To make modern cataract surgery an even greater benefit to patients, clinicians aim to reduce their dependence on post-cataract glasses and ameliorate residual refractive errors such as astigmatism and presbyopia. This combination of cataract surgery with refractive surgery is termed “refractive cataract surgery,” and it provides additional benefits to patients.
However, it is essential to be aware that in refractive cataract surgery, CMS makes a clear distinction between covered and noncovered items and services. There is no change in Medicare coverage of medically necessary cataract surgery or the corresponding payments. The surgeon’s and facility’s charges for additional items and services to correct presbyopia and astigmatism are not covered and are the patient’s responsibility.
CODING FOR DIAGNOSTICS
Prior to cataract surgery, the ophthalmologist performs an eye exam and biometry to determine an appropriate IOL power. Medicare’s most basic regulation concerning diagnostic tests addresses who can order them.
“All diagnostic x-ray tests, diagnostic laboratory tests, and other diagnostic tests must be ordered by the physician who is treating the beneficiary, that is, the physician who furnishes a consultation or treats a beneficiary for a specific medical problem and who uses the results in the management of the beneficiary’s specific medical problem. Tests not ordered by the physician who is treating the beneficiary are not reasonable and necessary.1
For example, it is reasonable and appropriate for a cataract surgeon to order an A-scan biometry to assist with the selection of an IOL for use in cataract surgery. It would not be appropriate for an optometrist to do so since it is not possible for the optometrist to perform cataract surgery.
Medicare’s longstanding national coverage determination policy covers this exam, biometry and sometimes a B-scan when a dense cataract is found.2
“Cataract surgery with an intraocular lens (IOL) implant is a high volume Medicare procedure. Along with the surgery, a substantial number of preoperative tests are available to the surgeon. In most cases, a comprehensive eye examination (ocular history and ocular examination) and a single scan to determine the appropriate pseudophakic power of the IOL are sufficient. In most cases involving a simple cataract, a diagnostic ultrasound A-scan is used. For patients with a dense cataract, an ultrasound B-scan may be used.”
It goes on to say: “Accordingly, where the only diagnosis is cataract(s), Medicare does not routinely cover testing other than one comprehensive eye exam (or a combination of a brief/intermediate examination not to exceed the charge of a comprehensive examination) and an A-scan, or if medically justified, a B-scan. Claims for additional diagnostic tests are denied as not reasonable and necessary unless there is an additional diagnosis and the medical need for the tests is fully documented.”
The last sentence provides solid regulatory support for additional diagnostic testing as noncovered services that are the patient’s financial responsibility, assuming the beneficiary agrees to undertake them. Since some items and services will not be covered and paid by Medicare or other third-party payers, you need to consider who will be financially responsible and have the patient sign an appropriate financial waiver, or Advanced Beneficiary Notice of Noncoverage (ABN). This is a written notice a health-care provider gives to a Part B Medicare beneficiary when the provider believes that Medicare will not pay for items or services and is signed by the patient before the service or item is provided.
By signing an ABN, the Medicare beneficiary acknowledges that they have been advised that Medicare will not pay for that particular service and agrees to be responsible for payment, either personally or through another insurance plan.
(An ABN cannot be used for a Part C Medicare beneficiary; follow the Medicare Advantage Organization’s instructions for predetermination of benefits.3)
Relevant CMS rulings
On May 3, 2005, Mark McClellan, MD, PhD, then administrator of CMS, published a ruling concerning access to presbyopia-correcting IOLs for Medicare beneficiaries.6 Simply put, the Medicare program allows beneficiaries to purchase an upgrade from a conventional IOL to a presbyopia-correcting (PC) IOL and pay additional charges beyond those associated with standard cataract surgery.
On Jan. 22, 2007, Leslie Norwalk, then acting administrator of CMS, published a ruling concerning access to astigmatism-correcting IOLs for Medicare beneficiaries that emulates the CMS ruling for PC IOLs.7
- Medicare has applied the “deluxe” concept8 to presbyopia- and astigmatism-correcting IOLs, permitting providers (ie, hospitals and ASCs) to collect an extra fee from beneficiaries for the noncovered aspect of an otherwise covered IOL. The CMS ruling states: “Therefore, the presbyopia-correcting functionality of an IOL does not fall into the benefit category and is not covered. Any additional provider or physician services required to insert or monitor a patient receiving a presbyopia-correcting IOL are also not covered. For example, eye examinations performed to determine the refractive state of the eyes following insertion of a presbyopia-correcting IOL are non-covered.”9 At the same time, CMS also agreed to allow the surgeon to charge the beneficiary for additional services to cope with astigmatism. “…the facility and physician may take into account any additional work and resources required for insertion, fitting, vision acuity testing, and monitoring of the presbyopia-correcting IOL that exceeds the work and resources attributable to insertion of a conventional IOL”
- “…the beneficiary requests this service”
- “The physician and the facility may not require the beneficiary to request a presbyopia-correcting IOL as a condition of performing a cataract extraction with IOL insertion”10
Third-party payers are not obliged to agree with the concepts described in the CMS Rulings, although many do. A few third-party payers may cover PC IOLs and astigmatism-correcting IOLs; providers must determine a payer’s policy prior to surgery.
BALANCE BILLING AND DIAGNOSTICS
In the context of practice management, covered services are subject to strict limitations on balance billing, while noncovered services are the beneficiary’s responsibility to pay. The difference between the actual charge and the assigned benefit amount for covered services that the provider has contractually accepted as payment in full is not the patient’s responsibility.4
Despite the prohibition against balance billing, payers generally agree that enrollees may be billed for noncovered services. Consequently, it is necessary to clearly define and separate covered from noncovered services and obtain the patient’s voluntary acceptance of financial responsibility for the latter.
There are several useful pre-cataract diagnostic tests that could be billed to the patient.
The following tests, however, are either screening or refractive in nature and consequently not covered by the Medicare national coverage policy, so they represent another occasion when the patient must sign an ABN to receive them:
- Contact lens trial
- Corneal topography
- Pachymetry
- Refraction
- SCODI-A
- SCODI-P
- Tear film imaging
- Tear osmolarity
- Wavefront aberrometry
BILLING FOR ADVANCED TECHNOLOGY IOLS
For payment purposes, Medicare distinguishes between conventional IOLs and advanced technology IOLs, presbyopia-correcting IOLs or astigmatism-correcting or toric IOLs. Some IOLs correct both.
According to the agency:
- Beneficiaries pay only the obligatory co-payment and deductible for cataract surgery with a conventional IOL.
- A presbyopia-correcting or toric IOL incorporates deluxe or upgraded components for the additional functionality that is noncovered and requires an additional payment by the beneficiary.
The vast majority of IOLs in the marketplace belong to the first category I cited — conventional IOLs. The reimbursement for conventional IOLs is included in the facility fee for the ambulatory surgery center (ASC) or hospital outpatient department (HOPD).
By virtue of their assignment agreement with Medicare, ASCs and HOPDs must accept Medicare’s payment for the facility fee for cataract surgery, including the conventional IOL, as full payment except for the applicable co-insurance and deductible. However, both ASCs and HOPDs may charge beneficiaries for the upgrade to an AC IOL or presbyopia-correcting IOL.
The presbyopia-correcting and astigmatism-correcting functions of these IOLs can be thought of as upgrade feature(s) not covered by Medicare. CMS publishes a list of approved IOLs that meet these characteristics; it is updated periodically.5 Since the cataract surgery with IOL already includes payment to the facility for the conventional spherical, single-function IOL, the derivation of the “upgrade charge” for the patient is based on your costs for a single-feature, posterior chamber IOL.
So, in addition to informed consent, the practice must educate these beneficiaries that cataract surgery with a presbyopia-correcting and/or astigmatism-correcting IOL encompasses both covered and noncovered items and services.
A Medicare beneficiary who does not meet Medicare’s medical necessity criteria for cataract surgery may pay the facility and the surgeon for the entire procedure. For example, if the beneficiary requests surgery for ametropia and there is an incipient cataract that is visually insignificant, the cataract surgery and IOL implantation would not be covered by Medicare.
Each surgeon needs to construct an individual protocol for additional refractive services and determine which are appropriate on a case-by-case basis. Once constructed, the surgeon should establish a reasonable fee for the refractive package considering the services included, and it should reflect fair market value of the services provided.
The HOPD or ASC will follow a similar approach to establish their noncovered facility fee for the toric IOL upgrade, additional equipment not used in routine cataract surgery and enhancements.
To derive a fee, consider the following approach:
- Develop a comprehensive list of all services included in the extended care package with your usual and customary charge
- Determine the frequency that each service is likely to occur within the population of patients who elect the toric IOL
- Multiply the frequency by the usual and customary fee to arrive at a weighted average fee for each service
- Total the weighted average fees to establish the extended care package charge for refractive error.
CONCLUSION
Refractive cataract surgery is a combination of covered cataract surgery and non-covered refractive services. Medicare providers can only bill beneficiaries for noncovered services, and only if the beneficiary understands and accepts financial responsibility in advance, usually by signing an ABN.
Balance billing Medicare beneficiaries for covered services is prohibited under the assignment agreement or restricted under the nonparticipation rules.
Keep in mind that other third-party payers have similar attitudes, although they are not obliged to follow Medicare guidelines. OM
References
1. Center for Medicare and Medicaid Services. Regulation and Guidance. https://tinyurl.com/2jk53344. Accessed June 2, 2024.
2. Center for Medicare and Medicaid Services NCD 10.1. https://www.cms.gov/medicare-coverage-database/view/ncd.aspx?NCDId=60. Accessed June 2, 2024.
3. MLN Medicare Learning Network. Advance Beneficiary Notice of Non-coverageTutorial. May 2023. https://tinyurl.com/mr3edw4x. Accessed June 2, 2024.
4. Health Insurance Glossary. Definition of balance billing. tiny.cc/n2hvyz. Accessed June 2, 2024
5. CMS. CMS Recognized Presbyopia-Correcting (PC) IOLs and Astigmatism-Correcting (AC) IOLs. https://tinyurl.com/5n7pmeh3. Accessed June 2, 2024.
6. CMS. Ruling 05-01. Published May 3, 2005. https://tinyurl.com/ye24vyt4. Accessed: June 2, 2024.
7. CMS. Ruling No. CMS-1536-R. Published January 22, 2007. https://tinyurl.com/3fuksk6y. Accessed: June 2, 2024.
8. Medicare Claims Processing Manual, Chapter 20, §90, Payment for Additional Expenses for Deluxe Features. https://tinyurl.com/3mt9d29n. Accessed June 2, 2024.
9. CMS Ruling 05-01. Published May 3, 2005. https://www.cms.gov/Regulations
-and-Guidance/Guidance/Rulings/CMS-Rulings-Items/CMS026530. Accessed June 2, 2024.
10. CMS Transmittal 636. https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Downloads/R636OTN.pdf. Accessed June 2, 2024.
