Overcoming Obstacles to Care
As with all financial aspects of care and treatment, sometimes prescribing functional orthotics for your patients doesn’t align with their health insurance coverage or an in-network agreement the provider is bound to follow. This page covers several scenarios that are commonly encountered by practices when ordering and dispensing functional orthotics.
Your Patient’s Insurance is Medicare Part B
Medicare Part B has specific rules for limited orthotics coverage through their Durable Medical Equipment (DME) benefits. Orthotic inserts are covered by Medicare only when placed in a shoe attached to a brace. Foot Levelers functional orthotics are usually not placed in a shoe attached to a brace, and, therefore, are a non-covered service under Medicare. Dispensing providers must have a registration with Medicare to bill as a DME supplier and received a prescription from an authorized provider. Chiropractors may not order or deliver these types of equipment under their own prescription through Medicare DME.
When services are excluded under Medicare, such as orthotics ordered by a Chiropractor, the patient is responsible for the full fee for the item or service. Providers should follow their usual Voluntary Advance Beneficiary process for advance notice using whatever form is in place in the office. The patient can and will pay for these important functional orthotics.
If your Medicare Part B patient has true secondary insurance that might cover Medicare excluded services, it’s critical to verify whether the payer needs a denial letter from Medicare Part B DME. Unfortunately, this is difficult, since, in order to file a claim, the provider must be a registered DME supplier. Often, Medicare will decline to issue a denial through the Part B carrier. Patients must reach out to their true secondary payer to explain this unusual situation and seek advice on how coverage may be available.
Your Patient’s Insurance is Medicare Part C (An Advantage/Medicare Replacement Plan)
It’s estimated that 47% of Medicare enrollees have opted for Medicare Part C over traditional Medicare Part B. This branch of coverage has three classes of policy types: Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), or Private Fee For Service (PFFS). Before any decisions can be made about coverage, complete a thorough verification of benefits to see which plan the patient has chosen. From there, benefits are divided into those that must be delivered within the plan and what options the patient has for out of network benefits.
For that reason, we urge you to verify benefits the same as you would with any other payer class. As with Medicare Part B, there may be no clear path to coverage when orthotics are ordered or dispensed by a Chiropractor. These patients are unlikely to have any benefit for orthotics under their plan.
The Provider is In-Network and the Allowed Fee Schedule is Lower Than the Cost of the Functional Orthotics
Many payers have a fee schedule for functional orthotics that will not cover the cost of the quality items you provide. But there are solutions that allow you to supply the higher quality custom orthotics from Foot Levelers while not running afoul of your network agreement.
Under some plans, the payer will authorize providers to offer an upgraded item of covered DME, provided that the insured patient agrees to be responsible for the difference between the charge for the upgrade and the payer’s payment amount for the standard item. An upgrade usually consists of an item that includes an “excess component.” An excess component is an item, feature, or expense for an item or feature that is in addition to or is more extensive or more expensive than the item that is covered under the payer’s coverage requirements. In this case, Foot Levelers functional orthotics have enhanced benefits that apply to the recommended orthotics, such as the leather composition, the increased Zorbacel for extra shock absorption, and the three-arch support.
Healthcare Procedure Coding System (HCPCS) billing code S1001 describes a deluxe/upgrade item requiring a patient waiver. It allows a participating provider to supply an upgraded product under specific circumstances at the patient’s request. Certain carriers may allow for billing of this code, thus allowing for the patient to pay the difference up to the full retail price of the functional orthotics. An outline of the process, along with billing examples can be found in this module.
The Patient’s Case is a Personal Injury or Worker’s Compensation Claim
Often the diagnoses for which the provider is treating an injury are not in line with the required diagnoses for functional orthotics. Covered services for injury claims are usually medically necessary when the condition treated is a direct result of the accident. Because the usual clinical indications of functional orthotics tend to be issues that were pre-existing to an injury, it’s difficult to get coverage through accident claims.
However, the provider may feel strongly that the functional orthotics will make a difference in the patient’s condition. We suggest that you consider requesting pre-authorization for the orthotics in these instances. Reach out to the adjuster or claim representative and find out how to seek pre-authorization and what’s required for submission. A letter of medical necessity, linking the condition to the accident, or the recovery of the patient may be considered. A sample letter for pre-authorization is included in the sample letter collection provided in this course.
The Patient’s Diagnosis for Which Orthotics are Prescribed is not Covered by the Payer
It’s found that the need for functional orthotics is clinically appropriate for your patient. Upon verification, the patient’s payer has a Medical Review Policy that does not ordinarily cover the diagnosis for which the orthotics were prescribed.
If functional orthotics will not be covered by the patient’s benefit package, or if the service is considered to be for the patient’s comfort or convenience, the items won’t meet the medical necessity requirement for reimbursement by the carrier.
In this scenario, the patient is compelled to pay for the service out of pocket. Check the patient’s policy and/or your provider contract to ensure your ability to pass the fees on to the patient. Obtain written proof of the advance notice signed by the patient either on your generic form, or one that the patient’s payer requires. A template is provided in the samples collection in this course.
The lack of third-party coverage does not negate the necessity of functional orthotics for your patient. Most patients will pay cash for their functional orthotics if they understand their importance in the recommended treatment plan. If you are a member of a Discount Medical Plan Organization (DMPO) like ChiroHealthUSA, you may be able to set a legal, discounted fee schedule for orthotics through such a plan. Remember, the No-Surprises Act of 2022 may require the delivery of a Good Faith Estimate (GFE) when patients are self-pay or not using their insurance in the practice.
When the provider does not have the option of being reimbursed for orthotics by the patient’s Healthplan, they need to identify alternatives to reimbursement. Developing a solid understanding of other options can reduce financial anxiety for the patient and increase reimbursement for the clinic. Orthotics should not be prescribed based on the patient’s health insurance coverage. This tutorial will help you find ways to successfully incorporate an orthotic treatment plan for self-pay patients.
Surveys show that fewer and fewer policies provide third-party coverage for functional orthotics. The lack of third-party financial assistance does not negate the fact that functional orthotics should be prescribed if indicated. Patients will pay out of pocket for their functional orthotics. It is reasonable to expect them to be willing to do so once they understand the importance of functional orthotics as well as their financial options and obligations.
Healthcare laws have established many financial safeguards for both insured and uninsured patients. Most of the laws place patients in the driver’s seat when it comes to knowing their options when seeking healthcare. Patients can elect at any time not to utilize their insurance benefits. If they choose this option, the provider must offer a Good Faith Estimate as outlined by the No Surprises Act. An insured patient has the right to know about all out of pocket costs up front, and most payer portals are creating robust tools to provide this information to the patient. If a recommended service or treatment is considered non-covered, a contracted provider must consult the payer’s rules for billing non-covered services before passing on the cost to the patient. A patient who is insured or uninsured may opt to join a Discount Medical Plan Organization (DMPO) to manage out of pocket costs for items such as orthotics. When building the clinic’s financial policy, serious consideration must be given to different types of self-pay situations.
Charges and Fees Must be Compliant
It may be considered non-compliant when you have different fees for the same service for distinct types of patients. For example, your published fee schedule for L3020 is $250 per foot, but you wish to extend a time-of- service discounted fee of $150 per foot to uninsured or underinsured patients. This is outside the boundaries of a reasonable time-of-service discount according to the Office of Inspector General of the Department of Health and Human Services. Their guidance has indicated that a 5-15% discount is within normal margins unless you reside in one of the very few states that allow for a slightly larger discount. You have options, though.
Discounts May Lead to a Non-Compliant Dual Fee Schedule
In some states, offering patients time-of-service (TOS) or prompt-pay discounts is perfectly legal. The risk comes in determining how much of a discount you can provide as a prompt-pay incentive. You can’t give patients a TOS discount and then send them a bill. A simple way to avoid dual fee schedules is to join a cash discount network that allows plan members to enjoy discounted fees within your customized fee schedule. One of the most popular is ChiroHealthUSA, a network that allows the provider to set their discounted fees and member patients to access those discounted fees legally and compliantly. If you wish to offer discounted fees for functional orthotics to those without third-party assistance, this is one of the safest and most effective ways to do so. Many states now allow doctors to offer special concierge contracts for services/products, so it’s critical to know your state law.
Medicare is Not Likely to Cover Functional Orthotics
Functional orthotic inserts are covered by Medicare only when placed in a shoe attached to a brace. Medicare’s Durable Medical Equipment (DME) benefit also does not allow for these functional orthotics to be dispensed from a physician’s practice. Functional orthotics for Medicare patients will always be an excluded service under Medicare and you may charge the patient your full fee. Although the rules surrounding the No Surprises Act may not apply to Medicare plans, the intent of the rule to provide advance notice of non-covered services applies to Medicare beneficiaries.
Luxury or Deluxe Orthotics Require Patient Acknowledgement
When the set fee schedule for a covered item is lower than the cost of the item, the patient may be responsible for the difference. Before billing for such items, the provider must consult the payer’s restrictions and/or requirements. In some cases, the payer will allow the provider to initiate the S1001 code (deluxe, upgrade item requested). Whether this code is allowed or not, patient acknowledgement must be obtained before providing the service and passing along the cost to the patient.
Navigating self-pay options requires your practice to establish policies, train staff through scripting, and offer clear financial guidelines to patients. Most of this can be handled by adding a Financial Report of Findings (FROF) to the provider’s Clinical Report of Findings. The next step in this module will provide more information on this process.