Today we want to address a topic that we talk a lot about, but always seems to be a thorn in the side of EMS crews, billers, and billing companies. Medical necessity is a term that conjures many different images and definitions in peoples’ minds. It at once feels overly broad yet painfully specific and its this dissonance in the minds of EMS providers that causes it to consistently be one of the top reasons for overpayment in EMS audits.
At MCS, we’ve conducted many audits and training sessions for our clients and regarding the documentation of medical necessity, we’ve found the biggest obstacle to proper documentation is subjectivity. How does subjectivity come into play? We find, because the definition of medical necessity seems to include everything, that it affects documentation by causing crews to make their own definitions and assume things like medical necessity is met due to the transport being a 911-call. In other instances, the crew assessing the patient may gloss over important findings and insert their personal opinion. We’ve found that a lack of a standard process by ambulance services to help crews document medical necessity allows subjectivity to take over this important part of documentation.
In this article, we’ll break down the definition of medical necessity, distinguish it from other Medicare coverage requirements, help services understand the importance of improving documentation, and provide suggestions for a better documentation process.
Medical Necessity Defined
Medicare defines medical necessity as being established when the patient’s condition is such that use of any other method of transportation is contraindicated because it would endanger the patient’s health. This determination is made regardless of whether other means of transport are actually available to the patient. To be clear, Medical Necessity is not necessarily the patient’s complaint or illness/injury they are seeking treatment for, or the fact that the transport was dispatched as an emergency, but very specifically is the condition of the patient at the time of transport that requires them to be transported by ambulance. Medical necessity is the answer to why. Why did the patient require an ambulance?
What About Emergency Transports?
A common response we hear from our clients, especially 911-only services, is that the emergency is the medical necessity. This reasoning comes from the perspective that if the service is required by law to respond to 911 calls, then they should be entitled to payment for those transports. However, emergency responses have no bearing on whether a transport meets medical necessity. In fact, CMS states that emergency responses do not independently establish or support medical necessity for ambulance transports. This misunderstanding can cause crews to gloss over the issue of medical necessity in the run documentation because they believe it is either self-evident or doesn’t matter for emergencies.
Our Claims Aren’t Being Denied, So Why Does This Matter?
Many ambulance services we’ve seen are stretched thin. EMS is a notoriously underpaid and under supported industry, and especially over the past year and a half, morale is low, and the challenges of fulfilling all the functions of an ambulance service are harder than ever. So, when we talk about medical necessity, services may find it hard to rank it high on their list of priorities. A common response we get from services regarding medical necessity is “our claims aren’t being denied, so we don’t see the problem.” This comes from a misunderstanding about how Medicare processes and pays claims, along with the all-too-common practice of pushing problems without an immediate solution down the road.
It’s important to understand that Medicare pays on an honor system. Because Medicare doesn’t have the resources to review every transport prior to payment, they pay based on the information submitted to them. However, that isn’t the end of the matter. Medicare can look back multiple years to audit paid claims, and if they are ultimately found not to meet the coverage criteria, they will be considered overpayments and must be refunded or put through a lengthy appeal process.
To look at it from a personal point of view, would you assume that you could submit a false tax return just because the IRS has never called you on it?
Ignoring proper documentation may not affect every claim you submit, but your service will create more work for itself in the long run in the form of uncertainty in future audits, spending money and resources on responding to and appealing audits, greater scrutiny if your service has high error rates, lost revenue your service thought it had earned, and other potential fines and liabilities—the worst being criminal.
What Can We Do?
The best way we’ve found to improve documentation of medical necessity is to create a process that takes the crew’s subjectivity out of the equation and relies on standardized guidelines. The same way your service has a standard routine for doing truck checks, your service should have a standard way of identifying and documenting medical necessity.
That is why we’ve created a medical necessity tool which incorporates the CMS guidelines for medical necessity into a fast assessment style application that can be accessed on your existing devices. When assessing the patient, the crew can answer quick and easy questions about the patient’s condition and the application will provide results in an editable statement which can be added to the PCR narrative. In less than three minutes your crew can obtain a thorough statement of medical necessity and cut down on QA review, billing reviews, overpayments, and the impact of future audits on your service.
We believe in working smart! By assisting your crews with taking some of the difficulty out of documentation you help their jobs become a little easier and improve your service’s bottom line. We hope that after reading this article the definition of medical necessity and why it’s important is clearer and that your service starts taking proactive steps to improve your documentation today.
If you have any questions about our services, the medical necessity app, or just have a question about this article or compliance in general, please contact us today!