Physician Practice

The brave new world of Medicare preauthorization

Physician Practice Insider, January 12, 2016

On December 30, 2015, CMS published a final rule that establishes a prior authorization program for certain Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) items. The goal of the prior authorization program is to ensure that the DMEPOS items are provided in a manner consistent with Medicare coverage, coding, and payment rules and to prevent unnecessary utilization while safeguarding beneficiaries’ access. The effective date of the regulations is February 29.

In 2014, there were about 37.5 million beneficiaries in the Medicare program and approximately one-third of these beneficiaries, or 10 million individuals, had a DMEPOS claim. Approximately 90,000 DME suppliers provided the DMEPOS items to the beneficiaries. The CERT program reviewed supplier claims in 2014 and reported that approximately $5.1 billion, or 51% of these claims, were improperly paid for DMEPOS items, according to the final rule. Furthermore, 92% of the improper payments were due to insufficient documentation. CMS provides this background as a powerful reason to nationalize the demonstration program.

This article was originally published on Medicare Compliance Watch. Subscribers can access the full article here.

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