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Region A's Prepayment Reviews for Orthoses

Posted by David McGill | December 02, 2015

On November 25, NHIC, the DME MAC for Region A, published the results for first-time prepayment probe reviews of L4360 (pneumatic walking boots) and L1940 (ankle-foot orthoses). Here's what you need to know.

1. L4360​ Key Findings

The medical review encompassed 156 claims submitted by 123 suppliers:

  • NHIC did not receive responses to additional documentation requests for 61 of the 156 claims (39%);
  • Of the remaining 95 claims, NHIC denied 93 for a claim denial rate of 98%;
  • 97% of the denied claims failed to meet the coverage criteria for a custom-fit orthosis;
  • 52% of the denied claims lacked a detailed written order; and
  • 63% of the denied claims were missing proof of delivery. 
2. L1940 Key Findings
The medical review encompassed 114 claims submitted by 117 suppliers:
  • ​NHIC did not receive responses to additional documentation requests for 34 of the 114 claims (30%);
  • Of the remaining 80 claims, NHIC denied 60 for a claim denial rate of 75%;
  • 23% of the denied claims lacked clinical documentation;
  • 11% of the denied claims did not provide documentation supporting medical necessity of a custom-fabricated orthosis;
  • 13% of the denied claims lacked a detailed written order; and 
  • 18% of the claims were missing proof of delivery.
3. What does this mean for you?
Based on the prepayment probe results for both L4360 and L1940, NHIC announced that it will continue with a prepay complex widespread medical review of claims for both of these codes. If you are a supplier in Region A, you should therefore expect additional documentation requests for claims involving these codes moving forward. You must respond to ADRs! Failure to do so can result in your company getting referred to the National Supplier Clearinghouse, which can revoke your Medicare billing privileges for failing to answer ADRs.
In addition, the results of the L4360 probe review demonstrate that NHIC is focusing closely on the criteria necessary to justify a custom-fit orthosis. The applicable policy article provides that a custom-fit item "requires substantial modification at the time of delivery in order to provide an individualized fit i.e., the item must be trimmed, bent, molded (with or without heat), or otherwise modified resulting in alterations beyond minimal self-adjustment." It also states that "[t]his fitting at delivery does require expertise of a certified orthotist or an individual who has equivalent specialized training in the provision of orthosis [sic] to fit the item to the individual beneficiary." If you intend to bill for a custom-fit orthosis, you must exhaustively document both the substantial modification you make to the device at the time of delivery" and the qualifications of the professional making those modifications in order to justify payment
Lastly, the scrutiny of L1940 - a code that describes a custom-fabricated AFO - suggests that NHIC may be concerned about suppliers' compliance with the more stringent requirements for custom-fabricated items. In that regard, the 30% non-response rate to ADR requests and 75% claim denial rate for the remaining claims are troubling. It is critical that suppliers closely review and document their satisfaction of the standards set forth in the LCD and accompanying policy article when billing for a custom-fabricated AFO.
We will keep you posted regarding future prepayment review results for L4360 and L1940 as they become available​.
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