{"id":12775,"date":"2021-01-21T20:46:55","date_gmt":"2021-01-21T15:16:55","guid":{"rendered":"https:\/\/www.medicalbillersandcoders.com\/blog\/?p=12775"},"modified":"2025-09-18T14:51:57","modified_gmt":"2025-09-18T14:51:57","slug":"defining-reasonable-and-necessary-coverage-for-medicare","status":"publish","type":"post","link":"https:\/\/www.medicalbillersandcoders.com\/blog\/defining-reasonable-and-necessary-coverage-for-medicare\/","title":{"rendered":"Defining \u2018Reasonable and Necessary\u2019 Coverage for Medicare"},"content":{"rendered":"<p style=\"text-align: justify;\">Medicare won\u2019t provide coverage for items and services that are not reasonable and necessary for the diagnosis or treatment of an illness or injury. National coverage determinations (NCDs) are made through an evidence-based process, with opportunities for public participation. In the absence of NCDs, an item or service may be covered at the discretion of the Medicare contractors based on a local coverage determination (LCD).<\/p>\n<p style=\"text-align: justify;\">No payment may be made under Part A or Part B for any expenses incurred for items or services not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed (misshapen) body member.<\/p>\n<p style=\"text-align: justify;\">When you are submitting claims to Medicare, your medical documentation should clearly demonstrate that the service meets all of the above criteria. Such documentation should be maintained in the patient\u2019s medical record and must be available to the contractor upon request.<\/p>\n<h2 style=\"text-align: left;\">Defining \u2018Reasonable and Necessary\u2019<\/h2>\n<p style=\"text-align: justify;\">Under a recently proposed rule (the final rule is effective on March 15, 2021.), CMS clarified the reasonable and necessary standard while providing a significant new way to seek coverage, particularly for innovative technology.<\/p>\n<p style=\"text-align: justify;\">As per this proposed rule, it will allow evidence of commercial coverage to show that a service or item is \u201creasonable and necessary.\u201d While there is a fair amount of clarification needed to implement such a change, this rule change would seemingly allow for a faster path to coverage for emerging treatments.<\/p>\n<p style=\"text-align: justify;\"><strong>CMS laid out three standards for determining whether an item or service is \u201creasonable and necessary under \u00a71862(a) (1) (A) of the Act if the service is:<\/strong><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"text-align: left;\">Safe and effective;<\/li>\n<li style=\"text-align: left;\">Not experimental or investigational; and<\/li>\n<li style=\"text-align: left;\">Appropriate<\/li>\n<\/ul>\n<p style=\"text-align: justify;\">CMS provided additional guidance related to whether an item or service is \u2018appropriate\u2019 in the Medicare Provider Integrity Manual. An item or service is \u2018appropriate\u2019 for Medicare patients, including the frequency and duration considered appropriate for the item or service, if it is:<\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"text-align: left;\">Furnished in accordance with accepted standards of medical practice for the diagnosis or treatment of the beneficiary\u2019s condition or to improve the function of a malformed body member;<\/li>\n<li style=\"text-align: left;\">Furnished in a setting appropriate to the beneficiary\u2019s medical needs and condition;<\/li>\n<li style=\"text-align: left;\">Ordered and furnished by qualified personnel; and<\/li>\n<li style=\"text-align: left;\">One that meets, but does not exceed, the beneficiary\u2019s medical need<\/li>\n<\/ul>\n<p style=\"text-align: justify;\">CMS plans to promulgate this standard through the Proposed Rule. This change would not be significant as it has already been the standard under which the MACs have operated. CMS proposed a more significant change, however, in the rulemaking.<\/p>\n<p style=\"text-align: justify;\">If finalized, CMS and the MACs would also consider an item or service \u201cappropriate\u201d if it is covered in the commercial insurance market unless there are clinically relevant differences between Medicare beneficiaries and commercially insured individuals. If the item or service is covered by a commercial plan, the other appropriateness criteria would not also need to be met.<\/p>\n<p style=\"text-align: justify;\">For this proposed rule when the comments are submitted in November, AHA warned against replacing the appropriateness criteria entirely with a consideration of commercial market coverage, noting that such an approach could reduce coverage in the Medicare program and transparency in coverage determinations.<\/p>\n<p style=\"text-align: justify;\">Under the final rule, which takes effect March 15, CMS opted not to replace the appropriateness criteria entirely and will issue draft sub-regulatory guidance on the methodology for determining when and how commercial coverage will be determined relevant.<\/p>\n<p style=\"text-align: justify;\">The final rule will establish a Medicare coverage pathway for innovative medical devices designated as a breakthrough by the Food and Drug Administration. According to CMS, the Medicare Coverage of Innovative Technology pathway will result in four years of national Medicare coverage starting on the date of FDA market authorization or a date within two years of authorization that the manufacturer chooses.<\/p>\n<h3 style=\"text-align: justify;\">About Medical Billers and Coders<\/h3>\n<p style=\"text-align: justify;\">We are catering to more than 40 specialties,\u00a0<a href=\"https:\/\/bit.ly\/38maDq8\"><strong>Medical Billers and Coders (MBC)<\/strong><\/a>\u00a0is proficient in handling services that range from\u00a0<a href=\"https:\/\/medicalbillersandcoders.com\/revenue-management-services.aspx\">revenue cycle management<\/a>\u00a0to\u00a0<a href=\"https:\/\/www.medicalbillersandcoders.com\/ICD-10.aspx\">ICD-10<\/a>\u00a0testing solutions. The main goal of our organization is to assist physicians looking for billers and coders.<\/p>\n<h2>FAQs<\/h2>\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1758207034052\"><strong class=\"schema-faq-question\">1. What does Medicare consider &#8220;reasonable and necessary&#8221; for coverage?<\/strong> <p class=\"schema-faq-answer\">Medicare considers services that are safe, effective, and not experimental as &#8220;reasonable and necessary&#8221; for coverage. These services must also meet medical standards and be appropriate for the patient\u2019s condition.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758207052120\"><strong class=\"schema-faq-question\">2. How does CMS determine if an item or service is appropriate for Medicare patients?<\/strong> <p class=\"schema-faq-answer\">CMS considers whether the service follows accepted medical practices, is provided in an appropriate setting, and is ordered by qualified professionals. It should also meet the patient&#8217;s medical needs without exceeding them.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758207063176\"><strong class=\"schema-faq-question\">3. What is the new proposed rule regarding commercial insurance coverage?<\/strong> <p class=\"schema-faq-answer\">The new rule suggests that CMS may consider a service &#8220;appropriate&#8221; for Medicare if it is covered by commercial insurance, unless significant differences exist between Medicare beneficiaries and those with commercial insurance.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758207075276\"><strong class=\"schema-faq-question\">4. How will innovative medical devices be covered under the new CMS rule?<\/strong> <p class=\"schema-faq-answer\">CMS has proposed a pathway for Medicare coverage of innovative medical devices designated as breakthrough by the FDA, ensuring national coverage starting from FDA market authorization.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1758207089179\"><strong class=\"schema-faq-question\">5. How should medical documentation be submitted to prove the necessity of a service for Medicare?<\/strong> <p class=\"schema-faq-answer\">Medical documentation should clearly demonstrate that the service meets Medicare\u2019s criteria of being reasonable and necessary for the diagnosis or treatment. This documentation should be available to the contractor upon request.<\/p> <\/div> <\/div>\n","protected":false},"excerpt":{"rendered":"<p>Medicare won\u2019t provide coverage for items and services that are not reasonable and necessary for the diagnosis or treatment of an illness or injury. National coverage determinations (NCDs) are made through an evidence-based process, with opportunities for public participation. In the absence of NCDs, an item or service may be covered at the discretion of [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":12778,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[51,146,753,2482],"class_list":["post-12775","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-medical-billing-services","tag-cms","tag-medicare-2","tag-medicare-billing","tag-reasonable-and-necessary"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.8 (Yoast SEO v27.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Defining \u2018Reasonable and Necessary\u2019 Coverage for Medicare<\/title>\n<meta name=\"description\" content=\"Under a recently proposed rule (final rule is effective on March 15, 2021.), CMS clarified reasonable and necessary standard while providing a significant new way to seek coverage, particularly for innovative technology.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.medicalbillersandcoders.com\/blog\/defining-reasonable-and-necessary-coverage-for-medicare\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Defining \u2018Reasonable and Necessary\u2019 Coverage for Medicare\" \/>\n<meta property=\"og:description\" content=\"Under a recently proposed rule (final rule is effective on March 15, 2021.), CMS clarified reasonable and necessary standard while providing a significant new way to seek coverage, particularly for innovative technology.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.medicalbillersandcoders.com\/blog\/defining-reasonable-and-necessary-coverage-for-medicare\/\" \/>\n<meta property=\"og:site_name\" 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