Home Health & Hospice Week

Now would be a good time to get your paperwork in order.

Prosthetics and orthotics suppliers who bill Medicare need to make sure the National Supplier Clearinghouse has their correct specialty codes on file - or else face rejected claims.

Major change: Durable medical equipment regional carriers have in the past processed P&O claims from all enrolled and approved providers and suppliers without regard to the specialty identified on the Medicare enrollment application form (CMS-855S). But that's about to change.

As of July 5, Medicare will reimburse for prosthetics and certain custom-fabricated orthotics only when furnished by physicians, pedorthists, physical therapists, occupational therapists and orthotics and prosthetics personnel as recognized by the appropriate specialty code.

The new policy implements a provision of the Social Security Act specifying that no payment is to be made for custom-fabricated orthotics and prosthetics unless furnished by a qualified practitioner or supplier.

"They're trying to tighten up the links between NSC supplier numbers and state law licensing requirements for Medicare payments," observes Asela Cuervo, an attorney in Washington, DC and member of the NSC Action Committee (NSCAC). The change aims to prevent folks from "coming in under the radar screen through the DMERCs."

The Centers for Medicare & Medicaid Services' Change Request No. 3607 puts new edits in the DMERC claims processing system that will carry out the policy change. The edits will look for certain specialty codes (see box, this page) to ensure that only suppliers who specify P&O on their enrollment application forms are reimbursed for P&O supplies.

Prepare For Tough Times Ahead

Though the change has been looming for a while, some DME experts fear the new specialty code requirements have the potential to cause serious problems for suppliers and patients alike.

"If they're able to abruptly stop paying providers, it will wreak havoc on the industry," predicts HME specialist Miriam Lieber of Van Nuys, CA-based Lieber Consulting and an NSCAC member. "A little bit of notice and warning would help avoid abrupt denials."

Lieber also worries the policy change will hurt smaller providers. Consider a small pharmacy that sells diabetic shoes, she says. Perhaps it does not employ an orthotist but instead has someone on staff who has been trained and certified by the manufacturer to fit the shoes properly.

"Medicare is saying that's no longer enough," Lieber says. "Now you have to become an orthotist."

CMS should have grandfathered in providers with manufacturer certifications or made other allow-ances, such as a more gradual transition to the new policy, Lieber says. Because it did not, Lieber sees the change as thinly veiled evidence of an agency effort to reduce the number of DME providers.

"I think CMS needs to look hard at what it's trying to accomplish," she says. "It's really the beginning of the demise for some of these specialty areas."

Protect yourself: Meanwhile, suppliers need to take immediate action. "Check on what your state license specifies," Lieber urges. "Don't wait for the government to do it for you."

Should you need to update your NSC file with the correct code, you must submit a "Change of Information" on the CMS 855S form, which the NSC in turn will transmit to your DMERC. 

Editor's Note: A Medlearn Matters article on the policy change is available online at www.cms.hhs.gov/medlearn/matters/mmarticles/2005/MM3607.pdf.