New aqueous drainage assist devices attract a great deal of interest from glaucoma surgeons because they offer alternatives to traditional filtration surgery, tube shunts, and other standard glaucoma procedures. Unfortunately, Medicare reimbursement is not universally available for many new procedures that are described as temporary, emerging technology — including many minimally invasive glaucoma surgery (MIGS) devices — and as such, have Category III CPT codes.¹

Likewise, other third party payers might not pay for products and services that are too new to be described as standard of care and are, therefore, considered to be experimental or investigational. Within CPT, permanent Category I codes are those that satisfy all of the following criteria.

• All devices and drugs necessary for performance of the procedure of service have received FDA clearance or approval when such is required for performance of the procedure or service.
• The procedure or service is performed by many physicians or other qualified healthcare professionals across the United States.
• The procedure or service is performed with frequency consistent with the intended clinical use (i.e., a service for a common condition should have high volume).
• The procedure or service is consistent with current medical practice.
• The clinical efficacy of the procedure or service is documented in literature that meets the requirements set forth in the CPT code-change application.

It takes years to meet the threshold for a permanent CPT code and subsequently garner widespread coverage and payment by insurers. In the interim between Category III and Category I designation, beneficiaries are financially responsible for the professional and facility charges associated with noncovered Category III CPT codes. Understandably, there is strong resistance from patients to pay for noncovered items and services, even if the alternative is a procedure that might not be the best for their specific needs. Experience shows that only a small minority of patients will agree to pay thousands of dollars for their own eye care when their insurance refuses to cover it.

Safe Handling

All manufacturers are keenly aware of this dilemma, and have some sympathy for the patient’s plight, as do physicians and healthcare systems. A number of healthcare programs exist to provide charity care for free or at a reduced cost to low-income patients who are uninsured or underinsured. These programs have the support of manufacturers who provide samples to offset the cost of health care. Yet despite all the good intentions, problems can arise when samples aren’t handled properly.

According to CMS, “Many drug and biologic companies provide physicians with free samples physicians may give to patients free of charge. It is legal to give these samples to your patients for free, but it is illegal to sell them. The Federal Government prosecutes physicians for billing Medicare for free samples. If you choose to accept samples, you will need reliable systems in place to safely store the samples and ensure samples remain separate from your commercial stock.”²

In a similar vein, within the Food and Drug Administration, the Prescription Drug Marketing Act bans “… the sale, purchase, or trade (including the offer to sell, purchase, or trade) of prescription drug samples.”³

CMS also limits the Medicare payment to hospital outpatient departments for device-intensive procedures that include a full or partial credit for the device, which applies to many MIGS procedures.⁴ In practice, this frequently occurs during clinical trials of new implants, but it also pertains to replacement devices as well as reduced cost initial implants.

Within ambulatory surgery centers (ASCs), claims for reimbursement are usually submitted on a CMS-1500 claim form rather than a UB-04 claim form, so a separate line item for the aqueous drainage assist device with a revenue code is impossible. For 2018, the CMS Final Rule⁵ requires the FB modifier along with the applicable Category III code for the procedure when the MIGS device is provided at no cost or full credit, and the FC modifier when the manufacturer provides a partial credit of 50% or more (but less than 100%).⁶ CMS would reduce the amount of reimbursement for the ASC facility fee to reflect the no-cost or low-cost MIGS device.

AMA Ethical Guidelines

In addition to the legal and regulatory prohibitions cited above, the American Medical Association published ethical guidelines for physicians on the use of drugs and devices:⁷

Opinion 8.06 - Prescribing and Dispensing Drugs and Devices

(1) Physicians should prescribe drugs, devices, and other treatments based solely upon medical considerations and patient need and reasonable expectations of the effectiveness of the drug, device, or other treatment for the particular patient.

(2) Physicians may not accept any kind of payment or compensation from a drug company or device manufacturer for prescribing its products. Furthermore, physicians should not be influenced in the prescribing of drugs, devices, or appliances by a direct or indirect financial interest in a firm or other supplier, regardless of whether the firm is a manufacturer, distributor, wholesaler, or repackager of the products involved.

(3) A third party’s offer to indemnify a physician for lawsuits arising from the physician’s prescription or use of the third party’s drug, device, or other product, introduces inappropriate incentives into medical decision making. Such offers, regardless of their limitations, therefore constitute unacceptable gifts. This does not address contractual assignments of liability between employers or in research arrangements, nor does it address government indemnification plans.

A Winning Situation

Samples of drugs and implantable devices are a useful part of charity care, especially for services not covered by insurance. Because they are free, there is no cost to reimburse. Providers are prohibited from obtaining payment for samples. Ethical considerations complement the legal and regulatory instructions. GP

References

1. Corcoran KJ. Coding for Minimally Invasive Glaucoma Surgery. Glaucoma Physician; March 2017.
2. Avoiding Medicare Fraud and Abuse: A Roadmap for Physicians. Centers for Medicare & Medicaid Services. Avilable online: https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/Avoiding_Medicare_FandA_Physicians_FactSheet_905645.pdf . Last accessed Oct, 23, 2017.
3. FDA Compliance Program Guidance Manual, Chapter 56, Drug Quality Assurance. Program §7356.022 Available online: https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/UCM342665.pdf . Last accessed Oct. 23, 2017.
4. CMS Manual System, Pub 100-04 Medicare Claims Processing, Transmittal 3181. Available online: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Downloads/R3181CP.pdf . Last accessed Oct. 23, 2017.
5. Federal Register. Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs. Available online at https://federalregister.gov/d/2017-23932; last accessed Nov. 2, 2017.
6. Government Publishing Office. Federal Register Vol 82 No 138, page 33661. July 20, 2017. Available online: https://www.gpo.gov/fdsys/pkg/FR-2017-07-20/content-detail.html . Last accessed Oct. 23, 2017.
7. American Medical Association. AMA Journal of Ethics. November 2010. Available online: http://journalofethics.ama-assn.org/2010/11/coet1-1011html . Last accessed Oct. 23, 2017.

Kevin J. Corcoran, COE, CPC, CPMA, FNAO, is president and co-owner of Corcoran Consulting Group.