Reimbursement Issues

2017 Medicare Fee Schedule Update (01/01/2017)

The Centers for Medicare and Medicaid Services (CMS) has released the 2017 Medicare DMEPOS fee schedule which will be effective for Medicare claims with a date of service on or after January 1, 2017.  The 2017 Medicare fee schedule for orthotic and prosthetic services will be increased by 0.7% over 2016 rates. The 0.7% increase is a net reflection of the 1% increase in the Consumer Pricing Index for Urban Areas (CPI-U) from June 2015 through June 2016, combined with the annual Multi-Factor Productivity Adjustment (MFP) of -0.3%.

Unfortunately, the 2% sequestration based reduction to all Medicare payments remains in effect (currently through 2025) meaning that Medicare fee for service payments will continue to be reduced by 2% due to sequestration.  While sequestration continues to impact Medicare reimbursement, it is not cumulative.  You will still receive 0.7% more for a service you provide in 2017 then you did in 2016 since the 2% sequestration reduction would be applied to both claims.

Download the 2017 Medicare DMEPOS fee schedule from the CMS website.

Miscellaneous HCPCS Codes Require Additional Inforamtion for Payment

Items billed with any HCPCS code with a narrative description that indicates miscellaneous,NOC, unlisted, or non-specified, that is billed to the DME MAC must also include the following information:

  • Description of the item or service
  • Manufacturer name
  • Product name and number
  • Supplier Price List (PL) amount
  • HCPCS code of related item (if applicable)

Miscellaneous HCPCS codes billed without this information will be denied for incomplete and invalid information and will need to be resubmitted with the missing information included.Miscellaneous coded products that have a specific HCPCS code must not be billed with a miscellaneous HCPCS code for that item. Inappropriate billing of miscellaneous HCPCS codes can result in a claim return/reject or denial of the HCPCS code for invalid coding.

Medicare Medical Policy Revisions (01/01/2017)

Lower Limb Prostheses

There are no changes to policy at this time. View this policy

Spinal Orthoses: TLSO and LSO

There are no changes to policy at this time. View this policy

Ankle-Foot/Knee-Ankle-Foot-Orthosis

There are no changes to policy at this time. View this policy

Knee Orthosis

There are no changes to policy at this time. View this policy

External Breast Prostheses

There are no changes to policy at this time. View this policy

Diabetic Shoes/Inserts

There are no changes to policy at this time. View this policy

Orthopedic Shoes/Inserts

There are no changes to policy at this time. View this policy

 

Medicare Audits & Reviews

Durable Medical Equipment Medicare Administrative Contractor (DME MAC) Audits

Here is a quick look at some of the items currently under pre-payment review in each of the four DME MAC Jurisdictions.

Jurisdiction A (Noridian)

AFO

The Jurisdiction A, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L1970, L4360 and L4361. The quarterly edit effectiveness results from July 2016 through October 2016 are as follows:

  • The L1970 review involved 126 claims, of which 106 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 84%.
  • The L4360 review involved 479 claims, of which 476 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 99%.
  • The L4361 review involved 600 claims, of which 478 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 80%.

Click here to view the announcement  and Click here for the results of the audit.

KO

The Jurisdiction A, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L1832 and L1833. The quarterly edit effectiveness results from July 2016 through October 2016 are as follows:

  • The L1832 review involved 164 claims, of which 163 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 100%.
  • The L1833 review involved 552 claims, of which 535 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 98%.

Click here to view the announcement  and Click here for the results of the audit.

LSO/TLSO

The Jurisdiction A, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L0648 and L0650. The quarterly edit effectiveness results from July 2016 through October 2016 are as follows:

  • The L0648 review involved 296 claims, of which 257 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 87%.
  • The L0650 review involved 581 claims, of which 499 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 87%.

Click here to view the announcement  and Click here for the results of the audit.

 

Jurisdiction B (CGS)

LSO/TLSO

The Medical Review Department of CGS, the Jurisdiction B DME MAC, began a complex service-specific prepayment review of HCPCS code L0637 (Spinal Orthoses) claims on July 1, 2016.  Between July 1, 2016 and September 30, 2016 claims for the L0637 had a 91% denial rate.  Th top denial reason was: Documentation at the time of delivery is not sufficiently detailed to include a detailed description of the modifications necessary at the time of fitting the orthosis to the beneficiary.

Click here for the results of the audit.

 

Jurisdiction C (CGS)

No pre-payment audits or audit results have been officially listed by CGS.

 

Jurisdiction D (Noridian)

AFO

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L4361. The quarterly edit effectiveness results from July 2016 through October 2016 are as follows: The L4361 review involved 591 claims, of which 401 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 68%.

Click here for the results of the audit.

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L1960, L1970 and L4360. The quarterly edit effectiveness results from June 2016 through September 2016 are as follows:

  • The L1960 review involved 162 claims, of which 127 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 76%.
  • The L1970 review involved 257 claims, of which 190 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 72%.
  • The L4360 review involved 328 claims, of which 328 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 99%.

Click here for the results of the audit

L1902, L1904, L1907, L4350 are currently under a pre-payment review, but no results have been published.  Click here to view the announcement

L1900, L1906, L1910, L1920, L1930, L1932, L1940, L1945, L1950, L1951, L1960, L1970, L1971, L1980, L1990, L2106, L2108, L2112, L2114, L2116, L4396, L4397, L4398 are currently under a pre-payment review, but no results have been publishedClick here to view the announcement

L2000, L2005, L2010, L2020, L2030, L2034, L2035, L2036, L2037, L2038, L2126, L2128, L2132, L2134, L2136 are currently under a pre-payment review, but no results have been published Click here to view the announcement

L4360, L4361, L4370, L4386, L4387, L4398, L4631 are currently under a pre-payment review, but no results have been publishedClick here to view the announcement

KO

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L1832 and L1843. The quarterly edit effectiveness results from July 2016 through October 2016 are as follows:

  • The L1832 review involved 153 claims, of which 152 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 99%.
  • The L1843 review involved 114 claims, of which 115 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 99%.

Click here for the results of the audit

K0901, K0902, L1810, L1812, L1820, L1830, L1831, L1832, L1833, L1834, L1836, L1840, L1843, L1844, L1845, L1846, L1847, L1848, L1850, L1860 are currently under a pre-payment review, but no results have been published.  Click here to view the announcement

Lower Limb Prostheses

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code L5980, L5981 and L5987. The final edit effectiveness results from June 2015 through February 2016 are as follows:

  • The L5980 review involved 19 claims, of which 19 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 88%.
  • The L5981 review involved 51 claims, of which 46 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 81%.
  • The L5987 review involved 41 claims, of which 36 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 79%

Click here for the results of the audit

LSO/TLSO

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L0450, L0452, L0454-L0458, L0460, L0462, L0464, L0466-L0470, L0472, L0480, L0482, L0484, L0486, L0488, L0490-L0492, L0621, L0623, L0625-L0643 and L0648-L0651. The quarterly edit effectiveness results from July 2016 through November 2016 are as follows:

  • The TLSO review involved 26 claims, of which 26 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 100%.
  • The LSO review involved 291 claims, of which 290 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 100%.
  • The SO review involved 25 claims, of which 23 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 97%.
  • The LO review involved 88 claims, of which 88 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 100%

Click here for the results of the audit

The Jurisdiction D, DME MAC, Medical Review Department is conducting a service specific review of HCPCS code(s) L0631 and L0637. The quarterly edit effectiveness results from June 2016 through September 2016 are as follows:

  • The L0631 review involved 121 claims, of which 121 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 100%.
  • The L0637 review involved 161 claims, of which 159 were denied. Based on dollars, this resulted in an overall claim potential improper payment rate of 99%

Click here for the results of the audit