NAAOP Challenges New Orthotic Coding Policy

Recently, the Statistical Analysis Durable Medical Equipment Regional Carrier (SADMERC) and most of the Durable Medical Equipment Regional Carriers (DMERCs)-Regions B, C, and D-released a "coding clarification" for orthoses.

In a statement, the National Association for the Advancement of Orthotics & Prosthetics (NAAOP), pointed out, "This coding clarification prohibits the use of add-on codes in conjunction with orthoses base codes that include the word 'prefabricated' in their descriptions. NAAOP believes that this coding clarification represents a significant and unreasonable limitation on the ability of orthotists to furnish patients with orthoses that provide optimum functionality, fit, and comfort."

The NAAOP statement continued, "Accordingly, NAAOP has sent the following letter to the SADMERC and DMERCs, challenging this new coding policy and requesting that they rescind the policy. We encourage all organizations and practitioners who agree with NAAOP's position to submit to the SADMERC and DMERCs a letter stating their views on this important issue."

The letter follows:

December 23, 2003 Doran D. Edwards, MD Medical Director Statistical Analysis DME Regional Carrier Palmetto GBA 2300 Springdale Drive, Building One Mail Code: AG-370 Camden, SC 29020

Re: Use of Add-On Codes with Prefabricated Orthoses Base Codes

Dear Dr. Edwards:

We are writing in response to your recent "coding clarification" that states that suppliers of orthotic services may not use add-on L-Codes in conjunction with "prefabricated" orthoses. This new policy will adversely impact practitioners and the Medicare program, and will deprive patients of necessary options that enhance comfort, stability, and, most importantly, function of orthoses. This new policy is contrary to the history and fundamental nature of the L-Code system and, we believe, is invalid. We, therefore, ask you to retract it immediately.

Coupled with the alarming trend of the SADMERC to systematically delete references to the term "custom fitted" in L-Code descriptions and to replace this phrase with the term "prefabricated," we believe that prohibiting practitioners from using add-on codes with prefabricated codes constitutes a serious threat to the current practice of orthotics that must be corrected.

We understand that this policy is in response to apparent abuses in the system. We wholeheartedly share your interest in curtailing such abuses. However, we feel that a more focused response is appropriate. A sweeping change to the entire L-Code system, in our view, is not a reasonable response to this perceived problem.

1. The "Coding Clarification" Is Unreasonable

There is insufficient support for this prohibition on the use of add-on codes in conjunction with base codes for orthoses that are described as "prefabricated." Frequently, a particular "prefabricated" orthosis may not fit within a single L-Code description, or it will be medically necessary to add a component, material, or feature to a prefabricated orthosis in order to provide medically necessary support and/or function.

Clinical orthotic care includes many examples where it is appropriate to use an add-on code with a base code that includes the term "prefabricated" in its description. For example, fracture bracing is accepted as a viable option to plaster and fiberglass casts for several types of fractures. Prefabricated systems can be utilized in situations where, previously, the entire orthosis had to be custom molded. Long leg, rigid, prefabricated fracture braces have a base code of L2136 (KAFO fracture orthosis, femoral fracture cast orthosis, rigid, prefabricated). However, not all fractures would be appropriately treated with a KAFO utilizing free motion knee joints. There may be ligament damage to the knee or fracture stabilization issues, requiring immobilization of the patient's knee using a drop lock or requiring a limitation of knee motion with plans to allow a gradual increase of motion over time. The HCPCS codes provide three viable options for these different scenarios: L2182, drop lock knee joint; L2184, limited motion knee joint; or L2186, adjustable motion knee joint. None of these control options-which would be clinically appropriate where medically necessary and ordered by a physician-are included in the base procedure. Instead, these options are described using the add-on code adaptability of the L-Coding system.

In the treatment of fractures, it may also be necessary to un-weight the limb and transfer the body weight through the thigh section of the fracture orthosis. One common method used to accomplish this is through the use of a weight-bearing thigh component described by L2188 (addition to lower-extremity fracture orthosis, quadrilateral brim). In other instances, most commonly when the fracture is high on the femur, the physician may alternatively request increased rotational control of the limb and proximal support between the limb and the trunk. In these situations, the orthotist commonly uses hip control components, described by code L2192 (addition to lower-extremity fracture orthosis, hip joint, pelvic band, thigh flange, and pelvic belt), to control the limb relative to the trunk and further stabilize the fracture.

There are many other examples in common clinical practice where orthoses described as "prefabricated" require the addition of appropriate add-on codes for individual patient need. The orthotic "coding clarification" restricts practitioners from providing necessary services, ultimately depriving patients of proper medical treatment. This new policy will have one of three impacts. It will either: (a) force practitioners to rely more often on more costly custom-fabricated orthoses, even when a prefabricated orthosis with add-on features could be used; (b) cause practitioners to provide prefabricated orthoses without making medically appropriate additions to the orthoses, because such additions are no longer reimbursable; or (c) shift additional costs onto practitioners who will feel compelled to provide the additional add-on features despite the lack of additional reimbursement. Thus, this rule will be highly detrimental to practitioners, the Medicare program generally, and the quality of patient care.

Furthermore, since the inception of the L-Code system, the fee schedule amounts for L-Codes are based on the assumption that base codes will be submitted in conjunction with appropriate add-on codes. Accordingly, the reimbursement for a base code is often set lower than if the item were to be furnished on a standalone basis. By prohibiting the combination of prefabricated orthoses codes and add-on codes, this policy will result in inappropriately low reimbursement for many orthoses, inadequately reimbursing practitioners for the cost of furnishing orthotic care.

2. The "Coding Clarification" Represents a Substantive Change to Existing Policy and Therefore Requires Notice-And-Comment Rulemaking Pursuant to the Administrative Procedure Act.

We believe that the "coding clarification" represents a substantial departure from prior policy that, at a minimum, requires notice and comment rulemaking. Unlike most HCPCS codes, in which a single code is meant to globally cover an entire procedure or item, L-Codes have always been divided into "base" codes and "add-on" codes that a practitioner combines, when appropriate, in order to represent the unique functionality and components of a prosthesis or orthosis. There is no precedent for introducing a third category of L-Codes: base codes that cannot be used in conjunction with add-on codes.

In fact, this "coding clarification" conflicts with the SADMERC's coding advice for certain "prefabricated" orthoses. For example, in August 2000, the SADMERC classified two products as "L4360 + L2200." The description for L4360 is "Pneumatic ankle foot orthosis, with or without joints, prefabricated, included fitting and adjustment." The description for L2200 is "Addition to lower extremity, limited ankle motion, each joint." This coding recommendation cannot be reconciled with the new "coding clarification" for orthoses, demonstrating that the policy is a departure from prior policy.

Furthermore, at least one HCPCS coding publication includes a statement immediately below the header of "Orthotic Devices - Upper Limb" stating that "the procedures in this section are considered as 'base' or 'basic procedures' and may be modified by listing procedures from the 'additions' sections and adding them to the base procedure." See 2003 HCPCS Level II (Ingenix, Inc. 2002). This sentence is immediately followed by codes for shoulder orthoses, which are all described as "prefabricated." The only reasonable interpretation of this sentence is that the codes that follow are prefabricated base codes that can be modified by add-on codes when necessary and appropriate.

The Administrative Procedure Act (APA) requires all federal agencies to publish proposed rules in the Federal Register in order to provide the public with notice and an opportunity to comment. 5 U.S.C. § 553(b), (c). The SADMERC and DMERCs, acting in the place of CMS to create de facto national policy, may not circumvent this "notice-and-comment" requirement. Accordingly, we believe that the SADMERC and DMERCs are not permitted to completely revise the L-Code system without adhering to the requirements of the APA.

While there is an exception to the APA notice-and-comment requirement for "interpretive rules," 5 U.S.C. §553(b)(3)(A), this exception is not applicable to the DMERCs' coding "clarification." Though the line between substantive rules and interpretative rules is not always clear, "[i]f a rule creates rights, assigns duties, or imposes obligations, the basic tenor of which is not already outlined in the law itself, then it is substantive." La Casa Del Convaleciente v. Sullivan, 965 F.2d 1175, 1178 (1st Cir. 1992). The DMERCs' new orthoses coding policy represents a fundamental and substantive change to the L-Code system. It will result in the denial of coverage of add-on orthotic features that previously were covered by Medicare when used in conjunction with a prefabricated orthosis and when medically necessary. Accordingly, the change in coding policy is a substantive rule, not an interpretation of existing policy. It is, therefore, subject to the APA's notice-and-comment requirements and the failure to satisfy these requirements renders the policy invalid.

For the reasons discussed above, we believe that the "coding clarification" for orthotics is invalid and should be retracted immediately. If you would like to discuss this issue directly, please call me at 432.683.3788.

Sincerely,

Michael J. Allen, CPO, FAAOP President, NAAOP

cc: Paul Hughes, MD, Medical Director for Region A Adrian Oleck, MD, Medical Director for Region B Doran Edwards, MD, Medical Director for Region C Robert Hoover, MD, Medical Director for Region D Peter W. Thomas, General Counsel, NAAOP

For more information, visit www.oandp.com/naaop

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