Massachusetts Regulations 40.02

Administrative Costs. A provider's costs for administration including but not limited to facility costs, overhead and costs of doing business are included in the rates set forth in this fee schedule, unless stated otherwise.

At Invoice Cost (AI). The price paid by the provider net of any manufacturer discounts received. Documentation of AI cost must be supplied to purchaser for payment upon request.

Centers for Medicare & Medicaid Services (CMS). A division of the U.S. Department of Health and Human Services (HHS) formerly referred to as Health Care Financing Administration (HCFA) that oversees and publishes rules and guidelines of the Medicaid and Medicare programs.

Codes. 114.3 CMR 40.00 utilizes codes, for which fees are set as defined below:

CPT Codes. Level I coding system of five-digit numeric CPT-4 codes from the Physicians' Current Procedural Terminology (CPT) developed and maintained by the American Medical Association. Procedures set forth under 114.3 CMR 40.00 conform to CPT 2004 codes and descriptors.

HCPCS National Codes. Level II coding system of alpha-numeric codes published and annually updated by the) Centers for Medicare and Medicaid Services (CMS) to supplement CPT codes for medical services and supplies.

All D codes are copyrighted by the American Dental Association. Services and items set forth under 114.3 CMR 40.00 utilize HCPCS 2004 codes and descriptors.

Consultation. A type of service (CPT codes 99241-99275) provided by a physician whose opinion or advice regarding evaluation and/or management of a specific problem is requested by another physician or other appropriate source. A physician consultant may initiate diagnostic and/or therapeutic services. The request for a consultation from the attending physician or other appropriate source and the need for consultation must be documented in the patient's medical record. The consultant's opinion and any services that were ordered or performed must also be documented in the patient's medical record and communicated to the requesting physician or other appropriate source.

A consultation initiated by a patient and/or family, and not requested by a physician, is not reported using the initial consultation codes but may be reported using the codes for confirmatory consultation or office visits, as appropriate.

Any procedure that can be identified with a specific CPT code performed on or subsequent to the date of the initial consultation should be reported separately.

If a consultant subsequently assumes responsibility for management of a portion or all of the patient's condition(s), the consultation codes should not be used. Department of Industrial Accidents (DIA). A department of the Commonwealth of Massachusetts Department of Labor and Workforce Development that oversees the Workers' Compensation system pursuant to M.G.L. c. 152 and other applicable laws and waivers.

Department of Public Health (DPH). A department of the Commonwealth of Massachusetts as established under M.G.L.c.17, § 1 that oversees and licenses healthcare facility standards and operations in addition to administering public health programs for all Massachusetts residents.

Description. A description of the medical procedure or item assigned to the Code based upon Current Procedural Terminology (CPT) or Health Care Common Procedure Coding System (HCPCS) which may include certain stipulations relevant to Massachusetts under M.G.L.c.152.

Division. The Division of Health Care Finance and Policy (DHCFP) Policy is a Division of the Commonwealth of Massachusetts Executive Office of Health and Human Services established under M.G.L.c.118G, formerly the Rate Setting Commission.

Eligible Provider. A provider as defined under 114.3 CMR 40.05, who also meets such conditions of participation as have been or may be adopted from time to time by a governmental unit or purchaser under M.G.L. c. 152. Out-of-state providers shall meet the comparable conditions of licensure and participation required by the state in which they practice.

Established Patient. A patient who has received professional services from the physician, or another physician of the same specialty who belongs to the same group practice, within the past three years. Under 114.3 CMR 40.00 the definition shall be applied to a single work related injury or episode of illness.

Fee. The payment value for the medical procedure or item contained in 114.3 CMR 40.06 and identified by a Code. Fees may be listed as Professional Component Fee ("PC Fee"), Technical Component Fee (�TC Fee�) and Global Fee ("GL Fee") when a professional, technical or global fee applies. Single payment rates are listed as "Fees". See definitions of (GL), (PC) and (TC) below.

Global Fee (GL). The Global Fee is the sum of the PC Fee and TC Fee. See definitions of (PC) and (TC) below.

Governmental Unit. A governmental unit is defined as any division, department, agency, board or commission of the Commonwealth and any political subdivision of the Commonwealth or the Commonwealth in its entirety.

Levels of Evaluation/Management (E/M) Services. The Evaluation/Management section (CPT codes 99201-99499) is divided into broad categories such as office visits, hospital visits and consultations. Within each category or subcategory of E/M service, there are three to five levels of E/M services available for reporting purposes. Levels of E/M services are not interchangeable among the different categories or subcategories of service.

The levels of E/M services include examinations, evaluations, treatments, conferences with or concerning patients, preventive pediatric and adult health supervision and similar medical services. The levels of E/M services encompass the wide variations in skill, effort, time, responsibility and medical knowledge required for the prevention or diagnosis and treatment of illness or injury and the promotion of optimal health. Each level of E/M services may be used by all physicians and nurses as specified in 114.3 CMR 40.05(10) and 114.3 CMR 40.05(15). In addition, an array of E/M services codes and fees are included for certain eligible providers as listed in sections within 114.3 CMR 40.06.

Coordination of care with other providers or agencies without a patient encounter on that day is reported using the case management CPT codes (99361-99373). For a full discussion of the levels of E/M services, refer to the CPT �Guidelines� issued annually by the CPT Editorial Panel of the American Medical Association (AMA).

Modifiers. There are CPT and HCPCS modifiers for each level of codes maintained and updated on an annual basis by the AMA. Two digit numeric or character modifiers should be used to identify circumstances that alter or enhance the description of a service or supply. 114.3 CMR 40.07(1) Appendix A lists a limited number of the common modifiers and certain reimbursement provisions associated with their use. However providers, suppliers and carriers may utilize any current CPT Level I and HCPCS Level II National Modifiers as necessary.

A full list of modifiers is contained in CPT �Guidelines� issued annually by the CPT Editorial Panel of the American Medical Association (AMA). Professional Component (PC). Certain procedures are a combination of a physician, or professional component and a technical component. When the modifier �26 is added to an appropriate code a PC allowable amount shall be paid.

Special Report. A service that is rarely provided, unusual, variable, or new may require a special report in determining medical appropriateness of the service. These services are generally reported as "unlisted services or procedures" and designated by digits '99' after the first three beginning code numbers. Pertinent information should include, but not be limited to, an adequate definition or description of the nature, extent, and need for the procedure; and the time, effort and equipment necessary to provide the service. Additional items which can be included are: complexity of symptoms, final diagnosis, pertinent physical findings, diagnostic and therapeutic procedures, concurrent problems, and follow-up care.

Technical Component (TC). The TC component reflects the technical portion of the radiology, laboratory, medical, or surgical procedure code. When the technical component is provided by a health care provider other than the physician providing the professional component, the health care provider bills for the technical component by adding Modifier �TC to the applicable code. The TC rate is payment for the facility's cost of rent, equipment, utilities, supplies, administrative and technical salaries and benefits, and all other overhead expenses.

Unlisted Procedure or Service. A service or procedure may be provided that is not listed in Regulation 114.3 CMR 40.06. When reporting such a service, the appropriate "Unlisted Procedure" code may be used to indicate the service. A "Special Report" may be required when billing codes for unlisted procedures.

(2) Copyright Notice. For more detail on CPT refer to the Physicians' Current Procedural Terminology, copyright 2003 American Medical Association, and any later updates. These CPT publications contain the complete and most current listings of CPT descriptive terms and numeric identifying codes and modifiers for reporting medical services and procedures.

(3) Other Service Providers Not Covered by this Regulation. Worker's Compensation Utilization Review as required by 452 CMR 6.00 authorizes healthcare treatment measures from time to time performed by practitioners of alternative or complementary care, such as massage therapists, who are not governed by 114.3 CMR 40.00. In such a case, the insurer, the employer and the health care service provider must agree upon the appropriate method of billing for treatment, e.g. the code, and the payment rate for such services.

(4) Services and Rates Covered by other Regulations.

(a) Other Services.

1. It is the policy of the Division of Health Care Finance and Policy to utilize the rules and reimbursement rates for governmental purchasers for certain healthcare services. These services and the regulations governing their rates of payment are the following:

Regulation TitleRegulation NumberAbortion and Sterilization114.3 CMR 13.00Adult Day Health Services114.3 CMR 10.00Ambulance Services114.3 CMR 27.00Chronic Maintenance Dialysis Treatment and Home Dialysis Supplies114.3 CMR 37.00Hearing Aid Dispensers114.3 CMR 23.00Home Health Services (includes private duty nursing referred to as continuous skilled nursing care)114.3 CMR 50.00 Hospice Services114.3 CMR 43.00Independent Living Services for the Personal Care Attendant Program114.3 CMR 9.00Outpatient Tuberculosis Control Services114.3 CMR 8.00Prescribed Drugs114.3 CMR 31.00Psychiatric Day Treatment Center Services114.3 CMR 7.00Rates for Community Health Centers114.3 CMR 4.00Rates of Payment for Mental Health Services Provided in Community Health Centers and Mental Health Centers114.3 CMR 6.00Rest Homes114.2 CMR 4.00Skilled Nursing Facilities and Transitional Care Units114.2 CMR 6.00Substance Abuse114.3 CMR 46.00Vision Care and Ophthalmic Materials114.3 CMR 15.00

2. Rate List Updates. Updates to rates affected by amendments to regulations cited in 114.3 CMR 40.02(4)(a)(1) will be posted on the Division web site. However, rates for Rest Homes pursuant to 114.3 CMR 4.00 and Skilled Nursing Facilities and Transitional Care Units pursuant to 114.3 CMR 6.00 must be obtained by calling DHCFP Provider Assistance.

(b) Hospitals. Workers' Compensation reimbursement within DPH licensed Massachusetts hospitals and out-of-state hospitals, when applicable, is governed by DHCFP regulation 114.1 CMR 41.00, Rates of Payment for Services Provided to Industrial Accident Patients by Hospitals. However, under chapter 398 of the Acts of 1991, the Division is required to establish rates for comparable services �regardless of the setting� in which they are provided. Therefore, 114.1 CMR 41.00 contains many references to regulation 114.3 CMR 40.00 for most services delivered in hospital outpatient settings. When such hospital services or procedures are unlisted and/or priced at individual consideration (I.C.) under 114.3 CMR 40.00, the hospital specific payment on account factor (PAF), or, if one is unavailable, the out of-state PAF applied to charges will be used to determine the facility reimbursement rate.