Medicare Compliance & Reimbursement

But a new slew of enrollment problems is on the horizon.

Promises, promises. Providers have been complaining for months that problems with the Provider Enrollment Chain and Ownership System (PECOS) are keeping them from billing Medicare even if they make the slightest change in their enrollment information. PECOS took effect last November, and since then providers have encountered nothing but trouble.

The Centers for Medicare & Medicaid Services insists it's been dealing with the problem, and allocated some new funds to help the carriers clear the huge stack of provider applications that remain. But still providers have their doubts. "We're pleased that CMS has provided additional funding to work down the backlog, but progress has been slow and we remain concerned," says an American Medical Association spokesperson.

A CMS official insists the problems will be solved by the fall, and in some cases much sooner. "Alot [of problems] are already cleared up," says the official. "We have put in a lot of effort and time working with the carriers individually." While some issues will take until October or November to resolve, others will be sorted out by the summer.

"A combination of things" has caused the PECOS problems, says the CMS source. "It's been a new system that's a little more national in scope than some of the individual things that [the carriers] had," and there were compatibility problems. In some cases, it can become complicated to deal with intricate ownership structures and holding companies. If a large chain changes ownership, it affects every individual provider within the chain.

"That's not going to be a systems problem; it's going to be an application problem," says the CMS official. That sort of issue will naturally take a while to work through because of its complexity.

Not only has CMS added funding for the carriers to deal with enrollment delays, it's expanded the hours that carrier staff can work and added money for overtime, says the official. "We have a team here that's comprised of people from the carriers," plus CMS staff and other contractors, and each team tackles one or more carriers.

But a new upheaval is coming for enrollment soon. Later this year, CMS will have to reenroll the entire physician community in preparation for the implementation of National Provider Identifiers, according to the AMA. The Health Insurance Portability and Accountability Act requires CMS to develop NPIs for all providers, and all payors will accept a single NPI for each provider.

The HIPAA deadline to use NPIs is May 23, 2007, but providers should be able to apply for NPIs by May 23, 2005, according to Walter Suarez, president and CEO of the Midwest Center for HIPAA Education in Bloomington, MN. Suarez predicts a rush to obtain NPIs once they become available. He lauds the convenience of having a single number for all payors.

But the carriers will definitely undergo another massive adjustment when they try to move over to NPIs, notes Suarez. It's unclear how the carriers will obtain the new numbers from CMS or the providers. Their systems "will have to be adjusted to accommodate the new numbers." We're awaiting "some additional guidance from the office of HIPAA standards on how that will happen," says Suarez. But it's clear the carriers will have to "reconfigure their identification system" and "make sure there's a match process inside the system, so when the provider sends the bill with the old number, they can identify the new number."

And NPIs will bring their own kind of complexity. For a clinic group that has 20 locations and 150 individual physicians, there will have to be an NPI for each location as well as each physician, predicts Suarez.

In terms of billing, physicians will probably need multiple NPIs to fill out the CMS 1500 form, claims Suarez. Put the NPI of the provider (clinic group) that is billing into box #33 of the 1500 form, but the NPI of the individual location into box #32 of the 1500 form, and the NPI of the individual physician into box 24-K. Thus it will be necessary to obtain numbers for all three levels. "The payor needs to be able to identify the location where the service was performed," notes Suarez.