Pulmonology Coding Alert

Your nebulizer claims won’t “pass go” with Medicare unless you can submit these two things.

Nebulizers. You code related services constantly, right? And you can likely choose the codes while daydreaming about being poolside with an umbrella drink. If you’re nodding in agreement, it’s time to leave Complacency Island and set sail for the Compliance Mainland, because you could be costing your practice valuable revenue.

Identify the Key Denial Reason

According to Medicare, providers improperly billed a lot of nebulizer services in 2018. For last year’s reporting period, Medicare’s “Fee-For-Service improper payment rate for nebulizers and related drugs was 15.2 percent and accounted for approximately $107.1 million in improper payments,” the April 2019 Medicare Learning Network® (MLN) publication, Provider Compliance Tips for Nebulizers and Related Drugs, states.

So what, precisely, was “improper” about these claims that resulted in denials? Simple answer: insufficient documentation, says the MLN publication. This problem alone accounted for 83.8 percent of the impropriety.

Solidify Your Documentation

Want to know what’s needed for your nebulizer and related drugs claims? Use this list of required items from Local Coverage Determinations (LCDs) issued by the four Medicare contractors that process Durable Medical Equipment (DME) as a denial-prevention checklist:

1. A Written Order Prior to Delivery (WOPD), which must be a 5 Element Order (5EO) and include all of the following elements:

• Beneficiary’s name 
• Item of DME ordered: this may be general (for example, hospital bed) or more specific (for example, continuous glucose monitor [CGM])
• Signature of the prescribing practitioner 
• Prescribing practitioner’s National Provider Identifier (NPI)
• The date of the order 

2. A completed 5EO within six months after the required Affordable Care Act (ACA) 6407 face-to-face examination;

3. The supplier’s receipt of the 5EO before delivery of the listed item(s); and

4. A date stamp or equivalent to document the 5EO receipt date.

Jumping the gun: If you don’t have a completed order with the critical elements above and the supplier delivers the nebulizer and related materials, Medicare will automatically deny it, the MLN publication emphasizes.

Build on the Foundation of ‘Reasonable and Necessary’

So, to justify to Medicare that a patient has a medical need for the nebulizer, you have to have in the beneficiary’s medical records the right evidence at the outset to demonstrate that the treatment is “reasonable and necessary prior to, or at the time of, the creation of the initial prescription.”

The right stuff: Examples of appropriate documentation that would qualify for continued medical necessity include initial justification and:

1. A recent order by the treating physician for refills;
2. A recent change in prescription;
3. Documentation in the beneficiary’s medical record within 12 months of the date of service showing usage of the item.

Know the Supply Delivery Requirements

A supplier’s nebulizer delivery is a little more complex than receiving books from Amazon via UPS. When a shipping service makes a delivery, the following documentation elements must be present, the MLN publication stresses:

1. Beneficiary’s name;
2. Delivery address;
3. Delivery service’s package identification number, supplier invoice number, or alternative method that links the supplier’s delivery documents with the delivery service’s records;
4. A description of the item(s) being delivered — the description can be either a narrative description, a HCPCS Level II code, the long description of a HCPCS Level II code, or a brand name/model number;
5. Quantity delivered;
6. Date delivered; and
7. Evidence of delivery.

For instance: For item 4 in the list above, the shipping order could include codes E0570 (Nebulizer, with compressor), E0574 (Ultrasonic/electronic aerosol generator with small volume nebulizer), or E0575 (Nebulizer, ultrasonic, large volume) to describe the particular type of nebulizer that’s been ordered.