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Medicare Secondary Payer FAQs

  1. Revised - Please explain condition code 08 in more detail.
  2. Revised - How do I bill Medicare if a patient has a primary insurance but the benefits have been exhausted?
  3. Revised - Some of my patients have open insurance records that they say are not valid anymore. Can you close these records so my claims will process?
  4. We sent a claim as Medicare primary and later discovered that another payer is primary to Medicare. When we adjusted the claim to make Medicare secondary with a D7 condition code, the claim was rejected because no payment is reported from the primary. What should we do?
  5. Can we bill a paper claim if the primary insurance does not have electronic payer information? In other words, the EOB from the primary does not have the correct information to process electronically, so we would need to send it paper. If so, how would we do that?
  6. We have a patient who has three insurances for their coverage of an auto accident: Progressive, Cincinnati and Medicare - Humana Open (HMO Product). The patient was covered for skilled nursing care. However, Humana needed a revalidation of skilled care/authorization, and did not cover the patient's care for three days. Our patient meets Medicare criteria for skilled nursing services. Would traditional Medicare pay when the claim is submitted to CGS (traditional Medicare)?
  7. Which condition code should I use on an adjustment claim when I'm making more than one change (e.g., change to date of service and change to charges)?
  8. How do I request conditional payment from Medicare when the patient's primary insurance does not pay?
  9. We would like additional clarification on Condition Codes D9 versus D7 for MSP. We sent a claim as Medicare primary and later discovered that another payer is primary to Medicare. When we adjusted the claim to make Medicare secondary with a D7 condition code, the claim was rejected because no payment is reported from the primary.
  10. For changes to MSP claims needing an electronically submitted adjustment, where would CGS like providers to indicate the required adjustment reason code on the UB04? The claims that are being submitted are rejecting with a T status repeatedly due to missing information within DDE. We have been told to put this code on page 3 in DDE and F9 for processing. Unfortunately, that resolution is not correct as MSP claims cannot be resubmitted within DDE.
  11. What description are you seeking when we use the NB code on an MSP claim?
  12. For conditional billing of annual and lifetime maximum, do we have to have a new denial for each claim?
  13. If a primary payer retroactively recoups their payment years later, we send a claim to Medicare for primary payment. Medicare denied the claim for timely filing. We appealed the timely filing denial and provided documentation showing the other payor had recouped their payment. Why was my timely filing appeal denied?
  14. When completing the Medicare Secondary Payer Questionnaire (MSPQ), what should the provider do when the Medicare beneficiary is unsure or cannot recall his retirement date?

Please explain condition code 08 in more detail.

Condition Code 08 is used when a beneficiary actively refuses to give other health information or is unable to give other health information. Use along with remarks to indicate refusal to supply other insurance information. Submit the claim as Medicare primary.

Condition Code 08 alerts the Benefits Coordination & Recovery Center (BCRC) to develop for other insurance information (including contacting the beneficiary). Note: This code CAN be used for non-response as well.

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How do I bill Medicare if a patient has a primary insurance but the benefits have been exhausted?

When benefits have been exhausted for the primary insurance, the claim is submitted to Medicare as primary with a 25 occurrence code with the date the benefits exhausted and remarks for liability, no-fault or workers' compensation situations only. Beneficiaries who are covered under a Group Health Plan (GHP) for which the benefits have exhausted should submit their claims in accordance with the MSP guidelines.

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Some of my patients have open insurance records that they say are not valid anymore. Can you close these records so my claims will process?

When insurance policies are terminated or are not valid, the Medicare patient or the Medicare provider must contact the Benefits Coordination & Recovery Center (BCRC) to have the files updated. They may be reached at 855.798.2627.

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We sent a claim as Medicare primary and later discovered that another payer is primary to Medicare. When we adjusted the claim to make Medicare secondary with a D7 condition code, the claim was rejected because no payment is reported from the primary.

If the primary payer made a payment, use the D7 condition code and verify that the correct MSP value code is reported with the amount paid by the primary payer. If no payment was made by the primary payer, use a D9 condition code. When using the D9 condition code, the adjustment reason must be entered in the Remarks field. Remarks need to include one of these nine reasons (BE, CD, DA, DP, FG, NB, PC, PE, PP). Without remarks on the claim, the claim will be RTPd.

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Can we bill a paper claim if the primary insurance does not have electronic payer information? In other words, the EOB from the primary does not have the correct information to process electronically, so we would need to send it paper. If so, how would we do that?

Once you receive the EOB from the primary, you are required to submit the MSP claim electronically unless you have an ASCA waiver to allow you to submit a claim hard copy. MSP claims require certain loops, segments and CAS segments with the appropriate information in each. Don't forget the Obligated to Accept Assignment (OTAF) amount, if applicable.

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We have a patient who has three insurances for their coverage of an auto accident: Progressive, Cincinnati and Medicare - Humana Open (HMO Product). The patient was covered for skilled nursing care. However, Humana needed a revalidation of skilled care/authorization, and did not cover the patient's care for three days. Our patient meets Medicare criteria for skilled nursing services. Would traditional Medicare pay when the claim is submitted to CGS (traditional Medicare)?

If the beneficiary is enrolled in an HMO and the HMO paid some of the claim and not part of the claim, then traditional Medicare will not pick up the non-covered days. You cannot bill to traditional Medicare for payment.

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Which condition code should I use on an adjustment claim when I'm making more than one change (e.g., change to date of service and change to charges)?

Use condition code D9 and indicate the changes made in the Remarks section.

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How do I request conditional payment from Medicare when the patient's primary insurance does not pay?

The following charts will give guidance:

No-fault insurer, liability insurer (including self-insurance), or Workers' Compensation (WC) that does not pay within the "promptly" period*
Appropriate MSP value code and 0000.00
Payer code C (conditional payment) and the primary payer's name on the primary payer line
Payer code Z and Medicare on the secondary payer line
The reason the no-fault, liability or WC insurer did not make prompt payment in the Remarks section – Two-position Explanation Codes for Conditional Billing:
  • DA – 120 days have passed since the primary payer was billed

*The "promptly period" for no-fault insurers and WC carriers means the insurer or WC carrier did not pay within 120 days after one of the following:

  1. Receipt of the claim by the no-fault insurer or WC carrier, OR
  2. Absent evidence to the contrary, the date of service (date of discharge, for inpatient services)

The "promptly period" for liability insurers means the insurer did not pay within 120 days of the earlier of the following:

  1. The date a general liability claim is filed with the insurer or a lien is filed against a potential liability settlement, OR
  2. The date of service (date of discharge, for inpatient services)

Group Health Plan (GHP) - If there is a primary GHP, Medicare may not pay conditionally on the liability, no-fault, or WC claim if the claim is not billed to the GHP first. The GHP insurer must be billed first and the primary payer payment information must appear on the claim submitted to Medicare.

Group Health Plan (GHP) applies approved amount to the patient's deductible, coinsurance, copay, or blood deductible
DO NOT submit Occurrence Code 24 and date of denial
Appropriate MSP value code and amount, value code 44, and OTAF amount
Remark code CD in the Remarks section (Charges applied to co-payment, coinsurance or deductible)
No additional remarks needed in addition to 2-digit remark code CD – Charges went to deductible

References:

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We would like additional clarification on Condition Codes D9 versus D7 for MSP. We sent a claim as Medicare primary and later discovered that another payer is primary to Medicare. When we adjusted the claim to make Medicare secondary with a D7 condition code, the claim was rejected because no payment is reported from the primary.

If the claim was initially processed as Medicare primary and is being adjusted to process as Medicare Secondary, and the primary payer made a payment, use the D7 condition code and verify that the correct MSP value code is reported with the amount paid by the primary payer. If no payment was made by the primary payer, or the claim was initially processed as a Medicare Secondary Payer code and being adjusted to reflect additional MSP information, use a D9 condition code. When using the D9 condition code, the adjustment reason must be entered in the Remarks field. One of these remarks must be included: BE, CD, DA, DP, FG, NB, PC, PE, or PP. Without remarks on the claim, the claim will be RTPd.

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For changes to MSP claims needing an electronically submitted adjustment, where would CGS like providers to indicate the required adjustment reason code on the UB04? The claims that are being submitted are rejecting with a T status repeatedly due to missing information within DDE. We have been told to put this code on page 3 in DDE and F9 for processing. Unfortunately, that resolution is not correct as MSP claims cannot be resubmitted within DDE.

Enter remarks on the claim (UB-04) in FL 80 or the electronic equivalent.

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What description are you seeking when we use the NB code on an MSP claim?

NB indicates "not a covered benefit." Submit NB, as applicable, with MSP value codes 12, 13, 14, 15, 41, or 43. For more information, refer to the CGS web article "Medicare Secondary Payer (MSP): Condition, Occurrence, Value, Patient Relationship, and Remarks Field Codes."

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For conditional billing of annual and lifetime maximum, do we have to have a new denial for each claim?

Conditional payment is not made for situations where the primary payer denies payment due to the lifetime maximum benefit having been met. If the patient's primary insurance is a Group Health Plan, the provider is required to submit the claim to the primary each time services are rendered to receive an EOB/RA from the primary payer. The claim is then submitted to Medicare with the appropriate Claim Adjustment Segments (CAS), and the system will automatically apply the appropriate payment calculation. If the patient's primary payer is a No-Fault, Liability, or Workers' Compensation plan, the MSP records must then be updated by the Benefits Coordination & Recovery Center (BCRC) before the claim can be submitted to Medicare.

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If a primary payer retroactively recoups their payment years later, we send a claim to Medicare for primary payment. Medicare denied the claim for timely filing. We appealed the timely filing denial and provided documentation showing the other payor had recouped their payment. Why was my timely filing appeal denied?

The CMS Medicare Claims Processing Manual (Pub. 100-04), chapter 1, section 70.7.1, contains what conditions contractors will allow for exceptions to and extensions of timely filing requirements. The exceptions include:

  • Administrative error
  • Retroactive Medicare entitlement
  • Retroactive Medicare entitlement involving State Medicaid Agencies
  • Retroactive disenrollment from a Medicare Advantage (MA) plan or Program of All-inclusive Care of the Elderly (PACE) provider organization.

The CMS MSP Manual (Pub. 100-05), chapter 3, section 10.5 also addresses this situation:
"In general, Medicare does not consider a situation where (a) Medicare processed a claim in accordance with the information on the claim form and consistent with the information in the Medicare's systems of records and; (b) a third party mistakenly paid primary when it alleges that Medicare should have been primary to constitute "good cause" to reopen."

References:

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When completing the Medicare Secondary Payer Questionnaire (MSPQ), what should the provider do when the Medicare beneficiary is unsure or cannot recall his retirement date?

During the intake process, when a beneficiary cannot recall his/her precise retirement date as it relates to coverage under a group health plan as a policyholder or cannot recall the same information as it relates to his/her spouse, as applicable, hospitals must follow the policy as referenced in the CMS Medicare Secondary Payer (MSP) Manual (Pub. 100-05), chapter 3, section 20.1.4.

Beneficiary is the policyholder

If the beneficiary knows his retirement date is prior to his Medicare dates (as shown on his card), report his Medicare Part A entitlement date as the date of retirement.

Beneficiary is a dependent under his spouse's GHP and the spouse retired prior to the beneficiary's Medicare Part A entitlement date

Report the beneficiary's Medicare entitlement date as his retirement date.

If beneficiary:

  • Worked beyond his Medicare Part A entitlement date, and
  • Had coverage under a GHP during that time, and
  • The hospital determines it has been at least 5 years since the beneficiary retired

Report the retirement date as 5 years retrospective to the date of admission.

Example: If the date of admission is January 4, 2014, report retirement date as January 4, 2009.

Note: Same for a spouse who had retired at least 5 years prior to the date of the beneficiary's hospital admission.

Beneficiary's (or spouse's, if applicable) retirement date occurred less than 5 years ago

Hospital must obtain the retirement date from appropriate informational sources, (e.g., former employer or supplemental insurer).

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Last Updated: 04.04.14


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