The Role of NCDs and LCDs in Medical Necessity
NCDs and LCDs play a key part in supporting the medical necessity of services or supplies provided to patients.
Medicare national coverage determinations (NCDs) and local coverage determinations (LCDs) dictate which diagnosis codes must be documented by clinicians to support the medical necessity of most services or supplies they provide to patients. Coders who are informed of these policies play an essential role in garnering uninterrupted cash flow for their clinicians.
National Coverage Documents (NCDs) are issued by the Centers for Medicare & Medicaid Services (CMS) at the national level meaning the policies apply to all Medicare providers.
Local Coverage Documents (LCDs) are issued by Medicare administrative contractors (MACs) or other payers at the local level. As such, LCDs may vary by state and carrier, even if they are for the same service or supply. Carriers other than Medicare may adopt these national/local policies and payment guidelines, as well.
One of the ICD-10 codes listed in that policy must be reported on the claim too, when an NCD or LCD exists for a CPT(R) code being reported on a claim. Otherwise, the claim will be denied.
A provider or supplier cannot bill a Medicare patient for an uncovered service or supply unless they inform the patient prior to rendering the service or supply, and the patient signs an advanced beneficiary notice (ABN). Without a signed ABN on file, the patient is not liable for the charges and the provider or supplier has no other choice but to write off the charges as lost revenue.
Familiarizing with the NCDs and LCDs relevant to the services your practice or facility commonly offers, presents a great opportunity for you to offer feedback and education to your clinicians relative to their documentation. For instance, in the MUGA example, educating the oncology physicians on documenting their orders whether the test is being done as a baseline before chemotherapy or as monitoring during/after chemotherapy would ensure future tests were covered.