National Government Services, Inc. Medicare Monthly Review Part A and B
A Combined Part A and Part B Newsletter

MMR-2007 11AB, November 2007

Reasonable Charge Update for 2008 for Splints, Casts, Dialysis Supplies, Dialysis Equipment, and Certain Intraocular Lenses

Provider Types Affected
Physicians, providers, and suppliers billing Medicare contractors (carriers, fiscal intermediaries, (FI), Medicare Administrative Contractors (A/B MAC), and Durable Medical Equipment Medicare Administrative Contractors (DME MAC)) for splints, casts, dialysis equipment, and certain intraocular lenses

Provider Action Needed
Affected providers may want to be certain their billing staffs know of these changes.

Background
For calendar year 2008, Medicare will continue to pay on a reasonable charge basis for splints, casts, dialysis supplies, dialysis equipment, and intraocular lenses. For intraocular lenses, payment is only made on a reasonable charge basis for lenses implanted in a physician’s office. For splints and casts, the Q-codes are to be used when supplies are indicated for cast and splint purposes.

This payment is in addition to the payment made under the Medicare physician fee schedule for the procedure for applying the splint or cast.

Change Request (CR) 5740 provides instructions regarding the calculation of reasonable charges for payment of claims for splints, casts, dialysis supplies, dialysis equipment, and intraocular lenses furnished in calendar year 2008. Payment on a reasonable charge basis is required for these items by regulations contained in 42 CFR 405.501 at: http://www.gpoaccess.gov/cfr/retrieve.html on the Internet. The 2008 payment limits for splints and casts will be based on the 2007 limits that were announced in CR 5382 last year, increased by 2.7 percent, the percentage change in the consumer price index for all urban consumers for the 12-month period ending June 30, 2007. The MLN Matters article related to CR 5382 can be viewed at http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM5382.pdf on the CMS Web site.

For intraocular lenses, payment is made only on a reasonable charge basis for lenses implanted in a physician’s office. Change Request 5740 instructs your carrier, or A/B MAC to compute 2008 customary and prevailing charges for the V2630, V2631, and V2632 (Intraocular Lenses Implanted in a Physician’s Office) using actual charge data from July 1, 2006, through June 30, 2007.

Carriers and A/B MACs will compute 2008 Inflation-Indexed Charge (IIC) amounts for the V2630, V2631, and V2632 that were not paid using gap-filled payment amounts in 2007.

DME MACs will compute 2008 customary and prevailing charges for the codes identified in the following tables using actual charge data from July 1, 2006 through June 30, 2007. For these same codes, they will compute 2008 IIC amounts for the codes identified in the following tables that were not paid using gap-filled amounts in 2007. These tables are:

Dialysis Supplies Billed With AX Modifier

Dialysis Supplies Billed Without AX Modifier

Dialysis Equipment Billed With AX Modifier

Dialysis Equipment Billed Without AX Modifier

Carriers and A/B MACs will make payment for splints and casts furnished in 2008 based on the lower of the actual charge or the payment limits established for these codes. Contractors will use the 2008 reasonable charges or the attached 2008 splints and casts payment limits to pay claims for items furnished from January 1, 2008 through December 31, 2008. Those 2008 payment limits are in Attachment A at the end of this article.

Additional Information
Detailed instructions for Calculating:

• Reasonable charges are located in Chapter 23 (Section 80) of the Medicare Claims Processing Manual;
• Customary and prevailing charge are located in Section 80.2 and 80.4 of Chapter 23 of the Medicare Claims Processing Manual; and
• The IIC (Inflation Indexed Charge) are located in Section 80.6 of Chapter 23 of the Medicare Claims Processing Manual. The IIC update factor for 2008 is 2.7 percent.

You can find Chapter 23 of the Medicare Claims Processing Manual at http://www.cms.hhs.gov/manuals/downloads/clm104c23.pdf on the CMS Web site.

For complete details regarding this Change Request (CR) please see the official instruction (CR5740) issued to your Medicare FI, carrier, DME MAC, or A/B MAC. That instruction may be viewed by going to http://www.cms.hhs.gov/transmittals/downloads/R1344CP.pdf on the CMS Web site.

If you have questions, please contact your Medicare FI, carrier, DME MAC, or A/B MAC at their toll-free number, which may be found at http://www.cms.hhs.gov/MLNProducts/downloads/CallCenterTollNumDirectory.zip on the CMS Web site.

2007 Payment Limits for Splints and Casts

Disclaimer
This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents.

News Flash – The Second Edition of The Guide to Medicare Preventive Services for Physicians, Providers, Suppliers, and Other Health Care Professionals is now available in downloadable format from the Centers for Medicare & Medicaid Services, Medicare Learning Network (MLN). This comprehensive guide provides Fee-for-Services health care providers and suppliers with coverage, coding, billing and reimbursement information for preventive services and screenings covered by Medicare. This guide gives clinicians and their staff the information they need to help them in recommending Medicare-covered preventive services and screenings that are right for their Medicare patients and provides information needed to effectively bill Medicare for services furnished. To view online, go to http://www.cms.hhs.gov/MLNProducts/downloads/mps_guide_web-061305.pdf on the CMS Web site.