Reimbursement Issues


New Standard Written Order (SWO) Requirements

The Centers for Medicare and Medicaid Services (CMS) recently announced a significant change to the requirements for physician orders for Durable Medical Equipment, Orthotics, Prosthetics, and Supplies (DMEPOS).  The change is effective for claims with a date of service on or after January 1, 2020 and eliminates the need for an initial/dispensing order for Medicare DMEPOS services.

Going forward, Medicare claims will only require a “standard written order” (SWO) which must be received prior to claim submission and contain essentially the same elements as the traditional “detailed written order” that has been part of the longstanding Medicare requirements for compliant DMEPOS claims.  Required elements of the new SWO include the following:

  • Beneficiary name or Medicare Beneficiary Identifier (MBI)
  • Order date
  • General description of the item
    • Can be either a general description, a HCPCS code, a HCPCS code narrative, or a brand name/model number
    • All separately billable features, additions, options, or accessories must be listed separately on the SWO
    • All separately billable supplies must be listed separately on the SWO
  • Quantity to be dispensed, if applicable
  • Treating/Ordering practitioner’s name or NPI
  • Treating/Ordering practitioner’s signature

While initial/dispensing orders are no longer required for services to be reimbursed, medical records must continue to support the medical need for O&P services that are provided.  It is important to remember that medical need must clearly be established prior to the provision of O&P care.  O&P providers should confirm that adequate documentation of medical need is well documented before providing care to Medicare beneficiaries.  It is also important to remember that for any claims with a date of service prior to January 1, 2020, the former rules remain in effect and, in most cases, an initial/dispensing order and a detailed written order must be received in order to maintain compliance with Medicare regulations.

2020 Medicare Fee Schedule Update

The Centers for Medicare and Medicaid Services (CMS) has released the 2020 Medicare DMEPOS fee schedule which will be effective for Medicare claims with a date of service on or after January 1, 2020.  The 2020 Medicare fee schedule for orthotic and prosthetic services will be increased by 0.9% over 2019 rates. The 0.9% increase is a net reflection of the 1.6% increase in the Consumer Pricing Index for Urban Areas (CPI-U) from June 2018 through June 2019, combined with the annual Multi-Factor Productivity Adjustment (MFP) of -0.7%.

The 2% sequestration-based reduction to all Medicare payments remains in effect, meaning that Medicare fee for service payments will continue to be reduced by 2%.  While sequestration continues to impact Medicare reimbursement, it is not cumulative.  You will still receive 0.9% more for a service you provide in 2020 then you did in 2019 since the 2% sequestration reduction would be applied to both claims.

Click here to view and download the complete 2020 Medicare DMEPOS fee schedule

Miscellaneous HCPCS Codes Require Additional Information 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

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 & Other Information

Durable Medical Equipment Medicare Administrative Contractor (DME MAC) Audits: Target, Probe and Educate (TPE)

Here is a quick look at some of the results for items currently under TPE review in each of the four DME MAC Jurisdictions.

Jurisdiction A  (Noridian)

Jurisdiction B (CGS)

Jurisdiction C (CGS)

  • AFO/KAFO: No results posted at this time
  • KO: L1832 & L1833
  • LSO/TLSO:L0450-L0651
  • Therapeutic Shoes: No results posted at this time

Jurisdiction D (Noridian)

DME MAC Issues New Dear Physician Letters

The DME MACs have  released a “Dear Physician” letter for knee orthoses that is designed to educate referral sources about what documentation must exist in their medical records in order to support your claim for a knee orthosis. AOPA has reviewed the Dear Physician letter and believes it is consistent with existing LCD and Policy requirements for Medicare coverage of knee orthoses.  View the Physician letter

The DME MACs  also published a revised Dear Physician letter that addresses the Medicare requirements for documentation within the referring physician’s medical records that support the medical necessity of orthotic and prosthetic services provided to Medicare beneficiaries. This letter replaces an early Dear Physician letter, issued in August, 2011 that was retired earlier this year.  The newly released letter acknowledges a legislative change that was passed in February, 2018 (that requires Medicare to consider the medical records of orthotists and prosthetists as part of the medical record for purposes of  medical necessity review/determinations) and reminds physicians that while orthotist and prosthetists notes are now part of the patient’s medical record for purposes of medical necessity review, it emphasizes the continued need for referring physicians to document the medical need for the O&P devices they prescribe. View the Physician letter