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FINALIZED: Prior Authorization process for certain DMEPOS

Just in time for the new year, the Final Rule has been released from CMS today regarding the Prior Authorization (PA) process for certain DMEPOS under CMS-6050-F. This final rule establishes a PA process for those items that are subject to unnecessary utilization. CMS defines unnecessary utilization as “Furnishing items that do not comply with one or more of Medicare’s coverage, coding, and payment rules.” They are further quoted as stating, “We believe a prior authorization process will ensure beneficiaries receive medically necessary care while minimizing the risk of improper payments, and will therefore protect both beneficiaries and the Medicare program.”

Click here to read the email from CMS.

This information comes straight from the final rule CMS-6050-F. For 2014, CERT reported that approximately 5.1 billion dollars were improperly paid for DMEPOS items. This represents a 53.1% improper payment rate for DMEPOS and represents 10.4% of the overall payment rate. 92% of DMEPOS improper payments were due to insufficient documentation. Hence, the reason for a PA program.

When will this become effective? The effective date is 60 days after publication which means by the end of February 2016.

What are some of the common HCPCS codes out of the 135 on the required PA list: E1390, E0260, E0601, E0470, E2402, E0277, and many L codes. In addition some power wheelchairs codes that were only eligible for ADMC such as K0856 and K0861 to name a few. The complete range for power wheelchairs that will be eligible for PA is from K0813-K0864. For manual chairs the K0004 has been added to the PA list.

What are the outcomes of this program? According to CMS, “The provider and supplier community will benefit from the increased education and outreach that is planned during year one of the PA program.”

What is the process for the PA? Timeframes not finalized yet in order to avoid barriers to care for beneficiaries.

However, here is the information that is in the initial proposed rule. After receipt of all the applicable required documentation, a review would be conducted and a decision communicated that will affirm or non-affirm the request.

  • A decision will be made within 10 days of receipt of all applicable information.
  • Two days for expedited request only be done if jeopardizing the life or health of the beneficiary; which this needs to be in the documentation.
  • 20 days for resubmission and an unlimited amount of resubmissions.
  • No submission for a PA means a denial and no appeal rights on the claim and the supplier is liable.
  • Even though an affirmation has been issued, there may still be a denial based on technical requirements that can only be evaluated after a claim is submitted for processing.

What should you do now? Review the final rule that is attached HERE and share with the entire company. Make sure the medical policies (LCDs), related articles, and other rules are understood and still followed. Stay tuned for more information as it’s released by CMS and the DME MACs and VGM. There are a lot of changes occurring in 2016 so make sure you are watching email updates as we will keep you informed as we receive information.

Click here to view the Final Master List of DMEPOS Items Subject o Frequent Unnecessary Utilization for Prior Authorization.