Page 37 - Medicare Benefit Policy Manual

In the case of any potential failure to maintain opt-out (including but not limited to
improper submission of a claim), the Medicare contractor must explain in its request to
the physician or practitioner that it would like to resolve this matter as soon as possible.
It must instruct the physician/practitioner to provide the information it requested within
45 days of the date of its development letter. It must provide the physician or practitioner
with the name and telephone number of a contact person in case they have any questions.

If the violation was due to a systems problem, the Medicare contractor must ask the
physician or practitioner to include with his or her response an explanation of the actions
being taken to correct the problem and when the physician or practitioner expects the
system error to be fixed. If the violation persists beyond the time period indicated in the
physician’s or practitioner’s response, the Medicare contractor must contact the physician
or practitioner again to ascertain why the problem still exists and when the physician or
practitioner expects to have it corrected. It must repeat this process until the system
problem is corrected.

Also, in the Medicare contractor’s development request, it must advise the physician or
practitioner that if no response is received by the due date, the Medicare contractor will
assume that there has been no correction of the failure to maintain opt-out and that this
could result in a determination that the physician/practitioner is once again subject to
Medicare rules.

In the case of wrongly filed claims, the Medicare contractor must hold the claim and any
others it receives from the physician or practitioner in suspense until it hears from the
physician or practitioner or the response date lapses. In this case, if the physician or
practitioner responds that the claim was filed in error, the Medicare contractor must
continue processing the claim, deny the claim, and send the physician or practitioner the
appropriate Remittance Advice and send the beneficiary a Medicare Summary Notice
(MSN) with the appropriate language explaining that the claim was submitted
erroneously and the beneficiary is responsible for the physician’s or practitioner’s charge.
In other words, the limiting charge provision does not apply and the beneficiary is
responsible for all charges. This process will apply to all claims until the physician or
practitioner is able to get the problem fixed.

If the Medicare contractor does not receive a response from the physician or practitioner
by the development letter due date or if it is determined that the opt-out physician or
practitioner knowingly and willfully failed to maintain opt-out, it must notify the
physician or practitioner that the effects of failure to maintain opt-out specified in §40.11
apply. It must formally notify the physician/practitioner of this determination and
of the rules that again apply (e.g., mandatory submission of claims, limiting charge,
etc.). It must specifically include in this letter each of the effects of failing to opt-out that
are identified in §40.11.

The act of claims submission by the beneficiary for an item or service provided by a
physician or practitioner who has opted out is not a violation by the physician or
practitioner and does not nullify the contract with the beneficiary. However, if there are