Medicare Advantage Coverage Determination Hierarchy

Description of Service:

The purpose of this guideline is to outline the process for applying coverage determination guidance in accordance with Centers for Medicare and Medicaid Services (CMS) regulations, ensuring compliance and consistency in decision making for Medicare Advantage members.

Guideline Statement:

Blue Cross NC Medicare Advantage Plan staff will perform clinical reviews for prior approval determinations utilizing defined Medicare criteria outlined in National Coverage Determinations (NCD), Local Coverage Determination (LCD), Local Coverage Article (LCA), Medicare Benefit Policy and Medicare Program Integrity manuals. In the absence of a NCD, LCD, LCA or manuals the plan will utilize internally created medical policies based on current evidence in widely used treatment guidelines, published clinical literature and/or review of policies from BCBSA plans.

Definitions:

• Evidence of Coverage (EOC): This is a document, along with the enrollment form, riders, or other documents, which explains the member’s coverage, what the Plan must do, and the member’s rights and responsibilities. The Medicare Advantage (MA) Plan follows Medicare Guidelines.
• Local Coverage Determination (LCD): A decision by a Medicare Contractor or Fiscal Intermediary or carrier under Part A or Part B, which determines whether a particular item or service is covered on a carrier wide basis in a local jurisdiction. An LCD may contain further criteria, codes, etc.
• Local Coverage Article (LCA): Local coverage Articles are a type of educational document published by the MACs. Articles often contain coding or other guidelines related to an LCD.
• Medicare Manuals: These manuals present information on Medicare Coverage. Any changes in Medicare coverage are released through Coverage Decisions Memoranda or Program Transmittals. These are accessed online at the CMS website.
• National Coverage Determination (NCD): A determination by CMS whether a particular item or service is covered. An NCD is issued for procedures that are established in the Federal Registry and is released in the form of a Coverage Determination prior to being entered into the NCD Manual.

Benefit Application

BCNC applies the following defined hierarchy for policy coverage determinations:

1. Eligibility

2. CMS

   1. NCD
   2. LCD/LCA within BCNC geographical service area when NCD is considered not fully established
   3. Medicare Manuals (i.e.., Medicare Benefit Policy Manual, Medicare Managed Care Manual or Medicare Claims Processing Manual)

3. Internal Medical Policies created in the absence of CMS guidance, based on evidence based published clinical literature, review of MA plans within the BCBSA and the Plans coverage decisions.

CMS Guidelines and Requirements:

Medicare Advantage policies are developed as needed and are subject to a minimum of an annual review, update, and approval by a Utilization Management (UM) Committee. The committee ensures that guidelines are based on the highest level of evidence currently available in clinical literature, widely accepted professional guidelines, clinical effectiveness data, and community physicians

Special Note - CMS agencies responsible for our jurisdiction include:

Celerian Group (CGS):  Durable Medical Equipment Medicare Administrative Contractor (DME MAC): Regional Carrier for Medicare DME items (Southeast-Jurisdiction C- Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, Texas, U.S. Virgin Islands, Virginia, and West Virginia)

Palmetto GBA:  Fiscal Intermediary (FI) Part A (and some Part B services) MAC for Jurisdiction M. It also includes Home Health and Hospice MAC Jurisdiction C, which covers Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia

References:

1. Social Security Administration (SSA). Section 1862(a)(1)(A). Accessed 11/05/2025 Social Security Act §1862
2. Pub. 110-04, Medicare Claims Processing Manual, Chapter 23 Fee Schedule Administration and Coding Requirements, § 30 Services Paid Under the Medicare Physician’s Fee Schedule, A. Physician’s Services. Accessed 06/05/2025 Medicare Claims Processing Manual (PDF)
3. 42 CFR § 422.101 – Requirements Relating to Basic Benefits.
4. 45 CFR § 146.136 – Mental Health Parity and Substance Use Disorder Benefits
5. 42 CFR § 422.109 – Effect of National Coverage Determinations (NCDs) and Legislative Changes in Benefits
6. 42 CFR § 422.137 - Medicare Advantage Utilization Management Committee
7. 42 CFR § 422.562 – General Provisions
8. Blue Cross NC Desktop Procedure-Clinical Operations Medicare: Medical Necessity Review Hierarchy; effective 12/12/2023 accessed via Medical Necessity Review Hierarchy_09262025.docx on 11/11/2025