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FAQ: Medicare Reimbursement for Negative Pressure Wound Therapy

Information regarding coding, coverage, and payment is provided as a service to our readers. Every effort has been made to ensure accuracy. However, HMP and the author do not represent, guarantee, or warranty that coding, coverage, and payment information is error-free and/or that payment will be received.

Even though negative pressure wound therapy (NPWT) has been used by wound management professionals for over 20 years, confusion, misinformation, and misperceptions still exist when it comes to reimbursement for both NPWT durable medical equipment (DME) and disposable NPWT (dNPWT). Because NPWT is one of the focuses of this month’s issue, this author is going to share the frequently asked questions (FAQs) that pertain to reimbursement for both types of NPWT.

NPWT DME FAQs

Q: Why do the DME suppliers require such specific orders and documentation before they will deliver NPWT DME to the patients’ homes?

A: The DME suppliers require exactly what is required for coverage by the DME  Medicare Administrative Contractors (MACs). If the DME suppliers do not establish a process for receiving accurate orders and documentation that supports the medical necessity for the NPWT DME, the DME MACs will deny coverage and the patients will be responsible for the full payment of the equipment and the supplies.

Q: How do the DME suppliers learn about the NPWT DME orders and documentation that their MACs require?

A: Both DME MACs have a Local Coverage Determination (LCD) and an Article that describe their medical necessity, utilization, documentation, and coding guidelines for NPWT DME.1,2 The DME suppliers should carefully read both documents and should implement processes for obtaining the required information from the wound management professionals who order NPWT DME from them.

Q: I am a wound management physician with an office-based practice. I order a lot of NPWT DME for many patients. My office manager has recently printed the Medicare LCD and Article for NPWT DME and insists that I read it thoroughly because she receives many inquiries from the DME suppliers, who say they do not have adequate information to provide the equipment and supplies to my patients. I am very busy and do not have time to read documents that do not pertain to my Medicare payments. Do you agree that reading the LCD and Article is a waste of my time?

A: Actually, you should give your office manager a raise for doing everything possible to help you learn your ordering and medical record documentation obligations for NPWT DME. Before ordering services, procedures, and products for a Medicare patient, you should understand the coverage requirements of the MACs. If your patient meets the medical necessity requirements of the LCD, your diagnosis(es) code(s) and order should reflect them. In addition, you should understand all the utilization guidelines and should document how your patient meets those guidelines. Finally, your documentation in the patient’s medical record should cover all the documentation guidelines outlined in the LCD. By doing your part to write complete orders, to document thoroughly and to share the information with the DME supplier, you are 1) helping your patient receive the care she/he needs as part of their Medicare Part B benefit, 2) assisting the DME supplier to meet the coverage requirements of the DME MAC, and 3) preventing an audit of your practice. Remember, if a DME supplier is audited and the problems stem from a physician’s lack of orders/documentation, that physician may also be audited. Therefore, I would take your office manager’s recommendation and read the LCD and Article for NPWT DME. After reading the documents, you should develop a plan for improving your orders and documentation to ensure patients receive the NPWT DME they need, the DME supplier has all the information required to supply the equipment and supplies, and that you and the DME supplier will successfully pass pre-payment or post-payment audits.

Q: I am a physician who has referred patients to a few DME suppliers who delivered the NPWT DME pump and supplies to Medicare patients even though I did not provide the specific order and documentation that other DME suppliers require of me. Are there any consequences for the DME suppliers who provide NPWT DME to patients even though they do not have the orders and documentation required by the LCDs/Articles?  
A: DME suppliers may receive Medicare payment without having the proper orders and documentation. However, if they are selected for an audit by one of the Medicare audit contractors, they risk large repayments when the auditor does not find the required orders and documentation. Consequently, the physicians, whose medical records do not comply with the LCD/Article requirements, may also be audited.

Q: Our hospital-owned outpatient wound management provider-based department (PBD) was recently audited for our NPWT billing to Medicare. We were audited because we used the 97607 and 97608 procedure codes to bill for the application of the NPWT DME. We believe the auditors are incorrect. Will you please verify the procedure codes that a PBD should report when we apply the NPWT DME and supplies that the patients receive from their DME supplier and bring to the PBD?

A: Unfortunately, the auditors are correct. You have been incorrectly coding and billing for your work to apply/reapply an NPWT DME pump and supplies that the patient acquired from their DME supplier. The codes 97607 and 97608 should only be used when the PBD purchases and applies a new disposable negative pressure wound therapy pump/cartridge. The correct codes for the application/reapplication of the NPWT DME pump and supplies are 97605 and 97606. You should correct your charge sheets and your Charge Description Master to include the correct codes. Finally, you should educate your staff and the entire revenue cycle team about the difference between 97605/97606 and 97607/97608.

Q: Our PBD director and physicians who work in the PBD are having a debate. They understand that PBDs and physician offices are required to purchase surgical dressings used during patient encounters. The PBD director believes that to be the case for the dressings and canisters that are used with NPWT DME. The physicians disagree with the PBD director and feel sure that the patients should bring the dressings and canisters for their NPWT DME pump to the PBD and physician office. Will you please tell us who is correct?

A: The physicians win this debate. Medicare includes the cost of surgical dressings when they calculate the Medicare allowable rate for PBDs and physician offices. However, Medicare pays the DME supplier for durable medical equipment, such as NPWT DME pumps, and for the supplies affiliated with the equipment, such as the NPWT dressings and cannisters. Therefore, patients should take the NPWT dressings and cannisters, which they acquired from the DME supplier, to their PBD/physician office visits.
dNPWT FAQs

Q: I am the medical director for a hospital-owned outpatient wound management PBD. Our hospital chief financial officer (CFO) told us we were losing money every time we purchased and applied a new dNPWT pump. We use the same codes (97605) to bill our dNPWT and NPWT DME pump and supplies. Why would we be losing money on the dNPWT?

A: First and foremost, when the PBD adds new services, procedures and products to their “wound management toolbox,” they should always review the diagnosis codes that support medical necessity for the item, the procedure codes created for the work, and the product codes assigned for the products. If your PBD staff had reviewed these codes before they purchased and used the dNPWT pumps, they would have learned that there are different procedure codes for the application of NPWT DME pumps and supplies (97605/97606, which only reimburse for work) and for the provision and application of new dNPWT pumps (97607/97608, which reimburse for work and the new dNPWT device). Because the PBD used the same codes to bill for the dNPWT device (that the PBD purchased) and the NPWT DME pumps and supplies (that the patients  acquired from their DME suppliers and brought to the PBD for application), the PBD did not receive payment for the dNPWT device that you purchased. The 2019 Medicare national average allowable rate for 97605 is $176.45 while the  rate for 97607 is $314.08.3 The difference in these allowable rates clearly explains why the hospital CFO found that the PBD was losing money. The good news is twofold. The PBD can add 97607/97608 to the charge sheets and Charge Description Master and receive the correct Medicare allowable rate going forward. The coders and billers can resubmit claims for any new dNPWT device that were applied less than 12 months ago.

Q: Our PBD recently began using dNPWT. Our coder provided us with LCD L33821 and Article A52511. As we read these coverage documents, they do not seem to pertain to dNPWT. Will you verify if these are the correct documents? If they are not correct, can you provide the coverage documents that pertain to our PBD that is in Florida?

A: Congratulations to your coder for remembering to research and review coverage documents for new technology. Unfortunately, your coder provided the LCD and Coverage Article that was written by the DME MACs for NPWT DME. Your coder should have provided the LCD L37166 and the Coverage Article A55818 written by First Coast Service Options, Inc., the Medicare Part A and Part B MAC for Florida, Puerto Rico, and the Virgin Islands.4,5 The LCD clearly lists the covered indications, the contradictions, the full procedure code descriptions for 97607 and 97608, a comprehensive list of documentation guidelines, and specific utilization guidelines for NPWT. The Coverage Article provides coding guidelines for 97607 and 97608.  

Q: I am the full-time physician in a PBD. Many of my patients who need NPWT prefer to use dNPWT because they can go to work and receive their NPWT. Unfortunately, many of their private insurance plans deem dNPWT as investigational and do not cover it. Yet the same plans cover NPWT DME. Therefore, I decided to request peer-to-peer teleconferences with the medical directors of those plans. Once I educated several medical directors that 1) dNPWT delivered the same negative pressure wound therapy as the NPWT DME and 2) dNPWT allows the patients to return to work and that dNPWT allows patients who are physically challenged to ambulate and still receive their NPWT, each medical director overturned their negative coverage for dNPWT. Should I encourage my wound management peers to request peer-to-peer teleconferences with private payer medical directors?

A: Congratulations for advocating for your patients who can benefit from dNPWT. You have experienced firsthand what this author has been teaching to wound management physicians for many years. Keep in mind that payer medical directors are not always well-versed in wound management. When payer medical directors receive education and clinical evidence about the same technology from multiple wound management physicians, they often overturn negative coverage policies. Therefore, I absolutely encourage wound management physicians to request educational peer-to-peer teleconferences with private payer medical directors. In fact, this author has seen MAC medical directors overturn negative coverage decisions after having educational peer-to-peer teleconferences with wound management physicians.

Q: About one year ago our PBD began using dNPWT pumps. The PBD also began purchasing and applying the disposable devices to patients who were also receiving home health agency (HHA) care. The PBD was very careful not to schedule a PBD appointment on the same day that the HHA provided a home visit to the patient. Last month the revenue integrity team conducted an internal audit and uncovered a surprising situation. Every time the PBD provided a new dNPWT device for a patient who also received HHA care, the PBD’s claim was paid. Then a few months later, Medicare took a repayment for every claim. Should the PBD appeal these repayments?

A: Do not waste your time appealing those claims because the dNPWT procedure codes are on the HHA consolidated billing list.6 Therefore, the HHA is responsible for purchasing, applying, and separately billing for new dNPWT device. If the HHA chooses not to fulfill its obligation, staff should write a contract with the PBD to 1) purchase, apply, and provide the new dNPWT device for the HHA patients, and 2) bill the HHA. In this author’s opinion, the HHA should take advantage of the coding/billing opportunity for new dNPWT device because the PBD contracted rate will most likely cost the HHA more than the dNPWT device will cost the HHA. In case you are wondering why the PBD was paid at first and then experienced a Medicare repayment, the answer is quite simple. PBDs submit “per encounter” claims to Medicare and HHAs submit “per episode” claims. Therefore, Medicare paid the PBD claims before Medicare learned that the patients were under a Medicare Part a home health plan of care. Then when the HHAs submitted their  claims for the episodes of care, Medicare initiated a repayment from the PBD.

Kathleen D. Schaum is a founding member of the Today’s Wound Clinic editorial advisory board and oversees a consulting business. She can be reached for consultation and questions by emailing kathleendschaum@bellsouth.net.

 

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Kathleen D. Schaum, MS
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References

1. CGS Administrators, LLC,and Noridian Healthcare Solutions, LLC. Surgical Dressing LCD. https://www.cms.gov/medicare-coverage-database/details/lcd-details.aspx?LCDId=33831&ver=21&CoverageSelection=Local&ArticleType=All&PolicyType=Final&s=All&KeyWord=surgical+dressings&KeyWordLookUp=Title&KeyWordSearchType=And&articleId=55818&bc=gAAAACAAAAAA&. Last accessed on August 17, 2019.
2. CGS Administrators, LLC and Noridian Healthcare Solutions, LLC. Surgical Dressing Article. https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=54563&ver=16&LCDId=33831&CoverageSelection=Local&ArticleType=All&PolicyType=Final&s=All&KeyWord=surgical+dressings&KeyWordLookUp=Title&KeyWordSearchType=And&bc=gAAAACABAAAA&. Last accessed on August 17, 2019.
3. Hospital Outpatient PPS Addendum B. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Addendum-A-and-Addendum-B-Updates-Items/2019-July-Addendum-B.html?DLPage=1&DLEntries=10&DLSort=2&DLSortDir=descending. Last accessed on August 17, 2019.
4. First Coast Service Options, Inc. Surgical Dressing Article. https://www.cms.gov/medicare-coverage-database/details/lcd-details.aspx?LCDId=37166&ver=16&Date=08%2f17%2f2019&DocID=L37166&bc=iAAAABAAAAAA&. Last accessed on August 17, 2019.
5. First Coast Service Options, Inc. Surgical Dressing Article. https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=55818&ver=7&Date=08%2f17%2f2019&DocID=A55818&bc=hAAAABAAAAAA&. Last accessed on August 17, 2019.
6. Home Health Consolidated Billing. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HomeHealthPPS/coding_billing.html. Last accessed on August 17, 2019.

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