Email Alert
February 12, 2010
Donald Romano*
On January 29, 2010, in KGV Easy Leasing Corporation v. Sebelius, 2010 WL 342598 (C.D. Cal. 2010), the court found that the Centers for Medicare & Medicaid Services properly denied an Independent Diagnostic Testing Facility (IDTF) claims for electrodiagnostic tests because of the lack of medical necessity. It further found that the plaintiff was not entitled to limitation of liability protection under Section 1879 of the Social Security Act, which allows providers and suppliers to be paid by Medicare under certain circumstances, despite the fact that an item or service was not reasonable and necessary, if the provider or supplier did not know and was not reasonably expected to know that the item or service was not payable. The court found:
- In support of its claim for payment, KGV submitted copies of its preprinted physician order forms, but the forms had numerous deficiencies and did not conform to the requirements of 42 C.F.R.
§ 410.33(d) because neither the order forms nor any of the other documentation KGV submitted demonstrated that the tests were ordered by the beneficiary's treating physician and were to be used in the management of the beneficiary's specific medical problem.
- KGV also failed to comply with the requirements of a Local Coverage Determination (LCD) issued by its carrier, which requires that the ordering physician clinically assess the patient and which states that symptoms by themselves are not adequate for presumptive diagnoses needing electrodiagnostic tests, but rather it is the clinical picture and presumptive diagnoses that dictate the reasonableness and necessity of electrodiagnostic tests. Specifically, KGV did not comply with the LCD because:
- The only information regarding the beneficiary's clinical picture came from the preprinted order form from which a referring physician must select preprinted symptoms and possible diagnoses.
- Although, according to KGV, its standard procedure was to await a telephone call from a physician ordering a test and then establish a time for the KGV technician to go to the physician's office and conduct that test on the patient, in practice, the date of the physician order form was the same as the date of the services for each beneficiary. Because the dates on the order forms and the dates that the test were allegedly performed were the same, there was no indication that a relationship existed between the beneficiaries and ordering physicians prior to the ordering of the tests.
- KGV's preprinted physician order forms did not indicate that the dates shown on the orders were the actual dates that the physician examined or consulted with the patient, and therefore there was no indication that the beneficiary was assessed prior to the ordering of the test.
- KGV was not entitled to limitation of liability protection under Section 1879 of the Social Security Act because, as a Medicare supplier, KGV was charged with the knowledge of the medical documentation requirements for IDTFs, which were set forth in regulations that were issued more than seven years prior to the dates of service at issue.
*We would like to thank Don Romano, Esquire (Arent Fox LLP, Washington, DC), for providing this email alert.