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Medical Coding News Archives

Medicare Moves Toward Electronic Documentation Submission

May 2, 2013:

Karen H. Kachur, RN, CPC, Clinical/Technical Editor

The Centers for Medicare and Medicaid Services (CMS) has implemented phase 1 in its transition to requesting and receiving medical documentation electronically.

In any given year, it is estimated more than 1 million medical document requests are sent to providers by:

  • Medical review departments at Medicare administrative contractors (MACs)
  • Comprehensive error rate testing contractor (CERT)
  • Payment error rate measurement contractor (PERM)
  • Medicare recovery auditors (formerly called RACs)

It is estimated that Medicare makes more than $28.8 billion in improper payments each year, while Medicaid is close behind with $21.9 billion in erroneous payments. Since the majority of these improper payments can be determined only by an individual comparing the claim against medical documentation, the requests for additional documentation are not going to go away.

While the majority of the information is sent to these entities by paper or fax, CMS has implemented the electronic submission of medical documentation (esMD) system, which allows providers and health information handlers (HIHs) to submit medical documentation over secure electronic means. Phase I of this voluntary program was implemented in September of 2011, and providers have reported a much faster turnaround time for payments using esMD—six days rather than the estimated three weeks for the paper method. In addition, esMD reduces the costs of labor as well as shipping and handling. During phase 1, providers can continue to respond to requests for medical documentation by regular mail but may send the medical information to the requesting contractor electronically.

Prior authorization requests for power mobility devices (PMD) may now be submitted directly to CMS via esMD. Once the DME supplier receives a letter of medical necessity and preauthorization from the provider, the supplier will submit the request for approval via esMD to CMS and will obtain preauthorization from the DME MAC before the request for DME is processed. Effective January 7, 2013, durable medical equipment Medicare administrative contractors (DME MACs) in jurisdictions C and D started to accept PMD prior authorization requests through esMD, followed by the jurisdiction A DME MAC on January 9, 2013, and the jurisdiction B DME MAC on February 22, 2013.

CMS expects to implement phase 2 of esMD in the future. At that time, providers will receive electronic, rather than paper, documentation requests when their claims are selected for review.


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