WPS Medicare Provider Part B - Claims - Unprocessable Claim Guidelines

Unprocessable Claim Guidelines

Since 1996, to help prevent the inappropriate use of the appeals system, the Centers for Medicare and Medicaid Services (CMS) has followed an editing process for assigned claims that lack certain information. When a Medicare paper or electronic claim contains incomplete or invalid information, it may be returned to a provider as unprocessable. Because no "initial determination" was made on a claim returned as unprocessable, the submitter may not ask for a review or appeal.

Unprocessable claims may be corrected and resubmitted to Medicare. Providers may submit resubmit the claim with the needed information as a "new claim," as this will minimize delays in payment or proper denial.

Providers should promptly correct returned claims using the Medicare editing system to meet their legal obligation for submitting a Medicare claim. Non-participating providers who currently bill beneficiaries prior to submitting a claim may continue to bill them.

What Does "Return as Unprocessable" Mean?

When a Medicare claim cannot be processed because information is missing or incorrect, it is called a "return as unprocessable" claim. It cannot be processed as submitted and must be corrected before an initial claim determination can be made. The Medicare Carriers Manual (MCM) gives carriers three options for returning claims as unprocessable.

Option 1
Incomplete or invalid information is discovered before the claim is entered into the Medicare carrier's claim processing system . The carrier may return any claims with incomplete or missing information before they are assigned a control number and/or entered into the claims system. Claims are returned to providers in hardcopy form or electronically with an explanation of any errors in the form of a description or code. Providers may correct and return the claim.

Option 2
Incomplete or invalid information is detected at the front-end of the process, the claim is assigned a control number and entered into the claims processing system. Claims with incomplete or invalid information are suspended and a development letter is generated and sent to the provider. If the provider submits corrections within a 45-day period, the claim is processed. If corrections are not made, the suspended claim is "returned as unprocessable" and the provider is notified with a remittance notice.

Option 3
Incomplete or invalid information is detected within the claims processing system. Claims with incomplete or invalid information are rejected through the remittance process along with an explanation of errors and possible corrections. The explanation will either be in the form of a description or a code. This is the option that WPS employs.

What Does "Incomplete" or "Invalid" Mean?

A Medicare claim that is missing certain required information is returned as unprocessable because the claim cannot be processed with incomplete information . A required data element is one that is needed to process a claim (e.g., a provider number or date of service).

A conditional data element is one that must be completed if other conditions exist (e.g., if the patient is not the insured under the policy, both the patient's and the insured's name must be entered on the claim.) If a Medicare claim contains complete and required information but the information is illogical or incorrect (such as the wrong provider number), the claim is returned as unprocessable because it has invalid information .

Special Note: If information is missing from required or conditional field(s) but the Medicare carrier keeps the information on file and can supply it, the claim will not be returned as unprocessable.

What Information Will Be Provided to Assist You in Correcting a Claim?

To assist you in making the appropriate corrections, the carrier supplies the following information (as long as it is on the received claim):

Beneficiary's name;
HIC number;
Dates of service; and
Patient account or control number.

An explanation of the errors in the form of a description or code is also provided.

When Will a Claim be Returned as Unprocessable?

To assist providers in completing paper claims, refer to the CMS-1500 instructions on the CMS web site .

Electronic submitters should refer to the National Standard Format (NSF) specifications, the carrier National Standard Format Matrix documents, and Medicare Part B Specifications for the ANSI X12 837. Printing specifications must be correct on the claim.

In general, your claim will be returned or rejected as unprocessable:

If a service was ordered or referred by a physician (other than those services specified below) and the physician's name and/or UPIN (or surrogate) is not present in items 17 or 17A.
If a physician extender or other limited licensed practitioner refers a patient for consultative services, but the name and/or UPIN of the supervising physician is not entered in items 17 or 17A.
For diagnostic tests subject to purchase price limitations: (a) if a "YES" or "NO" is not indicated in item 20; (b) if "YES" is indicated in item 20 and the purchase price is not entered under the word "$CHARGES:" or (c) if "YES" is indicated and the purchase price is entered under $CHARGES, but item 32 is blank (no name or PIN number is provided).
If a provider of service or supplier is required to submit a diagnosis in item 21, a ICD-9-CM code is either missing, incorrect or truncated, or a narrative diagnosis was not provided on an attachment.
If modifier "AQ" is entered in item 24D to refer to a Health Professional Shortage Area, but item 32 is left blank, or contains no facility/laboratory name, address, or carrier assigned PIN. Also, if the AR modifier is billed for the Physician Scarcity Area incentive, and item 32 is left blank, or does not contain the facility information.
If a performing physician/supplier/or other practitioner is a member of a group practice and does not enter his or her carrier assigned Provider Identification Number (PIN) in item 24K and the group practice's number in item 33.
If a primary insurer to Medicare is indicated in item 11, but fields 4, 6, and 7 are incomplete.
If there is insurance primary to Medicare that is indicated in item 11 by either an insured/group policy number or the Federal Employee Compensation Act (FECA) number, but the primary payer's program or plan name in item 11C is incomplete.
If a HCPCS modifier must be associated with a HCPCS procedure code or if the HCPCS modifier is invalid or obsolete.
If a date of service extends more than one day and a valid "to" date (MMDDCCYY) is not present in item 24A.
If the statement "Attending physician, not hospice employee" is not entered in item 19 for physicians rendering services to a patient in a hospice but the hospice the patient resides in does not employ the physician.
If an "unlisted procedure code" or a "not otherwise classified" (NOC) code is indicated in item 24D, but an accompanying narrative is not present in item 19 or on an attachment.
If the name, address or PIN of the facility where services were furnished in a hospital, clinic, laboratory, or facility other than a patient's home or physician's office is not entered in item 32,.

List of Requirements for Specific Claim Types

[Editor's note: The following instruction describes some "conditional" requirements which are claim specific and necessary for processing a Part B claim submitted on the CMS-1500 or the NSF. A "conditional data element" is one that must be completed if other conditions exist (e.g., if the insured is different from the patient, then the insured's name must be entered on a claim). A data element is considered not required if it is optional or is not needed in order to process a claim (e.g., patient status).

This instruction is minimal and does not include all conditional data element requirements that are claim specific. Some claim types covered by Part B are not included in these instructions. Effective October 1, 2002, providers must enter the name, address, and zip code of the facility if the services were furnished in a hospital, clinic, laboratory, or facility other than the patient's home or physician's office. You may no longer enter the word "same" in item 32 if the address is identical to the address entered in item 33. ]

Your claim will be returned or rejected as unprocessable:

CMS-1500 Item	Field Requirement	Unprocessable Situation
1a	Insured's Medicare Health Insurance Claim Number (HICN)	Field is blank or contains an invalid HICN
2 and 3	Patient's Name	Field is blank or contains an invalid patient's first and last name
11	Group Number (or the word "NONE" if Medicare is primary)	Field is blank or contains something other than the Group Number or the word "NONE"
12	Patient's or authorized person's signature (with some exceptions)	Field is blank or contains invalid information
14	Date of Initial Treatment	For chiropractic services, the initial treatment date is not indicated.
17	Referring/Ordering physician name (if service was referred or ordered)	-Field is blank or does not contain the Referring / Ordering physician's name -For parenteral and enteral nutrition claims: if the services of an ordering/referring physician(s) are used and their name and/or UPIN is not present in item 17 or 17A.
17a	Referring/Ordering physician UPIN (if service was referred or ordered)	Field is blank or does not contain the Referring/ Ordering physician's UPIN
19	Miscellaneous Requirements	-A drug "unlisted procedure code" or a "not otherwise classified' (NOC) code is indicated in item 24d but an accompanying narrative is not present in item 19. -For other NOCs, the accompanying narrative is not present in item 19 or on an attachment. -For independent laboratory claims, the claim does not contain validation from the prescribing physician that laboratory services were conducted at home or in an institution. -For outpatient services provided by a qualified, independent physical or occupational therapist, the UPIN of the attending physician is not present or the date the patient was last seen by the attending physician is not present. -For routine foot care claims, the date the patient was last seen and the attending physician's PIN are not indicated.
20	Purchased Service	A "Yes" or "No" is not indicated or a "Yes" is indicated but the purchase price and item 32 are blank or incomplete.
21	Diagnosis Code	An ICD-9-CM code is missing, invalid or truncated.
23	Prior Authorization Number/CLIA Number	-For all physician office laboratory claims, a 10-digit CLIA certification number is not present -For investigational devices billed in an FDA-approved clinical trial, an investigational device exemption (IDE) number is not present -For physicians performing care plan oversight services, if the 6-digit Medicare provider number of the home health agency (HHA) or hospice is not present
24a	Date of Service	Field is blank or contains an invalid date of service
24b	Place of Service	Field is blank or contains an invalid place of service
24d	CPT or HCPCS Modifier	Field is blank or contains an invalid or obsolete CPT or HCPCS code or a modifier is added that is invalid or obsolete
24k	Performing provider (if a member of a group practice)	Field is blank or contains an invalid PIN
31	Provider Signature (with some exceptions)	-Field is blank or contains invalid information -Effective October 1, 2002, providers and suppliers must complete this item and include the signature of the provider of service or supplier or his/her representative, and the date the form was signed. For electronic claims, it is necessary to enter a "Y" in the provider signature field (NSF: EAO.37 position 200) (ANSI: yes/no condition response - 2300 Loop, Element CLM 06) to indicate the providers signature was obtained. You may also enter an "N" in this field if no signature was obtained; however, the claim will be denied.
32	Name and address (including ZIP code) of facility where services were performed	-Field does not contain the complete information required. (Effective October 1, 2002, providers must enter the name, address, and zip code of the facility if the services were furnished in a hospital, clinic, laboratory, or facility other than the patient's home or physician's office. You may no longer enter the word "same" in item 32 if the address is identical to the address entered in item 33.) -For certified registered nurse anesthetists (CRNAs) and anesthesia assistant (AAs) employed by a group (such as a hospital, physician, or ASC), item 32 does not contain their personal PIN number and they do not enter the group's name, address, or billing number in item 24K. -For durable medical, orthotic and prosthetic claims: if the name, address, or PIN of the location where the order was accepted is not entered -For laboratory services performed by participating hospital-leased laboratory or an independent laboratory (including services to a patient at home or in an institution), name, address or PIN of the laboratory where services were performed is not included. -For all laboratory work performed outside a physician's office, the claim does not contain a name, address or PIN where the laboratory services were performed -For mammography "screening" and "diagnostic" claims, a qualified screening center does not accurately enter their six-digit, FDA-approved facility identification number when billing the technical or global component.
33	Billing provider name, address, and Provider Number (PIN)	Field is blank or does not contain the required information

The MA130 code indicating that the claim was unprocessable will appear on the Remittance Advice for any claim returned for incomplete or invalid information. The claim is returned with a form letter indicating the invalid or incomplete information that must be corrected before the claim is retransmitted/resubmitted. There are no appeal rights on rejected claims.

Additional information about unprocessable claims is available in the CMS Internet-Only Claims Processing Manual, Publication 100-4, Chapter 1, Section 80.3.1, available at:http://www.cms.hhs.gov/manuals/downloads/clm104c01.pdf (pdf)

Editors' Note: We published an article in the February 2005 Communiqué titled "Unprocessable Claim Denials," located on page 24. We republished this article last week (2/25/05) to address corrections made to this article. We are republishing this article again this week (3/4/05) to clarify Item 32 instructions. Clarified language is indicated in red. We also updated the February 2005 Communiqué to reflect these changes. Please make note of the clarifications below.

In an ongoing effort to reduce cost and administrative waste, we ask that providers resolve incorrect claim submission resulting in unprocessable denials. Unprocessable denials result in delays in payment of Medicare benefits.

What does "Unprocessable" mean?
When a Medicare claim cannot be processed because the information is missing or incorrect, it is called an unprocessable claim. It cannot be processed as submitted and must be corrected before an initial claim determination can be made. Claims denied as unprocessable have no appeal rights. The claim must be corrected and resubmitted to our office. Please ensure that you are submitting all REQUIRED information. Share this information with your electronic claim vendor.

The following are the top unprocessable denials for our 4-state jurisdiction:

Rendering Physician Invalid - Loop 2310B/2420A, REF02 (1C) for electronic submitters; Item 24K for CMS-1500 form. Enter the carrier assigned Provider Identification Number (PIN) when the performing provider/supplier is a member of a group practice. If you have received denials for invalid rendering physician number, please call the appropriate phone number listed below to verify the correct number.

Wisconsin, Illinois, and Michigan: 877-908-8476

Minnesota: 877-564-0315

Missing or Invalid Modifier - Loop 2400, SV101-3 through SV101-6 for electronic submitters; Item 24D for CMS-1500 form. Modifiers are required when they clarify/improve the reporting accuracy of the associated procedure codes. Please verify correct modifiers either by HCPCs Coding Guide or CPT 2005.

Facility Name or PIN Missing - Facility Name: Loop 2310D/2420C NM103 (FA), entire segment needed for electronic submitters; Item 32 for CMS-1500 form. Providers must enter the name of the facility where the service was performed unless it is Place of Service (POS) 11 (office) or 12 (home).

Item 32 for CMS-1500 Paper form: Providers must enter the address where the service was performed unless the POS is 12 (home). Please remember, effective for claims received on or after April 1, 2004, for POS 'home,' the Medicare carriers will use the beneficiary address on file to determine geographical payment.

Facility PIN: Loop 2310D/2420C, REF02 (1C), entire segment needed for electronic submitters; Item 32 for CMS-1500 form. If an independent laboratory is billing, enter the place where the test was performed and the carrier assigned PIN. The reference lab identification number should also be reported here. Only bill one unique facility number per claim.

Referring Physician Name and PIN - Referring Name - 2310A Loop NM1 and REF segments for electronic submitters; Item 17 for CMS-1500 form. Required if the claim involves a referral. Enter the name of the referring or ordering physician if the service or item was ordered or referred by a physician.

ID Number of Referring Physician - 2310A Loop NM1 and REF segments for electronic submitters; Item 17A for CMS-1500 form. Enter the CMS assigned UPIN of the referring physician listed in Item 17.

These unprocessable situations resulted in almost 250,000 denials in one month. This type of denial can be avoided by following correct claim submission instructions.

Page Last Updated: Monday, 09-Jun-2008 13:34:25 CDT