The Case for Prior Authorization in Home Respiratory Therapy

For taxpayers and policymakers alike, the concept of public health care dollars being lost to waste, fraud or abuse is nothing short of sickening. The need is too great—and the amount of resources too finite—to tolerate the misuse of funds. It’s something upon which every American would likely agree.

The federal government, to its credit, has taken great strides to clamp down within the Medicare program to ensure dollars go where they should and fraud is identified and prosecuted. A number of checks, balances and roadblocks have been put in place to protect the safety and integrity of public health care programs and the patients who depend upon them.

Yet while these fraud prevention solutions are laudable, many are cumbersome and even detrimental to the older Americans Medicare is intended to protect. When it comes to these regulations and requirements, more isn’t always better. Sometimes it’s just more.

For example, the providers of home oxygen supplies and services—who serve more than a million Americans with conditions like chronic obstructive pulmonary disease (COPD) and obstructive sleep apnea—are struggling with Medicare’s overly burdensome prescriber documentation requirements.

Under the system, rather than relying on written prescribers’ orders and certificates of medical necessity, these requirements create expansive documentation demands that require prescribers to guess which words contracted claims reviewers will accept to support Medicare paying suppliers for medically necessary home respiratory therapy. That’s despite a 2018 Centers for Medicare & Medicaid (CMS) report that found there was not a single case of oxygen or oxygen equipment suppliers providing supplies and services when they were not medically required.

It’s a process that can delay care and creates unreasonable costs and risks that could threaten access to life-sustaining respiratory therapy for Medicare patients.

Imagine if a pharmacist, whose job it is to dispense a drug ordered by a doctor, were held financially responsible for a documentation error made by the prescribing physician. This is the case today when home oxygen providers are held responsible—via withheld reimbursements—for clerical errors and documentation issues originating with the prescriber.

In fact, nearly all of the payments deemed “improper” through CMS’s auditing process are due to insufficient encounter notes, not the actions of providers. Complicating matters, the auditing process is confusing: data elements are not standardized, introducing reviewer subjectivity into the audit process. Without a clear and objective standard, third-party contractors have wide power to deny legitimate claims based on words missing from a prescriber’s record. Some reviewers reject claims because the word “chronic” is not spelled out when a physician writes that the patient has COPD. More recently, claims for patients with COPD have been denied after a hospital stay for an acute condition because the reviewer failed to notice that home oxygen was prescribed because of the patient’s underlying COPD, which was unrelated to the hospital stay.

The current auditing process works against home oxygen providers at a time when the need for their services is on the rise. It’s hard to imagine more providers being willing to step up when they could be denied compensation for doing their jobs—and for providing critical health care services in good faith.

CMS has voiced a commitment to put “patients over paperwork” and the home oxygen community would challenge policy makers to do just that.

The agency should follow the lead of many Medicaid programs and commercial insurers by implementing prior authorization for home respiratory therapy. This would let prescribers know they have provided the documentation needed up-front to establish medical necessity. Leveraging widely accessible web-based technology, a home respiratory therapy prior authorization program would eliminate the waste associated with over-zealous auditors, while protecting the integrity of the Medicare program. By improving payment accuracy, the federal government estimates the prior authorization provision alone would save upwards of $300 million over 10 years.

While Congress should carefully consider ways to address the overly burdensome and costly audit process for home respiratory therapy, the administration has sufficient authority to enact the changes it recommends when it comes to home respiratory therapy. Both should work closely with suppliers, prescribers and patients to bring balance to a broken system. These are laudable efforts that will more effectively root out fraud and abuse while driving down costs—and without putting patient care on the line.