February 2018

OIG to examine billing for OTS orthoses

The US Department of Health & Human Services Office of Inspector General (OIG) will examine the extent to which Medicare beneficiaries are being supplied certain off-the-shelf orthotic devices without visiting the referring physician within 12 months prior to their orthotic. The OIG also will analyze nationwide billing trends for 3 orthotic devices using data from 2014 to 2016.

The codes in question relate to devices billed under L0648, L0650, and L1833. L0648 and L0650 are lumbar sacral orthoses. L1833 is described as: Knee orthosis, adjustable knee joints (unicentric or polycentric), positional orthosis, rigid support, prefabricated, off-the shelf.

Billing for the 3 L-Codes has increased 97% and allowed charges have increased 116% representing $349 million in 2016. A Medicare Administrative Contractor (MAC) has identified improper payment rates as high as 79% for L0648, 88% for L0650, and 9% for L1833. Of concern to MAC is a lack of documentation of medical necessity in patients’ medical records.

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