Playing Musical Chairs With CTPs in 2015

  Information regarding coding, coverage, and payment is provided as a service to our readers. Every effort has been made to ensure information accuracy. However, HMP Communications and the authors do not represent, guarantee, or warranty that the coding, coverage, and payment information is error-free and/or that payment will be received. The ultimate responsibility for verifying coding, coverage, and payment information accuracy lies with the reader.

  Happy New Year, loyal readers! By the time I returned from my holiday vacation, many of you had read last month’s column that described 10 preparation steps for charge description masters (CDMs) in 2015 and had e-mailed questions pertaining to the status of cellular and/or tissue-based products (CTPs) for wounds (outdated term “skin substitutes”). Therefore, I will do my best to share and answer those questions here.

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Business Briefs: CTPs: From Coding & Payment Changes (Then) To Coverage Changes (Now)
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 Q: Which CTPs did the Centers for Medicare & Medicaid Services (CMS) designate as “high cost” and “low cost”?
  A: As I prepared to answer this question, the title of this column was born. Because CMS implemented a new methodology for determining which products are in the 2015 “high cost” and “low cost” groups, numerous products are in different groups than they were in 2014. In fact, this movement of groups reminded me of one of my favorite childhood games: musical chairs. Yes, the list of products in each group reads differently than in 2014. Please review the list of 34 “high cost” CTPs in Table 1 and the list of 22 “low cost” CTPs in Table 2.

  Q: Which CTPs were granted ambulatory payment classification (APC) pass-through status?
  A: As of Jan. 1, 2015, five products have been granted APC pass through status. See Table 3.

 Q: I heard that some CTPs have been assigned Healthcare Common Procedure Coding System (HCPCS) codes, but have been designated as “not payable by the APC payment system.” Will you please identify these CTPs?
  A: The 10 products in Table 4 above are not payable by the APC payment system.

  Q: What are the national average Medicare APC allowable rates for hospital-based outpatient departments (HOPDs) when “high cost” and “ low cost” CTPs are applied by qualified healthcare professionals (QHPs)? How do the 2015 allowable rates differ from the 2014 allowable rates?
  A: All allowable rates increased slightly in 2014. Unfortunately, they did not increase enough to cover the cost of all CTPs, particularly those needed for wounds > 100 sq cm. To influence this situation in 2017, HOPD program directors must: 1) set the charges in their CDMs to reflect the true costs of the CTPs and 2) verify that the claims submitted reflect the number of sq cm purchased for each application. Table 5 displays a comparison of the 2014 vs. 2015 national average Medicare allowable rates for HOPDs when “high cost” CTPs are applied. Table 6 displays a similar comparison for “low cost” CTPs. Because numerous HOPD program directors expressed concern about rising patient coinsurance rates, the patient coinsurance rates are also listed.

  Q: I thought that when a product received APC pass-through status that the HOPD always received “high cost” payment for the application, plus additional payment for the product. However, our billing department tells me that the HOPD does not always receive additional payment for the product. Will you please explain who is correct?
  A: To understand the pass-through status payment, one should remember:
    1. As of Jan. 1, 2014, CMS made the decision to package the HOPD’s payment for CTPs into the APC payment for the application of CTPs.
    2. Also on Jan. 1, 2014, CMS decided that CTPs that qualify for pass-through status will be assigned to the “high cost” APC groups and will be eligible for an additional payment for the CTP if its average selling price (ASP) plus 6% exceeds the portion of the APC “high cost” APC payment that is associated with the application of the CTP. The 2015 dollar amount of the product that is packaged into the procedure is displayed in Table 7.

  The following is an example of how a claim is processed for a fictitious packaged CTP with pass-through status that is applied to a 10 sq cm chronic venous stasis leg ulcer. This fictitious CTP’s ASP plus 6% is $800 for a 20 sq cm piece (the closest size available for a 10 sq cm ulcer). The HOPD claim includes 1 unit of 15271 and 20 units of Q4XXX. Medicare allows $1,407.42 for 15271. Medicare then subtracts $778.28 from $800, which equals $21.72 that is paid to the HOPD in addition to the Medicare allowable of $1,407.42. NOTE: The patient pays 20% ($281.49) of the $1,407.42, but the patient is not responsible for paying a portion of the $21.72. Medicare pays the entire $21.72.

 Let’s look at one more example of how a claim is processed for a different fictitious CTP with pass-through status that is applied to a 10 sq cm diabetic foot ulcer. This fictitious CTP’s ASP plus 6% is $500 for a 20 sq cm piece (the closest size available for a 10 sq cm ulcer). The HOPD claim includes 1 unit of 15275 and 20 units of Q4XXX. Medicare allows $1,407.42 for 15275, but does not allow any additional payment for the CTP with pass-through status because the ASP plus 6% ($500) is less than the CTP amount ($778.28) that is built into the packaged payment for the application of the CTP. NOTE: The patient pays 20% ($281.49) of the $1,407.42. Now you should understand why the billing department said the HOPD will not always receive a separate payment for the CTP.

  Q: How can I determine if Medicare covers any CTPs assigned new HCPCS codes in 2015?  A: Remember the following facts when thinking about Medicare coverage:
    • The existence of an HCPCS code does not guarantee coverage.
    • CMS requires HOPDs to identify the HCPCS code for the CTP on the claim, even when the CTP is packaged.
    • The medical director of the MAC that processes the HOPD’s claims has the authority to determine coverage for each CTP. NOTE: Each HOPD should verify the name of the MAC that processes its claims. Because the HOPD’s MAC may be different than the MAC that processes the QHPs’ claims, the HOPD and QHPs may have to consider two different Medicare medical policies. The policies are called local coverage determinations (LCDs).
    • Coverage (positive/negative/medical necessity) can vary from one MAC to another MAC.
    • HOPDs and QHPs should review their MAC’s LCDs and attached articles found at www.cms.gov/medicare-coverage-database/overview-and-quick-search.aspx on a monthly basis.

Kathleen Schaum may be reached for questions and/or consultation at 561-964-2470. For author disclosures, see page 4.