Medical Necessity is Not the Enemy

I’ve been reading various “Top Stories of 2012 in Healthcare” articles; this past year has really been a wild ride. The more I reread all the changes, the more I think of the great, reliable constant—medical necessity. It’s the cornerstone of the third-party reimbursement system, yet it remains a challenge that both providers and payers continue to struggle with. Believe it or not, CMS is greatly concerned with writing clear, accurately coded policies, and I’m sure other payers are as well.  I know: some of you are thinking, ‘’Ugh, I hate medical necessity.” So let’s take a closer look. According to CMS, “A service may be covered by a Medicare Contractor if it meets all of the following conditions:

  • It is one of the benefit categories described in Title XVIII of the Social Security Act
  • It is not excluded by Title XVIII of the Social Security Act other than 1862 (a) (1); and
  • It is reasonable and necessary under section 1862 (a) (1) of the Social Security Act.

Any idea how many words and pages of regulations are involved here? Any idea how many policies have been created? How about the number of changes made to the miles of regulatory guidance? This is actually a rhetorical question – I don’t know the precise answer either but perhaps “reams” is a fair statement. How does a hospital or healthcare provider keep it all straight?

My Take

Medical necessity compliance is complicated, but it’s really not the enemy.  Immediate access to policies and the latest regulatory changes is the challenge. If it were simple, the RACs would not be finding millions upon millions of dollars in claims errors. I don’t think anyone wants to make mistakes—not providers or payers—but the regulations are complicated, and it happens. At HIMSS 12, I was struck by something Mark Bertolini, CEO of Aetna said (to paraphrase), “We want a different relationship with physicians and hospital business partners.”’  He went on to say that use of technology is crucial to redefining the relationship, and he sees a future where health plans provide technology to physicians to better serve patients and help reduce cost.

Bravo, Mr. Bertolini! I would like to see payers spend less on auditors and instead work more closely with their physician and hospital partners.  Payers who offer partners access to technology that will help them comply with medical necessity regulations, among other metrics, is simply a smart move.  Whether it’s real-time or system-to-system, improved communication and electronic access to requirements will reduce errors and associated costs while improving compliance. Doing a better job less expensively is good for health care.

Barbara Aubry is a Regulatory Analyst with 3M Health Information Systems.

2 responses to “Medical Necessity is Not the Enemy

  1. Hello, would it be possible to obtain permission to print this article in our physician newsletter? I think our physicians would find it very enlightening.
    I am requesting on behalf of San Ramon Regional Medical Center.

    • Hello Helynn,
      I’m glad you find the article useful. Representatives from 3M HIS will be in contact with you to help with your request. Please let me know if you have any questions and thank you for visiting our blog.

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