Last year, the four durable medical equipment regional carriers issued supplier-manual updates requiring home medical equipment suppliers, in certain
by Cara C. Bachenheimer, Esq.
March 1, 2003

Last year, the four durable medical equipment regional carriers
issued supplier-manual updates requiring home medical equipment
suppliers, in certain circumstances such as pre-and post-pay
audits, to submit physician progress notes to substantiate medical
necessity for a particular claim.

Then, in December, the Centers for Medicare and Medicaid
Services, in its certificate of medical necessity submission to the
White House's Office of Management and Budget, reported
“suppliers and physicians will complete these [CMN] forms and
as needed supply additional routine supporting documentation
necessary to process claims.”

To put it plainly, CMS and the DMERCs have placed the burden on
DME suppliers to provide to the DMERCs copies of physician progress
notes to determine whether the medical necessity criteria were met
for a particular claim.

The CMN should not be the sole determinant of whether a
beneficiary meets the Medicare coverage criteria for a particular
item. However, the government needs to balance its need for and use
of additional documentation with the need for DME providers to be
able to operate in a climate that does not impose on them
inconsistent — or even impossible — burdens.

Suppliers should not be held liable financially when physicians'
progress notes do not document medical necessity sufficiently for
Medicare's purposes, especially when physicians have no financial
or other incentive to completely document in their progress notes
all information necessary to do so. This is particularly true when
other physician-generated documentation exists that does document
medical necessity.

The difficulty with relying solely on physician progress notes
is that many physicians are not fully aware of all the details of
the Medicare coverage policies for various DME, prosthetics,
orthotics and supplies — nor should they be expected to be.
Instead, the DMERCs should allow other physician-generated
documents to prove medical necessity.

CMS and the DMERCs must provide DME suppliers with detailed
information about the specific documentation that the DMERCs will
consider sufficient to substantiate medical necessity.

In the spirit of striking a balance between the government's
need to have sufficient documentation from the physician and the
supplier's limited ability to educate physicians on the details of
the Medicare policies for items, I suggest the following:

CMS should acknowledge that physicians commonly do not keep
in their progress notes consistent and complete information
regarding all the Medicare medical policy criteria that would
qualify beneficiaries for particular items.

Just because a physician's progress notes are incomplete does
not mean that the beneficiary does not meet the medical necessity

CMS should provide the DMERCs with specific guidance about
sufficient documentation to support medical necessity.

In practice, the DMERCs have inconsistent requirements and make
subjective judgments that impose operational difficulties on
multi-region suppliers.

CMS should instruct the DMERCs that physician-generated
documents beyond the progress notes should be treated as if that
documentation were in the physician progress notes.

The key is that the physician completed this other
documentation, although it may not technically and physically be
part of the physician progress notes.

CMS and the DMERCs should accept, as a statement of the
patient's actual medical condition, a physician-prepared letter of
medical necessity or other documentation that is specific to a
patient and explains why the patient requires a particular item,
consistent with the Medicare coverage policy.

In addition, the DMERCs should accord the same weight to this
physician documentation as they do to physician progress notes.

When a physician has limited patient information in the
progress notes related to his or her prescription for a particular
DME item, the DMERC should rely upon the more detailed evaluation
of another health care professional.

For some DMEPOS items, it may be appropriate for a licensed
health care professional other than the physician, such as a
physical or occupational therapist, to assess the beneficiary and
document those findings. Often, physicians rely on other health
care professionals to evaluate patients and make judgments about
the patients' conditions and their need for certain items and

While, in theory, I do not disagree with the idea of relying on
physician progress notes to determine whether medical necessity is
met, the government needs to understand the realities of the DME

The government must strike a balance between its need to
determine medical necessity and the need to protect DME suppliers
from unnecessary administrative burdens.

A specialist in health care legislation, regulations and
government relations, Cara C. Bachenheimer is an attorney with the
law firm of Epstein, Becker & Green in Washington. Bachenheimer
previously worked at the American Association for Homecare and the
Health Industry Distributors Association. You can reach her by
phone at 202/861-1825 or by e-mail at