Preventing Medical Necessity Denials – Is it Possible?

Medical necessity is a real thing – by definition anyway. We may not like the terminology since it doesn’t have anything to do with technique or the appropriateness of the care we deliver. But the definition(s) of medical necessity is one of the most important to you and your practice whether a cash-based practice or one dealing with third-party payers. Medicare Part B, Medicare Advantage plans, Personal Injury, and all other third-party payers have a mandate to only pay for medically necessary care. Providers who believe they are “following the rules” still receive denials due to medical necessity. There are multiple reasons this happens, and they may differ from provider to provider, and from payer to payer.

The Definition of Medically Necessary Care

The truth is…many providers do not fully comprehend medical necessity. It is not always due to a lack of effort. We define “clinically appropriate” as all the care that providers order and render within their scope of practice. But medical necessity is defined very differently and far more narrowly by Medicare and insurance companies. Sometimes the definitions vary significantly by both third-party payers and Chiropractic licensing boards. Understanding these definitions to which providers are held accountable is one of the most important compliance activities a practice can undertake.

We know that Medicare’s definition is as follows: “The patient must have a significant health problem in the form of a neuromusculoskeletal condition that necessitates treatment. The manipulative services rendered must have a direct therapeutic relationship to the patient’s condition and provide a reasonable expectation of recovery or improvement of FUNCTION.” There must be a valid expectation, at the time treatment is rendered, that improvement will occur. Through documentation, the provider must demonstrate that improvement has occurred, and that the functional loss has been restored to the pre-condition norms.

While we cannot list every payer’s definition of what constitutes medical necessity, we can provide a simple checklist of elements that must be included within your documentation to support and prove medical necessity.

• Patient consultation with appropriate history
• Subjective complaints reported by the patient
• Functional deficit brought on by mechanism of injury
• Physical examination findings and tests results
• Diagnosis codes with description of condition
• Treatment plan including measurable, functional goals

Preventive Measures for Medical Necessity Denials

Locate the Medical Review Policy (MRP). Start by finding the MRP for any payer that you are contracted with or that you bill on behalf of your patients. Review the medical necessity and/or documentation requirements for the services offered in your clinic. Look for the word ALL, as most payers require several criteria to be met and documented.

Document the Episode. As we audit records for providers, both proactively, and in defense of an audit, we see that a major reason for medical necessity issues is the apparent lack of episodic care. Chiropractic patients move through ebbs and flows during treatment, and it is best documented as “active treatment,” “preventive maintenance,” or “wellness care.” While in the active treatment phase, there should be clear evidence of a foundational visit with all the items noted above. The date in Box 14 of the 1500 billing form should correspond to the initial visit date of the episode of care. Then, the documentation of routine office visits (ROV) in which the treatment plan is being executed should demonstrate the required progress (or lack thereof) for the episode.

Document Progress. Documenting the patient’s progress, as it relates to functional change based on the goals established in the treatment plan, throughout the active care episode will streamline the task of satisfying medical necessity requirements for most payers. Each episode should have a beginning, a middle, and an end.

Submit Clean Claims. Reporting accurate onset dates in Box 14 and presenting correctly ordered diagnosis codes and appropriate procedure codes will provide clear communication that the patient is being properly managed.

Appropriate Discharge. Discharge from active treatment is just as important regardless of whether the patient returns for preventive maintenance or wellness care. It provides a documented end to the active treatment so that the next active episode is clearly delineated and more likely to meet medical necessity requirements.

Simply stated, medical necessity is the force that drives claim payment by third-party payers. Your documentation is the element that proves your treatment was justified and produced measurable improvement. Without proper documentation and coding, it would be fair to assume that your services will be denied as not medically necessary.

Dr. Colleen Auchenbach graduated with a Doctor of Chiropractic from Cleveland University Kansas City in December of 1998 and enjoyed practicing for over 20 years. Her interest in Medical Compliance began when she earned the 100-hour Insurance Consultant/Peer Review certification from Logan University in 2015. She has been a certified Medical Compliance Specialist-Physician since 2016 and a Certified Professional Medical Auditor since 2022. Dr. Auchenbach joined the excellent team at KMC University as a Specialist in 2020, and as a part of this dedicated team is determined to bring you accurate, current, and reliable information. You may reach her by email through info@kmcuniversity or by calling (855) 832-6562.