CMS ready to roll with prior authorizations

Thursday, December 31, 2015

BALTIMORE – CMS is moving forward with its plans to implement a prior authorization process for certain DME and stakeholders say it should make life easier for providers.

“The fact of the matter is, the items that are going to be subject to prior auths are already under prepay review in one form or another,” said Andrea Stark, a reimbursement consultant with MiraVista. “Anything that mitigates supplier risk and financial liability is, in my book, a positive thing.”

The rule was published Dec. 30 in the Federal Register, and additional sub-regulatory guidance will be published with specific details, inlcuding when prior auths will be implemented. CMS has a “master list” of 135 codes that could be subject to prior auths. Specifically, that means items with an average purchase fee of $1,000 or greater, or an average rental fee of $100 or greater, (adjusted annually for inflation) and are considered high utilization.

The list includes CPAP (E0601), semi-electric hospital beds (E0260), manual wheelchairs (K0004) and—a new addition—oxygen concentrators (E1390).

Inclusion on the master list doesn’t mean the code will automatically be subject to prior auths, says Stark, who “guesstimates” CMS will move forward with about 25% of the codes to start.

“The list is there to give them flexibility,” she said. “I think they will start small because they’ve got to ramp up resources and phase in the categories. They are vested in making sure this process works.”

CMS will publish the final list of codes in the Federal Register.

CMS first tested the waters with prior auths with a seven-state demonstration project for power mobility devices. While the success of the demo, which was expanded to 12 additional states in 2014 and then extended in August 2015, underlines the value of the prior auth process, there has been concern that other product categories, like oxygen, could require quicker approvals.

In its announcement, CMS says either the agency or the review contractor will “make a reasonable effort” to issue a determination within 10 business days, which it states is a “maximum timeframe” that can be adjusted downward. CMS says there will also be an “expedited” review process for cases where the standard timeframe is harmful to the beneficiary.

CMS is aware of the need for faster turnaround times in certain cases, says Stark.

“CMS will monitor this very closely and if modifications are required, they will make them,” she said.