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

Phone: 305.436.5030
Fax: 305.436.0086
E-mail Address: info {at] LEEDerGroup [dot] com

2012-12 Results of Widespread Prepayment Review for E0570-Nebulizer, with Compressor-L11499

December 06, 2012

Results of Widespread Prepayment Review for E0570 (Nebulizer, with Compressor) (L11499)
  • Historical Review Results
    DME MAC A Medical Review continues to review Nebulizers, with Compressor, based on the results of previous quarterly findings. The previous quarterly findings covered the period of March 2012 through May 31, 2012 and resulted in a Charge Denial Rate (CDR) of 68.7%.
  • Current Review Results
    The DME MAC Jurisdiction A has recently completed a widespread prepayment review of claims for E0570 (Nebulizer, with Compressor). These findings include claims processed primarily from June 2012 through August 31, 2012. This review was initiated due to errors identified by the Comprehensive Error Rate Testing (CERT) Contractor.
    The review involved prepayment complex medical review of 1228 claims submitted by 503 suppliers. Responses to the Additional Documentation Request (ADR) were not received for 181 (15%) of the claims. For the remaining 1042 claims, 232 claims were allowed and 810 were denied/partially denied resulting in a claim denial rate of 78%. The total denied allowance amount (dollar amount of allowable charges for services determined to be billed in error) divided by the total allowance amount of services medically reviewed resulted in an overall Charge Denial Rate (CDR) of 76.1%.
  • Charge Denial Rate Historical Data
    The following data depicts the Charge Denial Rate from previous quarters to current:
    Period Charge Denial Rate
    March 2011 – May 2011 71.9%
    June 2011 – August 2011 56.5%
    September 2011 – January 2012 60.2%
    March 2012 – May 2012 68.7%
    June 2012 – August 2012 76.1%
  • Primary Reasons for Denial
    Based on review of the documentation received, the following are the primary reasons for denial. Note that the percentages detailed below reflect the fact that a claim could have more than one missing/incomplete item:
  • Clinical Documentation Issues
    55.4% of the denied claims were missing any clinical information to support medical necessity. No medical records of any sort were submitted.
    29% of the denied claims had insufficient clinical documentation. The documentation submitted had no relevance to nebulizer use.
  • Detailed Written Order Issues
    11.6% of the denied claims were missing the detailed written order.
    Proof of Delivery Issues
    17.6% of the denied claims were missing proof of delivery.
    Claim Examples
    As an additional educational measure, the following are actual examples of claim denials. NHIC expects these examples will assist suppliers in understanding the medical review process and the common documentation errors that occur with nebulizer claims:
    Example 1:
    Received: Detailed physician’s order with legible signature and date of signature, delivery ticket including recipients/caregiver signature and date of receipt and payable diagnosis.
    Missing: Clinical notes do not explain reasonable and necessary use of nebulizer.
    Example 2:
    Received: Claim received with clinical notes from MD, completed delivery ticket including payable diagnosis.
    Missing: Written detailed order with beneficiary name, description of item to be dispensed, ordering physician’s legible signature, and date of physician signature.
    Example 3:
    Received: Detailed order with beneficiary name, physician’s legible signature and date of signature, clinical records and payable diagnosis.
    Missing: As proof of delivery missing: no receipt signature, no receipt date or delivery ticket at all.
    Next Step
    Based on the results of this prepayment review, DME MAC A will continue to review claims for E0570 (Nebulizer, with Compressor).
    Suppliers are reminded that repeated failure to respond to ADR requests could result in a referral to the Jurisdiction A Program Safeguard Contractor/Zone Program Integrity Contractor.
  • Educational References
    NHIC provides extensive educational offerings related to the proper documentation requirements for nebulizer claims. Please ensure that the responsible supplier staff is aware of and references this educational material so that supporting documentation for your claims is compliant with all requirements:
Nebulizers (L11499) LCD Nebulizers – Policy Article – Effective February 2011 (A24944)
Results of Widespread Prepayment Review of Claims for E0570: posted November 11, 2010, March 25, 2011, July 01, 2011, December 22, 2011, April 20, 2012, and August 17, 2012
DME MAC Jurisdiction A Supplier Manual (Chapter 10 – Durable Medical Equipment) for additional information regarding coverage and documentation requirements.
CERT Physician Letter – Nebulizers Monthly CERT Error examples (April 2011, May 2011, July 2011, January 2012, February 2012, and May 2012, August 2012)

Frequently Asked Questions (search word “nebulizer”)