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Reimbursement for Sleep Therapeutics
"Quick Guides" to Coding, Coverage and Payment
To view our Quick Guide for Coding, Coverage and Payment for CPAP and Accessories **,
please click here. To view our Quick Guide for Coding, Coverage and Payment
for Respiratory Assist Devices **,
please click here. To view our DreamFit® Nasal Mask Coding, Coverage and Payment Matrix
Guide **,
please click here.
**
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What's New?
Medicare News
FOR IMMEDIATE RELEASE
CMS Office of External Affairs
January 26, 2006
CMS revises payment classification of certain respiratory assist devices. Change will improve payment
accuracy and reduce beneficiary costs.
The cost of certain medical devices to help Medicare patients breathe will be reduced as a result of actions
taken today by the Centers for Medicare & Medicaid Services (CMS).
Under a final rule issued today, certain respiratory assist devices (RADs) will no longer be considered
durable medical equipment (DME) requiring frequent and substantial servicing for payment purposes, but
will be reclassified as capped rental DME items effective April 1, 2006. The rule applies to those RADs
that have a backup rate feature that delivers air pressure whenever the user's spontaneous breathing
efforts are insufficient. With this action, Medicare beneficiaries will be paying less out-of-pocket for
the use of the equipment.
Currently, beneficiaries must pay up to $128 per month in coinsurance for as long as the respiratory device
is being used. Under the new rule, that coinsurance amount will decrease to $96 a month, beginning with the
fourth month of rental. After 13 months of rental the beneficiary may take over ownership of the device and
will no longer have to pay any coinsurance on the rental of the device.
The Medicare program will also save under this rule, in that the monthly rental payments will be reduced with
the fourth month of rental and will stop altogether after 13 months when title for the equipment transfers
from the supplier to the beneficiary.
Since 1992, RADs that have a backup rate feature have been paid by Medicare on a continuous monthly rental
basis for as long as the beneficiary uses this device. The Health and Human Services Inspector General found
that the RADs do not require frequent service to justify continuous rental payments. Under the new rule,
beneficiaries using RADs may elect to take over ownership of the equipment after renting it for 13 months.
The rule also allows for a transition period for devices which are currently being rented to Medicare
beneficiaries so that rental months paid prior to April 1, 2006 will not count toward the rental payment cap.
"Medicare is committed to paying the right amount for the devices and equipment provided to its
beneficiaries," said CMS Administrator Mark B. McClellan, M.D., Ph.D. "We are helping people with
Medicare get the highest quality care and treatments at lower costs, ultimately lowering the costs for the
Medicare programs."
RADs are used by patients who have difficulty breathing. The RAD delivers variable levels of air pressure
to help spontaneous respiratory efforts and supplement the volume of air in a patient's lungs. RADs
with a back-up rate feature also deliver the air pressure whenever sufficient spontaneous inhalation fails
to occur. Maintaining a RAD generally requires replacing masks, changing filters, and other routine tasks,
rather than the frequent and substantial servicing, which may include dismantling, cleaning and recalibrating
equipment by skilled technicians. Under the Medicare law, all RADs are excluded from the DME payment category
that pays indefinite rental payments for items that require frequent and substantial servicing. Medicare will
continue to pay 80 percent and the beneficiary will pay 20 percent of the Medicare allowed payment amount for
maintenance for the equipment after the rental payments ends.
While other types of RADs have been paid correctly as capped rental devices, the RADs with a timed backup
feature were incorrectly categorized and paid under the payment category for items that require frequent and
substantial servicing. As a result, both Medicare and the beneficiary have been liable for rental payments and
copayments long after the total payments surpassed the purchase price of the device. However, Medicare still
pays more than cost for these devices.
This final rule, which will be published in the January 27, 2006 Federal Register, will apply to claims
received on or after April 1, 2006. In the cases where beneficiaries received these items prior to April 1,
2006, only the rental payments for months after the effective date will count toward the 13 month cap.
Note: For more information, see the CMS website: www.cms.hhs.gov.
General Information
Sleep therapy products (CPAP, bi-level devices, humidifiers
and interfaces) are generally dispensed by durable medical equipment (DME)
providers. They may also be dispensed from sleep laboratories,
either hospital-based or freestanding.
Sleep Laboratories
Sleep laboratories customarily provide sleep diagnostic testing services.
They may also dispense sleep therapy devices to Medicare and non-Medicare
patients who meet qualifying criteria. Stark Law limitations (in addition
to other laws) apply to sleep laboratories (whether hospital outpatient
or freestanding) that dispense sleep therapy equipment to Medicare and
Medicaid patients who have undergone sleep diagnostic testing at that
laboratory. Other “self-referral” limitations (included under state law)
may apply to sleep laboratories that wish to dispense sleep therapeutic
devices. The sleep lab should seek advice from qualified healthcare legal
counsel regarding self-referral issues for all patients prior to dispensing
sleep therapy devices to these patients.
A sleep laboratory that wishes to dispense durable medical equipment such
as sleep therapy devices, must obtain a supplier billing number from the National
Supplier Clearinghouse and/or the National Plan and Provider Enumeration
System (NPPES). The sleep laboratory will bill for sleep therapeutic devices
on the CMS (formerly HCFA)-1500 form. Payment for these devices may be made to
the dispensing agency (if the patient authorizes their insurance company to make
payment directly to the health care provider) or to the patient.
Durable Medical Equipment Providers
A licensed DME provider may dispense sleep therapy devices to
Medicare and non-Medicare patients who meet qualifying criteria.
Claims are submitted on the CMS (HCFA)-1500 form. Payment for the
devices may be made to the dispensing agency, if the patient authorizes
their insurance company to make payment directly to the health care
provider, or to the patient.
National Coverage Determination - CPAP
(Source: Medicare Coverage Issues Manual 60-17, Continuous Positive Airway Pressure)
CPAP is a non-invasive technique for providing low levels of air pressure from
a flow generator, via a nose mask, through the nares. The purpose is to prevent
the collapse of the oropharyngeal walls and the obstruction of airflow during
sleep, which occurs in obstructive sleep apnea (OSA).
The use of CPAP devices are covered under Medicare when ordered and prescribed by
the licensed treating physician to be used in adult patients with OSA if either of
the following criteria using the Apnea-Hyopopnea Index (AHI) are met:
- AHI = 15 events per hour, or
- AHI = 5 to 14 events per hour with documented symptoms of excessive daytime
sleepiness, impaired cognition, mood disorders or insomnia, or documented hypertension,
ischemic heart disease or history of stroke.
The AHI is equal to the average number of episodes of apnea and hyponea per hour and must be
based on a minimum of 2 hours of sleep recorded by polysomnography using actual recorded hours
of sleep (i.e. the AHI may not be extrapolated or projected).
The polysomnography must be performed in a facility – based sleep study laboratory, and
not in the home or in a mobile facility.
DMERC Regional CPAP Policy
(Source: CIGNA Government Services Medical Policy, Region D, Durable Medical Equipment
Regional Carrier [DMERC] – CPAP coverage policies are consistent from region
to region)
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Coding Information
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CPT/HCPS Codes
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The appearance of a code in this section does not necessarily indicate coverage.
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HCPCS MODIFIERS:
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EY - No physician or other health care provider order for this items or service.
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KX - Specific required documentation on file.
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EQUIPMENT
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E0601
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CONTINUOUS AIRWAY PRESSURE (CPAP) DEVICE
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ACCESSORIES
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A7030
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FULL FACE MASK USED WITH POSITIVE AIRWAY PRESSURE DEVICE, EACH
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A7031
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FACE MASK INTERFACE, REPLACEMENT FOR FULL FACE MASK, EACH
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A7032
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REPLACEMENT CUSHION FOR NASAL APPLICATION DEVICE, EACH
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A7033
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REPLACEMENT PILLOWS FOR NASAL APPLICATION DEVICE, PAIR
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A7034
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NASAL INTERFACE (MASK OR CANNULA TYPE) USED WITH POSITIVE AIRWAY PRESSURE DEVICE, WITH OR WITHOUT HEAD STRAP
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A7035
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HEADGEAR USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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A7036
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CHINSTRAP USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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A7037
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TUBING USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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A7038
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FILTER, DISPOSABLE, USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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A7039
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FILTER, NON DISPOSABLE, USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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A7044
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ORAL INTERFACE USED WITH POSITIVE AIRWAY PRESSURE DEVICE, EACH
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A7045
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EXHALATION PORT WITH OR WITHOUT SWIVEL USED WITH ACCESSORIES FOR POSITIVE AIRWAY DEVICES, REPLACEMENT ONLY
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A7046
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WATER CHAMBER FOR HUMIDIFIER, USED WITH POSITIVE AIRWAY PRESSURE DEVICE, REPLACEMENT, EACH
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E0561
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HUMIDIFIER, NON-HEATED, USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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E0562
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HUMIDIFIER, HEATED, USED WITH POSITIVE AIRWAY PRESSURE DEVICE
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| ICD-9 Codes that Support Medical Necessity |
Not specified. |
| Diagnoses that Support Medical Necessity |
Not specified.
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ICD-9 Codes that DO NOT Support Medical Necessity
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Not specified.
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ICD-9 Codes that DO NOT Support Medical Necessity Asterisk Explanation
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Not specified.
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Diagnoses that DO NOT Support Medical Necessity
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Not specified.
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General Information
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| Documentation Requirements |
Section 1833(e) of the Social Security Act precludes payment to any provider of
services unless "there has been furnished such information as may be necessary in
order to determine the amounts due such provider" (42 U.S.C. section 1395l(e)). It
is expected that the patient’s medical records will reflect the need for the care
provided. The patient’s medical records include the physician’s office records,
hospital records, nursing home records, home health agency records, records from
other healthcare professionals and test reports. This documentation must be available
to the DMERC upon request.
An order for each item billed must be signed and dated by the treating physician,
kept on file by the supplier, and made available to the DMERC upon request. Items
billed to the DMERC before a signed and dated order has been received by the supplier
must be submitted with an EY modifier added to each affected HCPCS code.
When billing for quantities of supplies greater than those described in the policy
as the usual maximum amounts, each claim must include documentation supporting the
medical necessity for the higher utilization. This information must be attached to
a hard copy claim or entered into the narrative field of an electronic claim.
Additionally, there must be clear documentation in the patient’s medical records
that corroborate the order and any additional documentation that pertains to the
medical necessity of the items and quantities billed.
Proper use of the KX modifier is discussed below. The KX modifier must not be used
on claims submitted to the DMERC until the requirements outlined in the documentation
section have been met.
INITIAL COVERAGE (FIRST THREE MONTHS):
On claims for the first through third months, suppliers must add a KX modifier to
codes for equipment (E0601) and accessories only if all of the criteria in the
“Indications and Limitations of Coverage and/or Medical Necessity” section of this
policy ("Initial Coverage") have been met. If the requirements for the KX modifier
are not met, the supplier may submit additional documentation with the claim to
justify coverage, but the KX modifier must not be used.
CONTINUED COVERAGE BEYOND THE FIRST THREE MONTHS OF THERAPY:
On the fourth month’s claim (and any month thereafter), the supplier must add a KX
modifier to codes for equipment (E0601) and accessories only if both the "Initial
Coverage" criteria and the "Continued Coverage" criteria in the “Indications and
Limitations of Coverage and/or Medical Necessity” section of this policy have been
met. Suppliers must maintain documentation in their records that these criteria have
been met and this must be available to the DMERC upon request.
If the supplier does not obtain information that the beneficiary is continuing to use
the CPAP device in time for submission of the fourth or succeeding months’ claims, the
supplier may still submit the claims, but a KX modifier must not be added. However, if
the supplier chooses to hold claims for the fourth and succeeding months until they
determine that the beneficiary is continuing to use the device, those claims may then
be submitted with the KX modifier.
Refer to the Supplier Manual for more information on documentation requirements.
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Utilization Guidelines
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Refer to Indications and Limitations of Coverage and/or Medical Necessity.
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| Other Comments |
DEFINITIONS:
A respiratory cycle is defined as an inspiration, followed by an expiration.
Polysomnography is the continuous and simultaneous monitoring and recording of various
physiological and pathophysiological parameters of sleep with physician review,
interpretation, and report. It must include sleep staging, which is defined to include
a 1-4 lead electroencephalogram (EEG), and electro-oculogram (EOG), and a submental
electromyogram (EMG). It must also include at least the following additional parameters
of sleep: airflow, respiratory effort, and oxygen saturation by oximetry. It may be performed
as either a whole night study for diagnosis only or as a split night study to diagnose and
initially evaluate treatment.
Apnea is defined as the cessation of airflow for at least 10 seconds documented on a polysomnogram.
Hypopnea is defined as an abnormal respiratory event lasting at least 10 seconds associated
with at least a 30% reduction in thoracoabdominal movement or airflow as compared to baseline,
and with at least a 4% decrease in oxygen saturation.
The apnea-hypopnea index (AHI) is defined as the average number of episodes of apneas and
hypopneas per hour of sleep. The polysomnogram must be based on a minimum of two hours of
recording time without the use of a positive airway pressure device, reported by polysomnogram.
The AHI may not be extrapolated or projected. For example, the total recording time off of
a device for the polysomnogram is 150 minutes of which 60 minutes are spent in sleep. During
those 150 minutes, the patient experienced 10 apneas and 20 hypopneas. The polysomnogram is
considered valid because it meets the two hour minimum requirement for total recording time
(150 minutes = 2.5 hours). The AHI is calculated using the 1 hour of sleep (60 minutes = 1
hour) and dividing that number into the 30 total respiratory events (10 apneas + 20
hypopneas = 30 events). The resultant AHI is 30 (30 events divided by 1 hour = 30).
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Revision History Number
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CPAP008
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HCPCS Coding and Medicare Payment Guidelines
For payment information, click on code.
| HCPCS Code* | Description | Frequency of Replacement
(as medically necessary) |
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A7032
| Replacement cushion for nasal interface. | Limit two per month |
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A7033
| Replacement pillows for nasal interface, pair. | Limit one per month |
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A7034
| Nasal interface, mask or cannula type, used with CPAP. | Limit one per 3 months |
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A7035
| Headgear used with CPAP. | Limit one per 6 months |
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A7036
| Chin Strap used with CPAP. | Limit one per 6 months |
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A7037
| Tubing for CPAP. | Limit one per month |
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A7038
| Filter, disposable, used with CPAP. | Limit two per month |
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A7039
| Filter, nondisposable, used with CPAP. | Limit one per 6 months |
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A7046
| Replacement water chamber for humidifier, each | Not specified |
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A9999
| Misc. supply or accessory. | For CPAP accessories with no unique code, such as replacement hose guide, swivel connector, etc. |
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E0561
| Humidifier, non-heated, used with positive airway pressure device. | Usually purchased |
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E0562
| Humidifier, heated, used with positive airway pressure device. | Usually purchased |
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E0601
| Continuous Positive Airway Pressure (CPAP) device. | N/A |
* Existence of coding does not guarantee coverage or payment for any procedure by any payer. Medical necessity
for the procedure must be established by the patient's physician in accordance with specific payer guidelines.
Coding for Auto-Titrating CPAP Units
Coverage and coding for autotitrating CPAP units is currently the same as coding
and coverage for conventional CPAP, using HCPCS code E0601.
Coverage Guidelines for Bilevel Devices
Medicare’s Respiratory Assist Devices policy states that bilevel devices without
a backup rate (E0470 devices) may be covered for patients with a diagnosis of
obstructive sleep apnea if CPAP has been "tried and proven ineffective."
Medicare Durable Medical Equipment Regional Carrier (DMERC) Payer Links
- Region A (HealthNow NY, Inc): CT, DE, MA, ME, NH, NJ, NY, PA, RI, VT
- Region B (AdminaStar Federal Medicare): DC, IL, IN, MD, MI, MN, OH, VA, WV, WI
- Region C (Palmetto Government Benefits Administrator): AR, CO, FL, GA, KY, LA, MS, NC, NM, OK, SC, TN, TX
- Region D (CIGNA Government Services): AL, AZ, CA, HI, ID, IA, KS, MO, MT, ND, NE, NV, OR, SD, UT, WA, WY
CPT Only® 2004 American Medical Association All Rights Reserved.
Existence of coding does not guarantee coverage or payment for any procedure by any payer.
Medical necessity for the procedure must be established by the patient's physician in accordance with specific payer guidelines.
The information that is being provided is for general information and should not be relied upon as definitive or comprehensive. All coding information is related to Medicare claims only. Medicaid agencies may utilize their own coding systems. Coverage rules may change from time to time. When seeking definitive information regarding coding or reimbursement it is always best to confer with your local Medicare office.
For additional information, contact our Reimbursement Department at 1-800-645-2891.
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