Re: CMS-R-131 (OMB# 0938-0566) Medicare and Medicaid Programs: Advance Beneficiary Notice (67 Federal Register 7380), February 19, 2002.

Liberty Place, Suite 700
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Thursday, March 21st 2002

Ms. Allison Eydt
Office of Management and Budget
Human Resources and Housing Branch
New Executive Office Building
Room 10235
725 17th Street, NW
Washington, DC 20503

Dear Ms. Eydt:

On behalf of our nearly 5,000 member hospitals, health systems, networks and other providers of care, the American Hospital Association (AHA) welcomes this opportunity to provide the Office of Management and Budget with comments on the Centers for Medicare and Medicaid Service’s (CMS) request for approval of proposed revisions to the Medicare program’s Advance Beneficiary Notice (ABN) and related paperwork requirements.

The ABN form is used by hospitals, physicians, suppliers and other providers to advise a beneficiary when Medicare may deny payment for a Part A or Part B item or service ordered by their physician because the item or service is not considered reasonable and necessary by the Medicare program. This form is given to affected beneficiaries before the item or service in question is furnished so that they can make an informed decision about whether to proceed. Beneficiaries who decide to proceed are then asked to sign the form acknowledging this possibility and agreeing to pay for the item or service if Medicare denies payment.

The AHA appreciates CMS’ efforts to simplify the language of the ABN for beneficiaries. We believe progress has been made in this regard since CMS first published proposed revisions in 2000. We have welcomed the opportunity to offer comments and meet with CMS officials to address our concerns. We are troubled, however, by the agency’s failure to address provider issues raised regarding overly complicated procedures for issuing ABNs, especially with respect to hospital emergency departments (EDs), and to recognize the full cost and burden to providers to prepare the notices, provide them to beneficiaries and answer questions.

The AHA recommends that OMB allow use of the revised forms only on a short-term basis, requiring that CMS address the operational and other issues listed below before full approval is granted.

Application of ABN Requirements to Emergency Departments
Notwithstanding CMS’s response to earlier comments, hospitals are still left in an untenable “Catch-22” situation with respect to services provided in an ED.

The Emergency Medical Treatment and Active Labor Act (EMTALA) requires hospitals participating in the Medicare program to screen any individual who comes to the ED to determine whether that person has an emergency medical condition and, if so, to stabilize him or her. A hospital must use any ancillary services ordered by the ED physician to adequately screen and stabilize patients to the extent that such services are routinely available to the ED.

However, Medicare sometimes denies payment for the services furnished in the emergency department because they exceed local medical review policies (LMRPs) or utilization guidelines for coverage and frequency established by Medicare fiscal intermediaries. In such cases, the fiscal intermediaries are applying their guidelines to the screening and stabilization process based on the principal diagnosis (determined after study), rather than applying the prudent layperson standard to the presenting condition of the beneficiary (the admitting diagnosis or reason for ED visit). For example, when a patient comes in complaining of chest pain, the ED physician must determine the source of the pain, whether from a heart attack, heartburn, or some other source. All the tests needed to do so should be covered, not just those tests related to the confirmed cause.

Similar problems occur when ED physicians – who have no prior experience with the patient and often have less than adequate medical history available – order one test over another. An example is the use of low osmolar contrast media (LOCM) when ordering an MRI or other test with contrast. Medicare has limited the use of LOCM to patients with a history of allergic reactions, preferring the use of lower cost contrast media, which has a higher risk of allergic reactions. For ED physicians, the use of LOCM is often the prudent course of action to protect both the patient and the physician in an uncertain emergency situation.

Hospitals cannot bill beneficiaries for such non-covered services unless they notify patients in advance that the services may not be covered (the ABN process), but in doing so they would be delaying the screening or stabilization required under EMTALA, which is prohibited by statute and compliance guidelines issued by the Office of Inspector General and CMS. The ABN instructions incorporate this prohibition, going on to prohibit issuing an ABN under any circumstances involving heightened duress of patients. The bottom line: Hospitals are required to screen (which requires diagnostic testing) and stabilize, but are often left unpaid. How can services required by EMTALA be judged unreasonable or unnecessary? This “Catch-22” situation remains unresolved in the provider instructions included in the clearance package.

The ABN process is inappropriate for an ED setting. The complexity of the pre-service notice process has no place in an emergency care environment where there is no pre-service scheduling. The perceived need for ABNs in the ED would be significantly reduced if fiscal intermediaries reviewed and processed claims in a fashion consistent with the nature of emergency services and a hospital’s obligations under EMTALA. Specifically, the AHA recommends that CMS adopt several policies. They include:

· Require that fiscal intermediaries judge the reasonableness and necessity of ED services on the basis of the beneficiary’s presenting condition or reason for visit, not the primary diagnosis that is determined after testing. CMS should utilize a recent UB-92 reporting change that capturesthe patient’s reason for an ED visit (Patient Reason for Visit FL76). While this change currently allows only a single diagnosis code, it wouldhelp explain why certain services were provided during the ED visit, allowing the fiscal intermediary to determine if the services provided were appropriate to the reason for the visit . CMS should also support expansion of this change to reflect multiple diagnosis codes in the UB-02 under development. This would reduce inappropriate denials of payment for EMTALA-required services and reduce the cost and administrative expense of medical review and appeals for ED services.

· Modify the application of LMRPs to ED services. LMRPs that limit the frequency of diagnostic tests should be applied to ED services exclusive of tests provided before the ED admission or visit. Even if it were possible for an ED treating physician to determine if diagnostic tests performed elsewhere had already used up the allotted tests (and they generally cannot), EMTALA compliance would require that the tests be performed to screen and stabilize.

· Require that fiscal intermediaries annually review denials of ED services to evaluate the need for LMRP changes. If LMRPs create a pattern of denials that are inappropriate or trigger medical review for services denied infrequently, the LMRP should be refined to avoid unnecessary burden in the future. Individual providers may not have enough experience with the application of individual LMRPs to identify patterns, but an annual analysis by the fiscal intermediary would readily identify patterns that should be reviewed.

We understand that some of these recommendations may be outside the scope of the immediate matter – that is, clearance of the revised ABN and its procedures – but it is imperative that this problem be resolved and, so far, CMS has failed to do so. We understand that CMS has undertaken a review of several operational problems related to EMTALA compliance. Perhaps that would be the appropriate place to address some of the issues and changes we recommend here. But the AHA believes the paperwork clearance process can serve a valuable role in imposing some timeframes within which that might occur.

Timely Delivery of ABNs
The requirement for “timely delivery” of ABNs needs to be clarified. CMS, in response to comments, said that, “The requirement for timely delivery of ABNs is clarified in MCM section 7310.1.C.5.” But we find that this section fails to provide such clarification. The section lets beneficiaries decide whether they have been put in a position where they feel “committed to receiving the item or service before receiving notice of the likelihood of denial of payment by Medicare.” We agree that beneficiaries need to receive notice when they still have a meaningful opportunity to act on it, but this so-called clarification lacks any objective criteria. It allows each beneficiary to apply his or her particular perspective and situation to the determination of “timely delivery” and expects the provider to be able to read the beneficiary’s mind.

The AHA recommends that more straightforward criteria be incorporated, such as before the procedure is initiated, beginning with any physical preparation of the patient (including disrobing, placement in or attachment of diagnostic or treatment equipment, etc.).

Understated Estimate of Provider Burden
CMS’ provider burden estimate continues to ignore many aspects of the cost of the ABN process. CMS estimates an average burden on providers and suppliers of about 1.6 hours per entity per year – with total estimated costs of about $32,800,000. CMS’ estimate is based only on its estimate of the time required to deliver the ABN to the beneficiary. The estimate fails to acknowledge or recognize that providers first must go through a process to assess and determine whether Medicare will cover the item or service in question. Given the complexity of Medicare coverage policy and the number of LMRPs that exist, this is not a quick or easy process. In a hospital setting it involves either significant staff time or the use of expensive software programs that must be purchased and frequently updated. CMS’ estimate also fails to recognize that once a provider determines that Medicare may not pay for a certain item or service, it must then provide a “cost estimate” for the beneficiary. Intuitively, the time necessary for this process will easily exceed CMS’s estimate of 5 minutes, at most, to deliver the ABN to the beneficiary. We estimate the ABN process will take at least 10 to 15 minutes on average.

We are especially concerned that this substantive underestimation of the burden of the revised ABN will disproportionately affect inner city and rural hospitals, which are already struggling due to ongoing skilled labor shortages, lack of access to capital for more sophisticated information systems, and declining Medicare and Medicaid margins. The AHA strongly urges a new burden estimate be prepared, incorporating these additional steps in the ABN delivery process before the ABN revisions are approved.

The AHA appreciates the opportunity to submit our comments on these proposed revisions to the Medicare ABN forms and related requirements. If you have any questions regarding our comments please contact me, Carmela Coyle, senior vice president for policy, at (202) 626-2266, or Ellen Pryga, director for policy development, at (202) 626-2267.


Rick Pollack
Executive Vice President


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