A Federal Court in California has prohibited the Center for Medicare and Medicaid Services (CMS) from seeking reimbursement of conditional payments when the medical codes for the conditions are unrelated or not related even if the primary code was for a work-related medical condition. The court made the following ruling in a motion for partial summary judgment in a declaratory judgment action.
"The Court shall issue a judicial declaration that: (1) One “item or service,” as used in the Medicare Secondary Payer statute, 42 U.S.C. § 1395y(b)(2)(B)(ii), does not as a matter of law equate to any medical items, devices, supplies, or services that appear under in a single line-item charge on a payment summary form issued by CMS. Rather, a statutory “item or service” simply refers to one indivisible medical item, device, medical supply, or service, regardless of how it is billed; (2) Whether a particular line-item charge on a payment summary form contains more than one indivisible item, device, medical supply, or service is a factual question that must be resolved on a case-by-case basis; (3) If a single line-item charge on a payment summary form contains multiple diagnosis codes—some of which relate to a medical condition covered by the insurance policy administered by CIGA and some of which do not—the presence of one covered code does not ipso facto make CIGA responsible for reimbursing the full amount of the charge; and (4) In the event that a single line-item charge on a payment summary form contains one indivisible item, device, medical supply, or service that is covered by the workers' compensation policy CIGA is administering, and one indivisible item, device, medical supply, or service that is not so covered, CIGA does not have a responsibility to make payment for the uncovered item, device, medical supply, or service just because it was billed under the same single line-item charge as the covered item, device, medical supply, or service."
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"For the reasons discussed above, the Court shall enter (1) an order vacating and setting aside the disputed portions of three reimbursement demands at issue in this lawsuit and (2) a judicial declaration that CMS's interpretation of the MSP is unlawful with respect to reimbursement of conditional payments. The Court declines to issue further declaratory relief or an injunction at this time.
California Insurance Guarantee Association v Price, Case No 2:15-cv-01113-ODW (FFMx), 2017 WL 1737717 (05/03/2017)