The Medicare, Medicaid, and SCHIP (State Children’s Health Insurance Program) Benefits Improvement and Protection Act of 2000 (BIPA) prohibits Medicare payments for prostheses and custom-fabricated orthoses unless the items are furnished by a qualified practitioner and fabricated by either a qualified practitioner or a qualified supplier. Further, section 427(b) of the BIPA required the U.S. Department of Health & Human Services (HHS) Secretary to promulgate regulations to implement the requirements in section 427(a). However, according to a report issued October 10 by the HHS, Office of the Inspector General (OIG), the Centers for Medicare & Medicaid Services (CMS) lacks regulations for payment requirements for prostheses and custom-fabricated orthoses.
The OIG selected a sample of 1,135 Medicare-allowed claims for prostheses and custom-fabricated orthoses in 2010 to determine whether the claimed items were furnished by qualified practitioners, were fabricated by either qualified practitioners or qualified suppliers, and met delivery documentation requirements. OIG also interviewed CMS staff regarding the implementation status of the BIPA payment requirements.
The OIG found that to date, CMS has not promulgated regulations related to BIPA payment requirements for practitioner and supplier qualifications for prostheses and custom fabricated orthoses. CMS has used other legal authorities that limit who can be paid for these devices; nevertheless, in 2010, Medicare allowed nearly 1,000 claims inappropriately. Despite the lack of regulations, most claims were allowed for prostheses and custom-fabricated orthoses furnished and/or fabricated by practitioners and/or suppliers who were licensed, certified, or accredited. Finally, Medicare inappropriately allowed 12 percent of claims for prostheses and custom-fabricated orthoses that did not meet federal delivery documentation requirements.
The OIG recommended, and CMS concurred, that CMS promulgate regulations to implement the BIPA payment requirements, ensure that suppliers maintain delivery documentation that meets federal requirements, and take appropriate action to address inappropriately allowed claims identified in our sample.