Unnoticed Medical Billing Changes in 2023


While not every policy alteration by the Centers for Medicare & Medicaid Services (CMS) grabs headlines, it’s often these less-publicized changes that lead to the most billing complications. Here are a couple of recent adjustments made by CMS that you might have overlooked.

New Place of Service Code

CMS introduced a new Place of Service (POS) code, 27, specifically for Outreach site/street locations. This code went into effect on October 1, but Medicare Administrative Contractors (MACs) have until January 1, 2024, to incorporate POS 27 into their claims processing systems.

The official definition for POS 27 is: “A non-permanent location on the street or in a non-standard environment, not classified under any other POS code, where healthcare professionals offer preventive, screening, diagnostic, and/or treatment services to homeless individuals without shelter.

In Transmittal 12202, CMS Provides Rationale for Establishing POS 27 for Medicare Part B Claims

At the behest of industry stakeholders, this fresh code was requested and subsequently established. Its purpose is to serve as a tool for recognizing care delivered to individuals who may encounter difficulties in accessing conventional healthcare facilities. Moreover, it holds the potential to enable the monitoring of care administered at outreach sites.

November Revision of Remittance Advice Remark Codes and Claim Adjustment Reason Codes

When reviewing the explanations of benefits from MACs, you might come across Remittance Advice Remark Codes (RARCs) and Claim Adjustment Reason Codes (CARCs) that are unfamiliar to you. CARCs offer insights into claim remittance processing, while RARCs provide supplementary details about CARCs.

As of November 1, the latest RARCs have been added to the X12 website, as depicted in the figure below. These codes cover electronic requests for additional information, real-time claim processing, unmet electronic visit verification data element requirements, reaching the maximum allowable payment, and the rejection of the Delay Reason code.

N886: Alert: On 07/01/2023, a Health Care Claim Request for Additional Information (277 RFAI) has been issued.

N887: Providers who are not participating in the Medicare Advantage Plan retain the right to appeal if the plan denies payment, either partially or in full, or if the provider believes that the plan has not reimbursed the services at the expected Medicare rate or level of service. To initiate an appeal, providers must submit a written request within 60 calendar days from the date of the remittance advice. The appeal will be reviewed by the plan, provided that a completed Signed Waiver of Liability Statement is included. To obtain the Waiver of Liability form, please reach out to your Medicare Advantage Plan directly.

Once we receive the completed forms, a decision on your appeal will be provided within 60 calendar days, starting from 07/01/2023.

N888: Alert: A request for additional information has been sent electronically for this claim, starting from 07/01/2023.

N889: Alert: This claim was initially processed in real-time, and a real-time 835 response was dispatched on 11/01/2023.

N890: The requirements for Electronic Visit Verification Data Element were not fulfilled, starting from 11/01/2023.

N891: The primary insurance has already made the maximum allowable payment for this service/procedure. As a result, no further payment is required, effective from 11/01/2023.

N892: The claim does not satisfy the criteria for acceptable use of the Delay Reason Code, starting from 11/01/2023.

Addition to List of Services Subject to Home Health Consolidated Billing

CMS maintains a roster of services and supplies that fall under the consolidated billing provision of the Home Health Prospective Payment System (HH PPS). Any services listed here are not separately reimbursed on days when a Medicare beneficiary is receiving care under a home health plan provided by a Home Health Agency (HHA). There are exceptions for therapies administered by physicians, supplies associated with physician services, and supplies used in institutional settings.

As of January 1, 2024, the HH consolidated billing non-routine supply code list has been updated to include wound suction, which is reported with HCPCS Level II code A9272. This code covers disposable wound suction, including dressing, along with all associated accessories and components, of any type, for each instance.

It’s important to note that MACs will not make separate payments for HCPCS Level II code A9272 on days when a beneficiary receiving such a service is within a home health episode. In such cases, Medicare will exclusively reimburse the primary HHA.

For authoritative guidance, please refer to CMS Manual System Pub 100-04 Medicare Claims Processing Transmittal 12197, Change Request 13295, issued on August 10, 2023.