Authorization Process (OPD)

The information submitted will be reviewed by the MAC, and the decision (affirmative or non-affirmative) will be issued to the requester. A provisional affirmation will be issued to the requester if it is decided that applicable Medicare coverage, coding, and payment rules are met. A non-affirmation will be issued to the requester if it is decided that applicable Medicare coverage, coding, and payment rules are not met. A unique tracking number (UTN) will be assigned with each PA request.

Note: While this prior authorization process is applicable to hospital OPDs, CMS allows the PA request to be sent by the physician/practitioner on behalf of the hospital OPD. If a PA request submitted by the physician/practitioner includes all necessary hospital OPD information, it is considered to be sent on behalf of the hospital OPD.

Review Decisions and Timeframes

Timeframes for conducting PA request will be dependent upon the service(s) and documentation submitted for PA request. There are three types of review timeframes:

  • Initial Submission - the first PA request sent to the contractor for review and decision. The MAC will complete its review of medical records and send an initial decision letter that is either postmarked or faxed within 10 business days following the receipt of initial request.
  • Resubmission - any subsequent resubmissions to correct an error or omission identified during a PA request decision. A resubmitted PA request is a request submitted with additional/updated documentation after the initial PA request was non-affirmed. The MAC will postmark or fax notification of the decision of these resubmitted requests to the provider or beneficiary within 10 business days of receipt of the resubmission request. The provider should review the detailed decision letter that was provided. A provider may resubmit a PA request an unlimited number of times, upon receipt of a non-affirmative decision. A UTN will be assigned with each PA request resubmission request.
  • Expedited - a PA request decision that is performed on an accelerated timeframe based on the MAC determination that delays in review and response could jeopardize the life or health of the beneficiary. If the MAC substantiates the need for an expedited decision, the MAC will make reasonable efforts to communicate a decision within 2 business days of receipt of the expedited request. The requestor will be notified regarding the acceptance of the PA request for expedited review or if it will convert the request to the standard PA request review process. The affirmative or non-affirmative decision will be rendered within the CMS-prescribed expedited review and will provide the decision to the provider via telephone, fax, electronic portal, or other "real-time" communication, within the requisite timeframe.

Note: The expedited submission should not be used when if the beneficiary's date of service is soon. This timeframe is to only be used when the patient's life and health are in jeopardy. The expedited request must include justification showing the standard timeframe would not be appropriated.

To prevent the claim from denying upon submission, the provider should hold their claim and not submit it until the UTN is provided. The MAC will follow the normal process to obtain a UTN from CMS shared systems.

Decision Letter(s)

The MAC will send decision letters with the UTN to the requester using the method the PA request was received postmarked within the timeframes described above. The MAC will have the option to send a copy of the decision to the requester via fax if a valid fax number was provided, even if the submission was sent via mail. The requester(s) will be notified to hold their claim and not submit until the UTN is received (in order to avoid a claims payment denial).

A copy of the decision letter will be sent to the beneficiary as well.

Decisions

Provisional Affirmation PA Decision

A provisional affirmation PA decision is a preliminary finding that a future claim submitted to Medicare for the service(s) likely meets Medicare's coverage, coding, and payment requirements.

Non-Affirmation PA Decision

A non-affirmation PA decision is a preliminary finding that if a future claim is submitted to Medicare for the requested service does not likely meet Medicare's coverage, coding, and payment requirements. The decision letter for an incomplete PA request will be detailed and the MAC will provide the PA request requester notification of what required documentation is missing or noncompliant with Medicare requirements via fax, mail, or MAC provider portal (when available).

Provisional Partial Affirmation PA Decision

A provisional partial affirmation PA decision means that one or more service(s) on the PA request received a provisional affirmation decision and one or more service(s) received a non-affirmation decision.

The MAC will follow the same process for any service(s) within the PA request that are given a provisional affirmation decision described above and one or more service(s) received a non-affirmation decision as described above.

Validation Period for Prior Authorization Decisions

PA request decisions and UTNs for these services are valid for 120 days. The decision date shall be counted as the first day of the 120 days. For example: if the PA request is affirmed on January 1, 2021 the PA request will be valid for dates of service through April 30, 2021. Otherwise, the provider will need to submit a new PA request.

Resubmitting a PA Request

The requestor may resubmit another complete PA request with all documentation required and whatever modifications are needed, as noted in the detailed decision letter. Unlimited resubmissions are permitted. The requestor is encouraged to include the original non-affirmed UTN on the resubmitted PA request.

Suspension of a PA Process

CMS may suspend the OPD services PA process requirement generally or for a particular service(s) at any time by issuing a notification on the CMS website.

Claim Submission

Affirmed PA Decision on File

Cases where a PA request was submitted and a provisional affirmation PA decision was granted, including any service(s) that was part of a partially affirmed decision.

  • The submission of the prior authorized claim is to have the 14-byte UTN that is located on the decision letter. For submission of electronic claims, the UTN must be in positions 1 through 18. When claim enters the Fiscal Intermediary Shared System (FISS), the UTN will move to positions 19 through 32 and zeros will autofill first field.
  • For all other submissions, the provider must TAB to the second field of the treatment authorization field (positions 19-32) and key the UTN. If information is entered into the first field (positions 1 through 18), it will come into FISS as zeros. If the Treatment Authorization Code is entered into the first field, FISS changes the Treatment Authorization code to zeros and the claim will not be accepted. If the UTN is entered into the first Treatment Authorization field, FISS will change the UTN to all zeros. The claim is accepted into FISS with the zeros and without the UTN. The claim will process without the UTN, but will edit for no OPD UTN.
  • Should be submitted to the applicable MAC for adjudication

Note: If all Medicare coverage, coding, and payment requirements are met, the claim will likely be paid.

  • Claims receiving a provisional affirmation may be denied based on either the following:
    • Technical requirements that can only be evaluated after the claim has been submitted for formal processing; or
    • Information was not available at the time of a PA request
    • We note claims for which there is a provisional affirmation PA decision will be afforded some protection from future audits, both pre- and postpayment; however, review contractors may audit claims if potential fraud, inappropriate utilization, or changes in billing patters are identified.

Non-Affirmed PA Decision on File

Cases where a PA request was submitted and a non-affirmed PA decision was granted, including any non-affirmed service(s) that was part of a partially affirmed decision.

  • The submission of the prior authorized claim is to have the 14 byte UTN that is located on the decision letter. For submission of electronic claims, the UTN must be in positions 1 through 18. When the claim enters FISS, the UTN will move to positions 19 through 32 and zeros will autofill the first field. For providers submitting electronic claims, the Medicare Treatment Authorization field must contain blanks or valid Medicare data in the first 14 bytes of the treatment authorization field at the loop 2300 REF02 (REF01=G1) segment for the ASC X12 837 claim.
  • For all other submissions, the provider must TAB to the second field of the treatment authorization field (positions 19-32) and key the UTN. If information is entered into the first field (positions 1 through 18), it will come into FISS as zeros. If the Treatment Authorization Code is entered into the first field, FISS changes the Treatment Authorization code to zeros and the claim will not be accepted. If the UTN is entered into the first Treatment Authorization field, FISS will change the UTN to all zeros. The claim is accepted into FOSS with the zeros and without the UTN. The claim will process without the UTN, but will edit for no OPD UTN.
  • Should be submitted to the applicable MAC for adjudication
    • If the claim is submitted to the MAC for payment with a non-affirmative PA decision, it will be denied.
    • All appeal rights are then available.
    • This claim could then be submitted to secondary insurance, if applicable.

Claims Submitted without a PA Decision on File

As described in 42 CFR §419.82, if a service requires PA under this program, then submitting a PA request is a condition of payment. Claims for HCPCS code subject to required prior authorization submitted without a prior authorization determination and a corresponding UTN will be automatically denied.

Insurance

Note: Whether Medicare is listed as primary or secondary, a prior authorization is required.

Medicare is Primary Insurance

In cases where Medicare is primary and another insurance company is secondary:

The contractors will suspend claims to request documentation and conduct a review of the Advance Beneficiary Notice (ABN) where there is no PA request, and the claim is submitted with the GA modifier appended.

The contractor will determine the validity of the ABN in accordance with standard ABN policies (See CMS Internet Only Manual (IOM), Publication 100-04, Medicare Claims Processing Manual, Chapter 30, Section 40).

Providers who choose to use the PA process to obtain a claim denial should follow the below process:

  • The requester may submit the PA request with complete documentation as appropriate. If all relevant Medicare coverage requirements are not met for the service, then a non-affirmative PA decision will be sent to the provider and beneficiary, advising that Medicare will not pay for the item.
  • After receiving a non-affirmative decision for the PA request, if the associated claim is submitted by the provider to the MAC for payment, it will be denied
  • The provider or beneficiary may forward the denied claim to his/her secondary insurance payer as appropriate to determine payment for the service

In cases where a beneficiary is daily eligible for Medicaid and Medicare, a non-affirmed prior authorization decision is sufficient for meeting states' obligation to pursue other coverage before considering Medicaid coverage. The provider may need to submit the claim to Medicare first and obtain a denial before submitting the claim to Medicaid for payment.

Another Insurance Company is Primary

Cases where another insurance company is primary and Medicare is secondary:

  • The requester submits the PA request with complete documentation as appropriate. If all relevant Medicare coverage requirements are met for the item(s), then a provisional affirmative PA decision will be sent to the provider and to the beneficiary, if specifically requested by the beneficiary, advising them that Medicare will pay for the service.
  • The provider submits a claim to the other insurance company
  • If the other insurance company denies the claim, the provider or beneficiary can submit a claim to the MAC for payment (listing the unique tracking number on the claim).

Advance Beneficiary Notice of Non-coverage (ABN)

If an applicable claim is submitted without a PA request decision and is flagged as having an ABN, it will be stopped for additional documentation to be request and a review of the ABN will be performed (to determine the validity of the ABN) following standard claim review guidelines and timelines. Please review information on the Noridian Advance Beneficiary Notice Of Noncoverage (ABN) webpage. The table below describes modifiers used for billing services in certain situations.

Modifiers

Modifier Description
GA Modifier Waiver of liability statement issues, as required by payer policy. Advanced Beneficiary Notice (ABN) of liability required. Modifier is used to signify a line item is linked to the mandatory use of an ABN when charged both related to and not related to an ABN must be submitted on the claim. Line item must be submitted as covered, and Medicare will make the determination for payment.
GZ Modifier Item or service expected to be denied as not reasonable and necessary. Cannot be used when ABN is given. Lines submitted as non-covered will be denied as provider-liable.
GY Modifier Item or service is statutorily excluded or does not meet the definition of any Medicare benefit. Lines submitted as non-covered and will be Patient Responsibility (PR).

 

Claims Exclusions

The following claim types are excluded from the PA program described in this operational guide unless otherwise specified:

  • Veterans Affairs
  • Indian Health Services
  • Medicare Advantage
  • Part A and B Demonstration
  • Medicare Advantage sub-category IME only claims
  • Part A/B rebilling

Claim Appeals

Claims subject to PA requirements under the hospital OPD program follow all current appeals procedures. A PA request that is non-affirmed is not an initial determination on a claim for payment for services provided and, therefore, would not be appealable; however, if a provider has an unlimited number of opportunities to resubmit a PA request, provided the claim has not yet been submitted and denied.

A non-affirmation PA decision does not prevent the provider from submitting a claim. Submission of a such a claim and resulting denial by the MAC would constitute an initial payment determination, which makes the appeal rights available.

For further information, please consult Medicare Claims Processing Manual publication, Chapter 29, Appeals of Claims Decision.

Claims related to or associated with services that require PA as a condition of payment will not be paid, if the service requiring PA is not also paid. These related services include, but are not limited to, services such as anesthesiology services, physician services, and/or facility services. Only associated services performed in the OPD setting will be affected. Depending on the time of claim submission for any related services, claims may be automatically denied or denied on a postpayment basis.

Cosmetic Services

Please refer to the following regarding cosmetic services:
CMS IOM, Publication 100-02, Chapter 16, Section 120 - Cosmetic Surgery

Resources

 

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