OIG Report: LCDs Create Inconsistency in Medicare Coverage

on Tuesday, 14 January 2014. All News Items | Medicare Coverage

Regular readers of our weekly newsletter are likely aware that we publish a monthly article on updates to Medicare national and local coverage policies – NCDs and LCDs.  So it should be no surprise that I found the OIG report on LCDs very interesting and enlightening.  The OIG found that LCDs have significant influence on Medicare’s coverage of items and services.  They also found that due to inconsistency between the LCDs from various contractor regions, Medicare patients’ access to items and services can depend on geography as much as their clinical indications.

 

The OIG report studied Part B LCDs but Part A LCDs that apply to hospital services have similar characteristics.  Some basic facts concerning Local Coverage Determinations:

1)    they apply only in States within the contractor’s jurisdiction;

2)    they must follow all Medicare statutes, rulings, regulations and national coverage, payment and coding policies; and

3)    they may limit coverage of an item or service to a specific diagnosis or condition, or they may prohibit coverage of an item or service completely.

 

The OIG is not the only government entity that has weighed in on LCDs.  In 2001, the Medicare Payment Advisory Commission (MedPAC) recommended the elimination of LCDs and in 2003, the Government Accounting Office (GAO) reported LCDs resulted in inequitable variations in coverage.  The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) affected LCDs in two ways.  First, it replaced Fiscal Intermediaries (FIs) and Carriers with Medicare Administrative Contractors (MACs).  Medicare Contractor Reform is continuing to refine Medicare jurisdictions as it decreases the number of MACs.  Secondly, the MMA called for a plan to evaluate new LCDs for possible national application and to increase consistency among LCDs.

 

The OIG report looked at LCDs in October 2011 and still found problems with inconsistencies.  The OIG found that the presence of LCDs was unrelated to the cost and utilization of items and services, LCDs limited coverage for items and services differently across States, and they defined similar clinical topics inconsistently.  Due to these types of inconsistencies, coverage for a given service may be restricted in one State where an LCD is in place and completely unrestricted in another State where no LCD is in place.  Forty percent of procedures with no coverage allowed in one or more States had allowed charges in other States where LCDs did not prohibit coverage. This means Medicare patients in some States did not have access to items and services that had significant use among Medicare patients in other States.  The report also noted that the State-by-State differences in coverage created by LCDs are contrary to the growing practice of evidence-based medicine that eschews local variation.

 

Also the volume of affected services varied greatly between States.  LCDs affected coverage for over 50 percent of items and services in some States (California, North Carolina, South Carolina, and Virginia) and as few as 5 percent of items and services in other States (Alabama, Georgia, and Tennessee). Over a fifth of the LCDs in effect during the OIG review restricted coverage for items and services in only 3 States—Florida, Puerto Rico, and the Virgin Islands. Remember these findings were for Part B policies, but likely similar for Part A coverage also.

 

The OIG recommended that CMS:

Ø  Establish a plan to evaluate new LCDs for national coverage consistent with MMA requirements

Ø  Continue efforts to increase consistency among existing LCDs

Ø  Consider requiring MACs to jointly develop a single set of coverage policies

Although CMS agreed with all of the OIG’s recommendation, they believe their current workgroups and other initiatives are addressing these recommendations.  The OIG maintains that pursuing a single set of coverage policies would simplify and strengthen Medicare coverage policy while lessening the administrative burden of LCDs.  So are changes in the LCD process likely – that remains to be seen.  Until then, we trudge along…

 

Most of the LCD updates for this month are related to the CPT/HCPCS coding changes for 2014.  One change of note is the removal of two drugs (Cimzia and Simponi) from Cahaba GBA’s Self-Administered Drug (SAD) list.

 

 New and Revised Coverage Documents:

Service

MAC

Type

Policy #

Change

Comments

Date of Update

Effective Date

Billing and Coding – Clarification of the Proper Use and Billing of Adenosine Injections

Cahaba (J10)

Article

A51986

revised

HCPCS code update (J0151 replacing J0152)

1/7/2014

1/1/2014

Self-Administered Drug Exclusion List

Cahaba (J10)

Article

A48903

revised

Injection, certolizumab pegol, 1 mg (Cimzia®) and Injection, golimumab, (Simponi®) removed from SAD list

1/3/2014

12/31/2013

Drugs and Biologicals: Immune Globulin Intravenous (IVIG)

Cahaba (J10)

LCD

L30029

revised

HCPCS code update (J1556 replacing C9130)

12/31/2013

1/1/2014

Drugs and Biologicals: Zoledronic Acid

Cahaba (J10)

LCD

L30035

revised

HCPCS code update (J3489 replacing Q2051)

12/31/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment of Diabetic and Venous Stasis Ulcers of the Lower Extremities

Cahaba (J10)

LCD

L31428

revised

HCPCS code update (Q4137 – Q4138, Q4140 – Q4143, Q4146 – Q4148 added to list of codes not separately payable)

12/31/2013

1/1/2014

Drugs and Biologicals: Colony Stimulating Factors

Cahaba (J10)

LCD

L30026

revised

HCPCS code update (J1440 and J1441 deleted; J1442 and J1446 added)

12/17/2013

1/1/2014

Medicine: Speech Language Pathology – Outpatient

Cahaba (J10)

LCD

L30010

revised

HCPCS code update (92506 deleted; 92522 and 92523 added)

12/17/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment of Diabetic and Venous Stasis Ulcers of the Lower Extremities

Cahaba (J10)

LCD

L31428

revised

HCPCS code update (Q4137 – Q4138, Q4140 – Q4143, Q4146 – Q4148, C9364-C9366, C9368-C9369 added to list of codes not separately payable)

12/17/2013

1/1/2014

Self-Administered Drug Exclusion List

Cahaba (J10)

Article

A48903

revised

HCPCS code update (J0717 replacing J0718)

12/17/2013

1/1/2014

Drugs and Biologicals: Colony Stimulating Factors

Cahaba (J10)

LCD

L30026

revised

Adding HCPCS code J1446 and covered diagnosis codes

12/12/2013

1/1/2014

Pharmacogenomic Testing for Warfarin Response

Cahaba (J10)

Article

A52652

NEW

Local Coverage Article for NCD

12/12/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment

Cahaba (J10)

LCD

L31428

revised

clarification of ulcer type addressed by this LCD

12/12/2013

1/1/2014

Bariatric Surgery for Treatment of Co-Morbid Conditions Related to Morbid Obesity

Cahaba (J10)

Article

A48897

revised

Update based on updated NCD

12/12/2013

9/24/2013

Injectable Collagenase Clostridium Histolyticum for Dupuytren's Contracture

Novitas (JL)

Article

A50801

retired

 

1/9/2014

10/31/2013

Serotypes A and B Botulinum Toxin Products

Novitas (JL)

Article

A47789

retired

 

1/9/2014

1/8/2014

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JL)

LCD and Articles

 

revised

L27474 - Blepharoplasty/Blepharoptosis
DL34396 - Surgery: Blepharoplasty
L27503 - Moh’s Micrographic Surgery
L27514 - Psychiatric Therapeutic Procedures
A49815 - Psychiatric Therapeutic Procedures
L27531 - Speech-Language Pathology (SLP) Services: Communication Disorders
L27547 - Wound Care
A47793 - Wound Care
DL27547 - Wound Care and Bioengineered Skin Substitutes
L27548 - Acute Care: Inpatient, Observation, and Treatment Room Services
A47796 - Acute Care: Inpatient, Observation, and Treatment Room Services
L29547 - Electromyography (EMG) and Nerve Conduction Studies
L31187 - Cardiovascular Nuclear Medicine

1/2/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JL)

LCD and Articles

 

revised

L31686 - Services That Are Not Reasonable and Necessary
L32465 - Hemodialysis Access Evaluation & Maintenance
DL32465 - Hemodialysis Access Evaluation & Maintenance
L32559 - Lipid Profile/Cholesterol Testing
L32573 - Pain Management of Peripheral Nerves by Injection
L32937 - Intravenous Immune Globulin (IVIG)
L33142 - Biomarkers for Oncology
A52316 - Biomarkers for Oncology
L33640 - Biomarkers Overview
L33658 - Hemophilia Factor Products
DL33658 - Hemophilia Factor Products
DL34355 - Glaucoma Treatment with Aqueous Drainage Device
A47797 - Approved Drugs and Biologicals; Includes Cancer Chemotherapeutic Agents

1/2/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JH)

LCD and Articles

 

revised

L32603 - Interventional Cardiology
L32622 - Bioengineered Skin Substitutes
L32635 - Cardiovascular Nuclear Medicine
L32641 - Non-Coronary Vascular Stents
L32681 - Upper Gastrointestinal Endoscopy
L32687 - WOUND CARED
L32687 - WOUND CARE
L32691 - CATEGORY III CODES
L32705 - Psychiatric PHP Programs
L32708 - Vascular Access for Hemodialysis
DL32708 - Vascular Access for Hemodialysis
L32709 - Diagn Abd Aortography and Renal Angio
L3212 - INTRAVENOUS IMMUNE GLOBULIN

1/3/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JH)

LCD and Articles

 

revised

L32715 - BLEPHAROPLASTY
DL32715 - BLEPHAROPLASTY
L32723 - Nerve Conduction/EMG Studies
L32731 - Frequency of Laboratory Tests
L32733 - Glaucoma Tx/Aqueous Drainage Device
L32735 - Hemophilia Factor Products
L32756 - THROMBOLYTIC AGENTSL32763 - Cosmetic and Reconstructive Surgery
L32766 - PSYCHIATRIC CODES
L33138 - Biomarkers for Oncology
A52317 - Biomarkers for Oncology
L33638 - Biomarkers Overview
L33604 - Pain Management of Peripheral Nerves by Injection
A51866 - Self Administered Drug Exclusion List

1/3/2014

1/1/2014 (available for review 2/13/14)

Laparoscopic Sleeve Gastrectomy for Severe Obesity

Palmetto (J11)

LCD

L32975

revised

Update based on updated NCD

1/2/2014

1/9/2014

Cardiac Output Measurement Thoracic Electrical Bioimpedance

Palmetto (J11)

LCD

L31586

revised

Numerous minor revisions

12/5/2013

12/12/2013

Colony Stimulating Factors

Palmetto (J11)

LCD

L31574

revised

Numerous minor revisions

12/5/2013

12/12/2013

Billing and Coding – Clarification of the Proper Use and Billing of Adenosine Injections

Cahaba (J10)

Article

A51986

revised

HCPCS code update (J0151 replacing J0152)

1/7/2014

1/1/2014

Self-Administered Drug Exclusion List

Cahaba (J10)

Article

A48903

revised

Injection, certolizumab pegol, 1 mg (Cimzia®) and Injection, golimumab, (Simponi®) removed from SAD list

1/3/2014

12/31/2013

Drugs and Biologicals: Immune Globulin Intravenous (IVIG)

Cahaba (J10)

LCD

L30029

revised

HCPCS code update (J1556 replacing C9130)

12/31/2013

1/1/2014

Drugs and Biologicals: Zoledronic Acid

Cahaba (J10)

LCD

L30035

revised

HCPCS code update (J3489 replacing Q2051)

12/31/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment of Diabetic and Venous Stasis Ulcers of the Lower Extremities

Cahaba (J10)

LCD

L31428

revised

HCPCS code update (Q4137 – Q4138, Q4140 – Q4143, Q4146 – Q4148 added to list of codes not separately payable)

12/31/2013

1/1/2014

Drugs and Biologicals: Colony Stimulating Factors

Cahaba (J10)

LCD

L30026

revised

HCPCS code update (J1440 and J1441 deleted; J1442 and J1446 added)

12/17/2013

1/1/2014

Medicine: Speech Language Pathology – Outpatient

Cahaba (J10)

LCD

L30010

revised

HCPCS code update (92506 deleted; 92522 and 92523 added)

12/17/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment of Diabetic and Venous Stasis Ulcers of the Lower Extremities

Cahaba (J10)

LCD

L31428

revised

HCPCS code update (Q4137 – Q4138, Q4140 – Q4143, Q4146 – Q4148, C9364-C9366, C9368-C9369 added to list of codes not separately payable)

12/17/2013

1/1/2014

Self-Administered Drug Exclusion List

Cahaba (J10)

Article

A48903

revised

HCPCS code update (J0717 replacing J0718)

12/17/2013

1/1/2014

Drugs and Biologicals: Colony Stimulating Factors

Cahaba (J10)

LCD

L30026

revised

Adding HCPCS code J1446 and covered diagnosis codes

12/12/2013

1/1/2014

Pharmacogenomic Testing for Warfarin Response

Cahaba (J10)

Article

A52652

NEW

Local Coverage Article for NCD

12/12/2013

1/1/2014

Surgery: Bioengineered Skin Substitutes (BSS) for the Treatment

Cahaba (J10)

LCD

L31428

revised

clarification of ulcer type addressed by this LCD

12/12/2013

1/1/2014

Bariatric Surgery for Treatment of Co-Morbid Conditions Related to Morbid Obesity

Cahaba (J10)

Article

A48897

revised

Update based on updated NCD

12/12/2013

9/24/2013

Injectable Collagenase Clostridium Histolyticum for Dupuytren's Contracture

Novitas (JL)

Article

A50801

retired

 

1/9/2014

10/31/2013

Serotypes A and B Botulinum Toxin Products

Novitas (JL)

Article

A47789

retired

 

1/9/2014

1/8/2014

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JL)

LCD and Articles

 

revised

L27474 - Blepharoplasty/Blepharoptosis
DL34396 - Surgery: Blepharoplasty
L27503 - Moh’s Micrographic Surgery
L27514 - Psychiatric Therapeutic Procedures
A49815 - Psychiatric Therapeutic Procedures
L27531 - Speech-Language Pathology (SLP) Services: Communication Disorders
L27547 - Wound Care
A47793 - Wound Care
DL27547 - Wound Care and Bioengineered Skin Substitutes
L27548 - Acute Care: Inpatient, Observation, and Treatment Room Services
A47796 - Acute Care: Inpatient, Observation, and Treatment Room Services
L29547 - Electromyography (EMG) and Nerve Conduction Studies
L31187 - Cardiovascular Nuclear Medicine

1/2/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JL)

LCD and Articles

 

revised

L31686 - Services That Are Not Reasonable and Necessary
L32465 - Hemodialysis Access Evaluation & Maintenance
DL32465 - Hemodialysis Access Evaluation & Maintenance
L32559 - Lipid Profile/Cholesterol Testing
L32573 - Pain Management of Peripheral Nerves by Injection
L32937 - Intravenous Immune Globulin (IVIG)
L33142 - Biomarkers for Oncology
A52316 - Biomarkers for Oncology
L33640 - Biomarkers Overview
L33658 - Hemophilia Factor Products
DL33658 - Hemophilia Factor Products
DL34355 - Glaucoma Treatment with Aqueous Drainage Device
A47797 - Approved Drugs and Biologicals; Includes Cancer Chemotherapeutic Agents

1/2/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JH)

LCD and Articles

 

revised

L32603 - Interventional Cardiology
L32622 - Bioengineered Skin Substitutes
L32635 - Cardiovascular Nuclear Medicine
L32641 - Non-Coronary Vascular Stents
L32681 - Upper Gastrointestinal Endoscopy
L32687 - WOUND CARED
L32687 - WOUND CAREL
32691 - CATEGORY III CODES
L32705 - Psychiatric PHP Programs
L32708 - Vascular Access for Hemodialysis
DL32708 - Vascular Access for Hemodialysis
L32709 - Diagn Abd Aortography and Renal Angio
L3212 - INTRAVENOUS IMMUNE GLOBULIN

1/3/2014

1/1/2014 (available for review 2/13/14)

CPT/HCPCS Code Updates for 2014 - Various policies

Novitas (JH)

LCD and Articles

 

revised

L32715 - BLEPHAROPLASTY
DL32715 - BLEPHAROPLASTY
L32723 - Nerve Conduction/EMG Studies
L32731 - Frequency of Laboratory Tests
L32733 - Glaucoma Tx/Aqueous Drainage Device
L32735 - Hemophilia Factor Products
L32756 - THROMBOLYTIC AGENTS
L32763 - Cosmetic and Reconstructive Surgery
L32766 - PSYCHIATRIC CODES
L33138 - Biomarkers for Oncology
A52317 - Biomarkers for Oncology
L33638 - Biomarkers Overview
L33604 - Pain Management of Peripheral Nerves by Injection
A51866 - Self Administered Drug Exclusion List

1/3/2014

1/1/2014 (available for review 2/13/14)

Laparoscopic Sleeve Gastrectomy for Severe Obesity

Palmetto (J11)

LCD

L32975

revised

Update based on updated NCD

1/2/2014

1/9/2014

Cardiac Output Measurement Thoracic Electrical Bioimpedance

Palmetto (J11)

LCD

L31586

revised

Numerous minor revisions

12/5/2013

12/12/2013

Colony Stimulating Factors

Palmetto (J11)

LCD

L31574

revised

Numerous minor revisions

12/5/2013

12/12/2013

Polices and articles can be viewed on the Medicare Coverage Database by entering the policy number in the Document ID search.

Article by Debbie Rubio

Debbie Rubio, BS, MT (ASCP), is the Manager of Regulatory Affairs and Compliance at Medical Management Plus, Inc.  Debbie has over twenty-seven years of experience in healthcare including nine years as the Clinical Compliance Coordinator at a large multi-facility health system.  In her current position, Debbie monitors, interprets and communicates current and upcoming regulatory and compliance issues as they relate to specific entities concerning Medicare and other payers.  You may contact Debbie at This email address is being protected from spambots. You need JavaScript enabled to view it. .

This material was compiled to share information.  MMP, Inc. is not offering legal advice.  Every reasonable effort has been taken to ensure the information is accurate and useful.

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