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Medicare secondary payer (MSP) ongoing responsibility for medicals (ORM)
Last Modified: 11/12/2024
Location: FL, PR, USVI
Business: Part A, Part B
Effective October 1, 2015, primary insurer plans for auto/no-fault (MSP type 14), worker's compensation (MSP type 15), and liability (MSP type 47) have the capability to accept ongoing responsibility for medicals (ORM). The “Responsible Reporting Entity” (RRE) is the plan for this process. The RRE has ORM associated with specified medical conditions. This information is collected to determine primary claims payment responsibility.
Examples of ORM include, but are not limited to:
• No-fault insurer agreeing to pay medical bills submitted to it until the policy in question is exhausted or
• Workers’ compensation plan being required under a particular state law to pay associated medical costs until there is a formal decision on a pending workers’ compensation claim
When ORM ends (for example, a policy limit is reached or a settlement occurs), the RRE reports an ORM termination date. This information is uploaded to the Common Working File by the MSP Contractor.
Payment will be rejected for claim lines with open ORM for the date of service associated with the diagnosis code(s) or family of diagnosis codes. This includes claims where Medicare was billed secondary, and the ORM made a full or partial payment. A match of the first three digits of the diagnosis code is considered family. When Medicare rejects claims due to the ORM indicator, the remittance advice will reflect one of the following claims adjustment reason codes (CARCs) and remittance advice remarks codes (RARCs):
• CARC 19 – This is a work-related injury/illness and thus the liability of the workers' compensation carrier
• RARC N728 – A workers' compensation insurer has reported having (ORM) services for this diagnosis
• Group code – Patient responsibility (PR)
• Reason code U6817 – An incoming clam that contains dates of service that is within or overlapping the date of the MSP type code 'E' (worker's compensation) record that contains a 'Y' in the ORM indicator field. The diagnosis on the claim is an exact match to the diagnosis on the 'E' MSP record, or the diagnosis on the claim is within the family of diagnosis code. The claim contains full or conditional payment.
• CARC 20 – This injury/illness is covered by the liability carrier
• RARC N725 – A liability insurer has reported having (ORM) services for this diagnosis
• Group code – PR Reason code U6818 – An incoming claim that contains dates of service within or overlapping the date of the MSP type code 'L' (liability) record containing a 'Y' in the ORM indicator field. The diagnosis on the claim is an exact match to the diagnosis on the 'L' MSP record, or the diagnosis on the claim is within the family of diagnosis codes. The claim contains full or conditional payment.
• CARC 21 – This injury/illness is the liability of the no-fault carrier
• RARC N727 – A no-fault insurer has reported having (ORM) services for this diagnosis
• Group code – PR Reason code U6816 – An incoming clam that contains dates of service within or overlapping the date of the MSP type code 'D' (no-fault) record containing a 'Y' in the ORM indicator field. The diagnosis on the claim is an exact match to the diagnosis on the 'D' MSP record, or the diagnosis on the claim is within the family of diagnosis codes. The claim contains full or conditional payment.
Payment will be made if the following codes and conditions are met, assuming the primary payer did not pay for an acceptable reason, such as benefits exhausted or benefits are no longer covered due to state-imposed limits, etc.
• Any of the CARC codes on the ORM claim: 26, 27, 31, 32, 35, 49, 50, 51, 53, 55, 56, 60, 96, 119, 149, 166, 167, 170, 184, 200, 204, 242, 256, B1(if a Medicare covered visit), B14; and
• The service is covered and otherwise reimbursable by Medicare
Residual payment will be made on ORM claims when the claim adjustment segment (CAS) shows one of the following CARCs and primary benefits are terminated, exhausted or the claim contains a partial or zero payment:
• Any one of the following CARC codes on the ORM claim:
• 27 – Expenses occurred after coverage terminated
• 35 – Lifetime benefit maximum has been reached
• 119 – Benefit maximum for this time period, or occurrence, has been reached
• 149 – Lifetime benefit maximum has been reached for this source/benefit category; and
• The service is covered and otherwise reimbursable by Medicare:
For example, a plan only pays for part of a hospital stay and not the full stay because coverage terminated, or benefits were exhausted during the patient’s stay. Medicare may make a secondary payment for that part of the stay when benefits were not paid by the primary payer.
When you indicate that the claim is for services unrelated to an open file (diagnosis codes do not match) and there is no 'Y' in the ORM indicator, you can indicate in remarks "not related to open segment."
Please note that a conditional payment cannot be made when ORM exists for the item or service in question. The 120-day prompt payment rule does not override the ORM requirements.
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