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HHS delays PECOS enforcement

Washington—Medicare officials Dec. 16 announced a delay in PECOS enforcement to at least July 5, 2011, “to give CMS more flexibility to determine the appropriate date for nonpayment of claims that fail the ordering/referring provider edits.”

Medicare requires ordering and referring providers to enroll in the government insurance program or opt out but delayed enforcement “with a placeholder future implementation date of July 5, 2011.” Medicare’s Internet-based Provider, Enrollment, Chain and Ownership System InternetBased PECOS is managed by the Centers for Medicare & Medicaid Services, a Department of Health and Human Services agency.

Two CMS regulatory notices issued Dec. 16 said, “The implementation of Phase 2 of this change request is being delayed and will not begin on Jan. 3, 2011.” Change requests 6417 and 6412 rescind and replace Feb. 26, 2010 notices.

The PECOS regulation is intended to fight Medicare fraud. Congress told HHS in the health reform law to start the system by July 6, 2010, but HHS now says it needs more time to implement and enforce the provision.

Medicare intends to deny payment for any items or services ordered or referred by a physician or dentist who has not enrolled in PECOS or opted out of Medicare, but acknowledges that this is a “challenging” process. Specifics of how the ordering/referring enrollment rule will affect dentists will not be fully known until the final rule is published.

“Although this policy would help protect the Medicare program from fraudulent and erroneous charges it would prove challenging for training programs because many if not most residents are not enrolled in PECOS and interns cannot enroll because they are not licensed. Many DOD physicians and VA physicians are also not Medicare enrolled,” says a notice at the CMS website.