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Travelers, SCIF Incorrectly Apply New E/M Rules Before Effective Dates

Travelers, SCIF Incorrectly Apply New E/M Rules Before Effective Dates

Every year, we see claims administrators incorrectly deny reimbursement because they fail to keep up with the latest changes to the Official Medical Fee Schedule (OMFS). But recently, we noticed the opposite problem: claims administrators applying new billing rules to incorrectly deny reimbursement when the date of service is before the new rule’s effective date.

In particular, multiple claims administrators are misapplying the new regulation regarding prolonged Evaluation and Management (E/M) services. Read on to learn how, and protect your office from these improper denials.

E/M Billing After March 1, 2021

Effective for dates of service on or after March 1, 2021, the Division of Workers’ Compensation (DWC) made significant changes to E/M services billing. In short, providers may choose to bill by the complexity of Medical Decision Making (MDM), or simply by time. For a detailed explanation, see our recent post.

As part of the changes, the DWC adopted a new time-based billing code for prolonged E/M services: Healthcare Common Procedure Coding System (HCPCS) G2212. When office or outpatient E/M services on a single date of service require more time than E/M billing codes 99205 or 99215 allow, providers must apply G2212. We explore this in detail here.

Again, the new E/M regulation and the adoption of G2212 is only applicable to dates of service on or after March 1, 2021.

Time Travelers

Some claims administrators are applying the above new regulations to bills for the wrong dates of service, denying reimbursement on invalid grounds.

Travelers Insurance, as well as California’s State Compensation Insurance Fund (SCIF), each recently incorrectly denied one DaisyBill provider’s reimbursements for 99358 and 99359. This did not occur because Travelers and SCIF failed to understand the new rules. Rather, Travelers and SCIF applied the new rules to dates of service prior to March 1, when the rules went into effect.

In the Explanation of Review (EOR) below, Travelers claims the prolonged services in question were not “separately reported because the work involved is included in the total work of the evaluation and management codes.”

In another EOR for the same provider, SCIF asserts that “Preparation of report...is included in the value of the report/service and is not separately reimbursable.”

In other words, both claims administrators incorrectly denied 99358 and 99359 because the provider also billed E/M code 99205 for the same date of service. Travelers and SCIF would be correct, had the provider fired up the DeLorean and time-traveled to the future to deliver the services in question.

But in both cases, the date of service was in January, weeks before G2212 became applicable.

Payer Motivations

Unfortunately, claims administrators have little motivation to prevent these errors. Many are content with a workers’ comp landscape in which invalid denials are frequent, because the burden of correcting them falls onto providers and their staff.

Providers often lack the time or resources to spot payer screw-ups, and may struggle to keep up with ever-changing billing and payment rules. Some claims administrators are only too happy to capitalize on this. Payers know that provider failure to dispute an incorrect reimbursement means the payer keeps the provider’s reimbursement.

We expect to see more invalid denials like these in the coming weeks and months. Providers must be prepared to analyze EORs, submit Second Review appeals, and even request Independent Bill Review if necessary.

DaisyBill knows the rules, even when claims administrators don’t follow them. Chat with us to learn how our technology and expertise can protect your revenue from payer noncompliance.


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