February 2014

Table of Contents

Important Contact Numbers

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Breast and Cervical Cancer Cost Share Exemption

The Centers for Medicare and Medicaid Services (CMS) recently released final rules revising 42 CFR 447.56, regarding limitations on Medicaid cost sharing. Effective January 1, 2014, individuals eligible for Medicaid under the Breast and Cervical Cancer Program will be exempt from cost sharing. The Breast and Cervical Cancer Program is for Medicaid eligible South Dakota women who need treatment for breast or cervical cancer, including pre-cancerous conditions and early stage cancer. South Dakota's Breast and Cervical Cancer Screening Program is administered by the South Dakota Department of Health, and is known as the All Women Count! Program.

Eligibility criteria for the Breast and Cervical Cancer Program may be found here.

More information on the All Women Count! Program may be found on the South Dakota Department of Health's website here

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Consumer Assessment of Healthcare Providers and Systems Survey

South Dakota Medicaid recently completed a Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey as part of a new requirement for Children's Health Insurance Program (CHIP) quality reporting. The parents and guardians of CHIP recipients were asked a number of questions regarding satisfaction levels with their child's healthcare services. Responses were overwhelmingly positive and South Dakota Medicaid will report the results to CMS this month. Below find an excerpt from the final report. Thank you for providing quality services to Medicaid and CHIP children.


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Emergency Indicator

Providers are NOT to use an "E" in box 10d for the CMS 1500 claim form for an emergency indicator. Instead, place a "Y" in box 24c for the emergency indicator.

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Health Homes Initiative Gains Momentum - Seeking New Health Homes

The second quarter of Health Home Implementation came to a close in December 2013 and the initiative continues to gain momentum. There are currently 110 health homes serving 115 locations under the leadership of 545 designated providers. The Department of Social Services continues to seek Health Homes across the state, but is conducting targeted outreach in underserved geographical areas. DSS is accepting applications from clinics that would like to become Health Homes. Health Homes become active at the beginning of a new quarter, so the next group of Health Homes will become active on April 1, 2014. The Health Home Application and additional information about the program can be found here or by calling (605) 773-3495.

The Centers for Medicare and Medicaid Services (CMS) has officially approved the Health Home State Plan Amendment with an effective date of July 2013. The approved State Plan Amendment can be found here.

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ICD-10 Transition

The ICD-10-CM diagnoses code set designates unique codes to identify health conditions and reasons for medical services. ICD-10 is significantly larger than the ICD-9-CM code set currently being utilized, offering more than 68,000 diagnostic codes as compared to 13,000 in ICD-9. ICD-10 describes diagnosis and healthcare procedures with greater specificity. The transition to ICD-10 is mandated through the Affordable Care Act.

Effective October 1, 2014, all providers, payers, and vendors must be ICD-10 compliant. This is a national endeavor and is not limited to Medicaid. South Dakota Medicaid is diligently working on its ICD-10 implementation and testing strategy for this federal mandate. We will provide updates regarding implementation of ICD-10 and its impact on South Dakota Medicaid claims over the coming months.

CMS has stated that providers will be permitted to use the revised CMS 1500 paper claim form (02/12) starting as early as January 2014, but it is not mandated for use until April 2014. South Dakota Medicaid is working on a process to be able to accept the new CMS 1500 form, but is not yet prepared to accept the revised form.

Claims submitted to South Dakota Medicaid on the revised form will not be accepted, entered, processed, nor paid when the new form is made available. Please continue to use the current (08/05) version of the CMS 1500 when billing South Dakota Medicaid until additional guidance is provided.

For more information, please review the Federal ICD-10 Fact Sheet.

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MAGI State Plan Amendments

The Patient Protection and Affordable Care Act of 2010 (PPACA) contained several provisions designed to coordinate Medicaid eligibility and enrollment with the newly created Health Insurance Marketplaces. State Plan Amendment (SPA) were submitted as required to Centers for Medicare and Medicaid Services under 42 CFR Parts 431, 435, and 457. It is important to note that many of the required pages replace pages in the current State Plan and do not include substantive changes to present eligibility policies or practice.

The State Plan Amendments designate the income methodology and standards that South Dakota uses for eligibility determinations beginning January 1, 2014. South Dakota will use the Modified Adjusted Gross Income (MAGI) standards as required by the PPACA. MAGI is an income calculation method that uses tax information to calculate income for use in eligibility determinations. The Department has converted income requirements to MAGI-equivalent standards.

The above named SPAs have been approved by the Centers for Medicare and Medicaid Services. The approval letters and approved State Plan pages may be viewed here.

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Oral Health: The Mouth-Body Connection
Article courtesy of Delta Dental of South Dakota

Many studies over the years have linked oral diseases with various medical conditions like heart disease and diabetes. However, a recent, comprehensive study that measured the effect that periodontal care can have on those who have chronic medical conditions or are pregnant showed that a healthy mouth can mean thousands of dollars in medical cost savings.

Chronic medical conditions affect an estimated one of every two adults over 21. And according to the Centers for Disease Control, 47.2 percent of American adults aged 30 years and older have some form of periodontal disease. The working relationship between diabetes and periodontitis (severe gum disease) may be the strongest of all the connections between the mouth and body. For example, diabetic patients with periodontitis are six times more at risk for worsening glycemic control and are at increased risk for other diabetic health complications (Mealey and Rose 2008).

The UCWellness Oral Health Study looked at three years of medical and dental claims and found that people who received and maintained treatment for gum disease had significant average annual health savings.

Average Annual Health Savings with Periodontal Treatment:

  • $1,814 for those with diabetes (plus an additional $1,477 in prescription savings after 7 or more periodontal visits)
  • $2,956 for those with heart disease (coronary artery disease)
  • $1,029 for those with cerebrovascular disease
  • $2,430 for pregnant women prior to the delivery of a first child
  • $3,964 for those with rheumatoid arthritis

The UCWellness Oral Health Study was conducted through a partnership between United Concordia Dental and Highmark, examining three years of medical and dental claims for 1.7 million members. The original study ran between 2007 and 2009.

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Out of State Prior Authorization

Effective January 13, 2014, all out-of-state inpatient hospital stays require a prior authorization if the hospitals are located beyond 50 miles of the South Dakota border (excluding Bismarck, ND). Please click here
for the Prior Authorization Request Form, a list of frequently asked questions, and additional information.

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Upcoming Pharmacy Claims Processing Changes

South Dakota Medicaid has historically utilized DEA numbers in the identification of prescribing providers during the processing of pharmacy claims. However, per ACA provisions, pharmacy claims must contain the NPI of the prescribing provider. The South Dakota Point of Sale system is undergoing programming modifications in order to assure full compliance with this requirement. DSS will distribute additional guidance and notice of system readiness for this change in the near future.

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Provider Enrollment Record Updates

Providers are required to update and maintain their enrollment records with South Dakota Medicaid. This includes updating the expiration dates of licenses for the organization and/or servicing providers as applicable. A number of providers have just completed or are entering their renewal period with their licensing agency. Have you updated South Dakota MEDX to reflect your license renewals? Modify the record by entering the new expiration date, confirming the taxonomy code hasn't expired, and faxing a copy of the license with the appropriate NPI noted on the fax cover sheet to 605-773-8520.

Providers also need to populate an end date for servicing providers who are no longer with the organization due to choice, retirement, death, or any other reason. This needs to be done promptly and will not impact the ability of outstanding claims to be paid. South Dakota Medicaid processes claims based on provider eligibility on the date of service. Following the update in SD MEDX, please send an email to or fax to 605-773-8520 with the NPI of the servicing provider, the NPI of the applicable billing organizations the end date applies to and why the provider left so the appropriate closure reason can be documented.

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Recovery Audit Contractor Exemption Extended

In March 2013, South Dakota Medicaid submitted a SPA requesting an extension of the Recovery Audit Contractors (RAC) exemption originally granted by CMS in February 2011. We requested this extension due to the 2011 Payment Error Rate Measurement (PERM) report, which found South Dakota's claims processing error rate at 1.2% - the lowest of the 17 states reviewed during the 2011 PERM cycle.

On November 25, 2013 South Dakota Medicaid received CMS approval to extend the RAC exemption through May 31, 2016. Find the SPA and CMS approval here.

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South Dakota Electronic Health Record (EHR) Incentive Payment Program

South Dakota Medicaid continues to pay eligible providers and eligible hospitals as part of the South Dakota EHR Incentive Payment Program which was established by the HITECH Act of 2009. The Medicaid EHR Incentive Payment Program provides incentive payments to eligible providers for adopting and meaningfully using certified Electronic Health Records (EHRs).

Eligible hospitals are currently in Program Year 2014, while eligible professionals are currently in Program Year 2013.  The deadline for eligible hospitals attesting to Program Year 2014 is December 31, 2014. Eligible professionals have until March 31, 2014 to register and attest to receive 2013 incentive payment.

Starting in Program Year 2014, providers who have received two of more EHR incentive payments will need to meet meaningful use Stage 2 criteria in order to continue to receive incentive payments. Stage 2 includes new objectives to improve patient care.

For assistance enrolling in or attesting for the EHR Payment Program, please contact HealthPOINT, an EHR resource and support center for South Dakota at: (605) 256-5555 or

To learn more about the South Dakota EHR program, please review the South Dakota Medicaid EHR Incentive Payment program website or sign up for the listserv by clicking on the Join or Leave List link.

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Comments or questions?
Contact Medical Services

South Dakota Department of Social Services

Division of Medical Services
700 Governors Drive
Pierre, SD 57501
Phone 605.773.3495

Fax 605.773.5246

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