CGS Administrators, LLC

August 2, 2011

Reprocessing of Customized Prosthetic Devices

Part-B payment can be made for items of Prosthetics, Orthotics, and Supplies (POS) when they are furnished to a beneficiary who is in a non-covered Part-A stay at a hospital or Skilled Nursing Facility (SNF). If these items are furnished to beneficiaries residing in a covered Part-A hospital or SNF stay, under Inpatient Prospective Payment System or SNF Consolidated Billing (CB) payment rules, the items would be bundled into the global Part-A payment for the covered stay itself.

An exception to this policy is when certain customized prosthetic devices are furnished to beneficiaries residing in a covered Part-A SNF stay as these items were carved out of the SNF CB provision by the Balanced Budget Refinement Act of 1999 (BBRA, PL 106-113, Appendix F, Section 103).

Since Monday, April 4, our claims processing system has been erroneously denying claims for certain custom prosthetic devices. CMS is issuing instructions to correct this processing error but the correction will not be implemented until Sunday, January 1, 2012. In the interim, the Durable Medical Equipment Medicare Administrative Contractors (DME MACs) will reprocess any claims for custom prosthetic devices (identified by the "L" series of HCPCS codes) that were inappropriately denied when such claims are brought to their attention.

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