Billing: Follow new rules for diabetes test supplies

Q. What do I need to know about furnishing diabetes testing supplies starting July 1?
Friday, June 21, 2013

A. The national mail-order competition includes all ZIP codes in all parts of the United States, as well as the District of Columbia, Puerto Rico, US Virgin Islands, Guam and American Samoa. This means that unless you won the bid, you will not be able to supply diabetic testing supplies to Medicare beneficiaries unless they personally come and pick the supplies up from you. The most common misconception is that “mail order” means that it is mailed, but they consider this as shipped or delivered to the beneficiary’s residence regardless of the method of delivery.   

The Medicare-approved amount for diabetic testing supplies will be the same regardless of where the supplies are furnished. Whether you are a contract supplier or non-contract supplier, the reimbursement is the same. The contract suppliers must always accept the Medicare approved amount as payment in full and cannot charge more than the 20% coinsurance and any unmet deductible. If you are not a contract supplier and a patient picks up the items, you are not held to this rule. You have the option to file the claim unassigned and have the patient pay more than the 20% coinsurance and any unmet deductible.

If you furnish diabetic testing supplies on a mail-order basis, you must use the KL modifier. If this mail-order modifier is not attached, you could be subject to penalties.

I also want to point out that contract suppliers are not able to ask the beneficiary to switch their glucose monitors. This is called the anti-switching rule. This rule requires contract suppliers to furnish the brand of testing supplies that works with the beneficiary’s monitor. If they do not carry that brand, the patient can ask about alternative brands it offers. The supplier cannot initiate this conversation.

Here is where it gets interesting and where I foresee problems come July:  

If the contract supplier does not ordinarily furnish the specific brand or mode of delivery and cannot obtain a revised prescription or locate another contract supplier that will furnish the needed item, the contract supplier must furnish the item as prescribed.

Kelly Wolfe is president of Regency Billing and Consulting. Reach her at or 727-286-6102.