Coding & Reimbursement

Reimbursement Success for Premium lOLs

By Suzanne L. Corcoran, COE

Premium IOLs, including presbyopia-correcting IOLs (PC-IOLs) and astigmatism-correcting IOLs (ACIOLs), have increased in popularity over the past several years. There are reimbursement issues to consider.

Q. What documentation is required when the patient elects implantation of a premium IOL?

A. Other than the usual medical records and consents, patients must be notified in advance of financial responsibility and agree to pay for the non-covered items and services associated with a premium IOL. For Medicare beneficiaries with visually significant cataract, the Aug. 5, 2005, CMS Transmittal 636 concerning PC-IOLs, and Transmittal 1536-R concerning toric IOLs, advocate the use of a Notice of Exclusion from Medicare Benefits (NEMB) to clearly identify the non-covered items and services and associated fees. The facility and surgeon should each execute an NEMB. The revised Advance Beneficiary Notice of Non-coverage (ABN) may also be utilized. We recommend continued use of an NEMB form, as we find that it is less confusing for patients.

Most non-Medicare payers are now familiar with these IOLs, but some are not. If a question arises, obtain prior permission for the surgeon and hospital or ASC to bill beneficiaries for the premium IOL as a non-covered service. The beneficiary must also agree to pay for the additional services and the upgrade to a premium IOL. A Notice of Exclusion from Health Plan Benefits (NEHB) serves this purpose. The facility and surgeon should each execute one.

Q. What should we tell patients about out-of-pocket expenses for non-covered items and services?

A. A solitary all-inclusive number incorporating both covered and non-covered charges does not segregate the charges the payer will reimburse from the non-covered fees. This raises the specter of balance-billing violations. Most importantly, the patient wants to know what he or she owes, and the provider should take the opportunity to collect payment for the non-covered items and services in advance of the procedure. The patient pays the physician for non-covered services and the facility for the non-covered portion of the premium IOL.

Q. What is the charge for the IOL?

A. There are two parts: one covered and one non-covered. As a point of reference, Medicare has in the past valued IOLs at $150 in its determination of ASC payment rates, so the covered portion is part of the standard facility fee. Therefore, the non-covered charge to upgrade to a premium IOL is any additional charge beyond $150. Unrealistic markups raise balance-billing questions.

Q. How does the facility represent the lens charge on a claim form?

A. Medicare and most payers bundle the IOL into the facility fee so it is not reported separately. Facilities describe the covered portion of the lens on the claim form with the HCPCS code and usual and customary fee used for cataract surgery with conventional IOLs.

Medicare does not require reporting of the non-covered items on the claim form unless the patient specifically requests them. However, if required for tracking purposes, to secure a denial, or if a non-Medicare payer requires inclusion on the claim form, report an additional line-item with a different HCPCS code and the dollar amount charged to the patient for the upgrade.

HCPCS code V2788, presbyopia-correcting function of IOL, distinguishes the non-covered portion of a PC-IOL from the covered portion. HCPCS code V2787, astigmatism-correcting function of IOL, is used to describe the non-covered portion of a toric IOL. These codes may be used by the facility (ASC or HOPD) to report the non-covered or deluxe portion of the IOL.

Q. What about the surgeon?

A. For Medicare claims the surgeon files, use HCPCS A9270 (Non-covered item or service) for the extended care package for refractive error. Another HCPCS code, S9986 (Not medically necessary service, patient is aware that service is not medically necessary) is useful for non-Medicare claims to identify a package of physician services that constitute extended care for refractive error that are likewise non-covered. In lieu of A9270 or S9986, some third-party payers may dictate more specific codes for the non-covered services.

Q. Must we segregate the ASC charges from professional fees for a surgeon-owned ASC?

A. Yes. Each entity (i.e., surgeon and facility) should separate the covered and non-covered charges for the patient and file its own claim, even if the surgeon owns the ASC or is an employee. Medicare uses unique identification numbers to distinguish the clinic and facility. Contracts with other payers are discrete. Funds should not be commingled. OM

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