Medicare Part A Allows Conditional Payments

At times claims properly submitted to automobile, no-fault, liability, or Worker’s Compensation insurers as primary payers, are not paid in a timely manner. This situation may occur when there are delays in settlements. To offset this problem, Medicare may make conditional payments in situations when the primary claims are not expected to be paid in a timely manner. If a provider has not received payment within 120 days, Medicare may be billed for any Medicare covered services provided and Medicare may make a conditional payment on the claim. However, once a settlement has been reached, the primary payer is still responsible for its portion of the claim. Medicare has the right to recover any conditional payments made on be-half of the beneficiary.

Claims for conditional payments must be billed electronically using the ANSI X12 837 format. The claim must pass the same ‘balancing equation’ as other Medicare Secondary Payer claims.

Below are the ANSI segments needed for a conditional claim.

Identifying Medicare as the Secondary Payer

SBR Segment for Secondary Payer

In the ANSI X12N 004010X096A1 format, indication of payer priority is identified in the

SBR segment. The format allows for primary, secondary, and tertiary payers to be reported based on the value provided in the SBR01. The associated values for the SBR01 are ‘P’ for primary, ‘S’ for secondary, and ‘T’ for tertiary.

• Syntax of the SBR Segment in 2000B loop for MSP (Secondary Payer information):

SBR*S*18*A6343*MEDICARE*****MA (example)
SBR01 = ‘S’ indicating Secondary Payer
SBR02 = ‘18’ indicating Self. The insurer is always the subscriber for Medicare
SBR03 = ’A6343’ indicating Subscribers Group Number
SBR04 = ’Medicare‘ indicating Medicare Group Name
SBR09 = ‘MA’ indicating Medicare Part A.

CLM Segment

The CLM 02 should contain the total charge amount, not the balance after the primary payer paid the claim.

SBR segment for Primary Payer

The SBR01 element is reported with the value of ‘P’ for primary payer. SBR09 indicates the type of primary payer.

• Syntax of the SBR Segment in 2320 loop for MSP (Primary Payer information):

SBR*P*01*XR12345*Progressive*****CI (example)
SBR01 = ‘P’ indicating Primary Payer
SBR02 = ‘01’ indicating Spouse1
SBR03 = ’XR12345’ indicating Group Number
SBR04 = ’Progressive’ indicting primary payer
SBR09 = ‘CI’ indicating Commercial Insurance

Claim Level Reporting

HI Segments - Occurrence/Value/Condition Codes

To prevent claims processing delays, all coding options available to explain the payer status of each insurer in the claim should be used. This includes using occurrence, condition and value codes when appropriate. Codes are contained in the 2300 loop HI segment, identified by individual qualifiers. Note: the codes used below are examples only. Use the appropriate codes for your claim type.

• Syntax of the HI Segment in 2300 loop

HI*BE: 14:: : 150 (example)
HI01 01 = ‘BE’ indicating Value Code
HI01:02 = ’14‘value code representing ‘Auto liability’.
HI01 04 = ’0’ indicating the total amount paid by the Primary payer. This value code represents why Medicare was not the primary payer, for example – the primary was workers compensation, patient is working elderly or auto insurance was involved. Note: The total amount paid by the previous payer is ‘0’.

HI*BH:01:D8:20060105 (example)
HI01 01 = ‘BH’ indicating Occurrence Code
HI01 02 = ‘24’ occurrence code indicating “Date insurance denied”
HI01 03 = ‘D8’ indicating a CCYYMMDD format
HI01 04 = Date of occurrence

CAS Segment – Claim Level Adjustment

The CAS segment in the 2320 loop should be used to report prior payers claim level adjustments that caused the amount paid to differ from the amount originally charged. This segment would normally report information returned on the previous payers 835 Remittance Advice. For conditional payments, the CAS should contain the total billed amount.

• Syntax of 2320 loop CAS segment for Claim Level Adjustment Information:

CAS*OA*42*100*1~ (example)
CAS01 = indicates Claim Adjustment Group Code
CAS01 valid values:
CO = indicating Contractual Obligations
CR = indicating Corrections and Reversals
OA = indicating Other Adjustments
PI = indicating Payer Initiated Reductions
PR = indicating Patient Responsibility
CAS02 = indicates Claim Adjustment Reason Code
CAS03 = indicates Monetary Adjustment Amount
Note: this is the full claim amount.
CAS04 = indicates Service Line Adjusted Units

AMT Segments

• Payer Paid Amount

This segment is required in this loop if the primary payer has adjudicated the claim. It is acceptable to show “0” (zero) as an amount paid.

• Syntax of the 2320 loop AMT segment for Payer Paid Amount:

AMT*C4*0~ (example)
For conditional payments prior paid amount is ‘0’
AMT01 = ‘C4’ indicating Prior Payment – Actual
AMT02 = Monetary Amount

AMT*T3*100~ (example)
For conditional payment total submitted charges are the total billed amount
AMT01 = ‘T3’ indicating Total Submitted Charges
AMT02 = Monetary Amount
This monetary amount should match the claim total amount in the CLM 02.

The calculation for balancing is as follows:
AMT 02 T3 qualifier (total submitted charge) minus CAS adjustments (CAS adjustments at both the claim AND the line) must equal AMT 02 C4 qualifier (prior paid amount).
Claims that do not contain the appropriate claim adjustment will reject at the EDI Gateway.

total submitted T3 = $100 minus
total adjusted CAS = $100
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Prior paid amount C4 = 0

Please contact Medicare EDI at (904) 791-8191 option 2 if you have comments or questions on this information.