Your Post-Cap O2 Questions Asked and Answered (Part 6)

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.
This week, however, following recent additional guidance issued by
CMS, Smith asked the agency to answer several questions of her
own.

The Devil is in the Details: On Jan. 27, CMS
issued additional guidance regarding billing for oxygen contents
and replacement of oxygen equipment after the expiration of the
five-year useful lifetime. This guidance is titled “Medicare
Billing Requirements and Policies for Replacement of Oxygen
Equipment and Oxygen Contents.” (Click here to read the guidance on the Jurisdiction C Web
site.) Since the guidance still left some things unclear, we posed
additional questions to CMS, and the following are the responses we
received.

Question: CMS states that “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.” Is the requirement for a new CMN,
a new “initial” CMN or a new “recertification” CMN?

Answer: A new initial 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 and recertifications based on the initial CMN,
however, are not required unless it is necessary in order to meet
existing medical review guidelines for oxygen and oxygen equipment.
The most recent qualifying value and testing date should be entered
on the CMN. (The initial date on the CMN should be the date that
the equipment was delivered to the beneficiary.)

Question: CMS states that when providing replacement
oxygen equipment, 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. What
happens if a supplier cannot obtain a delivery ticket that is kept
by a previous supplier? Can the supplier rely on a copy of the
initial CMN on file with the DME MAC?

Answer: Regarding proof of delivery from
previous suppliers, if the supplier cannot obtain this
documentation, then it cannot prove that the item has been used on
a continuous basis for more than five years. The supplier will have
to go based on when it first began furnishing the equipment —
the supplier should have proof-of-delivery documentation for its
equipment.

Question: CMS states “if 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, the patient may elect to obtain a new piece of
equipment” Will breaks in service be considered when calculating
the “reasonable useful lifetime” or will it be calculated as a
straight five years from the initial delivery date?

Answer: We do not count the days of a
break-in-billing without a break-in-need toward the reasonable
useful lifetime. For example, if there is a break-in-billing of 50
days, then the reasonable useful lifetime will effectively be five
years and 50 days from the date of delivery. As another example, if
there is a break-in-billing of 120 days without a break-in-need,
the reasonable useful lifetime will effectively be five years and
120 days from the date of delivery. In 42 CFR 414.210(f) the
concept of “continuous use” is tied to “reasonable useful
lifetime.”

The case where the break-in-billing has a break-in-need for over
60 days plus the days remaining in the last paid rental month
starts a new reasonable useful lifetime.

Based on CMS’ Jan. 27 guidance, the following is Smith’s
updated answer to a previously published question:

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.

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].