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UWHC,

Policies,Administrative,UWHC,UWHC-wide,Fiscal

Medicare as a Secondary Payor (2.28)

Medicare as a Secondary Payor (2.28) - Policies, Administrative, UWHC, UWHC-wide, Fiscal

2.28

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Administrative (Non-Clinical) Policy
Category:
 UWHC only (Hospital Administrative-entity wide)  UWMF only (entity wide)
 UWHC Departmental (indicate name)  UWMF Departmental (indicate name)
 UWHC and UWMF (shared)
Policy Title: Medicare as a Secondary Payor
Policy Number: 2.28
Effective Date: May 1, 2015
Chapter: Fiscal
Version: Revision
I. PURPOSE

To establish a process ensuring compliance with Medicare regulations by accurately identifying situations
where other third party payors are primary to Medicare benefits and billing for services provided by the
University of Wisconsin Hospital and Clinics (UWHC) with the exception of patients who have dual
eligibility for Medicaid and Medicare insurance. When the patient has dual eligibility Medicare generally
pays benefits as primary payor.

II. POLICY

UWHC will make efforts to obtain information from patients and/or their representative in order to
determine on a pre-billing basis if another third party payor may be primary to the patient's Medicare
benefits.

III. DEFINITIONS

Approved
The amount approved for the service by the primary insurance.

Coinsurance
The percent of the insurance company's approved amount that the beneficiary has to pay after they pay
the deductible for Medicare Part B.

Medicare Secondary Payor (MSP)
Any situation in which another payor or insurance policy, plan or program pays medical bills before
Medicare.

Primary Payor
An insurance policy, plan, or program that is first in line to pay on a claim for medical care.

Recurring Services
A Medicare beneficiary is considered to be receiving recurring services if he/she receives services defined
by Medicare as recurring.

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Secondary Payor
An insurance policy, plan or program that is second in line to pay on a claim for medical care.

IV. PROCEDURE
A. UWHC must obtain MSP information from a beneficiary and/or representative for services
rendered as stated in Medicare’s publication 10 admission procedures.
1. Admission Registration Process
The establishment of third party payors as primary to Medicare will occur during the
patient admission or outpatient registration process.
2. Hospital Laboratory
a. If the MSP information obtained by the hospital from the beneficiary and/or
representative is not older than 90 calendar days from the date the service was
rendered, then that information may be used to bill Medicare for non-patient lab
services where the patient is not present, but a specimen has been sent to us for
processing.
b. UWHC must be able to demonstrate that MSP information is not older than 90
calendar days when submitting bills for Medicare patients. Examples of
acceptable documentation would be the last (dated) MSP information update,
either electronic or hard copy.
3. Recurring Outpatient Services
a. The initial collection of MSP information must be obtained from a beneficiary
and/or representative.
b. Following the initial collection, subsequent verification of the MSP information
must be obtained from a beneficiary and/or representative once every 90 calendar
days. If the MSP information is no older than 90 calendar days from the date the
service was rendered, then that information may be used to bill Medicare for
recurring outpatient services.
B. Situations under which another payor may be primary over Medicare include, but are not limited
to:
1. A patient has Employer Group Health Plan (EGHP) coverage through either his/her
current employment or through the current employment of a spouse;
2. A patient is disabled and has Large Group Health Plan (LGHP) coverage though his/her
current employment or through the current employment of a family member;
3. A patient has been diagnosed with End Stage Renal Disease (ESRD) and has EGHP
coverage through either his/her current employment or through a spouse and is in the 30
month Coordination of Benefits (COB) period;
4. A patient is injured and another party is responsible (e.g., Worker's Compensation,
automobile accident, etc.);
5. A patient is a veteran of the armed services and the Veterans Administration has agreed
to pay benefits as primary payor;
6. Another government program is responsible for payment (e.g., Black Lung, Research,
etc.);
7. Employer Group Health Plan (EGHP) Coverage
If the patient has coverage through an EGHP Medicare is considered the secondary
payor.
a. UWHC will obtain the information needed to bill the EGHP as primary and
record this information in the billing system.
b. Information required from the beneficiary and/or representative is:
i. The employer's name
ii. The employer's address

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iii. The insurance company's name
iv. The insurance company's address
v. The insurance policy number
vi. The insurance group number
vii. The subscriber's name
viii. The subscriber's Date of Birth
8. Large Group Health Plan (LGHP) Coverage
If the patient is entitled to Medicare benefits on the basis of disability, Medicare benefits
are secondary for individuals who are disabled and have coverage through a LGHP based
on either his/her own current employment or the current employment of a family member
(in addition to a spouse a family member can include a parent or guardian). To be
considered a LGHP, the employer must have employed an average of 100 or more
employees during the preceding calendar year.
a. UWHC will obtain the information needed to bill the LGHP as primary and
record this information in the billing system.
b. Information required from the beneficiary and/or representative is:
i. The employer's name
ii. The employer's address
iii. The insurance company's name
iv. The insurance company's address
v. The insurance policy number
vi. The insurance group number
vii. The subscriber's name
viii. The subscriber's Date of Birth
9. End Stage Renal Disease (ESRD)
If the patient is entitled to Medicare benefits solely on the basis of having ESRD,
Medicare benefits are secondary for a limited period of time for individuals who have
coverage under an EGHP, regardless of the number of employees and regardless of the
patient's and/or spouse's employment status. Medicare is secondary to an EGHP for a
period of 30-months, which usually begins on the date the patient began training for self-
chronic dialysis treatment or 3 months from the first day of chronic dialysis treatment if
not being trained in self-dialysis. For patients who have been diagnosed with ESRD and
receive a kidney transplant during the 30-month period:
a. Medicare continues to be secondary to the EGHP until the end of the 30-month
period.
b. The 30-month coordination period remains in effect even when the patient
becomes eligible for Medicare benefits based on either age or disability during
the coordination period.
c. UWHC will obtain the information needed to bill the EGHP as primary and
record this information in the billing system.
d. Information required from the beneficiary and/or representative is:
i. The employer's name
ii. The employer's address
iii. The insurance company's name
iv. The insurance company's address
v. The insurance policy number
vi. The insurance group number
vii. The subscriber's name
viii. The subscriber's Date of Birth
10. Accidents and Injuries
When the patient is receiving services due to an accident or injury it is reasonable to

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expect that another party may be financially responsible for payment and Medicare would
be secondary. This would include:
a. Work related accidents where a Worker's Compensation carrier would be
primary;
b. Non-work related accidents where a liability company would be primary; and
c. Automobile accidents where either the patient or another party's medical benefit
under their automobile insurance policy would be primary;
d. UWHC will obtain and record the date of the accident or injury and record this
information in the billing system;
e. Although the patient diagnosis does not determine if another party is primary to
Medicare, UWHC should refer to the list of diagnoses codes which Medicare
uses to identify situations where another payor has the potential to be primary to
Medicare.
11. Veterans Administration (VA)
a. Medicare beneficiaries who are veterans can request that the Veterans
Administration authorize payment for health care services from non-VA
hospitals; if a copy of the VA authorization letter is not on file, UWHC must
obtain a copy of the letter from the patient.
b. Black Lung Patients: if the Medicare beneficiary is receiving services related to
black lung:
i. The federal Black Lung program may be primary over Medicare
ii. If the patient's services are related to respiratory illness (see Section
289.20 of the Department of Labor's list of approved black lung
procedures), send the patient's claim to:
Federal Black Lung Program
P.O. Box 740
Lanham, MD 20706
c. The patient's circumstances or the nature of the health care services may require
other governmental payors to be primary to Medicare or, in some cases Medicare
should not be billed at all if the services being provided are categorically non-
covered. If this occurs, UWHC must determine when Medicare should be billed
as secondary or not billed at all.
C. Billing Process
1. Pre-Billing
a. As part of the insurance verification process, UWHC will obtain MSP
information from the patient and/or the representative either by telephone or in
person.
i. Eligibility for other coverage is obtained through methods available to
UWHC staff by the primary payer. For some this is electronic eligibility,
for others it is verified through a phone call or card confirmation of
Medicare managed care participation
ii. Large group employer primary plans
iii. Other liability coverage listed within the Medicare system which
indicates that Medicare does not have primary liability for service
2. Billing
a. If the UWHC designee determines that Medicare is the primary payor:
i. The financial class is changed to the appropriate code and billed
accordingly
ii. The account comments are updated to include the information
b. If the UWHC designee determines that Medicare should be secondary to another
payor:

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i. The claim filing sequence on the account is changed
ii. The financial class is changed to the appropriate code and billed
accordingly
iii. The account comments are updated to include the information
c. Automobile medical insurance or no fault insurance claims are to be reviewed
prior to submission to Medicare:
i. All claims received by the UWHC billing staff that contains accident or
trauma diagnosis codes are reviewed for accuracy of the primary payor
assignment
ii. When a payment or denial notice is received, a claim is submitted to
Medicare with all the applicable codes (e.g., condition code, occurrence
code, and value code) and remarks
d. Before claims are submitted to Medicare they should be processed through an
automated editor to identify missing required data elements (e.g., an occurrence
code indicating an accident without an accident date); if the claim fails the
editing process it must be researched, corrected, and reprocessed through the
editing cycle.
3. Post-Billing
a. When the primary payor denies or delays payment, UWHC will bill Medicare for
conditional payment for the following reasons:
i. Services are not covered by the liability insurer;
ii. The claim has been properly filed and reasonable attempts have been
made to obtain payment from the third party, but the claim has been
outstanding for more than 120 days;
iii. UWHC was unable to file a claim with the primary insurer in time due to
information provided or not provided by the beneficiary
b. To submit a secondary claim to Medicare when a beneficiary has primary
coverage with a managed care provider:
i. Report condition codes
ii. Insert the appropriate value codes
iii. If the managed care provider makes a reduced payment because the
provider is not in the network or the service is otherwise not covered,
submit the claim to Medicare and report the amounts along with the
appropriate value codes
V. REFERENCES AND RELATED POLICIES

42 U.S.C. § 1395y
42 U.S.C. § 411.24
§ 1862(b)(2)(A): The Social Security Act
§ 289.20: Department of Labor List of Approved Black Lung Procedures
71 Federal Register 9,467: Medicare Secondary Payer Amendments (February 24, 2006)
CMS Manual Pub 100-04 Medicare Secondary Payer Transmittal 49/Change Request 4024 (April 7,
2006)
Hospital Administrative Policy 2.12-Hospital Billing Policy

VI. COORDINATION

Senior Management Sponsor: VP, Revenue Cycle
Author: Director, Patient Business Services
Reviewer: Director, Access Services

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Approval Committee: Administrative Policy and Procedure Committee

SIGNED BY

Ronald Sliwinski
President & CEO

Revision Detail:
Previous revision: 052012
Next revision: 052018