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CMS Issues Final Rule on Enrollment, Ordering and Referring, and Documentation Requirements

By Adrienne Dresevic, Esq., Carey F. Kalmowitz, Esq., and Stephanie P. Ottenwess, Esq.

May 2012-On April 27, 2012, CMS issued a final rule entitled "Medicare and Medicaid Programs; Changes in Provider and Supplier Enrollment, Ordering and Referring, and Documentation Requirements; and Changes in Provider Agreements" (the "Final Rule"). This rule finalizes the interim final rule with comment period ("IFC") issued May 5, 2010. CMS is touting the Final Rule as a tool which will help prevent Medicare fraud by ensuring that only "qualified, identifiable providers and suppliers" can order or certify certain medical services and supplies and by giving CMS the ability to tie specific claims to the ordering or certifying physician. CMS also believes that the Final Rule will help to ensure that beneficiaries receive quality care by allowing CMS to verify the credentials of a provider through the use of National Provider Identifiers ("NPI") on enrollment applications and claims. The Final Rule becomes effective on June 26, 2012.

By way of background, two years ago, CMS issued the IFC which implemented many changes to both the Medicare and Medicaid programs mandated by the Patient Protection and Affordable Care Act ("PPACA"). Both the IFC and the Final Rule focus on strengthening CMS' tools to maintain program integrity and ensure quality care. The Final Rule continues to mandate the following three main elements:

  • NPI Documentation. Requiring that all providers and suppliers that qualify for an NPI to include the NPI on all enrollment applications and on all claims for payment;
  • Enrollment. Requiring physicians and other professionals who are permitted to order and certify covered items and services for Medicare beneficiaries, including DMEPOS, imaging services, laboratory services and home health services, to be enrolled in Medicare or to maintain a valid opt-out status as of the date of service on the claim; and
  • Documentation Retention. Requiring that Medicare providers and suppliers furnishing ordered services, as well as the ordering and referring physician or health professional, maintain the ordering and referring documentation for 7 years from the date of service. Failure to meet the documentation retention requirements subjects a provider or supplier to revocation for not more than 1 year for each act of noncompliance.

Favorable Clarifications for the Radiology Community

The Final Rule contains several differences from the IFC and clarifies certain issues that were left unclear in the IFC. Notably, the Final Rule favorably addresses concerns the radiology community expressed with the IFC including whether "imaging services" included both the technical component ("TC") and professional component ("PC") of a study, who exactly would be considered an "imaging supplier," and whether the documentation requirements applied only to the TC provider/supplier of an imaging service. Within the comments of the Final Rule, CMS clarified that both the IFC and the Final Rule "specifically refer to the technical components of imaging services that are: (1) Ordered by physicians and, where permitted, other eligible professionals; (2) furnished by IDTFs, mammography centers, portable x-ray facilities, and radiation therapy centers that are enrolled in Medicare via the CMS-855B; and (3) billed by these Part B suppliers to the Part B claims system (MCS) on an X12N 837P or a paper form CMS-1500."

CMS also made clear that the documentation requirements were only applicable to the TC provider or supplier by specifically stating, "[w]e are not placing documentation requirements on physicians who interpret imaging tests."

Other important differences include that claims submitted without the NPI will be denied, and thus have appeal rights, rather than rejected as previously stated in the IFC. In addition, the enrollment requirement is satisfied by enrolling in PECOS or the legacy Medicare system. Moreover, CMS has indicated that it has not yet activated its automated edits designed to deny claims for services certified or ordered by a physician or other eligible health professional without an approved Medicare enrollment record. CMS states that it will provide "ample notice" when it decides to activate the edits. Finally, residents practicing in those states where they are licensed to practice will be allowed to enroll in Medicare solely for the purpose of ordering and certifying. With these enrolled residents, the residents' legal name and NPI must be included on the claim form. In states where residents are not allowed to be licensed, the teaching physician's legal name and NPI must be included on the claim as the person who ordered or certified the service.

The Final Rule's Impact on Radiology Practices and Imaging Providers

Although there were beneficial changes in the Final Rule, some burdens remain for radiology practices and other imaging providers, which could mean the difference between a claim being paid and denied. Indeed, even prior to meeting the burden of placing the legal name and NPI of the ordering/certifying physician on a claim, his/her Medicare enrollment status must be confirmed. Although there were many comments submitted by billing providers/suppliers questioning the ability to confirm enrollment status and voicing concerns about their lack of control over an ordering/certifying physician's decision not to enroll in Medicare, CMS seems unfazed. CMS insists that enrollment status is easily accessible on the CMS website and that, pursuant to its extensive outreach efforts to educate on enrollment requirements, it believes lack of enrollment will not be an issue. The only reprieve was given to physician specialists' services and in-hospital services covered by the hospital inpatient prospective payment system payments as noted in the comments:

Comment: A commenter noted that all of the services furnished by hospital-based radiologists are referred and that they have no way, within the short time frame between publication of the IFC [May 2010] and July 6, 2010, to inform and verify that referring providers [are enrolled in Medicare]. . . .

Response: Due to the comments received, we are removing the ordering or referring provider requirements on claims for physician specialists' services. In-hospital services that are covered by the hospital inpatient prospective payment system (IPPS) payments will also not be subject to the requirements of this rule. However, in-hospital diagnostic testing services that are not paid as part of PPS (for example, imaging services furnished by an IDTF or another entity) must be ordered by Medicare enrolled providers. . . .

Imaging centers and radiology groups should review current claims processing procedures, as well as document maintenance policies, as applicable, and make any necessary changes before June 26, 2012, or risk claim denials.


Adrienne Dresevic, Esq. graduated Magna Cum Laude from Wayne State University Law School. Practicing healthcare law, she concentrates in Stark and fraud/abuse, representing various diagnostic imaging providers, eg, IDTFs, mobile leasing entities, and radiology and multi-specialty group practices.

Carey F. Kalmowitz, Esq. graduated from NYU Law School. Practicing healthcare law, he concentrates on corporate and financial aspects, eg, structuring physician group practice transactions; diagnostic imaging and ancillary services, IDTFs, provider acquisitions, CON, compliance, and Stark and fraud/abuse.

Stephanie P. Ottenwess, Esq. graduated from Wayne State University Law School. Practicing healthcare law, she concentrates in fraud/abuse, compliance and risk management.

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