Reasonable Charge Update for 2007 for Splints, Casts, Dialysis Supplies, Dialysis Equipment, and Certain Intraocular Lenses

Provider Types Affected
Physicians, suppliers and providers billing Medicare carriers, Durable Medical Equipment Regional Carriers (DMERCs), DME Medicare Administrative Contractors (DME MACs), or Part A/B Medicare Administrative Contractors (A/B MACs) for splints, casts, dialysis supplies, dialysis equipment, and certain intraocular lenses.

Provider Action Needed
Physicians, suppliers and providers billing Medicare carriers, Durable Medical Equipment Regional Carriers (DMERCs), DME Medicare Administrative Contractors (DME MACs), or Part A/B Medicare Administrative Contractors (A/B MACs) for splints, casts, dialysis supplies, dialysis equipment, and certain intraocular lenses. Providers may want to be sure their billing staff knows of these changes.

Background
Payment continues to be made on a reasonable charge basis for splints, casts, dialysis supplies, dialysis equipment and intraocular lenses in calendar year 2007 as required by regulations contained in 42 CFR 405.501 (http://www.gpoaccess.gov/cfr/retrieve.html).

For splints and casts, Q-codes are to be used when supplies are indicated for cast and splint purposes. Current Procedural Terminology (CPT) codes should be used as indicated in the CPT section “Application of Casts and Strapping” for the specified CPT procedure codes in the 29XXX series. This payment is in addition to the payment made under the physician fee schedule for the procedure for applying the splint or cast.

For intraocular lenses, payment is only made on a reasonable charge basis for lenses implanted in a physician's office. Change Request (CR) 5282 instructs your carrier, DMERC, DME MAC, or A/B MAC to compute 2007 customary and prevailing charges for the V2630, V2631, and V2632 (Intraocular Lenses Implanted in a Physician's Office) using actual charge data from July 1, 2005, through June 30, 2006.

Carriers, and A/B MACs will compute 2007 Inflation-Indexed Charge (IIC) amounts for the V2630, V2631, and V2632 that were not paid using gap-filled payment amounts in 2006.

DMERCs and DME MACs will compute 2007 customary and prevailing charges for the codes identified in the following tables using actual charge data from July 1, 2005, through June 30, 2006. For these same codes, they will compute 2007 IIC amounts for the codes identified in the following tables that were not paid using gap-filled amounts in 2006.

These tables are:

Carriers and A/B MACs will make payment for splints and casts furnished in 2007 based on the lower of the actual charge or the payment limits established for these codes. Carriers, DMERCs and DME Medicare Administrative Contractors (MACs) to will use the 2007 reasonable charges or the same payment limits to pay claims for items furnished from January 1, 2007 through December 31, 2007. Those 2007 payment limits are in the table at the end of this article.

Additional Information
Instructions for calculating:

• Reasonable charges are located in chapter 23 (section 80) of the Medicare Claims Processing Manual (Pub. 100-04);



• Customary and prevailing charge are locate in section 80.2 and 80.4 of chapter 23 of the Medicare Claims Processing Manual (Pub 100-04); and



• The IIC (Inflation Indexed Charge) are located in section 80.6 of chapter 23 of the Medicare Claims Processing Manual (Pub. 100-04). The IIC update factor for 2007 is 4.3 percent.

You can find chapter 23 of the Medicare Claims Processing Manual (Pub. 100-04) at the following CMS website: http://www.cms.hhs.gov/manuals/downloads/clm104c23.pdf.

For complete details, please see the official instruction issued to your carrier, DMERC, DME MAC, or A/B MAC regarding this change. That instruction may be found at http://www.cms.hhs.gov/Transmittals/downloads/R1118CP.pdf on the CMS website.

If you have any questions, please contact your state's Provider Contact Center.

MLN Matters MM5382