October 23, 2008

Palmetto GBA, J1 Medicare Administrative Contractor for
California Transition Issues

As of September 2, 2008, Palmetto GBA contractor replaced NHIC as California's new J1 Medicare Administrative Contractor (MAC). California Part B providers are experiencing the most issues with this J1MAC transition and AAD members are dealing with claim denials due to: application of new local coverage determination policies (LCD), strict application of National Correct Coding Edits (NCCI) on correct use of modifiers, National Provider Number (NPI) errors and no access to EDI passwords for electronic reporting. In addition, Palmetto has limited customer service representatives who are trained and available, which makes telephone wait times very long or speaking with live person very rare.

The Centers for Medicare and Medicaid Services (CMS) is actively monitoring the problems and working closely with Palmetto GBA to address these issues. With clogged phone lines, Palmetto GBA is using their internet Web site to share updated information under the What's New and the Alert sectionsat the Palmetto GBA Web site: www.palmettogba.com/J1B

This situation stresses the importance of having internet access in your dermatology practice office. Use the internet to access the Palmetto GBA Web site for pertinent update information.

Claims that were previously paid by NHIC are now being rejected principally as the result of:

1. Application of new or modified Local Coverage Determinations (LCDs) instituted by Palmetto GBA.

2. Strict enforcement by Palmetto GBA of the National Correct Coding Initiative (NCCI) edits.

Access to Palmetto GBA Local Coverage Determination (LCD) Policies
The Palmetto GBA Local Coverage determination policies pertinent to dermatology may be accessed at the CMS Web site.

• Actinic Keratoses (AK)96 L28232

• MOHS96 L28278 (new diagnoses requirements)

• Skin Lesion Non-Malignant Removal96 L28300 (new diagnoses requirements)

• Treatment of Ulcers and Symptomatic Hyperkeratoses96 L28308

• Treatment of Varicose Veins of the Lower Extremities96 L28309

• Application of Bioengineered Skin Substitutes: Ulcers (of Lower Extremities), J1B-08-0009-L (revised LCD)

• Skin Lesion (Non Melanoma) Removal J1B-08-0072-L ((formerly Non-malignant Skin Lesion Removal, revised LCD)

National Correct Coding Initiative (NCCI) code set edits are being enforced by Palmetto. Modifiers put on the wrong procedure code will result in non-payment. Modifiers should be appended to the codes in column 2 in the NCCI edits. The NCCI edits may be accessed on the Web at: www.cms.hhs.gov/NationalCorrectCodInitEd/NCCIEP/List.asp

The California Medical Society (CMA) www.cmanet.org has compiled an updated list of common problems and fixes. Their purpose in sharing this list is to give county medical societies and individual practices the most up-to-date information available. CMA continues to encourage counties to use their Center for Economic Services (888/401-5911) for help resolving problems.

For the most up to date information, use the Palmetto GBA or CMA's Web site and other questions, contact American Academy of Dermatology, Cindy Bracy (847) 240-1840 or cbracy@aad.org.