PURPOSE:
Review the billing requirements for Medicare beneficiaries who receive services while enrolled in an HMO.

TEXT:
Hospitals and Skilled Nursing Facilities (SNF) are required to submit a claim to Medicare for all Medicare beneficiaries, even when a stay is covered by an HMO. Although Medicare will not make payment on these claims, the claim can be used to link a spell of illness.

The claim should be billed as a covered claim including all the routine data required on a Medicare covered stay as follows:

• Type of Bill
  The type of bill should NOT reflect a zero as the third digit. Acceptable values in the third position of the Bill Type are 1,2,3, or 4.
  
• Covered Days
  All days should be shown as covered.
  
• Condition Code
  All claims are to have a Condition Code 04 indicating HMO involvement.
  
• Charges
  All charges should be billed as covered unless the charges are for items routinely billed as non-covered (i.e telephone, personal services, etc).
  
• Deductible and Coinsurance Information
  Deductible and coinsurance information should be recorded in the appropriate data items on all bills, if applicable.
  
• Payer Information (Line A)Medicare MUST BE on "Line A" of Payer Information.
  The associated Payer Code"Z" must also be entered on Payer Line A.
  
• Insured Information(Line A)
  The correct Medicare Health Insurance Claim (HIC) number must appear on Payer Line A in the "CERT-SSN-HIC" Field. Do NOT enter the HMO's member ID number.
  
• Remarks "HMO PAID BILL" must be entered.

These claims are sent to the Common Working File (CWF) where they are edited against the CWF Eligibility File. If the CWF Eligibility File has an HMO record established, the claim will process with no Medicare reimbursement and the HMO message will appear on the Remittance Advice. If however, there is a discrepancy between the CWF HMO information and the data billed on the claim (i.e. CWF has an HMO record but the claim was billed without a Condition Code 04) the claim will be rejected. The provider will be required to correct the claim based on the CWF data and resubmit the claim as an adjustment.

Expected Impact
Hospitals and SNFs will continue to submit claims to the Intermediary for Medicare Beneficiaries even though that beneficiary is enrolled in an HMO.