Your Post-Cap O2 Questions Asked and Answered (Part 5)

AMARILLO, Texas — With all the confusion surrounding CMS’
new post-cap oxygen payment rules, it’s time for some answers. In a
special series for HomeCare Monday, Lisa K. Smith, Esq.,
an attorney with the Health Care Group at Brown & Fortunato, P.C., a law
firm based in Amarillo, Texas, responds to several of home medical
equipment providers’ most common questions about the new rules.

Corrections and Updates: On Jan. 27, CMS issued
additional guidance regarding billing for oxygen contents and
replacement oxygen equipment after the expiration of the five-year
useful lifetime. The guidance was issued as a listserv message with
the Change Request (Transmittal) to follow. This guidance can be
found online at
http://www.cignagovernmentservices.com/jc/pubs/news/2009/0109/cope9216.html.
Based on this information, the following Q&A’s previously
published have been revised to reflect the new guidance.

Question: Does a portable unit take on the exact start
date of the stationary system or can the two be unique? The
situation is the physician may initially order a stationary system
and a few months later the portable is added. Does the portable
unit have a unique oxygen cap start/end date (36-month period), or
do I start billing for portable contents once the stationary system
caps?

Updated Answer: The 36-month cap period for the
portable unit will be different from the 36-month cap period for
the stationary system if the portable equipment is added at a later
date. The supplier will continue to bill the portable unit as a
rental until it reaches the 36-month cap. However, the supplier can
start billing for portable contents after the stationary system
caps, and need not wait for the portable unit to cap.

This means that the supplier is able to bill for both the
portable rental and portable contents for that period after the
stationary system caps and before the portable system caps. Once
the portable system caps, the supplier can continue to bill for
portable contents.

In other words, stationary and/or portable contents can be
billed after the stationary system has reached the 36-month cap.
Stationary and/or portable contents cannot be billed during the
36-month rental period for the stationary system. This means that
when a supplier replaces the stationary oxygen equipment at the end
of the five-year useful life and starts a new 36-month rental, it
cannot continue to submit claims for portable contents.

Question: When billing for oxygen contents after the
36-month cap period, can the supplier bill for a month’s content if
it did not make a delivery in that month? In other words, can a
supplier deliver oxygen contents for multiple months at one time
and then bill for contents for each of those months?

Updated Answer: Yes, the supplier is not
required to deliver oxygen contents during the month in order to
bill for contents for that month, so long as the supplier delivered
oxygen contents for that month at an earlier date. For example, a
supplier can deliver a three-month supply of portable tanks on Jan.
15, and then submit monthly claims for portable contents with dates
of service of Jan. 15, Feb. 15 and March 15.

The new CMS guidance states that a maximum of three months of
oxygen contents can be delivered at one time. It further states
that “in order to bill for contents for a specific month, you must
have previously delivered quantities of oxygen that are sufficient
to last for one month following the date of service on the
claim.”

Question: What are the logistics for providing
replacement equipment after the end of the five-year useful life
period? What documentation is required? Will the patient need to
see the physician and is a new CMN required?

Updated Answer: The five-year useful life
period begins when the oxygen equipment is first delivered to the
patient and ends at the point when the equipment has been used by
the patient on a continuous basis for five years. It does not
restart if there has been a change in oxygen modality, change-out
of equipment or change in supplier.

As to CMN and testing requirements, CMS states: A new
certificate of medical necessity (CMN) is required in situations
where oxygen equipment is replaced because the equipment has been
in continuous use by the patient for the equipment’s reasonable
useful lifetime or is lost, stolen, or irreparably damaged. New
testing, however, is not required unless it is necessary in order
to meet existing medical review guidelines for oxygen and oxygen
equipment. You should continue to follow the existing guidelines
requiring recertification CMNs for all situations in which oxygen
equipment is being replaced. The most recent qualifying value and
testing date should be entered on the CMN.

It is not clear whether the reference to a “new” CMN means a new
initial CMN, recertification CMN or revised CMN, and we have sought
clarification from CMS.

Regarding additional documentation requirements, CMS states that
the supplier must maintain proof-of-delivery documentation showing
that replacement oxygen equipment has been provided. CMS states
that the supplier must also have proof-of-delivery documentation
that demonstrates that the oxygen equipment being replaced has been
in use for at least five years. While this may not be a problem for
a supplier who has had its equipment with the patient for the full
five years, it could easily be a problem if the patient has changed
suppliers during the five-year period. We are seeking clarification
from CMS concerning alternate forms of documentation that would
demonstrate that the equipment has reached its five-year useful
life, such as the initial CMN on file with the DME MAC.

Claims for replacement oxygen equipment for the first month of
use only must have the RA modifier for dates of service Jan. 1,
2009, or after, or the RP modifier for dates of service prior to
Jan. 1, 2009. The supplier must also include on the first month’s
claim a narrative explanation stating that the five-year useful
life of the prior equipment has expired, and include the date that
the beneficiary received the original equipment that is being
replaced.

CMS states: When submitting claims electronically for
replacement of oxygen equipment, you may use, for the narrative
explanation, loop 2400 (line note), segment NTE02 (NTE01=ADD) of
the ASC X12, version 4010A1 professional electronic claim format.
If you are billing using the Form CMS-1500 paper claim, you may
report this information in item 19 of the claim form.

Lisa K. Smith, who is Board Certified in Health Law by the
Texas Board of Legal Specialization, represents HME companies,
pharmacies, hospitals and other health care providers throughout
the United States. She can be contacted at [email protected].