News Alert: CMS to Require Positive COVID-19 Test Results for 20-Percent Medicare Add-on Payment

EDITOR’S NOTE: This article, originally published on RACmonitor and ICD10monitor, has been updated to alert facilities that COVID-19 testing inclusions will have a fiscal impact starting Sept. 1, 2020.

Effective Sept. 1, the Centers for Medicare & Medicaid Services (CMS) has enlisted a mandate requiring hospitals to have positive COVID-19 laboratory tests in patients’ records to qualify for Medicare’s 20-percent add-on payment. The 20-percent bonus applies to the DRG and does not affect patient liability, which continues to encompass the Part A inpatient deductible.

The new mandate, MLN Matters SE20015, which CMS said seeks to address “potential Medicare program integrity risks,” applies to admissions beginning Sept. 1. Until now, CMS guidance has indicated that a provider’s documentation – but not necessarily a positive test result – is sufficient to receive the 20-percent higher Medicare reimbursement for inpatient COVID treatment.

CMS has also said they will continue to apply the 20-percent add-on payment for COVID-19-related claims after the final rule takes effect, but they added that there will be post-payment audits/reviews to enforce this requirement – a sort of post-oversight, if you will, with the extra 20 percent to be recouped if no positive test results are found.

What will no doubt be a problem here, not only from the standpoint of administrative burden on hospitals and physician practices, is the fact that COVID-19 tests have become more widely available, and many hospital systems have treated thousands of patients who may have tested positive at some point during the pandemic. Yet in many cases, those patients then had several repeated tests, only to get a negative result, or repeated tests if initially testing positive despite being asymptomatic. This could continue to be the protocol for many hospitals after Sept. 1, and this could mean less reimbursement to hospitals for the same work.  

The American Hospital Association (AHA) is asking CMS to reconsider the new requirement. The lobbying group contended in a letter sent to CMS Administrator Seema Verma last Wednesday that requiring test results would put a “substantial administrative burden” on hospitals, asserting that provider documentation should continue to suffice. Their argument fell back on the CDC’s ICD-10 coding and reporting advice that “the COVID-19 diagnosis code on clinical judgment alone – in line with coding rules – continues to be an important approach, given that test accuracy may not be reliable, retesting is unnecessarily onerous, and some communities face persistent testing shortages.”

Another factor to consider is that if the government is now forcing hospitals to have a positive test in the record to get the 20-percent bump, then treating providers may stop making diagnoses of COVID-19 patients purely on a clinical basis, but will have to obtain tests on patients they already know have COVID-19. It may require multiple tests, because a negative may be a false negative (up to 30 percent of them are), and the provider needs that positive test to be paid appropriately.

According to the new rule, implemented under the provisions of Section 3710 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act:

“Positive tests must be demonstrated using only the results of viral testing (i.e., molecular or antigen), consistent with CDC guidelines. The test may be performed either during the hospital admission or prior to the hospital admission”

What also needs to be mentioned, as related to me by Dr. Ronald Hirsch of RACmonitor, is that the COVID test is terribly imperfect. So the patient with a negative test, who nonetheless has classic findings on CT scan, with hypoxemia and leukopenia, for example, who has COVID and will be treated for COVID, will not be sent home and told they are faking it. But how will that scenario affect this new rule that a positive lab test must be in the record for the 20-percent reimbursement increase?

What I find interesting in the new rule is the lack of clarification on how CMS is going about this mandate and review. Will they not allow for any defense of the medical record by the provider or facility?

The new rule goes on to read:

“CMS may conduct post-payment medical reviews to confirm the presence of a positive COVID-19 laboratory test, and, if no such test is contained in the medical record, the additional payment resulting from the 20 percent increase in the MS-DRG relative weight will be recouped.” So that means this  could be addressed by offsetting payments instead of a request for a refund. But it is too soon to tell how they will handle the process.

The AHA did go on to argue that in some cases, hospitals might have to dedicate considerable time and effort trying to get test results from third-party providers, and manually enter them into their medical records.

The problem with this new mandate is that in addition to a provider’s confirmation, hospitals have until now been able to use state or local COVID-19 test results, even if they weren’t confirmed by the CDC, to get the add-on payment. That will no longer fly. As stated above, CMS now requires viral testing, meaning molecular or antigen, consistent with CDC guidelines.

CDC coding guidance relates to the two ICD-10-CMcodes used to identify COVID patients: U07.1 for discharges on or after April 1, and before that, B97.29 for discharges on or after Jan. 27.

CMS implemented the provisions of Section 3710 of the CARES Act with the following language:

“To address potential Medicare program integrity risks, effective with admissions occurring on or after September 1, 2020, claims eligible for the 20 percent increase in the MS-DRG weighting factor will also be required to have a positive COVID-19 laboratory test documented in the patient’s medical record. Positive tests must be demonstrated using only the results of viral testing (i.e., molecular or antigen), consistent with CDC guidelines. The test may be performed either during the hospital admission or prior to the hospital admission.

For this purpose, a viral test performed within 14 days of the hospital admission, including a test performed by an entity other than the hospital, can be manually entered into the patient’s medical record to satisfy this documentation requirement. For example, a copy of a positive COVID-19 test result that was obtained a week before the admission from a local government-run testing center can be added to the patient’s medical record. In the rare circumstance where a viral test was performed more than 14 days prior to the hospital admission, CMS will consider whether there are complex medical factors in addition to that test result for purposes of this documentation requirement”, The new rule goes on to say, “CMS may conduct post-payment medical review to confirm the presence of a positive COVID-19 laboratory test and, if no such test is contained in the medical record, the additional payment resulting from the 20 percent increase in the MS-DRG relative weight will be recouped.”

This will be a story to keep an eye on in the coming months. To review the full new rule, go online

https://www.cms.gov/files/document/se20015.pdf