Billing

Incarcerated or Unlawfully Present in the U.S. Claim Rejections (U538H, U538Q)

This stringent claim editing process helps ensure that Medicare does not make payments for services rendered to beneficiaries who are not eligible due to being unlawfully present in the U.S. or incarcerated, thus aligning with established policy guidelines.

Reason Code U538H Incarcerated Beneficiary (patient liable)

The term "incarcerated" refers to individuals who are in custody or under some form of confinement. This includes, but isn't limited to, those who are:

  • Under arrest
  • Incarcerated or imprisoned
  • Escaped from confinement
  • Under supervised release
  • On medical furlough
  • Required to reside in mental health facilities
  • Required to reside in halfway houses
  • Living under home detention
  • Confined completely or partially under any penal statute or rule

These conditions collectively describe various ways a person might be restricted or limited in their freedom under legal or penal regulations.

Reason Code UH38Q (patient liable)

Alien: Unlawfully present in the U.S.

The term "alien" in this context refers to individuals who are not lawfully present in the U.S. Under the specified policy, Medicare payments cannot be made for items and services provided to an alien beneficiary if they were unlawfully present in the U.S. on the date those services were rendered. This means that Medicare will not cover the costs for healthcare services if the beneficiary is in the country without legal authorization at the time of receiving those services.

To implement the policy regarding payment restrictions for items and services furnished to unlawfully present aliens and incarcerated beneficiaries, the CMS has established claim level editing. This process leverages data obtained from the SSA. The data includes the names of Medicare beneficiaries and the periods during which these beneficiaries are either:

  • In federal or state custody (incarcerated)
  • Unlawfully present in the U.S.

Here's how the process works:

  1. Data Comparison: The SSA provides data that contains specific information about the beneficiaries and the relevant time periods when they are either incarcerated or unlawfully present in the country.
  2. Claim Rejection: This information is cross-referenced with the dates of service on incoming Medicare claims. If there is any overlap between the SSA data and the dates of service, indicating that the beneficiary was in custody or unlawfully present during that time, the CWF will reject the claim.
  3. Notification and Denial: Rejected claims will include a trailer sent to the Medicare contractor, which details the date span during which the beneficiary was in custody or unlawfully present. Consequently, contractors will deny payment for these claims.

This stringent claim editing process helps ensure that Medicare does not make payments for services rendered to beneficiaries who are not eligible due to being unlawfully present in the U.S. or incarcerated, thus aligning with established policy guidelines.

In order for any records to be updated or corrected regarding the status of being unlawfully present or incarcerated, the patient or the patient's representative must contact the SSA to have the file updated. This is essential so that the correct information is reflected in the SSA data, which is used by the CMS for claim level editing.

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Posted 12/9/2024