Surgical Never Events Billing Related and Non-related Services

Surgical “Never Events” Billing Related and Non-related Services As a follow-up to last month’s Current Developments’ article titled “Reporting E-codes for Surgical ‘Never Events,’” this article will further discuss the obligation on Medicare providers to list diagnosis codes on their claims. Specificallly, Medicare requires providers to report International Classification of Diseases, Ninth Revision Clinical Modification (ICD-9-CM) codes E876.5, E876.6, and E876.7 when filing claims for surgical “never events.” As specified in a National Coverage Decision (NCD) published on January 15, 2009, CMS will not reimburse a provider for services and/or procedures related to a “never event,” i.e., the wrong operation on the correct patient, the operation on the wrong patient, or the operation on the wrong side or body part.

The Centers for Medicare & Medicaid Services (CMS) recently issued guidance with respect to billing surgical “never events.” CMS now requires hospitals to submit two inpatient claims when a surgical error, i.e. a surgical “never event,” is rendered with covered services. CMS has informed providers that “Medicare will not cover hospitalizations and other services related to…non-covered procedures.”   Further, CMS contractors will review beneficiaries’ histories to identify claims related to the surgical “never event” every 30 days for an 18 month period from the date of the surgical error. Additionally, CMS contractors will “take appropriate action as necessary.” Thus, it is imperative for providers to understand how to distinguish and accurately claim related and non-related services and/or procedures when a surgical “never event” occurs since CMS contractors will routinely monitor claims and collect identified overpayments.

Related vs. Non-related Services
When a surgical error occurs, it is possible for additional services and/or procedures to be furnished during hospitalization. Some surgical errors will require additional hospital services to  treat conditions or complications due to the surgical errors, i.e. related services. Other hospital services may be necessary for conditions or complications not related to the surgical error, i.e. non-related services. Services that are related to a surgical “never events” are not reimbursed under Medicare. These services include:

• Services provided in the operating room when the surgical “never event” occurred;
• Services rendered by providers who can individually bill Medicare and who are present in the operating room during the surgical “never event;” and
• Services rendered during the hospitalization that are related to the surgical “never event.”

It is important to note that services related to a surgical “never event” do not include the “performance of the correct procedure” or reasonable and necessary services following hospital discharged.  Thus, these services, as well as services not related to the surgical “never-event,” are reimbursed by CMS if medically necessary and reasonable.

The following checklist was may assist in determining if a service is related or non-related to a surgical “never-event.”