OIG says that 23% of orthotic devices are medically questionable
By MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON - According to an inspection report released last week by the Department of Health and Human Services (HHS; Washington) Office of Inspector General (OIG), 30% of the 500 beneficiaries it recently sampled received one or more miscoded orthotic devices and 7% received one or more device that is medically unnecessary.
According to the OIG, another 16% received orthotics that are medically questionable. The OIG also found that the qualifications of orthotic suppliers vary, with non-certified suppliers the most likely to provide inappropriate devices.
The OIG's second inspection in this area followed up on its 1997 study of orthotics. "We found that carriers still lack specific guidelines that facilitate the payment of upper limb devices and hip devices," reported the OIG. "They do use procedures that focus on assuring the appropriateness of orthotic claims."
According to the OIG, the carriers believe that better documentation and improved coding would strengthen the orthotics billing process. The OIG recommended that the Health Care Financing Administration (HCFA; Washington) take steps to improve Medicare billing for orthotic devices and that it require standards for suppliers of custom-molded and custom-fabricated orthotic devices. It estimated that implementing these recommendations would eliminate as much as $43 million annually in inappropriate Medicare orthotics payments.
In a separate report, the OIG concluded that Medicare rates for orthotic body jackets coded L0430 exceeded the Medicaid rates by 21% across eight states. The OIG examined those rates under HCFA's inherent reasonableness authority and found that Medicare paid more for orthotic body jackets than Medicaid and Tricare while in another four states, the Medicare rates Medicare rates exceeded the Tricare rates by an average of 7.4%.
The report also showed that Medicare reimbursement rates allowed suppliers to mark-up orthotic body jackets from 54% to 832%. The OIG recommended that HCFA determine the appropriateness of Medicare allowed charges for orthotic body jackets, providing "reasonable profits" for suppliers.
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