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Reimbursement: Follow instructions closely for orthotics

Reimbursement: Follow instructions closely for orthotics

Noel NeilQ. Why are my orthotics claims denying?  

A. Prefabricated orthoses fall under two categories: OR02 custom fitted or OR03 off-the-shelf. There is no physical difference between the two. The differentiating factor is the adjustment needed at the time of fitting. For OTS, minimal self-adjustment by the beneficiary, caretaker or supplier is required but does not require the services of a certified orthotist. Custom fitted requires the expertise of a certified orthotist or an individual who has specialized training. The challenge is that there are custom-fitted orthotics that do not have a corresponding off-the-shelf equivalent HCPCS code.  

In 2021, Medicare published several articles addressing coding and edits for these orthoses. 

On May 25, 2021, Medicare announced additional payment edits for DMEPOS suppliers of custom fabricated and prefabricated (custom-fitted) orthotics. The article lists 21 states where the supplier must have a licensed/certified orthotist or prosthetist on file. 

The edits were turned on for dates of service on or after Oct. 1, 2021. In all the cases I have reviewed, the claims denied because the supplier had no intention of providing a custom-fabricated orthosis since they did not have OR02 selected on their 855s but since there is no physical difference in orthoses between the custom fitted and the OTS, they bill the code provided to them by the manufacturer. The good news is these denials can be corrected and prevented.  

On May 7, 2021, Medicare clarified the correct way to bill these custom-fitted codes as OTS. Specifically, the article states, “When there is not a corresponding prefabricated off-the-shelf HCPCS code for the HCPCS categorized as custom fitted orthotics.” The article listed several miscellaneous codes that must be used for billing. Suppliers must include a narrative with the claims, the HCPCS code of the item being provided, and OTS to indicate it is off-the-shelf, as well as the supplier’s retail price. 

Suppliers who followed this instruction have been successful at getting payment as OTS.  

Noel Neil JM, CDME, is vice president of corporate compliance and auditing for ACU-Serve. Reach him at 561.778.4454 or [email protected].


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