coding & reimbursement
From Monofocal to Presbyopia-Correcting IOLs
Reimbursement protocols for all IOLs.

The question of who may purchase an IOL, and who may sell it — and to whom — has been a controversy for more than a decade. Now, with the new presbyopia-correcting IOLs, there is renewed interest in this issue for all types of IOLs.

Q. Who may be reimbursed for IOLs used in cataract surgery?

A: Medicare and other third-party payers reimburse the facility where surgery is performed: either the ambulatory surgery center (ASC) or hospital outpatient department (HOPD). Medicare reimbursement for the IOL is part of APC 246 in an HOPD, and of Group 8 in an ASC. Rarely does the surgeon get paid. While cataract surgery can be performed in a surgeon's office or a non-certified ASC (which is treated like an office), this situation is uncommon. When this happens, there is no facility fee but the surgeon can be reimbursed for the IOL by the carrier.

Q. May the surgeon purchase an IOL directly from the manufacturer?

A: Yes, but there are significant difficulties with this approach. For example, the surgeon cannot file a claim for reimbursement for the IOL implanted in an HOPD or ASC. When the surgery is covered by Medicare, the IOL is also a covered benefit and the ASC or HOPD receives reimbursement for the IOL as part of the facility fee. The surgeon cannot bill the patient directly for an IOL or for anything that is covered by Medicare. It is a violation of the physician's participation agreement with Medicare. If the ASC or HOPD did not provide the IOL, but received reimbursement for the lens, then the facility filed a false claim and was paid too much. Both of these violations carry the potential for fines and penalties for the surgeon and the facility.

Q. May the surgeon purchase the IOL from the manufacturer and resell it to the facility?

A: Yes, but the physician may only charge the HOPD or ASC for the cost of the IOL including direct costs (shipping, taxes, etc). Arrangements allowing the surgeon to profit on the resale of the IOL could engender allegations of kickback, because it appears that the HOPD or ASC is financially rewarding the surgeon for referring cases. Both federal and state anti-kickback statutes are implicated. We recommend that the surgeon avoid this legal liability by asking the HOPD or ASC to order the IOL.

Q. What is the beneficiary's financial liability for the IOL?

A: It varies depending on the type of IOL used in cataract surgery. With a conventional IOL or new technology IOL, the lens is fully covered and the patient is only responsible for the co-payment and any unmet deductible. If a presbyopia-correcting IOL is used, the facility fee received by the hospital or ASC includes reimbursement for a conventional lens. Patients may be charged for the upgrade.

Q. For presbyopia-correcting IOLs, is there a limit to the charge for the upgrade?

A: Medicare has not established a limit to the amount that can be charged to the beneficiary for the non-covered portion of the presbyopia-correcting IOL. However, there is the expectation that the charge reasonably represents the efforts and costs expended by the facility. A large mark-up is unjustified and may be viewed as an attempt to circumvent the facility's assignment agreement with Medicare or other third-party payer. Balance billing of this sort could subject the facility to fines and penalties, even loss of its Medicare status. In addition, there has been speculation that states' attorneys general might pursue these institutions for price-gouging.

Suzanne Corcoran is vice president of Corcoran Consulting Group. She can be reached at (800) 399-6565.