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OIG Work Plan Zeroes in on OTS Orthotics

Posted by David McGill | January 22, 2018

Last week, the Office of Inspector General updated its Work Plan with a new announcement titled, Questionable Billing for Off-the-Shelf Orthotic Devices. Here's what you need to know:

  • ​The OIG's announcement will result in the OIG specifically evaluating "the extent to which Medicare beneficiaries are being supplied [ ] orthotic devices [submitted under L0648, L0650, and L1833] without an encounter with the referring physician within the 12 months prior to their orthotic claim."
  • The OIG further plans on analyzing billing trends involving these codes "on a nation-wide scale."

The OIG will focus on these codes because, according to its data, claims for these codes have grown by 97% and allowed charges have grown by 116% since 2014. The OIG also cites inordinately high improper payment rates - a topic that Ossur R&R has reported on repeatedly in the past - as supporting this new scrutiny.

What does this mean for you?

Generally, we recommend operating under the assumption moving forward that the DME MACs will issue Additional Documentation Requests for all claims you submit involving those 3 codes. If you do so, it will put you in the strongest possible position to withstand audits and prepayment claim reviews if and when they occur. 

More specifically, make sure that before dispensing an OTS orthotic device to a Medicare beneficiary, you confirm that the patient has had an encounter with the referring physician in the preceding 12 months, as the OIG has identified this as a key focus area. In addition, make sure your claim meets all of the requirements spelled out in the applicable Local Coverage Determination for the type of orthotic you deliver.

Given the DME MAC data suggesting that the percentage of claims inappropriately paid by Medicare for bracing products generally and OTS orthotics specifically is well north of 50% - and often in excess of 85% - we are not surprised by the OIG's escalating concern about these claims/codes. Prepare for a high level of scrutiny, get your claims house in order, and respond promptly to all Additional Documentation Requests moving forward.

We will keep you advised of further developments as new information becomes available.

Össur R&R

The Source for O&P Reimbursement & Regulatory News & Analysis

If you have any questions for Össur’s Reimbursement Team or about Össur’s Reimbursement Services, please contact us at [email protected]