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CMS Issues Final Rule on Medicare Prior Authorization for Certain DMEPOS Including Most Lower Limb Prostheses

On December 29th, the Centers for Medicare and Medicaid Services (CMS) released the long anticipated final rule regarding Medicare prior authorization of certain DMEPOS, including most lower limb prostheses.  The final rule, which will be published in the December 30, 2015 Federal Register, will be implemented 60 days after it publication. AOPA has reviewed the final rule, and offers the following preliminary thoughts and comments regarding the provisions of the final rule. AOPA’s primary concern with prior authorization of prostheses is, and always has been, that it will critically delay timely access to the provision of prosthetic devices that are crucial to the rehabilitation needs of Medicare beneficiaries.  In the final rule, CMS acknowledged that proper access to medically necessary care is of the utmost importance, but indicated that it will use sub-regulatory processes to determine appropriate timelines for making prior authorization decisions.  These sub-regulatory processes are inherently arbitrary in that they do not allow for public input and or comment regarding their appropriateness.  AOPA remains concerned that prior authorization of any kind will only serve to hinder the delivery of medically necessary prosthetic care within reasonable timeframes. Another concern that AOPA expressed in its comments on the proposed rule that was not sufficiently addressed in the final rule is that prior authorization does not equate to a guarantee of claim payment nor does it eliminate the exposure of the claim to additional audits.  While the final rule states that an affirmative prior authorization decision indicates that the required documentation for claim payment is present, it also reiterates that it is not an initial claim determination and the claim may ultimately be denied for technical reasons such as invalid proof of delivery documentation. AOPA met with representatives from the Office of Management and Budget (OMB) in August while they were reviewing the proposed rule and registered concerns about the above issues. The few seeming new wrinkles in the final rule is that implementation will not be immediate and universal, but there will be a Master List of 135 HCPCS codes eligible for inclusion in prior authorization.  It appears there will a phase-in process, meaning not all 135 codes will be subject to prior authorization immediately.  Rather, the final rule indicates that CMS will establish a subset of the master list that will determine which HCPCS codes require prior authorization as part of the initial implementation of the final rule.  While the master list includes lower limb prosthetic HCPCS codes that meet or exceed the $1,000 threshold, it remains to be seen which codes will be included in the initial list of codes that will be subject to prior authorization. While the current list does not include any orthotic codes, AOPA remains concerned that future updates to the master list may include orthotic codes that meet the criteria for inclusion in prior authorization. At first glance, the final rule does not recognize two key facts from Medicare’s own data:

  1. There is not a problem of unnecessary utilization of lower limb prosthetics, and the -14% reduction in prosthetics payments over the 2010-13 period proves that;
  2. Today, Medicare prosthetic patients are 35% LESS LIKELY to receive an advanced tech prosthetic device than they were just 5 years ago (2005-2009).

In addition, the final rule acknowledges AOPA’s concern regarding the need for a more timely response to prior authorization requests but elects to define these timeframes through sub regulatory processes that do not allow for public comment or input. While AOPA will review the final rule more closely in the coming days, After its preliminary review,  AOPA believes that the final rule fails to address AOPA’s concerns regarding the implementation of a prior authorization program that:

  1. Does not appear to constitute a guarantee of payment; and
  2. Retains the payment threshold of $1,000 for inclusion in prior authorization
  3. Does not assure that providers would not be subject to post-payment/RAC audits on the very same issue of medical necessity; and
  4. Uses sub-regulatory processes to define appropriate timeframes for response to prior authorization requests; and
  5. Exceeds its authority to initiate a limited pilot on prior authorization, done only in selected areas (as was done with power mobility devices) to a national policy impacting all amputee beneficiaries nationwide.

AOPA will provide additional analysis of the final rule as it becomes available.