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Home Health Demand Denials (Condition Code 20)

A demand denial allows a beneficiary to request that Medicare review services that:

  • their HHA advised them were not medically reasonable and necessary; or
  • failed to meet the homebound or intermittent, or noncustodial requirements, and therefore, would not be reimbursed if billed.

NOTE: If the Advance Beneficiary Notice (ABN) was provided because the services do not meet the Medicare covered benefit definition (i.e. routine foot care) or are custodial in nature (housekeeping or home health aide services) and the beneficiary has authorized billing Medicare, the HHA should submit a no-pay bill using condition code 21.

The HHA must inform the beneficiary of their decision with an ABN, which also must be signed by the beneficiary or appropriate representative before any services are provided. The ABN provides the beneficiary with the option to have a demand denial (condition code 20) submitted to Medicare for review. The HHA must comply with the beneficiary's request to submit a demand bill (condition code 20).

Demand denials must be submitted promptly once the last billable service is provided and the physician's signature has been obtained for all orders. Beneficiaries may pay out of pocket or third party payers may cover the services in question. All demand denials will be subject to medical review through the additional development request (ADR) process. Home health agencies will need to monitor the Fiscal Intermediary Standard System (FISS) and return the patient's medical information to CGS when the demand bill is in FISS ADR status/location S B6001. See the CGS Additional Development Request (ADR) Process Web pages for more information on ADRs.

If medical review upholds the HHA's decision that the services were not coverable, the HHA keeps the funds collected from the beneficiary. However, if CGS determines the ABN notification was not properly executed, or some other factor changed liability for payment of the disputed services to the HHA, the HHA must refund any funds collected. HHAs must also refund any monies collected if medical review determines that the services were payable by Medicare.

See the Medicare Claims Processing Manual (Pub. 100-04, Ch. 10, § 50)External PDFfor additional information on demand billing under the Home Health Prospective Payment System (HH PPS). The link to access this resource is at the bottom of this page.

Billing Requirements

In demand denial situations, a RAP is required to be billed as usual; do not submit the RAP with condition code 20. The condition code of 20 would be submitted on the final claim. The RAP will process and pay the appropriate percentage payment and the episode will be posted to the beneficiary eligibility record housed at the Common Working File (CWF). Demand denial (condition code 20) information is submitted on HH PPS claims with a TOB (type of bill) 329 and includes all the required information including all visit-specific detail for the entire HH PPS episode. Please note that TOB 3X0 is no longer valid for demand bills where condition code 20 is used.

The following information must also be provided on a demand bill.

  • Condition code 20
  • Charges for services in dispute shown as covered and noncovered
  • Remarks indicating the reason for the demand denial (condition code 20)

Additional Resources

Updated: 06.23.14


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