editing to meet the Act’s requirements for ordering and referring providers as follows:
    Phase 1: Beginning October 5, 2009, if the billed Part B service requires an ordering/referring provider and the ordering/referring provider is not reported on the claim, the claim is not paid. If the ordering/referring provider is reported on the claim, but does not have a current Medicare enrollment record or is not of a specialty that is eligible to order and refer, the claim was paid, but the billing provider received an informational message in the remittance advice indicating that the claim failed the ordering/referring provider edits.
    Only physicians and certain types of non-physician practitioners are eligible to order or refer items or services for Medicare beneficiaries. They are as follows:
    Physician (doctor of medicine or osteopathy, doctor of dental medicine, doctor of dental surgery, doctor of podiatric medicine, doctor of optometry)
    Physician Assistant
    Certified Clinical Nurse Specialist
    Nurse Practitioner
    Clinical Psychologist
    Interns, Residents and Fellows
    Certified Nurse Midwife
    Clinical Social Worker
    The informational message will indicate that the identification of the Ordering/Referring provider is missing, incomplete or invalid, or that the Ordering/Referring Provider is not eligible to order or refer. The informational message on an adjustment claim that does not pass the edits will indicate that the claim/service lacks information that is needed for adjudication. The informational messages are identified below:
    For Part B providers and suppliers who submit claims to Carriers:
    N264 Missing/incomplete/invalid ordering physician provider name
    N265 Missing/incomplete/invalid ordering physician primary identifier
    For adjusted claims CARC code 45 along with RARC codes N264 and N265 will be used.
    DME suppliers who submit claims to Carriers (applicable to 5010 edits):
    N544 Alert: Although this was paid, you have billed with a referring/ordering provider that does not match our system record. Unless corrected, this will not be paid in the future.
    For Part A HHA providers who order and refer, the claims system shall initially process the claim and add the following remark message:
    N272 Missing/incomplete/invalid other payer attending provider identifier
    For adjusted claims, the CARC code 16 and/or the RARC code N272 shall be used.
    Note: if the billed service requires an ordering/referring provider and the ordering/referring provider is not on the claim, the claim will not be paid.
    Phase 2: CMS has not announced a date when the edits for Phase 2 will become active. CMS will give the provider community at least 60 days notice prior to turning on these edits. During Phase 2, Medicare will deny Part B, DME and Part A HHA claims that fail the ordering/referring provider edits. Physicians and others who are eligible to order and refer items or services need to be enrolled in Medicare and must be of a specialty that is eligible to order and refer. If the billed service requires an ordering/referring provider and the ordering/referring provider is not on the claim, the claim will not be paid. If the ordering/referring provider is on the claim, but is not enrolled in Medicare, the claim will not be paid. In addition, if the ordering/referring provider is on the claim, but is not of a specialty that is eligible to order and refer, the claim will not be paid.
  • Below are the denial edits for Part B providers and suppliers who submit claims to Carriers including DME:
    254D Referring/Ordering Provider Not Allowed to Refer
    255D Referring/Ordering Provider Mismatch
    289D Referring/Ordering Provider NPI Required
    CARC code 16 and/or the RARC code N264 and N265 shall be used for denied or adjusted claims.
  • Below are the denial edits for Part A HHA providers who submit claims:
    37236 – This reason code will assign when: The statement ‘From’ date on the claim is on or after the date the phase 2 edits are turned on
    The type of bill is ‘32’ or ‘33’
    Covered charges or providers reimbursement is greater than zero but the attending physician NPI on the claim is not present in the eligible attending physician file from PECOS or the attending physician NPI on the claim is present in the eligible attending physician files from PECOS but the name does not match the NPI record in the eligible attending physician files from PECOS or the specialty code is not a valid eligible code
    37237 – This reason code will assign when: The statement ‘From’ date on the claim is on or after the date the phase 2 edits are turned on
    The type of bill is ‘32’ or ‘33’
    The type of bill frequency code is ‘7’ or ‘F-P’
    Covered charges or provider reimbursement is greater than zero but the attending physician NPI on the claim is not present in the eligible attending physician file from PECOS or the attending physician NPI on the claims is present in the eligible attending physician files from PECOS but the name does not match the NPI record in the eligible attending physician files from PECOS or the specialty code is not a valid eligible code
  • CMS published the final rule, CMS-6010-F, RIN 0938-AQ01, ‘Medicare and Medicaid Programs; Changes in Provider and Supplier Enrollment, Ordering and Referring, and Documentation Requirements; and Changes in Provider Agreements,’ on April 24, 2012, permitting Phase 2 edits to be implemented.
    CMS will announce the date via an updated article when it shall authorize Part A/B and DME MACs and Part A RHHIs to implement Phase 2 edits.
  • Additional Information
    A note on terminology: Part B claims use the term ‘ordering/referring provider’ to denote the person who ordered, referred or certified an item or service reported in that claim. CMS has used this term on its Web site and in educational products. The final rule uses technically correct terms: 1) a provider ‘orders’ non-physician items or services for the beneficiary, such as DMEPOS, clinical laboratory services or imaging services; and 2) a provider ‘certifies’ home health services for a beneficiary. The terms ‘ordered,’ ‘referred’ and ‘certified’ are often used interchangeably within the health care industry. Since it would be cumbersome to be technically correct, CMS will continue to use the term ‘ordered/referred’ in materials directed to a broad provider audience.
    For more information about the Medicare enrollment process, visit www.cms.gov/Medicare/Provider-Enrollment-and-Certification/MedicareProviderSupEnroll/index.html, or contact the designated Medicare Contractor for your state. Medicare provider enrollment contact information for each state can be found at www.cms.gov/Medicare/Provider-Enrollment-and-Certification/MedicareProviderSupEnroll/downloads/Contact_list.pdf on the CMS Web site.
    The Medicare Learning Network® fact sheet, ‘Medicare Enrollment Guidelines for Ordering/Referring Providers’ provides information about the requirements for eligible ordering/referring providers and is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/MedEnroll_OrderReferProv_FactSheet_ICN906223.pdf on the CMS Web site.
    You may find the following articles helpful in understanding this matter:
    MLN Matters® Article MM 6417, ‘Expansion of the Current Scope of Editing for Ordering/Referring Providers for Claims Processed by Medicare Carriers and Part B Medicare Administrative Contractors (MACs),’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM6417.pdf on the CMS Web site
    MLN Matters® Article MM 6421, ‘Expansion of the Current Scope of Editing for Ordering/Referring Providers for Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) Suppliers’ Claims Processed by Durable Medical Equipment Medicare Administrative Contractors (DME MACs),’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM6421.pdf on the CMS Web site
    MLN Matters® Article MM 6856, ‘Expansion of the Current Scope of Editing for Attending Physician Providers for free-standing and provider-based Home Health Agency (HHA) claims processed by Medicare Regional Home Health Intermediaries (RHHIs),’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM6856.pdf on the CMS Web site
    MLN Matters® Article MM 7097, ‘Eligible Physicians and Non-Physician Practitioners Who Need to Enroll in the Medicare Program for the Sole Purpose of Ordering and Referring Items and Services for Medicare Beneficiaries,’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM7097.pdf on the CMS Web site
    MLN Matters® Article MM 6129, ‘New Requirement for Ordering/Referring Information on Ambulatory Surgical Center (ASC) Claims for Diagnostic Services,’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM6129.pdf on the CMS Web site
    MLN Matters® Special Edition Article SE 1011, ‘Edits on the Ordering/Referring Providers in Medicare Part B Claims (Change Requests 6417, 6421 and 6696),’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE1011.pdf on the CMS Web site
    MLN Matters® Article Special Edition Article SE 1201 ‘Important Reminder for Providers and Suppliers Who Provide Services and Items Ordered or Referred by Other Providers and Suppliers’ is available at www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE1201.pdf on the CMS Web site
    MLN Matters® Special Edition Article SE 1208, ’855-O Medicare Enrollment Application Ordering and Referring Physicians or Other Eligible Professionals,’ is available at https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE1208.pdf on the CMS Web site
  • Disclaimer
    This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may contain references or links to statutes, regulations or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents. CPT only copyright 2011 American Medical Association.

last updated on 06/21/2012