To:  NHPCO Members
From:  NHPCO Health Policy Team
Date:   February 08, 2012

CMS Issues Transmittal Announcing New Hospice Condition Code for Out of Service Area Discharges and Limited Use of Occurrence Code 42

Summary at a Glance

CMS issues CR7677 with information on:

• Limited use of occurrence code 42, only for patient revocations
• Establishment of condition code 52 for instances where the patient is unavailable or unable to receive hospice services from the hospice responsible for their care
• Clarifications on codes no longer used for hospice discharge when the patient is no longer terminally ill and when the face-to-face encounter is not completed timely
• Billing for denials for hospice room and board
• Clarification on nurse practitioner billing codes and modifier when the nurse practitioner is the patient’s attending physician

On January 25, 2012, CMS issued CR 7677, announcing a new hospice condition code for out of service area discharges and limited use for occurrence code 42.  The CR was rescinded and reissued on February 3, 2012 after some of the necessary manual text was inadvertently deleted.  The effective date of the CR is for claims submitted on or after July 1, 2012. 

CR7677 provides instruction to hospices about a change in the use of occurrence code 42, to be used only when the patient revokes their hospice benefits, and the addition of condition code 52 for instances where the patient is unavailable or unable to receive hospice services from the hospice responsible for their care.  In addition, the CR includes manual clarification about hospice billing for denial of room and board charges and revenue code and modifiers for nurse practitioner billing.

Occurrence Code 42 – Patient Revocation

The CR requires hospices to discontinue use of occurrence code 42 for situations when a provider initiates the termination of hospice care and only use occurrence code 42 to indicate a discharge due to a patient revocation, in accordance with the existing National Uniform Billing Committee (NUBC) instructions.  This means that as of July 1, 2012, occurrence code 42 will not be used for hospice discharge when the patient is no longer terminally ill or when there is an untimely face-to-face encounter.

Condition Code 52 – Out of Service Area Discharge

The CR also instructs hospices to use a new condition code 52 to indicate a discharge “due to the patient’s unavailability/inability to receive hospice services from the hospice which has been responsible for the patient.”  This code would be used for instances where the patient is considered to have moved out of the hospice’s service area.  Examples of uses for condition code 52 include, but are not limited to:

1. when a hospice patient moves to another part of the country;
2. when a hospice patient leaves the area for a vacation;
3. when a hospice patient is admitted to a hospital or SNF that does not have contractual arrangements with the hospice.

These new codes will enable providers and policymakers to distinguish between a revocation and a hospice-initiated discharge on hospice claims.  In addition, this change will “help in understanding different patterns of hospice care and their associated costs, which is necessary for future payment reform.”  CMS also states their concern about a “possible program vulnerability when a patient is discharged from the hospice benefit, has an intervening hospital stay, and then is readmitted to the hospice benefit.  Knowing the reason for the discharge would help in focusing efforts to strengthen the integrity of the benefit, and in identifying differing care patterns that may be associated with more costly hospice care.

Patient No Longer Terminally Ill or Face-to-Face Encounter Not Timely

Those discharges occurring because a patient is no longer terminally ill or when the face-to-face encounter is not done in a timely manner do not have any special coding other than the patient status code.  CR 7478 noted that, “If the required face-to-face encounter is not timely, the hospice would be unable to recertify the patient as being terminally ill, and the patient would cease to be eligible for the Medicare hospice benefit.  In such instances, the hospice must discharge the patient from the Medicare hospice benefit because he or she is not considered terminally ill for Medicare purposes.”  Discharges due to late face-to-face encounters fit into the “no longer terminally ill” category.   

The following chart will provide a description of the set of codes now available for discharge and when to use them.  Please note that discharges occurring because a patient is no longer terminally ill are identified by not being associated with any special coding other than the patient status code.

With this CR, Section 30.3 of Chapter 11 of the Medicare Claims Processing Manual has also been updated.  

Billing for Denial of Hospice Room and Board Charges

Section 100 of Chapter 11 of the Medicare Claims Processing Manual has been added that directs hospices to submit claims for room and board and receive a denial so that a secondary payor can provide reimbursement.  Hospice providers may submit the room and board charges as non-covered using revenue code 0659 with HCPCS A9270 and modifier GY on an otherwise covered hospice claim.  The transmittal directs the Medicare Administrative Contractor on the process to sending the denial for charges.

Clarification of Nurse Practitioner Codes When the Nurse Practitioner is Serving as the Patient’s Attending Physician

• The transmittal requires Medicare Administrative Contractors to pay revenue code 0657 when reported with a GV modifier (physician services performed by a nurse practitioner) appending to the HCPCS code with the lower of the submitted charge or 85% of the physician fee schedule.  Please note that the nurse practitioner may only bill separately for hospice services when designated by the patient as their “attending physician.”

• Medicare will adjust hospice claims already processed containing revenue code 0657 reported with a GV modifier appended to a HCPCS code if payment was made at 85% of the submitted charges and the claim is brought to the attention of your Medicare contractor within 6 months of the implementation date of CR7677, which is July 2, 2012.

MedLearn Matters article

The MedLearn Matters article on MM7677 – New Hospice Condition Code for Out of Service Area Discharges.

Questions should be directed to regulatory@nhpco.org

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