Keeping Up With Coverage

  In order for today’s wound clinics to maintain their status as centers for wound care excellence, the professionals who manage and work there do their best to offer products, procedures, and services that will produce optimal clinical outcomes at affordable prices to the patients and the payers. Not a day goes by that this author does not receive a call or an e-mail asking about coding and payment for some product, procedure, or service. What amazes this author the most is that very few people ask, “Is the product, procedure, or service covered?” When this author reminds the inquirer to be sure to check if their Medicare contractor has a Local Coverage Determination (LCD) regarding the product, procedure, or service in question, the inquirer is often silent or asks, “What’s an LCD?”   To assist those professionals who are new to the business of wound care or are confused, this article will answer the question: “How do I know if a product, procedure, or service is reimbursed by Medicare?” When asking this question, remember that reimbursement is composed of three parts: coding, payment, and coverage. The following are three steps to follow when you wish to check if a product, procedure, or service has a verified code, has a Medicare payment rate, and is covered by the Medicare contractor that processes your claims.

STEP ONE: Check if one or more codes have been created and verified for the product, procedure, or service.

    a) If the product is a diabetic shoe, a lower/upper limb orthotic, a negative pressure wound therapy pump, an ostomy supply, a support surface, a surgical dressing, etc., you can check if a HCPCS code has been verified for a particular brand and product number by visiting the Pricing, Data Analysis, and Coding (PDAC) website: https://www.dmepdac.com/dmecsapp/do/search. This web site will allow you to learn:     b) The exact description of each HCPCS code     c) The exact description of each HCPCS modifier     d) The current fee schedule rate for each HCPCS code     e) The HCPCS code verified for a particular brand – can search by manufacturer, by product name, by product number, etc.     f) If the product is a skin substitute, you can verify if a HCPCS code has been assigned to a particular brand and product number by visiting the ASP NDC–HCPCS Crosswalk website: www.cms.hhs.gov/McrPartBDrugAvgSalesPrice/01a1_2009aspfiles.asp#TopOfPage   When one opens this website, they will find a variety of files which are updated on a quarterly basis. Be sure to select the NDC-HCPCS Crosswalk and the correct year and quarter for which you need information. Although this file is very large, it can be sorted by HCPCS code, by manufacturer name, by product name, by product NDC, etc.     g) If you are searching for a procedure or service code, you should use one or more of the American Medical Association’s (AMA) current books and subscriptions:     h) CPT® Current Procedural Terminology     i) CPT® Changes: An Insider’s View     j) CPT® Assistant     k) CPT® Network   Be sure to visit the AMA’s website where you can order a wealth of coding information: https://catalog.ama-assn.org/Catalog/home.jsp   STEP ONE Summary: The manufacturers and distributors of wound care related items will often provide you with codes that are relevant to their products. Although that is a welcome service, providers are ultimately responsible for verifying the correct codes for each product, procedure, and service that they provide. If a manufacturer or distributor tells you to use a code that you cannot verify, be sure to ask the representative to provide you with either:     1) A copy of the letter from CMS that verifies the HCPCS code was assigned to the product, or     2) An AMA resource that verifies the CPT® code is relevant to the particular procedure or service.

STEP TWO: Check if the product, procedure, or service has a published payment rate on the Medicare Payment System that is pertinent to the provider(s).

    a) The Medicare payment system for hospital-based outpatient wound care departments (HOPDs) is known as the Outpatient Prospective Payment System (OPPS). Based on the amount of resources required, all of the payable products, procedures, and services are assigned to an Ambulatory Payment Classification (APC) group. Each APC group is assigned a national average payment rate and a required coinsurance rate. The APC rates can be found for each payable HCPCS and CPT® code in Addendum B of the OPPS system file: https://www.cms.hhs.gov/HospitalOutpatientPPS/AU/list.asp#TopOfPage   Because CMS updates the OPPS Addendum B on a quarterly basis, providers should be sure to select the correct year and quarter. Pay particularly close attention to the quarterly adjustments to the Average Sales Price of the skin substitutes Q4101-QQ4112. Also, remember that the rates listed in Addendum B are national average rates. Each HOPD director should contact the hospital’s billing or finance department to confirm their hospital’s unique OPPS payment and coinsurance rates.     b) The Medicare payment system for physicians is known as the Medicare Physician Fee Schedule (MPFS). Most of the payable procedures and services are assigned rates on the MPFS. These rates are adjusted to reflect the variation in practice costs from area to area. By viewing the MPFS look-up files, physicians can learn the rates that pertain to their geographic area: https://www.cms.hhs.gov/PFSlookup/02_PFSSearch.asp#TopOfPage   Physicians should note that the MPFS lists both the Medicare fees for services provided in their offices and for services provided in facilities.   STEP TWO Summary: The manufacturers and distributors of wound care related items will often provide you with the national average payment rates for their products, procedures, and services. Although that is a great service, the HOPD should verify their particular payment rate and required coinsurance rate. Physicians should either 1) contact their billing services to verify the MPFS payment rate in their geographical area, or 2) visit the MPFS look-up web site. Unlike the OPPS file, the MPFS does not list the patient’s coinsurance responsibility because it is always 20% of the published rate. In other words, if the procedure/service is medically necessary, Medicare will pay 80% of the rate published in the MPFS. The patient will be responsible for paying the other 20% of the published MPFS for that geographic area.

STEP THREE: Confirm if the product, procedure, or service is covered by the Medicare contractor that processes your claims.

    a) Contact your finance, billing and/or coding departments to learn the name of the Medicare contractor that processes the claims for the HOPD and for the physician(s) who practice there.   In the past, the Medicare contractors that processed the claims for HOPDs were called Fiscal Intermediaries (FI) and for physicians were called Carriers. In some states, the FI and Carrier contract was awarded to the same insurance company. In those cases, the medical policies for the HOPDs and the physicians were usually very similar. In other states, CMS awarded the contracts for FI and Carrier to two different insurance companies. That situation proved to be particularly problematic for physician-driven HOPDs. In many instances, the physicians’ Medicare guidelines were different than the HOPDs’ because two different Medicare contractors wrote the medical policies.   To remedy this situation, CMS divided the country into 15 Medicare jurisdictions. Bids were accepted for one Medicare contractor (Medicare Administrative Contractor [MAC]) to process the claims for both the HOPD and the physicians in each of the 15 jurisdictions. All of the contracts for the new MACs have been awarded to 10 different insurance companies (NOTE: several insurance companies were awarded contracts for more than one jurisdiction). Some of the MACs have already assumed their responsibilities. Other MACs are in the process of assuming their responsibilities. Newly announced MACS are just getting started. Therefore, HOPDs and physicians should closely monitor which Medicare contractor is processing their claims now and which Medicare contractor will process their claims in the future.   Identify the web address for your current and future Medicare contractor. (See Table I for the web sites of the new MACs) Book mark the website in your “favorites.” Sign-up to receive all pertinent communications from both your current and your future Medicare contractor.     b) Assign someone to monthly monitor the Local Coverage Determination (LCD) medical policy section of your current and future Medicare contractor’s web site. That person should review all of active LCDs that pertain to products, procedures, and services that you offer to your chronic wound care patients. As your LCD monitor locates each LCD that pertains to your wound care practice, he/she should:     c) Print the LCD     d) Before leaving the LCD, scroll to the bottom of the LCD and look under “Related Documents’ for accompanying Articles and under “LCD Attachments” for any additional documents such as Coding Guidelines. If the LCD contains one or more related documents or attachments, click on the hyperlinks to view and print this important additional information.     e) Review each LCD and its related documents and attachments with the entire wound care team. Pay particular attention to:     f) Effective date of LCD     g) Indications and Limitations of Coverage and / or Medical Necessity     h) Coding Information (Bill type codes, revenue codes, CPT®/HCPCS codes, ICD-9 codes that support/do not support medical necessity)     i) Documentation requirements     j) Utilization guidelines     k) Revision history explanation       l) Note that Medicare contractors do not write LCDs about all products, procedures, and services that they cover. That type of coverage is usually referred to as “neutral coverage” and is based on medical necessity. Neutral coverage is actually the best type of coverage because the contractor is not placing a lot of limitations on the utilization of the product, procedure, or service.     m) Note that Medicare contractors, who choose to control their coverage via LCDs, often have different philosophies. For example: some Medicare contractors’ skin substitute LCDs only describe the products that they cover. Other Medicare contractors’ skin substitute LCDs only describe the products whose utilization they wish to control; all other skin substitutes are covered based on medical necessity.     n) Be aware that your Medicare contractor may update existing LCDs one or more times throughout the year. Therefore, your LCD monitor should monthly check your Medicare contractor’s web site for updates to existing LCDs, for LCDs that are retired, for DRAFT LCDs, and for Notices of new LCDs that are about to be implemented. To assist in this endeavor, your LCD monitor may choose to join the Medicare contractor’s list serve, which sends out notices on a wide variety of topics, including coverage issues.     o) Pay particular attention to LCD updates during the transition from FI/Carrier to your new MAC. In preparation for their role as a new Medicare contractor, the new MACs are required to assimilate all the LCDs, pertaining to the same subject, which they inherited from the FIs and Carriers into one LCD. Because this LCD assimilation is a huge task, the MACs may inadvertently make a mistake, such as forgetting pertinent ICD-9, CPT®, or HCPCS codes. If providers notice a mistake and inform the MAC medical director, he/she is usually open to correcting LCD mistakes during the transition period.     p) Take an active role in educating the MAC medical director about evidence-based wound care guidelines and practices by:     q) Attending and presenting at open public LCD meetings when pertinent new DRAFT LCDs are released. The dates, times, registration process, and presentation guidelines, for these open meetings are announced on the Medicare contractors’ web sites.     r) Commenting on DRAFT LCDs during the open comment period. The process for commenting on new DRAFT LCDs is clearly described on each Medicare contractor’s web site. Additionally, most DRAFT LCDs specify the contact name and e-mail address to which providers can submit their comments. The Medicare contractor’s Medical Directors value the education and comments they receive during the open comment period. Unfortunately, most wound care providers do not take advantage of this wonderful opportunity of meeting and communicating with their contractor’s medical director. Providers should keep in mind that a DRAFT LCD is truly a “Draft”. If the providers do not comment on restrictions or guidance that is not consistent with published evidence, with published practice guidelines, etc. the Medicare Medical Director will assume that the DRAFT should become final as proposed. Providers should not allow inappropriate LCD language to become final just because they failed to comment on the DRAFT LCD!     s) Using the Reconsideration Process to request an evidence-based update to an existing LCD. This process is clearly outlined on every Medicare contractor’s web site. As evidence and protocols evolve, providers should feel obligated to request changes to LCDs that are based on outdated information. The Reconsideration Process is mandated by CMS to give providers the opportunity to explain how LCDs should be updated. For example: the LCD may not list all of the ICD-9-CM codes that appropriately describe the medical necessity for a particular product, procedure, or service.   STEP THREE Summary: Just because a product, procedure, or service has a code and a payment rate does not mean that the Medicare contractor has a neutral or positive coverage policy that will actually allow them to pay for the submitted claims submitted. Wound care providers must take an active role in monitoring and following LCD guidelines, in requesting evidence-based changes to existing LCDs via the Reconsideration Process, and in educating (via presentations at open LCD meetings and commenting during DRAFT LCD open comment periods) the Medicare contractor why some segments of DRAFT LCDs are not evidence-based or are not following published coding conventions. In order to operate successful wound care businesses, wound care providers must keep up with all three components of reimbursement: coding, payment, and most importantly: Keep Up With Coverage! Kathleen D. Schaum, MS, is President of Kathleen D. Schaum & Associates, Inc., Lake Worth, Fla. Schaum can be reached for questions and consultations by calling (561) 964-2470 or through her email address: kathleendschaum@bellsouth.net.