Vermont § 9418a - Processing claims, downcoding, and adherence to coding rules [Effective until January 1, 2026; see also section 9418a effective January 1, 2026 set out below]

§ 9418a. Processing claims, downcoding, and adherence to coding rules [Effective until January 1, 2026; see also section 9418a effective January 1, 2026 set out below]

• (a) Health plans, contracting entities, covered entities, and payers shall accept and
  initiate the processing of all health care claims submitted by a health care provider
  pursuant to and consistent with the current version of the American Medical Association’s
  Current Procedural Terminology (CPT) codes, reporting guidelines, and conventions;
  the Centers for Medicare and Medicaid Services Healthcare Common Procedure Coding
  System (HCPCS); American Society of Anesthesiologists; the National Correct Coding
  Initiative (NCCI); the National Council for Prescription Drug Programs coding; or
  other appropriate nationally recognized standards, guidelines, or conventions approved
  by the Commissioner. (b) When editing claims, health plans, contracting entities, covered entities, and payers
  shall adhere to edit standards except as provided in subsection (c) of this section: (1) the CPT, HCPCS, and NCCI; (2) national specialty society edit standards; or (3) other appropriate nationally recognized edit standards, guidelines, or conventions
  approved by the Commissioner. (c) Adherence to the edit standards in subdivision (b)(1) or (2) of this section is not
  required: (1) when necessary to comply with State or federal laws, rules, regulations, or coverage
  mandates; or (2) for edits that the payer determines are more favorable to providers than the edit
  standards in subdivisions (b)(1) through (3) of this section or to address new codes
  not yet incorporated by a payer’s edit management software, provided the edit standards
  are developed with input from the relevant Vermont provider community and national
  provider organizations and provided the edits are available to providers on the plan’s
  websites and in their newsletters. (d) [Reserved.] (e)(1) Except as otherwise provided in subdivision (2) of this subsection, no health plan,
  contracting entity, covered entity, or payer shall subject any health care provider
  to prepayment coding validation edit review. As used in this subsection, “prepayment
  coding validation edit review” means any action by the health plan, contracting entity,
  covered entity, or payer, or by a contractor, assignee, agent, or other entity acting
  on its behalf, requiring a health care provider to provide medical record documentation
  in conjunction with or after submission of a claim for payment for health care services
  delivered, but before the claim has been adjudicated. (2) Nothing in this subsection shall be construed to prohibit targeted prepayment coding
  validation edit review of a specific provider, provider group, or facility under certain
  circumstances, including evaluating high-dollar claims; verifying complex financial
  arrangements; investigating member questions; conducting post-audit monitoring; addressing
  a reasonable belief of fraud, waste, or abuse; or other circumstances determined by
  the Commissioner through a bulletin or guidance. (f) Nothing in this section shall preclude a health plan, contracting entity, covered
  entity, or payer from determining that any such claim is not eligible for payment
  in full or in part, based on a determination that: (1) the claim is contested as defined in subdivision 9418(a)(2) of this title; (2) the service provided is not a covered benefit under the contract, including a determination
  that such service is not medically necessary or is experimental or investigational; (3) the insured did not obtain a referral, prior authorization, or precertification, or
  satisfy any other condition precedent to receiving covered benefits from the health
  care provider; (4) the covered benefit exceeds the benefit limits of the contract; (5) the person is not eligible for coverage or is otherwise not compliant with the terms
  and conditions of his or her coverage agreement; (6) the health plan has a reasonable belief that fraud or other intentional misconduct
  has occurred; or (7) the health plan, contracting entity, covered entity, or payer determines through coordination
  of benefits that another entity is liable for the claim. (g) Nothing in this section shall be deemed to require a health plan, contracting entity,
  covered entity, or payer to pay or reimburse a claim, in full or in part, or to dictate
  the amount of a claim to be paid by a health plan, contracting entity, covered entity,
  or payer to a health care provider. (h) No health plan, contracting entity, covered entity, or payer shall automatically reassign
  or reduce the code level of evaluation and management codes billed for covered services
  (downcoding), except that a health plan, contracting entity, covered entity, or payer
  may reassign a new patient visit code to an established patient visit code based solely
  on CPT codes, CPT guidelines, and CPT conventions. (i) Notwithstanding the provisions of subsection (f) of this section, and other than the
  edits contained in the conventions in subsections (a) and (b) of this section, health
  plans, contracting entities, covered entities, and payers shall continue to have the
  right to deny, pend, or adjust claims for services on other bases and shall have the
  right to reassign or reduce the code level for selected claims for services based
  on a review of the clinical information provided at the time the service was rendered
  for the particular claim or a review of the information derived from a health plan’s
  fraud or abuse billing detection programs that create a reasonable belief of fraudulent
  or abusive billing practices, provided that the decision to reassign or reduce is
  based primarily on a review of clinical information. (j) Every health plan, contracting entity, covered entity, and payer shall publish on
  its provider website and in its provider newsletter if applicable: (1) the name of any commercially available claims editing software product that the health
  plan, contracting entity, covered entity, or payer utilizes; (2) the standard or standards, pursuant to subsection (b) of this section, that the entity
  uses for claim edits; (3) the payment percentages for modifiers; and (4) any significant edits, as determined by the health plan, contracting entity, covered
  entity, or payer, added to the claims software product after the effective date of
  this section, which are made at the request of the health plan, contracting entity,
  covered entity, or payer. (k) Upon written request, the health plan, contracting entity, covered entity, or payer
  shall also directly provide the information in subsection (j) of this section to a
  health care provider who is a participating member in the health plan’s, contracting
  entity’s, covered entity’s, or payer’s provider network. (l) For purposes of this section, “health plan” includes a workers’ compensation policy
  of a casualty insurer licensed to do business in Vermont. [Subsection (m) repealed effective January 1, 2028.] (m) There is established a working group comprising the health plans, contracting entities,
  covered entities, and payers subject to the reporting requirement in subsection 9414a(b) of this title; representatives of hospitals and health care providers; representatives of the Department
  of Financial Regulation and of other relevant State agencies; and other interested
  parties to study trends in coding and billing that health plans, contracting entities,
  covered entities, or payers, or a combination of them, seek to address through claim
  editing. The working group shall provide a progress report to the House Committee
  on Health Care and the Senate Committees on Health and Welfare and on Finance upon
  request. [Subsection (n) repealed effective January 1, 2028.] (n) With respect to the working group established under subsection (m) of this section
  and to the extent required to avoid violations of federal antitrust laws, the Department
  shall facilitate and supervise the participation of members of the working group. (Added 2007, No. 203 (Adj. Sess.), § 28, eff. June 10, 2008; amended 2009, No. 61, § 30; 2011, No. 21, § 18; 2011, No. 171 (Adj. Sess.), § 11a, eff. May 16, 2012; 2023, No. 111 (Adj. Sess.), § 2, eff. January 1, 2025 and January 1, 2026; 2023, No. 111 (Adj. Sess.), § 8, eff. January 1, 2028.) § 9418a. Processing claims, downcoding, and adherence to coding rules [Effective January 1,
  2026; see also section 9418a effective until January 1, 2026 set out above] (a) Health plans, contracting entities, covered entities, and payers shall accept and
  initiate the processing of all health care claims submitted by a health care provider
  pursuant to and consistent with the current version of the American Medical Association’s
  Current Procedural Terminology (CPT) codes, reporting guidelines, and conventions;
  the Centers for Medicare and Medicaid Services Healthcare Common Procedure Coding
  System (HCPCS); American Society of Anesthesiologists; the National Correct Coding
  Initiative (NCCI); the National Council for Prescription Drug Programs coding; or
  other appropriate nationally recognized standards, guidelines, or conventions approved
  by the Commissioner. (b)(1) Except as provided in subsection (c) of this section, when editing claims, health
  plans, contracting entities, covered entities, and payers shall require not more than
  the following edit standards, processes, and guidelines: (A) for claims for outpatient and professional services, the NCCI as in effect for Medicare; (B) for facility claims, the Medicare Code Editor as in effect for Medicare; (C) for pharmacy claims, appropriate nationally recognized edit standards, guidelines,
  or conventions; and (D) for any other claim not addressed by subdivision (A), (B), or (C) of this subdivision
  (1), other appropriate nationally recognized edit standards, guidelines, or conventions
  approved by the Commissioner. (2) For outpatient services, professional services, and facility claims, a health plan,
  contracting entity, covered entity, or payer shall apply the relevant edit standards,
  processes, and guidelines from NCCI or Medicare Code Editor pursuant to subdivisions
  (1)(A) and (B) of this subsection that were in effect for Medicare on the date of
  the claim submission; provided, however, that if Medicare has changed an applicable
  edit standard, process, or guideline within 90 days prior to the date of the claim
  submission, the health plan, contracting entity, covered entity, or payer may use
  the version of the edit standard, process, or guideline that Medicare had applied
  prior to the most recent change if the health plan, contracting entity, covered entity,
  or payer has not yet released an updated version of its edits in accordance with subsection
  (d) of this section. (c) Adherence to the edit standards in subsection (b) of this section is not required: (1) when necessary to comply with State or federal laws, rules, regulations, or coverage
  mandates; (2) for edits that the payer determines are more favorable to providers than the edit
  standards in subsection (b) of this section or to address new codes not yet incorporated
  by a payer’s edit management software, provided the edit standards are: (A) developed with input from the relevant Vermont provider community and national provider
  organizations; (B) clearly supported by nationally recognized standards, guidelines, or conventions approved
  by the Commissioner of Financial Regulation; and (C) available to providers on the plan’s websites and in its newsletters or equivalent
  electronic communications; or (3) when adjudicating claims for health care services that were delivered outside the
  State of Vermont, unless the payer and the out-of-state provider agree that one or
  more of the edit standards set forth in subsection (b) of this section will apply. (d) Health plans, contracting entities, covered entities, and payers shall not release
  edits more than quarterly, to take effect on January 1, April 1, July 1, or October
  1, as applicable, and the edits shall not be implemented without filing with the Commissioner
  of Financial Regulation to ensure consistency with nationally recognized standards
  guidelines, and conventions, and at least 30 days’ advance notice to providers. Whenever
  Medicare changes an edit standard, process, or guideline that it applies to outpatient
  service, professional service, or facility claims, each health plan, contracting entity,
  covered entity, or payer shall incorporate those modifications into its next quarterly
  release of edits. (e)(1) Except as otherwise provided in subdivision (2) of this subsection, no health plan,
  contracting entity, covered entity, or payer shall subject any health care provider
  to prepayment coding validation edit review. As used in this subsection, “prepayment
  coding validation edit review” means any action by the health plan, contracting entity,
  covered entity, or payer, or by a contractor, assignee, agent, or other entity acting
  on its behalf, requiring a health care provider to provide medical record documentation
  in conjunction with or after submission of a claim for payment for health care services
  delivered, but before the claim has been adjudicated. (2) Nothing in this subsection shall be construed to prohibit targeted prepayment coding
  validation edit review of a specific provider, provider group, or facility under certain
  circumstances, including evaluating high-dollar claims; verifying complex financial
  arrangements; investigating member questions; conducting post-audit monitoring; addressing
  a reasonable belief of fraud, waste, or abuse; or other circumstances determined by
  the Commissioner through a bulletin or guidance. (f) Nothing in this section shall preclude a health plan, contracting entity, covered
  entity, or payer from determining that any such claim is not eligible for payment
  in full or in part, based on a determination that: (1) the claim is contested as defined in subdivision 9418(a)(2) of this title; (2) the service provided is not a covered benefit under the contract, including a determination
  that such service is not medically necessary or is experimental or investigational; (3) the insured did not obtain a referral, prior authorization, or precertification, or
  satisfy any other condition precedent to receiving covered benefits from the health
  care provider; (4) the covered benefit exceeds the benefit limits of the contract; (5) the person is not eligible for coverage or is otherwise not compliant with the terms
  and conditions of his or her coverage agreement; (6) the health plan has a reasonable belief that fraud or other intentional misconduct
  has occurred; or (7) the health plan, contracting entity, covered entity, or payer determines through coordination
  of benefits that another entity is liable for the claim. (g) Nothing in this section shall be deemed to require a health plan, contracting entity,
  covered entity, or payer to pay or reimburse a claim, in full or in part, or to dictate
  the amount of a claim to be paid by a health plan, contracting entity, covered entity,
  or payer to a health care provider. (h) No health plan, contracting entity, covered entity, or payer shall automatically reassign
  or reduce the code level of evaluation and management codes billed for covered services
  (downcoding), except that a health plan, contracting entity, covered entity, or payer
  may reassign a new patient visit code to an established patient visit code based solely
  on CPT codes, CPT guidelines, and CPT conventions. (i) Notwithstanding the provisions of subsection (f) of this section, and other than the
  edits contained in the conventions in subsections (a) and (b) of this section, health
  plans, contracting entities, covered entities, and payers shall continue to have the
  right to deny, pend, or adjust claims for services on other bases and shall have the
  right to reassign or reduce the code level for selected claims for services based
  on a review of the clinical information provided at the time the service was rendered
  for the particular claim or a review of the information derived from a health plan’s
  fraud or abuse billing detection programs that create a reasonable belief of fraudulent
  or abusive billing practices, provided that the decision to reassign or reduce is
  based primarily on a review of clinical information. (j) If adding an edit pursuant to subsection (b) or subdivision (c)(1) or (2) of this
  section, a health plan, contracting entity, covered entity, or payer shall publish
  on its provider website and in its provider newsletter or equivalent electronic provider
  communications: (1) the name of any commercially available claims editing software product that the health
  plan, contracting entity, covered entity, or payer utilizes; (2) the specific standard or standards that the entity uses for claim edits and how those
  claim edits are supported by those specific standards; (3) the payment percentages for modifiers; and (4) the specific edit or edits added to the claims software product. (k) Upon written request, the health plan, contracting entity, covered entity, or payer
  shall also directly provide the information in subsection (j) of this section to a
  health care provider who is a participating member in the health plan’s, contracting
  entity’s, covered entity’s, or payer’s provider network. (l) For purposes of this section, “health plan” includes a workers’ compensation policy
  of a casualty insurer licensed to do business in Vermont. [Subsection (m) repealed effective January 1, 2028.] (m) There is established a working group comprising the health plans, contracting entities,
  covered entities, and payers subject to the reporting requirement in subsection 9414a(b) of this title; representatives of hospitals and health care providers; representatives of the Department
  of Financial Regulation and of other relevant State agencies; and other interested
  parties to study trends in coding and billing that health plans, contracting entities,
  covered entities, or payers, or a combination of them, seek to address through claim
  editing. The working group shall provide a progress report to the House Committee
  on Health Care and the Senate Committees on Health and Welfare and on Finance upon
  request. [Subsection (n) repealed effective January 1, 2028.] (n) With respect to the working group established under subsection (m) of this section
  and to the extent required to avoid violations of federal antitrust laws, the Department
  shall facilitate and supervise the participation of members of the working group. (Added 2007, No. 203 (Adj. Sess.), § 28, eff. June 10, 2008; amended 2009, No. 61, § 30; 2011, No. 21, § 18; 2011, No. 171 (Adj. Sess.), § 11a, eff. May 16, 2012; 2023, No. 111 (Adj. Sess.), § 2, eff. January 1, 2025 and January 1, 2026; 2023, No. 111 (Adj. Sess.), § 8, eff. January 1, 2028; 2025, No. 3, § 1, eff. January 1, 2026.)