Reason Code 55504: Line Denied Medical Necessity Was Not Supported as Outlined in Palmetto GBA's Local Coverage Determination

Published 11/14/2019

Reason Code 5504 indicates that the service(s) billed (was/were) not covered because medical necessity was not supported as outlined in Palmetto GBA's Local Coverage Determination (LCD).

Local Coverage Determinations

To Prevent This Denial for Part A Inpatient/Psychiatric Denials

  • To prevent this denial, please refer to Palmetto GBA's LCD Psychiatric Inpatient Hospitalization (L34570)

To Prevent This Denial for Skilled Nursing Facilities and Part A Outpatient Denials

  • Documentation supporting medical necessity should be legible, relevant and sufficient to justify the services billed. This documentation must be made available to the A/B MAC upon request.
  • Documentation should justify:
    • The individual is under the care of a physician or nonphysician practitioner
    • Services require the skills of a therapist
    • Services are of the appropriate type, frequency, intensity and duration for the individual needs of the patient
  • The documentation in the medical records should have sufficient information to determine that a service was performed on specific dates, and the medical necessity of the service(s) rendered
  • If the signed order includes a plan of care, no further certification of the plan is required. Payment is dependent on the certification of the plan of care rather than the order, but the use of an order is prudent to determine that a physician is involved in care and available to certify the plan.
  • Required documentation:
    • Evaluation and plan of care, including any other pertinent characteristics of the beneficiary
    • Certifications and recertifications
    • The history and physical exam pertinent to the patient’s care (including the response or changes in behavior to previously administered skilled services)
    • The skilled services provided
    • A detailed rationale that explains the need for the skilled service in light of the patient’s overall medical condition and experiences
    • The complexity of the service to be performed
    • Progress reports written by the clinician
    • Services related to progress reports are to be furnished on or before every 10th treatment day
    • Treatment notes for each visit detailing the patient’s response to the skilled services provided (may also serve as progress notes)
    • When appropriate, a justification statement for services that are more extensive than is typical for the condition treated
    • Payment and coverage conditions require that the plan must be reviewed as often as necessary but at least whenever it is certified or recertified to complete the certification requirements. It is not required that the same physician/NPP who participated initially in recommending or planning the patient's care certify and/or recertify the plans.

For more information, refer to CMS Internet-Only Manuals (IOMs), Medicare Benefit Policy Manual, Pub 100-02, Medicare Benefit Policy Manual, Chapter 15, §220.3 (1.33 MB).

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