Massachusetts HMEs entangled in CO-50 denials

Thursday, February 28, 2002

BOSTON - Now that providers here have been audited and penalized "tens of thousands of dollars" by Medicaid for not sending CO-50 denials to the DMERCs for review, the New England Medical Equipment Dealers Association (NEMED) is eyeing CMS for clarification.

What's happened is this: Providers who have patients with both Medicaid and Medicare are getting squeezed between the state and the feds. They're getting prior authorization from Medicaid and sending their claim to Medicare, only to have it sent back with a CO-50 denial. Then when they send the claim back to Medicaid, Medicaid refuses to pay and requests the provider send the claim to the DMERCs for review.

Fran Burke, owner of the Chicopee, Mass.-based Burke Medical Supply, said there's been a flurry of CO-50 denials, and Medicaid's trying to crack down, and who could blame them? But he said there's a simple solution to the problem.

"Medicare should just tag the claims as 'not a covered service,'" Burke said. "It's just a matter of semantics."

NEMED agrees that providers should send CO-50 denials back for review when additional documentation is available, according to Karyn Estrella, NEMED's executive director. But they shouldn't have to send back all C0-50 denials, which are given for "not medically necessary" equipment and supplies.

"In a post-audit situation, the company gets penalized for submitting claims with CO-50s," Estrella said.

Estrella said the DMERCs have indicated that they agree with NEMED and providers. Why? It's a burden on them to re-review the claims, for one.

Burke said it's a burden on providers, too. First, having to send back the claims delays their processing time; second, it stalls cash flow; and third, it results in audits, he said.

"While all this arguing is going on, the clock is ticking, and providers are left holding the bag with the money," Burke said.

Estrella said the bottom line's an issue of access to HME. HME