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The Affordable Care Act Payment Adjustments and Forthcoming EPC

January 22, 2018

The Affordable Care Act (ACA) and 42 CFR 447 requires state Medicaid agencies to reimburse primary care physicians with a specialty designation of family medicine, general internal medicine or pediatric medicine at parity with Medicare for specified Evaluation and Management (E&M) and vaccine administration services for dates of service 2013 – 2014. Upon implementation of necessary system modifications, the Department of Health Care Services (DHCS) directed the DHCS Fiscal Intermediary (FI) to resubmit claims paid on or after January 1, 2013, to allow and account for payment increases to eligible providers for specific E&M and vaccine administration services. Extensive system changes were required to accurately pay and report the payments. In an effort to expedite funds to providers, DHCS issued loans to the providers in the form of interim payments in late 2013 to cover estimated payouts for claims from January 1, 2013, to that time. These interim payments were lump sum payments with no claim detail and continued on a weekly basis to cover each ongoing week’s estimated payouts. The interim payments were designed to be recouped once the system was capable of accurately paying and reporting payments. Erroneous Payment Corrections (EPCs) were completed to reprocess many of the eligible claims going back to January 2013 and to capture clarifications to the law that altered payments.

This EPC will reprocess all qualifying claims at a claim-line level, resulting in final settlement of all increased payments authorized under ACA 1202. All initial interim payments will be recouped at the same time the retroactive claims are reprocessed under this EPC. These recoupments will appear with Remittance Advice Details (RAD) code 1802: Accounts Receivable – Amount withheld for recoupment of ACA Interim Payment. This may result in a net positive payout, or a net negative amount owed in cases where the interim payment amount exceeds the amount of reprocessed claims. Not all ACA-eligible providers will be affected by this EPC as many have already received their full settlement.

The recoveries are authorized under the provisions of Welfare and Institutions Code (W&I Code), Sections 14176 and 14177, and California Code of Regulations (CCR), Title 22, Section 51458.1(a)(1). In addition, the W&I Code sections authorize DHCS to enter into repayment agreements with providers or offset overpayments against amounts due. If the total warrant amount is not sufficient to offset the recovery, the negative balance will be converted to an accounts receivable transaction and subtracted from future Medi-Cal reimbursements.

No action is required on your part. The FI will resubmit the affected claims in phases until all eligible claims are resubmitted. This notification pertains to affected claims for dates of service from January 1, 2013, through December 31, 2014, originally processed from January 1, 2013, through December 31, 2016. These resubmissions will appear on RAD forms beginning January 25, 2018, with RAD code 0991: ACA Retroactive Rate (TRUE-UP/EPC) Adjustment. In addition, “zero pay” crossover claims that are eligible for payment increases will also be reprocessed. These resubmitted claims will appear on RAD forms, under the claim type Medicare Crossover, with Claim Control Number (CCN) roll number 55 (Resubmit). The roll number is the fifth and sixth digits of the CCN.

Providers are encouraged to review their ACA-eligible claims (original or EPC) to determine if the billed usual and customary charge reflects their correct/normal costs as this may affect reimbursement rates. It is also advised that providers check their ACA-eligible local E&M/Neonatal Intensive Care Unit /Pediatric Intensive Care Unit (NICU/PICU) claims (original or EPC) to ensure an accurate ACA modifier was used. Providers who believe their ACA payments are affected by the usual and customary charge or ACA modifiers can resolve this by submitting an Appeal Form or Claims Inquiry Form (CIF) as outlined in the instructions below.

If you disagree with any of these resubmissions, you may submit a CIF within six months of the new RAD date or you may submit an Appeal Form within 90 days of the new RAD date. For CIF completion instructions, please refer to the CIF Completion and CIF Special Billing Instructions sections in the appropriate Part 2 manual or on the Medi-Cal website (www.medi-cal.ca.gov). For Appeal Form completion instructions, please refer to the Appeal Form Completion section in the appropriate Part 2 manual or on the Medi-Cal website.