17 Fla. L. Weekly Supp. 466a
Online Reference: FLWSUPP 1706BADIInsurance — Personal injury protection — Coverage — Medical expenses — CPT coding — National Correct Coding Initiative is incorporated in Florida PIP law as part of Medicare pay system — Where medical provider improperly filed claims for CPT codes for comprehensive treatments and unbundled component services, insurer was not required to contact provider before paying benefits for comprehensive treatments and denying benefits for component services, as this did not constitute change in coding — No merit to argument that, if bills were not payable under Medicare Part B due to unbundling, they should be paid under workers’ compensation fee schedule — Question certified
SOCC, P.L. D/B/A SOUTH ORANGE WELLNESS & INJURY CENTER A/A/O MICHELLE BADILLO, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 9th Judicial Circuit in and for Orange County. Case No. 08-SC-15504-O. March 24, 2010. Antoinette Plogstedt, Judge. Counsel: Peter A. Shapiro, Law Office of Peter A. Shapiro, P.A., Orlando. John L. Morrow and Matthew J. Corker, Conroy, Simberg, Ganon, Krevans, Abel, Lurvey, Morrow, & Schefer, P.A., Orlando, for Defendant.
REVERSED at 37 Fla. L. Weekly D1663a
SUMMARY JUDGMENT FOR DEFENDANT
THIS CAUSE, having come on before this Court on Defendant’s and Plaintiff’s respective Motions for Summary Judgment, and the Court having reviewed the Motions, Applicable Law, and having heard arguments of counsel, finds that there are no material facts in dispute and that Defendant, State Farm Mutual Automobile Insurance Company (“State Farm”) is entitled to a Final Judgment as a matter of law. At the request of both parties, by separate order of the court, the Court has consolidated Case Number 2008-sc-17057-o (Michelle Badillo) into this cause (Carmen Garcia).
UNDISPUTED FACTS (MICHELLE BADILLO)
The Plaintiff, a medical provider, accepted an assignment of benefits from its patient, Michelle Badillo (State Farm’s insured), for its care and treatment of Ms. Badillo with regard to a March 5, 2008, motor vehicle accident. The assignment granted to Plaintiff the rights and benefits under State Farm’s policy of Personal Injury Protection (PIP) insurance, deemed to be compliant with §627.730-627.7405.
The Plaintiff provided medical treatment to State Farm’s insured and thereafter sought reimbursement from State Farm for the services rendered and requested payment for the services from State Farm. Plaintiff billed Defendant for treatment.
On March 12, 2008, Plaintiff billed for services rendered to State Farm’s insured under CPT Code 95851 (Range of Motion) and CPT Code 98941 (Chiropractic Manipulative Treatment; 3-4 regions). State Farm paid the amounts billed for CPT Code 98941 (i.e., the comprehensive code) which included the amount billed for CPT Code 95851 (i.e., the component code). Along with payment for services rendered on March 12, 2008, State Farm provided the Plaintiff with an Explanation of Review as it related to CPT Code 95851, in which State Farm alerted the provider that CPT Code 95851 was flagged by the National Correct Coding Initiative (NCCI) Comprehensive edit database with a superscript of ‘0′, which indicates that the line item is disallowed, even if an appropriate NCCI modifier was present. State Farm further advised that the provider was to “[P]lease review the bill to ensure the proper procedure code and modifier were reported.” The Explanation of Review provided as the source, http://www.cms/hhs.gov/NationalCorrectCodInitEd/01-overview.asp.
On October 1, 2008, Plaintiff sent a demand letter to State Farm seeking the principal sum of $150.00. The demand letter was received by State Farm on October 7, 2008.
UNDISPUTED FACTS (CARMEN GARCIA)
The Plaintiff, a medical provider, accepted an assignment of benefits from its patient, Carmen Garcia (State Farm’s insured), for its care and treatment of Ms. Garcia with regard to a June 1, 2008, motor vehicle accident. The assignment granted to Plaintiff the rights and benefits under State Farm’s policy of Personal Injury Protection (PIP) insurance, deemed to be compliant with §627.730-627.7405.
The Plaintiff provided medical treatment to State Farm’s insured and thereafter sought reimbursement from State Farm for the services rendered and requested payment for the services from State Farm. Plaintiff billed Defendant for treatment.
On July 10, 2008, July 16, 2008, July 17, 2008, July 23, 2008, and July 30, 2008, Plaintiff billed for services rendered to State Farm’s insured under both CPT Code 97124-59, 2 units (Massage Therapy/Therapeutic Procedure) and CPT Code 97140 (Manual Therapy Technique). State Farm paid the amounts billed for CPT Code 97140 (i.e., the comprehensive code), which included the amounts billed for CPT Code 97124-59 (i.e., the component code). Along with payment for services rendered on July 10, 2008, July 16, 2008, July 17, 2008, July 23, 2008, and July 30, 2008, State Farm provided the Plaintiff with Explanations of Review as it related to CPT Code 97124-59, in which State Farm alerted the provider that CPT Code 97124-59 was flagged by the National Correct Coding Initiative (NCCI) Comprehensive edit database with a superscript of ‘0′, which indicates that the line item is disallowed even if an appropriate NCCI modifier was present. State Farm further advised that the provider was to “[P]lease review the bill to ensure the proper procedure code and modifier were reported.” The Explanation of Review provided as the source, p.
On October 10, 2008, Plaintiff sent a demand letter to State Farm seeking the principal sum of $500.00. The demand letter was received by State Farm on October 13, 2008.
Plaintiff’s Position
Plaintiff argues that the Florida PIP Statute does not expressly reference NCCI Edits nor include or otherwise incorporate the NCCI edits. Plaintiff asserted that the Florida Legislature specifically did not import any of Medicare’s rules or regulations when the Florida PIP Statute was amended in 2008. Among other things, Plaintiff references paragraph (5)(a)4, as support of the legislature’s intent to not import the NCCI Edits, which states, in relevant part, as follows:
Subparagraph 2 does not allow the insurer to apply any limitation on the number of treatments or other utilization limits that apply under Medicare or worker’s compensation. An insurer that applies the allowable payment limitations in subparagraph 2 must reimburse a provider who lawfully provided care or treatment under the scope of his or her license, regardless of whether such provider would be entitled to reimbursement under Medicare due to restrictions or limitation on the types or discipline of healthcare providers who may be reimbursed for particular procedures or procedure codes.
Fla. Stat. §627.736(5)(a)4.(2008).
Plaintiff contends that the legislature brought the Medicare and Workers’ Compensation fee schedules into the automobile insurance system to provide an easy way to price services provided by providers and to eliminate litigation over reasonableness of charges, and nothing more. Plaintiff contends that the Medicare rules, including NCCI Edits, were never meant to apply to many provider types that qualify for PIP benefits in Florida, such as chiropractors, message therapists, spiritual healers, etc. Also, Plaintiff argues that NCCI edits were not meant to apply to third party payers other than Medicare and Plaintiff contends that the NCCI edits were utilization limitations. Plaintiff argues that the reference to the OIG in the PIP statute was that the Court should only seek guidance from the OIG. OIG documents call for a voluntary compliance program and only refer to NCCI as a voluntary method as to the proper use of modifiers. Even if OIG references NCCI, it is in a voluntary basis only and it does not specify that it should apply to Florida PIP or all providers.
Plaintiff also argues that, by virtue of Defendant’s assertion that the bills in question contained improper unbundling of services, and that by not paying one of the codes, Defendant changed the codes. Therefore, the Defendant had an obligation to contact the Plaintiff (verbally or otherwise) to discuss the reasons that the Defendant changed the codes/did not pay for one of the codes, and the Plaintiff’s reasons for coding as it did. The relevant statute states, in part, as follows:
For any treatment for service that is upcoded or that is unbundled when such treatment for services should be bundled, in accordance with paragraph (d). To facilitate prompt payment of lawful services and insurer may change codes that determine to have been improperly or incorrectly upcoded or unbundled, and may make payment based on the changed codes, without affecting the rights of the provider to dispute the change by the insurer, provided that before doing so, the insurer must contact the healthcare provider and discuss reasons for the insurer’s change and the healthcare provider’s reason for the coding, or make a good faith effort to do so as documented in the insurer’s file.
Fla. Stat. §627.736(5)(b)1.3. (2008).
Pursuant to the above statutory language, Plaintiff asserts that Defendant’s failure to pay both codes in question, in essence was a change in the code(s), and a violation of the spirit and intent of the statute as it pertains to a claim of unbundling, and that State Farm failed to contact the healthcare provider to discuss the change and reasons for said change as required by statute. As such, Plaintiff argues that Defendant failed to comply with the PIP Statute.
Plaintiff alternatively argues that even if the NCCI Edits (as part of the Medicare system) do apply to Florida’s PIP Statute, and even if State Farm did make contact with the Plaintiff as it related to the unbundling contention, that Plaintiff would still prevail under Florida Statute §627.736(5)(a)2.f. This portion of the statute states, in part, as follows:
For all other medical services, supplies and care, 200% of the allowable amount under the participating physician’s schedule of Medicare Part B. However, if service. . . . is not reimbursable under Medicare Part B, the insurer may limit reimbursement to 80% of the maximum allowable amount under the worker’s compensation schedule. . .
Fla. Stat. §627.736(5)(a)2.f. (2008).
It is, therefore, Plaintiff’s position that if an amount is not reimbursable under Medicare Part B (as Defendant was claiming), the plain language of the statute required payment under the workers’ compensation statute.
State Farm’s Position
State Farm’s position is that Florida Statutes §627.736(5), “Charges for Treatment of Injured Persons,” incorporates the Medicare fee schedules/guidelines. State Farm argues that the bills submitted by Plaintiff for payment should be adjusted in the same manner as if they were being adjusted by the Centers for Medicare and Medicaid Services (CMS), including all provisions of the Medicare benefit policy manuals, with the exception of the two (2) specific exclusions as set forth in §627.736(5)(a)(4). Here, State Farm’s position is that the CMS 1500 form was improperly coded in violation of §627.736(5)(d), and, therefore, for purposes of paragraph (4)(b), State Farm was not considered to have been furnished with notice of a covered loss and the amount of same.
Additionally, State Farm contends that the bills submitted by Plaintiff contained CPT codes that were improperly unbundled in violation of §627.736(5)(b)(1)(e). As such, neither State Farm nor its insured have any obligation to pay the unbundled portion of the bills in dispute. As it relates to the issue of unbundling, State Farm contends that the more comprehensive code was paid in this matter, and, as such, the bill was considered to have been paid in full.
Furthermore, State Farm contends that the Florida Statutes have adopted the identical payment system that was devised by the CMS, by virtue of the PIP statute that requires that all bills for services be submitted to the insurer on properly completed CMS forms utilizing the Healthcare Correct Procedure Coding System (HCPCS) and comply with the CMS instructions, the CPT editorial panel for the American Medical Association (AMA) and healthcare correct procedural coding system. State Farm argues that in determining compliance with CPT and HCPCS coding, guidance shall be provided by the entities referenced in subsection (d), which includes the Office of the Inspector General (OIG). The statute at issue herein additionally references and sets forth that all other medical services, supplies, and care are to be paid at the participating provider fee schedules under Medicare Part B. Medicare Part B and CMS are referenced throughout §627.736. This Statute sets for that an insurer is to . . .pay 200% of what Medicare would pay. . . It is clear that the statute is unambiguous on its face and that Medicare guidelines are to be followed.
As it relates to proper billing/coding practices, Medicare implemented the National Correct Coding Initiative (CCI) in January 1996. The initiative was developed to provide correct coding of healthcare services by providers to prevent Medicare payments for improperly coded services. CI consists of automated edits provided to carriers to evaluate claims and submissions when a provider bills more than one service for the same beneficiary on the same date of service. CMS developed the NCCI system to promote national correct coding methodologies and to control improper coding that leads to inappropriate payments of Medicare Part B claims. These coding policies are based on coding conventions defined in the AMA current procedural terminology (CPT) manual. State Farm argues that it is, therefore, clear that Medicare implemented the NCCI as part of Medicare Part B and that the NCCI Edits apply to claims submitted under Medicare Part B.
State Farm asserts that the NCCI has developed a database which includes the NCCI Edits. This database was designed to prevent improper payment when incorrect coding combinations are reported. In this present matter, State Farm argues, that under the NCCI Edits (which sets forth a list of comprehensive/component codes) the codes at issue here for Michelle Badillo (i.e., CPT Code 95851 billed in tandem with 98941) were improperly billed as, pursuant to the NCCI Edits, Code 95851 is a component of CPT Code 98941. State Farm argues that, as to Carmen Garcia, the Plaintiff improperly billed for CPT Code 97124-59, as it is a component of CPT Code 97140, pursuant to the NCCI edits. Further, pursuant to the edits, this code combination has been disallowed and the use of a modifier is not permitted in order to bypass the edits. By virtue of billing these two codes on the same date of service for the same patient, pursuant to the applicable NCCI Edits, the provider improperly unbundled the services at issue herein.
It is State Farm’s position that it and its insured are not required to pay a claim for charges for any treatment or service which is unbundled when such treatment or services should be bundled in accordance with paragraph (d). State Farm contends that, pursuant to the guidance set forth by the OIG, which includes and incorporates the NCCI Edits, Plaintiff has unbundled the CPT Codes at issue here, and, that these codes should have been bundled.
Finally, State Farm asserts that it did not have any obligation to discuss any reasons for any alleged change to the bills/codes in question herein, as State Farm did not change any codes. Rather, State Farm made the appropriate payments pursuant to the applicable fee schedules and simply denied payment for the improperly billed codes.
FINDINGS OF FACT AND CONCLUSIONS OF LAW:
This Court adopts the undisputed facts herein. The Court has reviewed the motions, attachments thereto, affidavits of record, Fla. Stat. §627.736, Office of Inspector General (OIG) publications and the National Correct Coding Initiative (NCCI) Manual including its edits. The Court concludes Medicare Part B includes the National Correct Coding Initiative and, therefore, is part of the allowable amount under the participating physician’s fee schedule for Medicare Part B.
This Court finds that Plaintiff improperly unbundled its services provided when billing range of motion measurement, CPT Code 95851-59, separately from chiropractic manipulative care, CPT 9894,1 for date of service March 12, 2008 (Michelle Badillo). This Court further finds that Plaintiff improperly unbundled its services when billing State Farm for CPT Code 97124-59, 2 units (Massage Therapy/Therapeutic Procedure) and CPT Code 97140 (Manual Therapy Technique) on the same date of service. According to the National Correct Coding Initiative, one code is a component of a more comprehensive code and cannot be billed separately for the same patient on the same date of service. The use of a modifier to bypass the edits is not allowed when billing these code combinations.
This Court rejects Plaintiff’s argument and accepts Defendant’s argument on the meaning of Section (5)(a)4. The inclusion of this paragraph into the statute excepts out only two sections of the Medicare system that the legislature did not want to include in Florida Personal Injury Protection law. In essence, the legislature adopted the Medicare pay system and excluded out only those two sections that they did not want to apply to Florida law. This means that all other Medicare guidelines, rules and regulations should apply to subsection 5.
As to Plaintiff’s argument that State Farm was obligated to contact a health provider and “discuss the reason for the insurer’s changes,” this Court, in its analysis of the statute, finds that this section is clear and unambiguous. Therefore, the words of the statute must be read with plain meaning and strictly construed. In the terms of the statute, if an insurer changes a code, it must contact the provided and “discuss the reasons for the insurer’s change.” However, State Farm did not make any coding change; rather, it simply paid for the comprehensive treatment and denied payment for the component treatment that was unbundled and improperly billed. The Court finds that State Farm did not change any codes. When services are improperly unbundled, one contemplates that what happened here, would occur; that the lesser codes would simply be denied in favor of a bundled service code that includes the other services. Because State Farm did not change a code, there was no obligation of State Farm to contact the Plaintiff to discuss the reasons for changing a code.
On the issue of unbundling, Florida Statute §627.732 in its definitional section, defines unbundling. The statute states that an insurer or insured is not required to pay a claim for charges that is unbundled when such treatment or services should be bundled, in accordance with paragraph (d). The court finds that Plaintiff did unbundle services and, therefore, neither the insured nor the insurer was obligated to pay the Plaintiff provider for the above-referenced unbundled amount.
With regard to Plaintiff’s argument that if the bills were not payable under Medicare Part B, then the bills should be paid under worker’s compensation, this Court finds no legislative intent for payment under the worker’s compensation schedule under the facts of this case. All CPT codes are reimbursable under Medicare Part B, provided that the bills are not unbundled and they are submitted in accordance with paragraph (d).
IT IS THEREFORE ORDERED and ADJUDGED, as follows:
Final Judgment be and the same is hereby entered in favor of Defendant State Farm Mutual Automobile Insurance Company and against Plaintiff. Plaintiff takes nothing by this action and State Farm shall go hence without day.
The court also finds that this issue is of great public importance and hereby certifies the following question to the 5th District Court of Appeal:
WHETHER STATE FARM PROPERLY DENIED PAYMENT OF PLAINTIFF PROVIDER’S UNBUNDLED COMPONENT TREATMENT CHARGE, WHEN IT PAID THE MORE COMPREHENSIVE TREATMENT CHARGE, PURSUANT TO THE NATIONAL CORRECT CODING INITIATIVE COMPREHENSIVE EDITS DATABASE (NCCI EDITS) UNDER FLORIDA’S NO FAULT (PIP) STATUTE, AND WHEN IT DID NOT CONTACT THE PROVIDER TO DISCUSS THE SAME.
