Medicare Compliance & Reimbursement

Providers:  Don't miss the draft LCD--and a chance to comment.

Providers who bill Medicare for nebulizer equipment, related supplies or drugs will need to be ready with proof of medical necessity.

The Centers for Medicare & Medicaid Services recently assigned the new durable medical equipment Program Safeguard Contractors the task of revamping Medicare's nebulizer-related payment policies. And the PSCs have delivered--they recently issued a hefty 23 pages outlining future coverage.

The changes are significant departures from current policy, reports respiratory therapist Harold Davis, a specialist for The VGM Group's respiratory division in McRae, AR.

The local coverage determination includes these coverage highlights:

• When a provider orders a small volume ultrasonic nebulizer (E0574), Medicare will reimburse at the rate for the least costly alternative of a pneumatic compressor (E0570).

• Contractors will deny any claim for a large volume ultrasonic nebulizer (E0575) as medically unnecessary. Medicare will not cover related supplies and accessories, either.

• A battery-powered compressor (E0571) will likely meet with denial. "[The devices] are rarely medically necessary," according to the draft LCD.

In addition to reducing payment for some products or eliminating coverage altogether, the draft LCD also tightens the reins on documentation for medical necessity.

Providers Must Get In Their Two Cents Now

Only four provisions in the lengthy LCD are open for comment, the PSCs stipulate:

1. Medicare contractors will base payment for levalbuterol on the allowance for albuterol.

2. Medicare contractors will base payment for DuoNeb on the allowance for separate unit dose vials of albuterol and ipratropium.

3. Medicare will no longer cover the following nebulizer drugs because there is inadequate support in the medical literature for administration using a DME nebulizer: amikacin, atropine, beclomethasone, betamethasone, bitolerol, dexamethasone, flunisolide, formoterol, gentamicin, glycopyrrolate, terbutaline and triamcinalone.

4. Given those deletions, Medicare will therefore limit coverage to these drugs: acetylcysteine, albuterol, budesonide, cromolyn, dornase alpha, iloprost, ipratropium, isoetharine, isoproterenol, levalbuterol, metaproterenol, pentamidine, and tobramycin.

Physicians, manufacturers, suppliers and other professionals involved in treating Medicare beneficiaries with chronic lung conditions may comment, according to a recent letter from three PSC medical directors.

Comments are due by May 8.

TriCenturion of Columbia, SC, is the PSC for DME Regions A and B. TrustSolutions, based in Milwaukee, is the PSC for DME Region C, and IntegriGuard, based in Omaha, NE, is the PSC for Region D.

Editor's Note: The LCD and the PSC letter, which includes guidance on how to submit comments, is available at www.tricenturion.com/content/whatsnew_dyn.cfm --scroll down to "Nebulizer-Draft Policy."

For updates and additional information regarding the next steps in the LCD, go to the PSCs' individual Web sites: www.tricenturion.com, www.trustsolutionsllc.com/DRAFT_LCD_Status.asp, and www.integriguard.org/gov/psc/index.htm.