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Functional Limitation Reporting Claim Rejections

March 13, 2014 8 Comments

Will it ever stop?  The problems with functional limitation reporting claim rejections that is.  Grant it, there are some confusing scenarios that create provider side problems in Film at 11coding, but the bigger issue is the continued problems with CMS and the Medicare Administrative Contractors adjudicating claims.  Because of the difference in reporting and adjudication for those reporting on the UB04 claim form and those reporting on the CMS 1500 claim form, as well as the soft-coded edits done by MACs and the hard corded edits in the CMS common working file (CWF) things are a mess.  There is simply no other way to put it.  All this for a system that has nothing to do with coding for reimbursement, and as most providers understand, will not ultimately give much accurate information on beneficiary functional outcome, the sunk costs on this endeavor for providers is tremendous. (We’ll save discussion on outcomes for another post).

So what is happening with functional limitation reporting claim rejections?  If you listen to the folks on the CMS provider customer service lines, it’s nothing that can’t be solved with a review of MM8005, and a refresher on SE1307.  That’s what providers have been told for weeks, many couldn’t even get their problem escalated to discuss the issue, even after declaring that they had memorized every word of MM8005. Well as it turns out, CMS had some problems in the common working file with adjudication of claims, and therefore claims were rejecting inappropriately. (Please let me know if this has taken you by surprise).

Functional Limitation Claims Rejections – What to Do Now

Many of the MACs are now reporting on the party line that CMS has detected problems in the common working file that is causing rejections.  However, the MACs are also pointing out that there are good rejections (provider fault) and these unfortunate rejections (glitch in the common working file).  So now providers are instructed to review their claims and see if they have caused the problems, prior to calling customer services.  I guess the rationale in that is why waste anyone’s time, however, most MACs have not provided education and guidance on this, other than direct providers to MM8005 and SE 1307 (Sorry, I don’t mean to keep mentioning these two memos).  Kudos to WPS for having conducted a great webinar for their MAC Part A providers.

CMS notes two issues:

Issue 1 – Certain Initial therapy services are rejecting incorrectly indicating the provider did not submit the patient’s functional current status and the paired functional goal status G-code/severity modifier.  Issue 2 – Claims are rejecting when a claim is submitted with a different functional G-code set than is currently indicated in the patient’s HIMR history. The example given is when the patient has not been discharged and both sets of functional reporting have the same billing provider NPI and same discipline (GN, GO, or GP modifier). The system is not recognizing an episode of care when 60 days have lapsed since the last billed date of service for the initial G-code set. Therefore, the initial episode of care is not closing which prevents the second episode of care from being recognized.

The error notices associated with these two issues are:

CO-4 – The procedure code is inconsistent with the modifier used or a required modifier is missing
N572 – This procedure is not payable unless non-payable reporting codes and appropriate are submitted

Per an update from Palmetto GBA, CMS has indicated a fix will be placed into production on March 24, 2014, and should address some of the issues associated with the above error codes. Palmetto GBA suggests that providers in their MAC sign up for a CPIL alert for this issue which means you will receive an email when more information is available.  Other MACs including NGS and FCSO have reported the same issue.  Please stay on alert for notices on this matter from your MAC.

Before contacting the Provider Contact Center, (per the Palmetto update) providers should review  requirements for reporting therapy functional G-codes and modifiers. As a failure to meet any one of the requirements below would mean that the rejection was correct and providers will be required to correct and resubmit these claims:

Therapy functional reporting is required at specific intervals. This includes the appropriate non-payable G-codes and associated modifiers.

  • At the onset of the therapy episode of care
  • Specific points during treatment the treatment at specific points – Once every 10 treatment days – When an evaluative/re-evaluative service is billed (CPT code 92506, 92597, 92607, 92608, 92610, 92611, 92612, 92614, 92616, 96105, 96125, 97001, 97002, 97003, or 97004)
  • At the time of discharge from the plan of care
  • Generally, two G-codes will be reported at a time
    • One G-code for current functional status and a second G-code for projected goal status
  • Reporting G-code out of sequence may result in subsequent services being rejected
  • At the end of the reporting period the projected goal status and the discharge G-code both should be submitted
  • Only one functional limitation should be reported at a given time. For patients with more than one plan of care, report on the second functional limitation using a different set of G-codes after the first reported functional limitation is complete.
  • One of the required therapy modifiers GN – service delivered under an Outpatient Speech-Language Pathology Plan of Care, GO – service delivered under an Outpatient Occupational Therapy Plan of Care, or GP – service delivered under an Outpatient Physical Therapy Plan of Care must also be submitted
  • For each non-payable G-code, a severity/complexity modifier must be billed to report the patient’s functional limitation/impairment

Are you having problems with functional limitation reporting claim rejections?  Are your claims rejected due to the errors noted above?

Picture Credit: Roger Wilco via Compfight

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Nancy Beckley

Nancy J. Beckley MS, MBA, CHC: President-Nancy Beckley & Associates LLC. Compliance outsourcing, risk assessment, compliance plans, compliance training, auditing, due diligence, investigation support for therapy providers.

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Comments (8)

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  1. anamarie says:

    YES! We are under Noridian and getting denied on a claim that was reported correctly. I contacted Noridian and went over each code from start of care to discharge (5 months of codes) with the more than occasional, ‘hummmm’ on the other end of the line. I was told they must ‘investigate further’…we’ll see if they actually get back to me 🙁

  2. Hi Nancy

    Your post stated it well. This is the worst mess I have seen in a long time. All kinds of data errors resulting in claims rejections coupled with useless and contradictory advice from the MACs.

    This program was a true “Garbage In-Garbage Out” exercise from the beginning, now therapy providers are paying lots of money for very expensive garbage.

    All the best,


  3. Todd says:

    Yes and we are no longer accepting Medicare patients.

  4. Pam says:

    Yes!!! We are also under Noridian and I have 2 different providers having this issue. And it’s totally random. I’ve tried everything, including re entering the entire claim, and still they deny. Sometimes it is the initial, sometimes the progress. I know they are correctly billed, as they are identical to other claims that are being paid. We use WebPT, so they are accurate, no doubt about it.

    I have one from today, so the March 24th fix apparently didn’t do what it was supposed to do.

    I’m so frustrated

  5. Carie says:

    Yes frustrated. We are getting denied on all claims
    Since march. Nothing resolved.

  6. Marguerite says:

    We are having exact same issues as well. It is so frustrating because Novitas Medicare reported the issue was corrected and now they are stating they are aware that there are still issues with denials. I have been informed not to send claims back but the A/R is getting higher and higher and higher! Feeling helpless in rectifying the situation.


  7. debbieG says:

    Well, here we are in September- and Im still having issues. Our software alerts us when the G-code is due, there really should be no problems, but now they have changed error code from CO-4 to CO-97. But, same issue. Anyone have a fix?

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