CMS is implementing a change that ensures you’ll get the full payment you’re owed when partial episode payment (PEP) adjustments are erroneously applied to dual eligibles’ claims.
 
The change will be effective for home health episodes ending on or after Jan. 1, 2010 and will be implemented on April 1, 2013, according to a transmittal published Nov. 2.
 
When a dual eligible meets Medicare goals and is readmitted to home health as a Medicaid patient, Medicaid may ask the agency to submit a demand bill to Medicare, CMS notes. When the request for anticipated payment (RAP) on the demand bill episode is received, the claims processing system automatically applies a PEP to the original episode if it overlaps the demand bill episode.
 
In those cases, there hadn’t been a way for agencies to claim the full episode payment they’re due because agencies are unable to submit an adjustment for the PEP, CMS says. Now, the Medicare system will automatically correct the PEP and issue the full payment if the final claim for the overlapping episode is a fully denied demand bill (meaning it carries condition code 20 and all charges are non-covered).