Important New Medicare Rules Impact O&P Field

The Centers for Medicare & Medicaid Services (CMS) has established several new rules of engagement that O&P practitioners and suppliers must follow to receive Medicare payments, and these rules go into effect immediately. Parts of the new rules also apply to Medicaid services. This article examines these new rules and the impact they will have on the O&P field. Recently issued "interim final" regulations on provider and supplier enrollment, ordering, referring, and documentation standards were issued by CMS as mandated by P.L. 111-148, the "Patient Protection and Affordable Care Act" (PPACA). 1 Interim final rules apply on their effective date but are subject to change based on comments received from the public. The O&P Alliance, of which the National Association for the Advancement of Orthotics and Prosthetics (NAAOP) is a member, will be submitting written comments on this new set of rules. The interim final rules are designed to enhance current Medicare procedures to limit waste, fraud, and abuse within the system, and apply well beyond the world of O&P. However, there may be significant unintended consequences to these new rules as well as glitches in their implementation. National Provider Identification The interim final rules build on existing law to require all Medicare providers or suppliers who are eligible for a National Provider Identification (NPI) number to report their NPI on the Medicare enrollment form. For O&P providers, this is the Medicare supplier number issued by the National Supplier Clearinghouse (NSC). These supplier numbers will be melded into the NPI database later this year. In addition, all paper or electronic claims must include the NPI of the provider or supplier who is enrolled in fee-for-service (FFS) Medicare, as well as any other providers or suppliers that are required to be identified on the claim. This provision also extends to Medicaid through provider agreements between the state agency and participating providers, which require that any Medicaid provider who is eligible for an NPI to submit the NPI to the state agency and include the NPI on all Medicaid claims. Any claims missing the NPI will be rejected. For claims submitted by a Medicare beneficiary, the claim does not need to have the provider or supplier NPI, but it must include the legal name of the provider. This provision is effective July 6, 2010. The requirement for all providers or suppliers to use NPIs is designed to ensure that only verified and credentialed individuals and entities participate in Medicare. One concern is whether certain providers, such as O&P professionals, will be penalized for the failure of the referring physician or non-physician professional (such as a physician assistant or nurse practitioner) to obtain an NPI. Ordering and Referring Covered Items and Services for Medicare Beneficiaries The new regulations require that all claims submitted for covered Part B items or services that require an order or referral must include, as a condition of payment, the NPI and legal name of the ordering or referring physician or eligible professional. 2 In addition, with some exceptions, the ordering or referring professional must have a valid enrollment record in the Provider Enrollment, Chain, and Ownership System (PECOS). Part B drugs are excluded from this requirement. Claims for covered home health services under Part A or Part B must also include the NPI and legal name of the ordering physician, and that physician must have an approved enrollment record in PECOS. Claims submitted by beneficiaries are not required to have the NPI of the ordering or referring physician or eligible professional but must include the legal name of the provider, and that provider must have a valid enrollment in PECOS. Physicians or other eligible professionals who do not participate in Medicare may refer and order O&P services for Medicare patients but must have a valid opt-out record from PECOS. In the event of orders or referrals from physician residents or interns, the teaching physician and his or her NPI must be identified on the claim. Physicians or eligible professionals employed by the Public Health Service, the Department of Defense (DoD), or the Department of Veterans Affairs (VA) who do not submit claims to Medicare will still be required to enroll in Medicare solely for the purpose of ordering and referring services. While the interim final rule goes into effect on July 6, 2010, the requirements that physicians and eligible professionals who engage in orders and referrals for DMEPOS be enrolled in Medicare is effective July 1, 2010, as mandated by the statute. Beginning on July 6, 2010, Medicare contractors will reject any claim that does not include the legal name and NPI of the ordering, referring, or prescribing physician or eligible professional unless it meets the exceptions described above. These new regulations are consistent with change request (CR) 6421, which was initially published in 2009 but whose full implementation was delayed until January 3, 2011. The CR required NPIs and PECOS enrollment for Part B durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS), laboratory, imaging, and specialist services. Consequently, CMS anticipates that many physicians and professionals are already in the process of updating and/or enrolling in PECOS. The intent is to address concerns regarding unnecessary referrals and orders for services by making sure physicians and eligible professionals who order or refer services that are subject to abuse—such as DMEPOS, home health, laboratory, imaging, and specialist services—have verified credentials. CMS believes the primary way to ensure this is through PECOS. All providers and suppliers who enrolled in Medicare within the last six years should have established enrollment records in PECOS. Those providers and suppliers who enrolled more than six years ago and have not updated their information within the past six years will be required to submit a Medicare enrollment form to establish an enrollment record in PECOS. A real fear regarding PECOS is that it is cumbersome, often outdated, and may impose significant burdens on O&P practitioners and suppliers who receive referrals from physicians and other eligible professionals. A related concern is how beneficiaries are expected to verify PECOS enrollment if they choose to submit claims on their own given the difficulties providers and suppliers experience with the current system. CMS should engage in much greater efforts to educate providers and suppliers about these new rules before denying payment for legitimate healthcare services that are not technically compliant with these new regulations. Documentation Requirements on O&P Practitioners and Suppliers The interim final rule expands current Medicare documentation standards to require providers or suppliers who furnish DMEPOS to maintain documentation for seven years from the date of an order, certification, or referral. Upon request from CMS or a Medicare contractor, DMEPOS suppliers and providers must provide access to that documentation. The documentation requirements also apply to physicians and other eligible professionals who order or refer DMEPOS, home health, laboratory, imaging, or specialist services. This documentation encompasses electronic and written communications relating to the order or request for payment and must include the NPI of the physician or eligible professional who ordered or referred the item. Failure to adhere to this documentation requirement may result in the supplier's or physician's revocation of Medicare enrollment for one year for each act of non-compliance as well as the potential exclusion from participation in the Medicare program. Providers may appeal the revocation decision. These requirements became effective on January 1, 2010. The new penalties associated with non-compliance mean that multiple documentation failures could result in an extended period of disenrollment from Medicare as well as Medicaid, a deathblow to most O&P practices. CMS should consider the development of certain exceptions to this requirement for situations where records are destroyed or lost prior to the seven-year deadline in the event of circumstances beyond the provider's control. In particular, this would ensure that smaller O&P providers, who are more likely to use paper records or have limited electronic systems, would not be penalized in the event of a natural disaster or systems malfunction. Peter W. Thomas, JD, serves as general counsel for the National Association for the Advancement of Orthotics and Prosthetics (NAAOP). Johanna Kreisel, JD, is an associate at Powers Pyles Sutter & Verville, PC, Washington DC. References Centers for Medicare & Medicaid Services. Medicare and Medicaid Programs; Changes in Provider and Supplier Enrollment, Ordering and Referring and Documentation Requirements; and Changes in Provider Agreements. Fed Regist . May 5, 2010;75(86):24437-24449. "Eligible professional" is defined under the Social Security Act §1848(k)(3)(B) as a physician assistant, nurse practitioner, clinical nurse specialist, registered nurse anesthetist, certified nurse-midwife, clinical social worker, clinical psychologist, registered dietician or nutrition professional, physical or occupational therapist or qualified speech-language pathologist, or a qualified audiologist.

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