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The Legal Department articles are not intended to serve as legal advice and are offered for educational purposes only. The information provided should not be used as a substitute for independent legal advice and it is not intended to address every situation that could potentially arise. Please be aware that laws, regulations and technical standards change over time. As a result, it is important to verify and update any reference or information that is provided in the article.
Medicare Reimbursement: How to Bill Second Party Payers
Catherine Atkins, JD
Deputy Executive Director
For background, when a patient has Medicare as well as private health care insurance, Medicare is the primary payer and the health care insurance plan (for instance, Mental Health Network) is the second party payer. If Medicare denies the claim, then the health care plan becomes the primary payer. Since Section 1861(s)(2) of the Social Security Act currently excludes LMFTs as Medicare providers, when a patient receives treatment from an LMFT in California, the health care plan essentially becomes the primary payer. 1
In the past, plans required providers or patients to submit denial letters from Medicare before the plans would pay out as second party payer. However, CAMFT recently learned that Medicare changed its policy and no longer sends denial letters for services to Medicare patients. Because providers were unable to garner denial letters from Medicare for the treatment, they were unable to submit the claim to the secondary plan for processing and payment. Because LMFTs are a large resource for Medicare patients in California, it is essential that a system be implemented that allows direct billing for the services provided.
Accordingly, CAMFT has been working with the major health care plans in California to determine what process or procedure is best utilized in the situation described above. Here is what we have learned so far:
Mental Health Network
MHN no longer requires receipt of Medicare denial letters before paying.
Avante requires the enrollee/provider to obtain pre-authorization for services. (Treatment would be pre-certified and the provider would receive written notification of the pre-certification for a specified number of visits. At the conclusion of those certified visits, a treatment plan requesting additional visits would be submitted to Avante and additional sessions will be granted as appropriate based on the enrollee's issues. The provider would invoice Avante on a regular basis for the certified sessions.)
While Blue Cross has not yet created a procedure to cover this issue, they have been working with us to expeditiously create such a procedure. Until such procedure is put into place, we suggest including language from this article with your invoices for reimbursement.
A provider must submit the Value Options "Coordination of Benefits (COB) form" filled out by the patient along with the initial claim. The provider should note under Section C of the COB form, that: "LMFT licensure is a non-covered Medicare provider licensure and provider is unable to obtain Member Explanation of Benefits (MEOB) of Medicare denial."
While Optum has not yet created a procedure to cover this issue, they have been working with us to expeditiously create such a procedure. Until such procedure is put into place, we suggest including language from this article with your invoices for reimbursement.
United HealthCare Insurance
United HealthCare Insurance has not responded to any correspondence. Until we obtain a response from UHCI, we suggest including language from this article with your invoices for reimbursement.
Magellan has not responded to any correspondence. Until we obtain a response from Magellan, we suggest including language from this article with your invoices for reimbursement.
We will continue to keep you updated on any health care plan's creation of policy to streamline reimbursement for Medicare patients. For more information on the status of LMFTs and Medicare reimbursement, please review the "Legislative Update" section of this, as well as, upcoming issues of The Therapist.
Catherine L. Atkins, JD, is a Staff Attorney and the Deputy Executive Director at CAMFT. Cathy is available to answer members' questions regarding business, legal, and ethical issues.