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Office of Mental Health

Medicaid/Medicare Crossover Update
May 24, 2011

Issue 1: After May 27th, 2011 co-pays and deductibles will no longer be reimbursed for Medicare/Medicaid dually-enrolled clients receiving Offsite Clinic Services

As our Article 31 providers are aware, Medicaid will not reimburse for offsite clinic services.  However, Medicaid did pay some portion of Medicare co-pays and deductibles for offsite services to most Medicare/Medicaid dually-enrolled individuals.

As a result of changes in the state budget recommended by the Medicaid Redesign Team (MRT Proposal 164), Medicaid payments for co-pays and deductibles for offsite Medicare approved clinic services will no longer be reimbursed after May 27th, 2011.

Issue 2: Problems with Medicaid payment for offsite Medicare-approved services

As you may know, providers have been unable to receive Medicaid reimbursement for co-pays and deductibles for offsite Medicare approved services.  On November 30, 2010 the Office of Mental Health posted guidance for Article 31 mental health clinics billing Medicaid for offsite services provided to Medicare/Medicaid dually-enrolled clients.  It has come to our attention that this guidance is inaccurate and results in denial of payment from Medicaid. 

OMH Provider Survey to determine the amount of Provider Liability for Denied Offsite claims

OMH recognizes that there are clinic providers that have continued to provide offsite services to dually-enrolled clients because the guidance from OMH stated that they would receive the full co-payment or deductible from Medicaid.  In actuality, as a result of a legislative change effective July 1, 2003, the Medicaid program does not pay the full co-insurance for all Medicare services for clinic offsite services reimbursed by Medicare.  Medicaid pays 20% of the co-insurance for Medicare Part B services when the Medicare paid amount is higher than the Medicaid fee.

This affects any Medicare/Medicaid crossover claims for offsite services performed between October 1, 2011 and May 27, 2011.  More information on the legislative change can be found in the August 2003 Medicaid Update Leaving OMH site followed by the November 2003 Medicaid Update Leaving OMH sitePlease note: This update does not apply to onsite clinic services where Medicaid will continue to pay the higher of what Medicare or Medicaid would pay for Medicare/Medicaid dually-enrolled individuals who receive mental health clinic services that comply with the billing rules set forth in Part 599 clinic regulations.

To determine the best means to process these denied claims, OMH is developing a survey for clinic providers to determine the volume.  More information on the survey and the process for submitting the claims to Medicaid will be sent out to clinic providers shortly. It is important that your clinic respond to the survey if offsite services to dually-enrolled clients have been provided.

Please do not hesitate to contact Gwen Diamond, OMH Financial Planning, at (518) 474-6911 if you have any questions regarding this matter.

Comments or questions about the information on this page can be directed to the Bureau of Financial Planning.