For many years, the O&P profession has grappled with the challenges of an outdated payment model that does not always support the provision of care necessary for the best patient outcomes. O&P professionals routinely justify low margins on some delivered services and devices because they can balance the accounts receivables with the margins on other deliveries. Reimbursement for many O&P services continues to shrink—and in the best-case scenarios, it remains static.
O&P News asked various O&P professionals to share their insights and expertise on the current reimbursement processes.
O&P News: In your opinion, what are the biggest challenges with the current payment model under the L-code system?
Heather Smith, PT, MPH: Obviously, there are limitations to today’s system in which we bill codes and are paid on the volume of services. Clearly, there are limitations to the codes themselves and the valuation of those codes. The current system does not take into account the outcome of those services, and so high-value services are reimbursed the same as low-value services. I think there is a lot of opportunity as we move to value-based payment for providers to create payment structures that reward the outcome of service, including improvement in function and patient satisfaction.
Jeffrey M. Brandt, CPO: As a result of the coding system not evolving and becoming more adept at quickly evaluating the efficacy of new technologies, it is stifling innovation and causing confusion in the commercial payor world as to why more providers are using more miscellaneous codes than ever before. Because the current system has not evolved, I believe it has dissuaded inventors and manufacturers from developing newer products that contain benefits and features outside of the existing L-code descriptors.
In my opinion, we have as much product research to support the technological benefits to the patient as we’ve ever had as a profession, and we don’t have an L-code system with the corresponding capability to evaluate, accept, reject, or eliminate products and descriptors to meet the demand, pace, and impact of the clinical and product advances.
Frank Bostock, MBA, CO: The biggest challenge for the O&P profession under the current L-code system payment model is that L codes only reimburse individuals for the delivery of products—and as such, certified orthotists and prosthetists, as health-care professionals, are not compensated for the patient-care services that they provide to their patients beyond the delivery of a product. Subsequently, it is important for the O&P profession to pursue including Current Procedural Terminology (CPT) patient-care billings in their practices for the patient-care services that they provide that are within their scopes of practice and are not included in the labor component of the delivery of a product that is bundled within the Health-Care Common Procedure Coding System (HCPCS) reimbursements. If the O&P profession does not pursue adopting billing CPT codes, then the O&P profession will remain in its product paradigm in the eyes of its payors, referral sources, and patients.
As a supplier of O&P products, the O&P profession finds that many of the products that O&P professionals provide have become commodities and are now readily available on the internet through nontraditional suppliers and providers. The availability of O&P products through nontraditional and non-O&P industry delivery models will provide patients and payors alternative sources for purchasing O&P products, including the Amazons of the world, wherein through a smartphone app a patient can take a picture of his or her leg and send it to an online provider who will fabricate a custom knee brace and have it at the patient’s doorstep in a matter of days, with online fitting and care instructions. As such, certified orthotists and prosthetists will find their roles as product providers diminishing, and O&P will be challenged to survive in a product-only health-care delivery model.
Today, as health-care providers, certified orthotists and prosthetists assist their patients in improving the quality of their lives not through selling them products, but rather through knowing what products and patient-care services combined will provide them with increased mobility and independence, and the best possible cost-effective outcomes.
Stephanie Greene, Esq.: The current L-code system, while defined by Medicare as a fee-for-service model, more closely resembles a type of limited global capitation system that doesn’t really have the potential “upside” for O&P providers. Under global capitation, a single payment is made to cover the cost of a predefined set of services delivered to a patient. The lower a provider keeps its amount or costs of service, the better the profit. We generally think of global capitation as something like a set monthly fee paid to a skilled nursing facility (SNF) or fees paid to a Medicare Advantage Plan, again to cover all services provided to the patient.
For O&P providers, our fee-for-service system is very similar to a global capitation model except it is limited in scope to a single type of service. We receive a “single fee” for an item delivered (the argument is that it is a “fee-for-service model”), but that single fee is to pay for all services provided to the patient, not just the single episode of delivery to the patient. The single fee covers the encounters for evaluation, measuring, fabrication, and fitting. It also covers the follow-up services for modifications. Unlike the SNF or Medicare Advantage example, O&P has limited ways to impact the number of services or costs associated with servicing the patient.
The current payment model also has an additional downside: commercial payors’ reliance on Medicare coverage determinations. Commercial payors use the same code set as CMS and often reference or specifically follow the same coverage guidelines as CMS and the durable medical equipment Medicare administrative contractors (DME MACs). Since commercial payors do not assign their own HCPCS codes to an item or new technology, we must rely upon CMS for recognizing new technology and assigning the item its own HCPCS code, and then a fee schedule. Unfortunately, the process for obtaining a new HCPCS code is antiquated and fraught with obstacles. The result is very few new technologies are recognized within the HCPCS system. The difficulty in obtaining an HCPCS code also has led to fewer manufacturers even attempting to obtain an HCPCS code for new devices. For instance, in 2007 there were 171 HCPCS applications, with only 35 approved for new codes. In contrast, in 2017 only 78 applications were received (and only 68 of them were for new codes). Out of the 78 applications, only seven new codes were approved. This represents a 60 percent decline in applications during a 10-year period where new technological developments within the O&P industry were on the rise.
When CMS does not issue an HCPCS code for a specific device or technology, suppliers must use a miscellaneous or not-otherwise-classified code, generally referred to in the profession as a “99” code. There are two distinct problems with 99 codes. First, many commercial payors take a stance that new technologies classified with a 99 code are experimental and investigational, and thus noncovered. Second, the O&P profession is at the mercy of often one-sided contract language for determining fee schedules for 99 codes. We have seen a trend in commercial payors, and Medicaid payors, to propose fee schedules based on a percentage above the manufacturer invoice, and often the proposed percentage is in the range of 5 to 10 percent. Commercial payors tend to be very reluctant to negotiate very far from their offered fee schedule, resulting in a “take it or leave it” approach offered to many in the O&P profession. Other payment terms are based upon the manufacturer suggested retail price (MSRP), which may not consider a single product with a single MSRP, but multiple lines of 99 HCPCS codes used to describe the product’s components. Additionally, many O&P items do not have MSRPs, or the MSRPs do not consider all of the services that must be covered by the payment for the single item (returning again to our global capitation issue).
To summarize and answer the original question, the biggest challenges with the current L-code system are (1) a lack of fair compensation for the entirety of the services provided when using a single fee-for-service model and (2) the chilling effect the current HCPCS system has on recognizing new technology. Without the recognition of new technology and an available market for the technology, we ultimately stifle the development of the technology all together. The impact of the current payment system therefore extends far beyond the prosthetist or orthotist but rather reaches the manufacturer, the inventor, and, ultimately, the patient.
O&P News: Do you believe O&P clinicians should be able to bill for their time and expertise?
Brandt: Absolutely. Our profession has sanctified its educational requirements over the past 20 years to [require] a master’s level degree. Given this level of education, combined with residencies, board exams, and, in many states, licensure, practitioners should be able to bill and be appropriately reimbursed for the care they provide.
We, as a profession, through outcomes measures, are increasingly quantifying the patient-care portion that accompanies the devices we provide. Our profession and billing foundation were once predicated on the device we provided, but as science and research have better informed us, we now know that the care we provide, alongside of the manufactured device, is at least as important and many times the differentiator in helping a patient transition to using [the device] and actually achieving the outcome all parties were shooting for.
Bostock: Yes. Are certified orthotists and prosthetists product suppliers, or are they knowledge-based health-care professionals? Does it make a difference? A difference as it relates to how CMS, insurance payors, referral sources, and patients view certified orthotists and prosthetists? I believe that it does.
The perceptions of patients, payors, and referral sources of the O&P profession ultimately define the profession as it relates to the care certified orthotists and prosthetists provide their patients and how they are compensated as health-care professionals. CMS, payors, referral sources, and patients are the ones that create the paradigm for our profession, and, unfortunately, it is a paradigm that currently defines O&P practitioners as suppliers, vendors, and product sales reps—providers of products. Certified orthotists and prosthetists are the only health-care professionals that do not bill CPT codes for the care that they provide to their patients. Other health-care professionals bill HCPCS codes for the devices that they provide and CPT codes for the patient-care services that they provide to their patients, and certified orthotists and prosthetists should join the ranks of other health-care professionals and bill HCPCS codes when they provide their patients with products and bill CPT codes for the patient-care services that they provide to their patients that are within their scope of practice.
The American Board for Certification in Orthotics, Prosthetics, and Pedorthics (ABC) defines ABC-certified orthotists and prosthetists as health-care professionals specifically educated and trained to manage comprehensive orthotic and/or prosthetic patient care. Under this definition there are not any references to the profession as vendors, suppliers, product sales reps, or just fitters of products—rather, [ABC] states that certified orthotists and prosthetists are educated and trained to manage comprehensive O&P patient care. If certified orthotists and prosthetists are educated and trained to provide comprehensive O&P care to their patients, they should bill for the care that they provide to their patients.
Greene: Yes. O&P is a profession. A profession is generally defined as a paid occupation that involves prolonged training and a formal qualification. Fifteen states have licensure requirements, and three more states require accreditation from a nationally accepted accrediting body. Additionally, Congress passed Section 427 of the Benefit Improvement and Protection Act (BIPA), which instructed CMS to take the steps necessary to limit the payment of prostheses and custom orthoses to qualified providers and suppliers. Congress, and 18 state legislatures, have recognized and solidified our industry as a profession. CMS’s payment system should be updated to likewise recognize the health-care treatment provided by the O&P profession.
The knowledge and expertise of a prosthetist and orthotist is used during each visit with a patient, and as a profession we provide health care during our interactions with our patients. It is appropriate for prosthetists and orthotists to be compensated like other health-care professionals, such as physicians or even physical or occupational therapists.
O&P News: Is there a current payment model that would work better for O&P? If so, how would this model work for O&P?
Brandt: Potentially. We are already paid in a bundle payment. If the current payment system could be modified or improved to capture more clinical episodes of care and subsequent closely related outcomes, the current payment model might survive. The payment model would allow, for example, multiple check sockets or sockets or even trial units to make more highly predictive patient use or efficacy decisions. Like the Merit-Based Incentive Payment System, payment levels should be commensurate with level of outcome and quality of care provided—not simply payment for devices.
Bostock: Yes. Other health-care providers, such as physicians, physical and occupational therapists, dentists, optometrists, podiatrists, and athletic trainers, provide and bill for patient-care services using CPT codes and provide and bill for medical products using HCPCS codes, in many instances including orthotic and prosthetic devices. Certified orthotists and prosthetists who also provide patient-care services and medical devices only bill for the products and not the patient-care services that they provide to their patients. The O&P profession should adopt the same billing practices the other health-care providers use wherein the products that they provide to their patients are billed using HCPCS codes, and, when patient-care services are provided, they bill using CPT codes.
Greene: Out of the current compensation methods used by CMS, I believe the most appropriate compensation method would be copying the physician CPT system, mimicking the evaluation and management (E/M) coding patient visit system. E/M coding is based on three key components: history, physical, and medical decision making. For instance, an office visit has five different levels, or E/M codes, depending upon the complexity of the evaluation. A similar type of system could be instituted within the O&P profession, compensating a prosthetist or orthotist based upon the number and complexity of services provided to the patient during a specific visit.
In addition to providing compensation for the treatment provided during office visits, prosthetists and orthotists should still receive compensation for the actual prosthetic or orthotic device provided to the patient. This again is in line with how physicians are compensated. When the physician provides the patient with a device or other equipment, the physician is able to bill for the actual item provided with the item’s HCPCS code. [For the provision of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS), the physician must have a separate DMEPOS provider number.]
By mimicking the physician system, prosthetists and orthotists would be compensated for the health-care services and treatment they provide to patients. The compensation would be based upon the actual services provided and needed by a patient, compensating more for the complex cases and less for others.
O&P News: Do you believe that O&P should separate from durable medical equipment (DME)? If so, why?
Brandt: Yes—provided it can be done correctly and with recognition of the care component. It is clear that “true” O&P care is often defined as long-term usage or the need for a custom device and treatment approach, and those devices require thoughtful and knowledgeable provisioning and long-term usage oversight as well as maintenance and replacements. DME products/devices are largely an acute usage-type of product requiring very minimal clinical skills. They are often most effectively provided immediately following a physician’s office visit for efficiency and thoroughness as it relates to the physician’s treatment approach for that patient’s visit.
Bostock: Yes. Certified orthotists and prosthetists should be recognized as knowledge-based health-care professionals, just like other health-care professionals—such as physical therapists, physicians, and podiatrists that also provide patient-care services, and O&P and DME products.
Greene: Yes. Most of the DME services are limited to the provision (or delivery) of equipment used by the patient. Except for limited circumstances like complex rehabilitation wheelchairs, the DME provider does not evaluate the patient or provide health-care treatment. The knowledge and training of many DME providers is product specific and is based around being able to instruct the patient on the use of the item. This is distinct from the O&P profession. We evaluate the health-care needs of a patient and develop a treatment plan for the patient. To do so, we are required to have extensive knowledge and education on the physical body, and knowledge of how to treat deformities and ailments impacting the body.
The O&P industry is fighting to be viewed as a profession and to distinguish the provision of a prosthesis and custom orthosis from the “delivery” of a piece of equipment. We are not demonstrating how to use a CPAP machine or mailing diabetic testing strips to a patient, but instead we are evaluating the patient’s physical needs and developing a specific treatment for the patient. We are a profession of health-care providers, and we cannot fully be viewed and treated as such while we are grouped together with and held to similar requirements as DME suppliers. While those services are important and needed within our health-care system, they are distinct from the services provided by prosthetists and orthotists.
O&P News: Some believe that patients have the most to gain from a payment model that adequately accounts for the services provided by O&P clinicians; can you provide any insight or examples of why this is the case?
Smith: The move to value-based payment will benefit patients. As cost and outcomes data becomes more available, patients will be able to choose high-value providers for their care.
Brandt: I would largely agree but also I believe the clinicians and support staff at the O&P practice would largely benefit from a payment model shift to fee-for-value. It would presumably allow for practices to move more in sync with a patient’s clinical needs as dictated by the pathology as opposed to not being able to provide something in a critical timeline because of an L-code quantity or administrative procedural issue.
Bostock: Today, the O&P profession places a greater emphasis on the patient care and rehabilitative services provided by certified orthotists and prosthetists for their patients, and not just on the products provided. The O&P profession has a unique body of knowledge that no other health-care profession has, that interfaces patient-care skills with in-depth knowledge of componentry and materials that enable O&P professionals to assist their patients in achieving their health-care goals and improving their quality of life. Today, as health-care providers, certified orthotists and prosthetists assist their patients in improving the quality of their lives not through selling them products, but rather through knowing what products and patient-care services combined will provide them with increased mobility and independence, and the best possible cost-effective outcomes.
Greene: I believe a proper payment model protects the patient by ensuring the patient receives all of the care necessary to obtain the best outcome possible. You can open any newspaper on any given day and find an article about the decreasing quality of health care due to the increased pressures placed on health-care providers. Physicians are having to see more patients in a day due to the decreased revenue received for each service. With the increase in volume, patient advocacy groups have argued there is a risk for mistakes and inadequate care.
Under our current payment system, the more time or visits spent with a patient, the less revenue the prosthetist or orthotist receives for the care. This inherently places the prosthetist and patient at odds. While we all hope a prosthetist or orthotist would never purposely provide less than quality care because of the compensation model, the reality is the clinician must continue to bring in new patients and provide new services to receive compensation. This means that extra visits to try different technology or follow-up visits to verify the best fit are harder and harder for prosthetists to afford. Likewise, the amount of time a prosthetist can spend with each patient on a given day is lessening.
By compensating the prosthetist for the actual health care provided, you protect the patient by removing the inherent conflict that currently exists between care and compensation.
