Payment Policies

Date: 12/16/16

Updated Payment Policies

Effective 1/15/2017

We are happy to inform you that Magnolia Health is publishing its Payment Policies to inform providers about acceptable billing practices and reimbursement methodologies for certain procedures and services. We will apply these policies as medical claims reimbursement edits within our claims adjudication system. This is in addition to all other reimbursement processes that Magnolia currently employs.

Magnolia believes that publishing this information will help providers to bill claims more accurately, therefore reducing unnecessary denials and delays in claims processing and payments. These policies address coding inaccuracies including diagnosis to procedure code mismatch, inappropriately modified procedures, unbundling, incidental procedures, duplication of services, medical necessity requirements and health plan specific payment rules for procedures and services.

These policies are developed based on medical literature and research, industry standards and guidelines as published and defined by the American Medical Association’s Current Procedural Terminology (CPT®), Centers for Medicare and Medicaid Services (CMS), and public domain specialty society guidance, unless specifically addressed in the fee-for-service provider manual published by the state of Mississippi or regulations.

Visit magnoliahealthplan.com to find the Payment Policies. The effective date for the below policies is 1/15/2017.

Policy Name	Description
ADHD Assessment and Treatment	This policy defines the medically necessary procedures for the diagnosis and treatment of Attention Deficit Hyperactivity disorder (ADHD).
Bronchial Thermoplasty	This policy provides a statement of medical necessary for bronchial thermoplasty (BT).
Diagnosis of Vaginitis	This policy defines the medically necessary indications for the diagnostic evaluation of vaginitis in members ≥ 13 years of age.
Influenza and Strep Testing	This policy provides a statement of medical necessity for Influenza and streptococcus group A testing performed at the same visit.
Holter Monitors	This policy defines the medically necessary indications for continuous ambulatory ECG monitoring.
Homocysteine Testing	This policy defines the medically necessary indications for homocysteine testing.
Laser Skin Therapy	This policy defines the medically necessary indications for excimer laser based targeted phototherapy.
Fractionated Exhaled Nitric Oxide (FeNO) Testing	This policy provides a statement of medical necessity for the testing of FeNO.

EX Codes for Use in Provider Notification

The table below contains explanation codes for Payment and Clinical policy denials:

Explanation Code	Definition	Description of Claims Edit
w7	Preventable Readmission Recoupment	Represents an overpayment of a previously reimbursed claim. Depending on the provider's contract, the overpayment is collected either by an offset from a future payment to the provider or as a direct refund from the provider.
xE	Procedure Code is Disallowed with Diagnosis code(s) per plan policy	The procedure code is not reimbursable when billed with a diagnosis code that does not support medical necessity.
xL	Procedure Code Unbundled per State Rules, Contract or Payment Policy	Multiple procedure codes are billed for the component parts of a procedure, service or item, when there is a single CPT code that includes the complete procedure, service or related items.
xP	Service is denied according to a payment or coverage policy	The procedure code billed is considered not medically necessary. For example, the procedure code is considered experimental, investigational or unproven.
xS	Readmission Denied After Medical Record Review	After clinical review of the medical records, the readmission was determined to be preventable; therefore the denial is upheld.
ym	Potential Preventable Readmission Submit all Medical Records	Represents a denial for a potentially preventable readmission. Provider must submit all medical records within the readmission time period (15 or 30 day) depending on health plan rules. Records are clinically reviewed by the health plan's Medical Management team.
yv	Outpatient services included in inpatient admission per CMS/Plan Guidelines	The technical component of all outpatient diagnostic and non-diagnostic services are bundled into the inpatient hospitalization when those services occur during the 1-day or 3 days preceding the inpatient admission.