The Centers for Medicare & Medicaid Services (CMS) directive, issued December 2, 2000, notified providers that as of January 1, 2001, the Coordination of Benefits Contractor (COBC) assumed responsibility for virtually all activities related to initial Medicare Secondary Payer (MSP) development. The COBC has the sole authority to ensure the accuracy and integrity of the MSP information contained in CMSs’ database, which includes:

• Whether or not the information providers receive from the beneficiary (during the MSP screening process) and report on their claims is correct
• Whether or not the information the COBC receives from various sources (which indicates the MSP file(s) on the Common Working File [CWF] is not accurate), is correct

As part of a provider’s eligibility verification process for Medicare beneficiaries, which is required to be conducted before claims are submitted to Medicare, providers should be checking for MSP file(s) on CWF. If a provider identifies an MSP file that requires correction because the information within that MSP file is invalid, it should contact the COBC so that they can make the correction before the provider submits its claim(s) to Medicare.

In addition, providers should utilize all available/applicable condition codes, occurrence codes, and remarks opportunities (i.e., Remarks field; UB-04 Form Locator [FL] 80) when submitting Medicare primary claims when there is an active MSP file on the CWF.

Instructions for Accidents

Situation: Accident MSP File Exists on the CWF

When looking for MSP files on CWF, providers may find that there is an active accident MSP file and that the MSP file is valid. The active accident MSP file on CWF is valid because the beneficiary was, in fact, involved in an accident in the past. However, per the information the provider collected during their MSP screening process, or by other research, it was determined that the current services are not related to the prior accident. In this situation, you do not need to contact the COBC. To submit the claim for payment as Medicare primary, providers may follow the following instructions depending on the exact circumstances:

• If there are no accident diagnosis codes on the current claim and you have verified during your MSP screening process that the services are not related to the active XX (whichever accident provision is active such as 14, 15 or 47) MSP file, then submit a Medicare primary claim. In the Remarks field, indicate, “Per MSP screening process, services not related to active XX (whichever accident provision is active) MSP file.” Do not report an occurrence code 05 on the claim.

- Or -

• If there are accident diagnosis codes on the current claim (claim is for a current accident) and you have verified during your MSP screening process that there are no primary insurers for the current accident (med-pay, no-fault, workers compensation and/or liability insurance) and that the services are not related to the active XX (whichever accident provision is active such as 14, 15 or 47) MSP file, then submit a Medicare primary claim. In the Remarks field, indicate, “Per MSP screening process, services not related to active XX (whichever accident provision is active) MSP file.” In addition, report occurrence code 05 with the date of the current accident on the claim. Occurrence code 05 lets Medicare know that it was determined during the MSP screening process that there is no primary insurer for this current accident. Do not also report this statement in the Remarks field.

When a claim posts to the CWF with a trauma diagnosis code, the CWF sends an alert to the COBC and they will investigate further.

Situation: No Accident MSP File Exists on the CWF

When looking for MSP files on CWF, providers may find that there are no active accident MSP files. However, the beneficiary is receiving services as the result of an accident. If it is determined during the MSP screening process that there are no primary insurers (med-pay, no-fault, workers compensation and/or liability insurance) for the accident-related services, then the provider may submit a Medicare primary claim. In this situation, it is not necessary to contact the COBC to have them establish an accident MSP file on the CWF. When there is an accident with no primary insurers (and also no accident MSP file on the CWF), providers may use the following instructions to submit the claim for payment as Medicare primary:

• Submit a Medicare primary claim with occurrence code 05 and the date of the accident. Occurrence code 05 lets Medicare know that it was determined during the MSP screening process that there is no primary insurer for this current accident. Do not report remarks in the Remarks field.

When a claim posts to the CWF with a trauma diagnosis code, the CWF sends an alert to the COBC and they will investigate further.

Instructions for Group Health Plan Situations

The MSP screening process includes checking the MSP information on the CWF to see if there is an active group health plan (GHP) MSP file. Sometimes, the information collected during the MSP screening process invalidates the active GHP MSP file on the CWF.

In certain situations, the following condition codes can be reported to relay the reason(s) why Medicare is the primary payer on their claims, if applicable:

09 Beneficiary and/or spouse is not employed

10 Beneficiary and/or spouse is employed but no GHP coverage exists

11 Disabled beneficiaries who is not covered by a large GHP

28 Employer GHP is secondary to Medicare because there are less than 20 employees

29 Employer GHP is secondary to Medicare because there are less than 100 employees

Occurrence codes that can also be used (with regard to GHP MSP files) include:

18 Date of retirement patient/beneficiary

19 Date of retirement for spouse (if applicable/available)

A2 Effective date for the insured Part A policy (this code will allow us to create a corrected MSP file on the CWF without delaying processing of the claim, as appropriate)

Note: Do not use an occurrence code 24 and date of insurance denial/rejection on a Medicare primary claim. Occurrence code 24 is used on conditional claims when the primary payer for an MSP beneficiary has not made payment for a valid/acceptable reason.

Instructions for Adjusting MSP Rejected (Cost-Avoided) Claims

The codes provided above will not always stop a claim from rejecting for MSP. If the claim rejects for MSP (cost avoid) upon initial submission of the Medicare primary claim, providers will need to submit an adjustment claim reporting the information as to why Medicare is the primary payer.

To adjust cost-avoided claims:

• If Medicare is the primary payer, report condition code D9 (Any other changes) and report the above information/code(s) accordingly.
• If Medicare is the secondary payer (i.e., MSP), report condition code D7 (Change to make Medicare the secondary payer) and report all required MSP claim billing codes.

Note: The Medicare beneficiary may have more than one active MSP file on CWF (e.g., an active accident file and an active GHP file). When this occurs, and Medicare is in fact primary, providers will need to follow both instructions above for accidents and for GHP situations.