The Third-Party Reimbursement Process for Orthotics
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- Rosanna Bates
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1 The Third-Party Reimbursement Process for Orthotics When the foot hits the ground, everything changes. We know that over 90% of the population suffers with overpronation of their feet. Implementing Foot Levelers' orthotics in your practice is not only good for your patients, it's good for your business. However, with the ever-increasing compliance rules and regulations, "miss-steps" when attempting reimbursement for orthotics from insurance can land you in hot water. This lesson is intended to get you on track with the necessary requirements and best practices for prescribing and obtaining proper reimbursement by thirdparty payers for orthotics in your practice. Objectives After completing this lesson, participants will be able to: Understand the process of implementing orthotics in the practice, from prescription to payment. Find medical review policy for orthotics and understand its implications when billing a third-party payer. Know when and how much a third-party payer will contribute to the patient's financial responsibility for orthotics. Master the medical record documentation necessary when prescribing and billing for orthotics. Submit billing with correct diagnosis and procedure coding when billing third-party payers. Collect payment from third-party payers for orthotics and understand how to appropriately charge patients for co-insurance and co-payments. Execute the post-orthotic ordering process of dispensing and check out, including proper coding, billing, and payment. Write compliance policy and procedure regarding the prescribing, ordering, and dispensing of orthotics. Step 1: Implement Orthotics, from Prescription to Payment Because the process of getting paid for orthotics begins with the provider s decision to order them, it s important to view the process from 15,000 ft., start to finish. This step will take you through a high-level overview and assist you in determining whether your patient has third-party assistance with their financial responsibility for orthotics in your office. Watch the Rapid Tutorial titled, Implement Orthotics, from Prescription to Payment. This overview will assist you with beginning the process. Download and review the Reference Tool titled, Billing and Coding Protocols for Functional Orthotics provided by Foot Levelers. This tool will be referred to throughout this lesson. We recommend you keep an electronic and paper copy for quick reference. Step 2: Insurance Verification In this step, we ll find out if our patient has third-party assistance with their financial responsibility for orthotics in your office. If the patient does not have third-party insurance coverage, refer to the lesson titled, The Non-Insurance Reimbursement Process for Orthotics to review how to collect cash for the services. Make sure you ve collected the patient s insurance card and coverage information. Review page 7 of the Reference Tool, Billing and Coding Protocols for Functional Orthotics for information about verification of orthotics coverage. 1
2 Refer to page 14 of the same guide to find the suggested Verification Form to fill out during the verification process. Print this form and have it available when you start the verification process. You may wish to print multiple copies to keep on file for the future. Watch the Rapid Tutorial titled, Proper Use of the Orthotics Verification Form to better understand its intended use and best practices for verifying coverage for orthotics. Call to verify the patient s insurance as directed in the Rapid Tutorial above. Based on the outcome of the verification, take the following steps: o If the patient does have coverage for orthotics, continue to Step Three to locate and review the carrier s Medical Review Policy for Orthotics. o If the patient does not have coverage for orthotics, visit the lesson titled The Non-Insurance Reimbursement Process for Orthotics for more information on the cash process. Step 3: Confirm Coverage with Third-Party Payer Medical Review Policy (MRP) Not only must you verify the coverage, but you must also review the carrier s rules for medical necessity for orthotics, found in the Medical Review Policy (MRP). Usually, these are located on the carrier s website, or by contacting the Provider Relations Department. Download and review the Support Tool titled, Sample Orthotic Medical Review Policy. Refer to this tool as you proceed to watch the tutorial below. Learn about Medicare Review Policy (MRP) by watching the Rapid Tutorial titled, Locating and Interpreting Orthotics Carrier Medical Review Policies. Using this newfound knowledge, follow-up by locating and reviewing the MRP for the patient you verified in step 2 above. Visit the website, find the MRP, and download/print it to be used throughout the remainder of this lesson. Once you find the MRP, look for the covered diagnoses listed. This is an important aspect of your findings in the MRP. Next, look for the approved HCPCS (Healthcare Common Procedure Coding System) codes in the MRP. What did you find in the policy? Is the patient s given diagnosis listed in the MRP and therefore, covered for reimbursement? Is the type of orthotic prescribed covered for reimbursement? If yes, continue with this lesson. If not, the patient does not have third party assistance with their financial responsibility for orthotics in your office. However, since the patient needs the orthotics, refer to the lesson titled The Non-Insurance Reimbursement Process for Orthotics for assistance with affordable cash opportunities. Step 4: Use History, Exam to Establish Medical Necessity Just because a patient has coverage for orthotics and the diagnosis is covered in the MRP, it doesn t mean medical necessity is automatically established. Providers should pay special attention to the documentation requirements necessary to lay a solid foundation for medical necessity. Review Page 4, Step 1 of the Reference Tool, Billing and Coding Protocols for Functional Orthotics for information about history, examination and treatment plans in your documentation. When using the Foot Levelers 3D Body View Scanning System, the data collected about the foot is an excellent contributing factor in the examination and diagnosis process. Be sure to include the digital findings as a permanent part of the patient s clinical record to be considered as part of your foundational medical necessity. Pay special attention to the bulleted list in the Reference Tool that outlines all the possibilities of examination and diagnostic testing options. 2
3 Download and review the Support Tool titled, Functional Foot Examination. Whether you use a paper documentation system or EHR, consider using the suggested examination process provided to ensure medical necessity is established. Make sure that your internal processes and protocols allow for the suggested actions in the guide and foot examination to ensure that you always establish proper medical necessity for orthotics. Step 5: CPT, HCPCS, and ICD Coding When Billing for Orthotics The orthotics themselves are described using HCPCS codes. HCPCS stands for Healthcare Common Procedure Coding System. Durable Medical Equipment (DME) is usually best described using the HCPCS codes assigned. The patient s diagnosis is described using ICD codes (International Classification of Diseases) provided by the doctor. Appropriate diagnosis codes are found in the Medical Review Policy of the carrier you re attempting to bill as noted in Step 3 above. Review pages 5-7 in the Reference Tool titled, Billing and Coding for Functional Orthotics for an overview of coding for coverage and reimbursement of orthotics. Refer to the Medical Review Policy (MRP) for the carrier you re billing. Do they list the Diagnosis Codes approved? If the patient s assigned diagnosis is not in the MRP, you may still prescribe, but the orthotics will not be covered by the carrier. NOTE: Spinal diagnosis codes are rarely included with covered ICD codes for orthotics. Review page 15, Appendix B in the Reference Tool titled, Billing and Coding for Functional Orthotics for the proper coding for orthotics. This explanation helps to clarify why certain codes are assigned to various types of orthotics. NOTE: HCPCS codes L3010 and L3020 are the only 2 recommended codes when billing for Foot Leveler s orthotics, as they best meet the definitions. There are many other services that are ancillary to prescribing and dispensing orthotics in your office. Refer to pages 6-7 in the Reference Tool titled, Billing and Coding for Functional Orthotics for other CPT codes that may be utilized. Other services commonly performed include, E/M coding, X-ray, orthotic management and training and check-out, extra-spinal manipulation, and other ancillary treatment such as strapping and therapeutic exercises. NOTE: Practitioners may be able to use the Kiosk or 3D BodyView scanner as a tool to evaluate a new patient -- just as you would measure blood pressure and range of motion. Where the scan is taken on the same visit as E&M service, the CPT code for a scan is not separately billable. Repeated scans can be utilized to evaluate patient progress, where appropriate. Step 6: Billing Protocols and Processes for Submitting Orthotics for Payment The carrier always dictates billing protocols. They can and do vary from carrier to carrier. It s another reason why locating and understanding the carrier s MPR is vital to properly billing for orthotics. Review pages 8 and 9 in the Reference Tool titled, Billing and Coding for Functional Orthotics for an overview of general billing protocols for orthotics. Download and review the Fact Sheet titled, Billing Orthotics to Third Party Payers. Pay special attention to the diagrams that outline how the ICD and HCPCS codes are placed on the 1500 billing forms and the modifiers that may be used. 3
4 Step 7: Post-Ordering Processes: Dispensing and Check-Out Once the orthotics have been ordered an received back at the provider s office, we do not simply hand them to the patient with instructions to have a nice day. There are important processes that should be implemented to assist the patient with a favorable orthotics use and break in. Refer to pages 6 and 7 of the Reference Tool titled, Billing and Coding for Functional Orthotics. Review the descriptions of codes and Because these two codes are timed treatment codes, it s critical to understand the rules of coding according to time. Download and review the Fact Sheet titled, Guidelines for Timed Codes to better understand proper documentation and reporting of these and other timed codes. We recommend that you create a system or protocol for the day the orthotics are dispensed to the patient. If you use Electronic Health Record (EHR) documentation, you may wish to create a macro that outlines your usual note for the day, and then customize for each patient. Depending on what you do in this appointment, is the usual CPT code billed. Likewise, create a system or protocol as noted above, for what happens if the patient needs to have a check out for a problem encountered with the orthotics. Again, creating the system and the standard note ahead allows you to customize per patient and avoid creating from scratch for each patient. Step 8: Special Billing and Collections Circumstances There is an entire lesson devoted to dealing with orthotics when there is no insurance. However, there are also some situations that you may encounter when the patient does have insurance, but special circumstances apply. Watch the Rapid Tutorial titled, Understanding Payment Options for Orthotics. Pay special attention to the three types of patient situations you will encounter in your practice. Refer to pages 9 and 10 of the Reference Tool titled, Billing and Coding for Functional Orthotics. Here you ll find various situations that may be encountered that must be handled. Review these to determine whether they would ever apply to patients in your office. If your office participates with various third-party payers, you may find situations where the allowable fee schedule for orthotics may be below costs. You may be able to use the S1001 code to upcharge for a luxury item. Download and review the Fact Sheet titled, Proper Use of Code S1001-Luxury Item, Patient Aware for the steps necessary. Providers who prescribe Foot Levelers orthotics sometimes recommend an orthotic that is part of a shoe or sandal. Third-party payers may not allow for the cost of the shoe or sandal. Download and review the Fact Sheet titled, Billing for Orthotics in Shoes or Sandals and resolve to implement this system into the practice when dispensing shoes or sandals. Be very careful when accepting assignment for orthotics billed to a Personal Injury or Worker s Compensation carrier. The types of diagnoses usually covered for accidents would not often be medically necessary for orthotics. You are urged to seek pre-authorization for orthotics billed to either of these types of carriers before ordering and dispensing. Step 9: Final Collection Processes and Appeals Even after billing carefully and correctly, denials can happen. If you are out-of-network with the carrier, your patient is ultimately responsible for every penny up to the total of your actual charged fee. If you are in-network with the 4
5 carrier, the payment or explanation of benefits (EOB) will dictate whether you can pass additional costs on to the patient. Either way, make sure the carrier has paid all they are responsible for. Refer to pages 12 and 13 of the Reference Tool titled, Billing and Coding for Functional Orthotics. Sample letters of appeal and pre-authorization have been provided as templates for you to use if follow-up is necessary. Copy and customize these letters as master templates in your billing/collections system to have on hand if yo need to write a letter regarding orthotics to the carrier. As with any other service, if orthotics are denied or underpaid by a carrier, the EOB will outline patient responsibility. This will dictate whether you are able to pass the costs along to the patient or if you must continue to fight to get the service paid. Patients can make payments toward their balance in your office at any time, according to the practice s financial policy. Allowing your patient to pay a little at a time toward the balance is perfectly acceptable and helps your patient to afford orthotics if denied. Step 10: Implement Policy and Standard Operating Procedure Policies and procedures are a required element of every practice s compliance program. Since 2010, compliance programs are mandatory and should be implemented and maintained. We ve provided sample policy and starter procedure for you to customize for your program. If you do not have a required practice compliance program, please reach out to us to assist you by calling Download the Sample Policy titled, Billing Third-Party Payers for Orthotics. Customize it according to your office process, train your team on this policy, and add it to your final compliance program manual. Download the Support Tool titled, Sample SOP-Billing Third-Party Payers for Orthotics. We ve provided an outline of bullet points to prompt you to consider the steps that are necessary when billing for orthotics. Expand and personalize this SOP to provide complete, step-by-step process for billing orthotics in your practice. Best practice is to begin writing this the next time billing for orthotics takes place, so the team member doing the process simply writes it down as they go. If you need assistance with SOP construction, be sure to contact us at Train your team on the policy and procedure and ensure that the process is followed to maximize this activity. 5
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