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Equipped to Get Paid: Billing for DME, Orthotics, and Prosthetics in Private Practice

Purchasing splints, prosthetics, and durable medical equipment isn’t so simple. Orthotics and prosthetics billing isn't so simple.

Kylie McKee
5 min read
September 26, 2018
image representing equipped to get paid: billing for dme, orthotics, and prosthetics in private practice
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Some things in life are very straightforward. For instance, if you need a new pair of jeans, you simply head to the store (or use my preferred method: ordering online from the comfort of your own home), give your money to the cashier, and walk out the door with exactly what you need. Unfortunately, purchasing things such as splints, prosthetics, and durable medical equipment (DME) isn’t so cut and dried. In fact, when it comes to orthotics and prosthetics billing, there’s a lot of room for error. So, to make sure your patients get with they need—and you get paid what you deserve—stick to the following guidelines:

Obtaining a Provider Number

If you want to receive reimbursement from a Durable Medical Equipment Regional Carrier (DMERC), then you have to provide your number—your DMEPOS number, that is. Not to be confused with your NPI number, your DMEPOS number is required to receive reimbursement for items like splints, orthotics, and other supplies. Medicare considers physical therapists “suppliers,” but DMERCs won’t see you that way until you obtain this number. To do so, you’ll need to fill out and submit a CMS-855S form (along with all of your supporting documents) to Palmetto GBA, the national supplier clearinghouse for Medicare. If you have questions, you can contact the clearinghouse at 866-238-9652 or visit the Palmetto GBA website.

Here are a few additional details:

  • Generally speaking, the application process should take about 60 days.
  • You can also expect a visit from a Medicare inspector before you receive your supplier number.
  • After three years, you will need to re-enroll, which means filling out another CMS-855S form and getting another visit from a Medicare inspector before receiving your number.

Picking the Right Codes

There are several different codes providers can use to bill for orthotics, prosthetics, and DMEs—and it’s absolutely crucial that you pick the right one. Here are some tips for making sure you’ve chosen the right code for the service you provided—and for the payer you’re billing (Note: All CPT codes—including the following codes—are property of the AMA):

97760: Orthotics Initial Encounter Code

Description:  Orthotic(s) management and training (including assessment and fitting when not otherwise reported), upper extremity(ies), lower extremity(ies) and/or trunk, initial orthotic(s) encounter, each 15 minutes.

Not only does this code cover orthotics management and training, but it also includes the patient assessment and fitting (if you haven’t reported it otherwise). Specifically, this code refers to the initial encounter. This is a change for 2018, as therapists could previously use this code for subsequent visits. You should report this code for services performed on any and all regions of the body. 

That said, if you use an L-code, make sure you don’t report 97760. That’s because L-codes cover management and training in addition to building the device. (If you’re out of the loop on L-codes, fear not. We’ll cover those below.)

97761: Prosthetic Initial Encounter Code

Description:  Prosthetic(s) training, upper and or lower extremity(ies), initial prosthetic(s) encounter, each 15-minutes.

Providers should use this CPT code for any prosthetics-related instructions or interventions, including:

  • ADLs for UE and LE amputees,
  • Walking for LE amputees,
  • Donning and doffing activities,
  • Residual limb management, and
  • prosthesis-related self care.

Much like its numeric neighbor 97760, this code applies only to the initial encounter.

97763: Orthotic and Prosthetic Management

Description:  Orthotic(s)/prosthetic(s) management and/or training, upper extremity(ies), lower extremity(ies), and/or trunk, subsequent orthotic(s)/prosthetic(s) encounter, each 15 minutes.

As we mentioned previously, you should only use 97760 and 97761 for initial encounters. Otherwise, you would use 97763, which includes the same activities described by the other two codes, but is reserved specifically for subsequent encounters.

You may be wondering about 97762—particularly if you’ve used this code in the past—but as of January 1, 2018, 97762 was deleted and replaced with 97763.

L-Codes: Splinting and Bracing

So, what are L-codes? These are the HCPCS codes providers must use when billing for splints, braces, and any other services related to assessment, fabrication, and supplies—including follow-up. As mentioned above, providers should not bill 97760 or 97761 with any L-codes on private payer or workers’ comp claims, as those codes cover the assessment.

Before you can bill L-codes to Medicare, you must be a certified DME provider. If you haven’t received your DME certification yet, here are some tips for billing Medicare for orthotic services:

  • Bill 97760 for the initial assessment;
  • Bill the patient for the device or supplies; and
  • Bill 97763 for subsequent visits.

Obtaining Reimbursement

Now, on to the good stuff: getting paid. There’s a lot at play here, so let’s dissect what, exactly, payers are reimbursing you for during these interventions. (Note: The information below refers to how Medicare reimburses for prosthetics and orthotics and does not necessarily reflect how commercial payers reimburse for these interventions. That said, many [if not most] commercial insurance payers align themselves with Medicare policies, so this should serve as a good general guide.)

For prosthetics, Medicare reimbursement includes:

  • evaluation,
  • fitting,
  • parts and labor,
  • repairs due to normal wear or tear within the first 90 days of the delivery date, and
  • adjustments made during fitting and within the first 90 days of the delivery date (not including adjustments brought on by changes in the remaining limb or a patient's level of function).

For orthotics, Medicare reimbursement includes:  

  • evaluation,
  • measurement and/or fitting,
  • fabrication and customization,
  • materials,
  • cost of labor, and
  • delivery.

Renting or Selling DME

If your patient decides to rent or purchase a DME item, your DMERC will want to know. You can inform your DMERC of the patient’s decision by including one of the following modifiers on the claim:

  • BR: The beneficiary has elected to rent the item.
  • BP: The beneficiary has elected to buy the item; or  
  • BU: You have informed the beneficiary of his or her purchase or rental options, but he or she has not made a decision after 30 days.

Proving Medical Necessity

For certain items, the DMERC requires a certificate of medical necessity (CMN). Each DMERC has its own list of items requiring a CMN, but these lists typically include the following items:

  • osteogenesis stimulators,
  • TENS units,
  • wheelchairs (motorized and manual),
  • CPAP machines,
  • lymphedema pumps,
  • hospital beds,
  • support surfaces,
  • seat lift mechanisms, and
  • power-operated vehicles.

For instructions on how to complete a CMN, visit this page on the Noridian website.

Billing for TENS Units

Billing for TENS units is little tricker than billing for other pieces of DME. In fact, it can even be difficult to receive reimbursement for TENS units, with nearly half of all claims for TENS units being denied. The number-one reason for those denials? Incorrect billing procedure. The second most prevalent reason for denials? The claim failed to prove medical necessity.

To start, you must obtain a written order prior to delivery (WOPD) before you can even hand over the unit and provide the DMERC with a CMN (as referenced in the previous section). Furthermore, as far as Medicare is concerned, there are only two reasons why a patient would need to purchase a TENS unit: acute post-op pain and chronic pain. So, make sure your CMN justifies one of these conditions in order to receive payment.

Now for the really fun stuff. As long as the provider is DME certified, the provider will bill the patient for a “rental” payment of 10% of the purchase price—less coinsurance and/or any deductible is allowed—for the first two months of use. This is essentially a trial period, which gives the attending physician a chance to determine whether the patient needs to actually purchase the unit. If the physician deems it medically appropriate, then the full amount for the unit will be due (the carrier will not adjust this amount for the two monthly payments). You can then bill your DMERC for the two-month rental period as well as the actual purchase.

For TENS, the HCPCS codes are E0720 and E0730. For TENS supplies, the codes are A4557, A4595, and E0731.

When buying a new pair of jeans, there isn’t much to it outside of picking the right fit. But when it comes to orthotics and prosthetics, the fit is only half the battle. Got any tips of your own? Leave them in the comment section below.

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