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From Health Law Daily, December 30, 2015

CMS finalizes prior authorization process for DMEPOS

By Mary Damitio, J.D.

CMS has finalized a prior authorization process that will be required before Medicare beneficiaries can receive certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). The agency issued the Final rule, which goes into effect on February 29, 2016, to combat questionable billing practices while ensuring that beneficiaries continue to have access to medically necessary care (Final rule, 80 FR 81674, December 30, 2015).

Purpose. CMS has ongoing concerns about improper payments relating to DMEPOS items. The HHS Office of Inspector General (OIG) and the U.S. Government Accountability Office (GAO) issued several reports highlighting questionable DMEPOS supplier billing practices, inappropriate payments, and unnecessary utilization of items. As a result, CMS implemented the DMEPOS Competitive Bidding Program and has heightened screening of suppliers as authorized by Section 6410 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). CMS also set up a three-year prior authorization demonstration program for power mobility devices (PMDs) in states with high incidences of fraudulent claims, which resulted in dramatically lower expenditures for such devices.

Master List. The Final rule expands the preauthorization process for certain DMEPOS beyond just PMDs and creates a “Master List” of 135 items that are frequently subject to overutilization and that are potentially subject to prior authorization. The list will be updated annually and items will remain on the list for 10 years, after which time, items can either remain on the list or be added back if a subsequent governmental report identifies them as frequently unnecessarily utilized.

Required authorization. Because presence on the Master List does not mean that an item is automatically subject to prior authorization, the Final rule also establishes a “Required Prior Authorization List,” which includes a subset of items. CMS will initially require prior authorization for those items and will publish notice of the authorization requirement 60 days prior to the implementation of the process.

New process. CMS is emphasizing that the Final rule will not create new clinical documentation requirements, but will instead require that the information be presented at an earlier stage. The process will ensure that all coverage, coding, and clinical documentation requirements are met prior to the beneficiary receiving the item and the claim being submitted for payment so that the beneficiaries are not responsible for the costs of items that are ineligible for Medicare coverage.

Any claim that is submitted with a provisional affirmation will be paid provided that all other requirements are met. Any claims submitted with a non-affirmation decision or without a decision will be denied.

Access. In order to ensure that beneficiaries continue to have access to necessary DMEPOS items, CMS is setting forth a specified timeframe for the review and approval of coverage requests. Therefore, CMS or its contractor will make a “reasonable effort” to make an initial prior authorization determination within 10 business days and a resubmission prior authorization determination within 20 business days of a request. An expedited process will also be available in instances where delays could jeopardize beneficiaries’ health.

MainStory: TopStory CMSNews BillingNews CoverageNews DMENews MedicaidPaymentNews PartBNews

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