Often we receive questions from the field regarding coding of therapy diagnoses and we wish we could just “add” any ICD-9 code to the computer system.  However, we have to base the selection of the codes off of the Medicare Administrative Contractor’s (MACs) Local Coverage Determination.  So what are Local Coverage Determinations (LCDs)?

In order to understand the LCD, we have to first look at what Medicare considers as “covered”.  So, let’s start at the beginning.

Medicare coverage is limited to items or services that are reasonable and necessary to treat specific diagnoses, conditions, illnesses, and/or injuries.  All of these must be within the scope of the Medicare benefit category of course.  CMS has National Coverage Determinations (NCDs) that were developed through an evidence-based process and at times in conjunction with independent consultants/technology assessments and/or with Medicare Evidence Development and Coverage Advisory Committee (MEDCAC) to outline the conditions for which an item or service is considered to be covered (or not covered) under section 1862(a)(1) of the Social Security Act.

LCDs contain only reasonable and necessary conditions of coverage allowed under section 1862(a)(1)(A) of the Social Security Act. In other words, the LCD is a decision by a MAC whether to cover a particular item or service in accordance with the section 1862(a)(1)(A) of the Social Security Act.  They are developed by the MAC through consideration of medical literature, the advice of local medical societies and consultants, public and provider comments.  LCDs specify under what circumstances an item or service is considered to be reasonable and necessary.  They are tools to assist us in submitting correct claims for payment.  LCDs are published to provide guidance.

Why is this important and how does this relate to therapy?  The answer is simple really……..therapy services must be reasonable and necessary to treat a patient’s condition/illness .

The MACs may review claims at any time (before and/or after payment).  Automated denials can be made as well.  When the MAC determines whether an item or service is covered, this determination is made based on the LCD or the clinical judgment of the reviewer.  The item or service may be covered if it meets certain conditions.  These conditions are noted in the Medicare Program Integrity Manual, Chapter 13, Section 13.5.1:

  • Safe and effective treatment
  • Duration and frequency that is appropriate for the item or service
  • Furnished in accordance with accepted standards of medical practice for the diagnosis or treatment of the patient’s condition
  • Furnished in a setting appropriate to the patient’s medical needs and condition
  • Ordered and furnished by qualified personnel
  • Meets (but does not exceed) the patient’s medical need
  • Is at least as beneficial as an existing and available medically appropriate alternative

The best practice is for therapists to follow their MAC LCD for guidance of coverage and code accordingly.  Keep in mind that a particular ICD-9 code may be covered on a LCD for nursing treatment of a condition/illness but that same ICD-9 code/diagnosis may not be covered to support reasonable and necessary therapy intervention.

Those who oversee and submit billing will need to include all ICD-9 codes on the claim to support all of the services provided.  This means that there will be times when therapy ICD-9 codes differ slightly or significantly from the facility ICD-9 codes.

All therapy ICD-9 codes must be on the claim to support the therapy HCPCs billed.  If they are not, automatic denials will most likely occur.