Local coverage determinations for Medicare benefits

Priority Health Medicare must provide its members with all Original Medicare-covered services.

Exceptions, which are paid by Original Medicare1, are:

  • Hospice care
  • Inpatient hospital stays when enrollment ends
  • Clinical trials

In providing Part A and Part B coverage, Priority Health must ensure that coverage is consistent with general coverage guidelines included under Original Medicare in its manuals and instructions UNLESS superseded by a Center for Medicare & Medicaid Services (CMS) instruction or regulation concerning Part C of the Medicare program.

Using Local Coverage Determinations (LCDs)

To ensure consistency of coverage, Priority Health must apply Medicare medical policy as found either under National Coverage Determinations (NCDs) or Local Coverage Determinations (LCDs)2. Benefits Original Medicare describes a benefit in an LCD, that LCD must have been written by a local Medicare Administrative Contractor (MAC) or fiscal intermediary with "jurisdiction for claims in the geographic area in which services are covered under the Medicare Advantage (MA) plan"3.

We administer Priority Health Medicare benefits using the following LCDs as awarded by CMS:

  • Inpatient (Part A) services: Wisconsin Physician Services (WPS-Medicare) for all hospitals except 9 still falling under National Government Services (NGS)
  • Outpatient (Part B) hospital services: WPS-Medicare for all hospitals except 9 still falling under NGS
  • Outpatient (Part B) professional services: WPS-Medicare
  • Durable medical equipment (DME): NGS
  • Home health services: NGS

For non-contracted providers outside our service region, services are reimbursed based on the local coverage determinations in the provider's geographic region.

Application of LCDs

The LCDs identified above are used because Medicare has awarded the MAC or fiscal intermediary a contract for handling of payment for a certain category of Original Medicare covered benefits for State of Michigan Original Medicare beneficiaries. Since our service area covers all counties in lower Michigan, we must use these LCDs in making coverage or payment determinations.

LCDs and provider disputes

Providers who dispute the use of a particular LCD can file a provider "appeal." If the provider disputes our use of one of the intermediaries identified above citing another intermediary's LCD, the provider should submit documentation (i.e., supply the appropriate LCD and other information) that we can review and consider in making our decision.

Note: There may be other intermediaries with LCDs that could be applicable to State of Michigan residents. We will consider use of another intermediary's LCD if:

  • There is no LCD for the service identified by one of the intermediaries above, and
  • If the intermediary has jurisdiction for coverage in the State of Michigan.

1See Section 10.2, Basic Rule, Chapter 4, Medicare Managed Care Manual.

2See Section 80 et al, National and Local Coverage Determinations, Chapter 4, Medicare Managed Care Manual.

3See Section 80.1, Chapter 4, Medicare Managed Care Manual.

4At this time, NGS does not service the state of Michigan for the processing of Part B claims, so Part B LCDs are not applicable for Priority Health Medicare members.

5See Section 80.2., Chapter 4, Medicare Managed Care Manual.