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 The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101.  

The rules say that medically necessary services are those that are reasonable and necessary for the diagnosis or treatment of an illness or injury. Medically necessary services include services to improve the functioning of a malformed body member. You can find this rule in the Social Security Act, Section 1862(a)(1)(A).  

The rules say that services that are not medically necessary are not covered. The rules also say that experimental and investigational devices are not covered. You can find this rule at 42 CFR Sections 411.15 and 411.15(o).  

The rules say that the implantation of spinal cord stimulators (SCS) may be covered as therapies for the relief of chronic intractable pain. SCS is best suited for neuropathic pain but may have some limited value in other types of nociceptive severe, intractable pain. Therapy consists of a short trial with a percutaneous implantation of neurostimulator electrode(s) in the epidural space for assessing a patient's suitability for ongoing treatment with a permanent surgically implanted nerve stimulator. Performance and documentation of an effective trial is a prerequisite for permanent nerve stimulation. In situations where the spinal cord stimulator has been working well but is in need of replacement for battery change, malfunction or end of stimulator life, a new trial is not needed to replace the stimulator. Selection of patients for implantation of spinal cord stimulators is critical to success of this therapy. SCS therapy should be considered as a late option after more conservative attempts such as medications, physical therapy, psychological therapy or other modalities have been tried. Patients must have undergone careful screening, evaluation and diagnosis by a multidisciplinary team prior to implantation. (Such screening must include psychological, as well as physical evaluation). Documentation of the history and careful screening must be available in the patient chart if requested. Patients being selected for a trial      

Must not have active substance abuse issues.     
Must undergo proper patient education, discussion, and disclosure including an extensive discussion of the risks and benefits of this therapy.     
Must undergo appropriate psychological screening  

Many experts recommend that the temporary neurostimulator be placed in an ASC or outpatient hospital setting. However, the temporary neurostimulator trial can be done in an office setting if all the sterility, equipment, professional training and support personnel required for the proper surgery, and follow up of the patient are available. Permanent neurostimulators must be placed in an ASC or hospital. Physicians performing SCS trials in the office setting must have like privileges at a local hospital or ASC, or the providers must be subspecialty boarded in Pain Medicine by the American Board of Anesthesiology. It is preferable that physicians performing the SCS trial will also perform the permanent implant. If the physician implanting the trial neurostimulator does not or cannot implant the permanent neurostimulator, the patient should be informed of this in writing and given the name of the referral surgeon who will implant the permanent neurostimulator(s). It is expected that accurate patient selection will lead to most patients going on to receive permanent implants. Only patients who experience a positive response to a trial should proceed to a permanent implantation. All trials which proceed to permanent implant must have adequate documentation in the chart to support that decision. A successful trial should be associated with at least a 50% reduction of target pain, or 50% reduction of analgesic medications, and show some element of functional improvement. (Patients with reflex sympathetic dystrophy may show lower levels of improvement since it takes longer periods for improvement than the typical 1-2 week trial). Physician judgment and experience will also be taken into account. Physicians with a low trial to permanent implant ratio (less than 50%) will be subject to post-payment review and may be asked to submit documentation as to the patient selection criteria, the radiologic imaging demonstrating proper lead placement, and the medical necessity of the trials. Noridian will reimburse for placement of a maximum of 2 leads or 16 "contacts," and for 2 SCS trials per anatomic spinal region per patient per lifetime (with exceptions allowed for technical limitations for the initial trials or for use of different modalities of stimulation, including new technology). More than 2 SCS trials per anatomic spinal region per patient per lifetime is not considered reasonable and necessary. If a trial fails, a repeat trial is not appropriate unless there are extenuating circumstances that lead to trial failure. You can find this information in Medicare's Local Coverage Determination (LCD): Spinal Cord Stimulators for Chronic Pain (L36204).  

The rules say that two general classifications of electrical nerve stimulators are employed to treat chronic intractable pain: peripheral nerve stimulators and central nervous system stimulators.  

A. Implanted Peripheral Nerve Stimulators: Payment may be made under the prosthetic device benefit for implanted peripheral nerve stimulators. Use of this stimulator involves implantation of electrodes around a selected peripheral nerve. The stimulating electrode is connected by an insulated lead to a receiver unit which is implanted under the skin at a depth not greater than 1/2 inch. Stimulation is induced by a generator connected to an antenna unit which is attached to the skin surface over the receiver unit. Implantation of electrodes requires surgery and usually necessitates an operating room. NOTE: Peripheral nerve stimulators may also be employed to assess a patient's suitability for continued treatment with an electric nerve stimulator. As explained in ?160.7.1, such use of the stimulator is covered as part of the total diagnostic service furnished to the beneficiary rather than as a prosthesis. B. Central Nervous System Stimulators (Dorsal Column and Depth Brain Stimulators): The implantation of central nervous system stimulators may be covered as therapies for the relief of chronic intractable pain, subject to the following conditions:  

1. Types of Implantations  

There are two types of implantations covered by this instruction:      

Dorsal Column (Spinal Cord) Neurostimulation - The surgical implantation of neurostimulator electrodes within the dura mater (endodural) or the percutaneous insertion of electrodes in the epidural space is covered.     
Depth Brain Neurostimulation - The stereotactic implantation of electrodes in the deep brain (e.g., thalamus and periaqueductal gray matter) is covered.  

2. Conditions for Coverage  

No payment may be made for the implantation of dorsal column or depth brain stimulators or services and supplies related to such implantation, unless all of the conditions listed below have been met:      

The implantation of the stimulator is used only as a late resort (if not a last resort) for patients with chronic intractable pain;     
With respect to item a, other treatment modalities (pharmacological, surgical, physical, or psychological therapies) have been tried and did not prove satisfactory, or are judged to be unsuitable or contraindicated for the given patient;     
Patients have undergone careful screening, evaluation and diagnosis by a multidisciplinary team prior to implantation. (Such screening must include psychological, as well as physical evaluation);     
All the facilities, equipment, and professional and support personnel required for the proper diagnosis, treatment training, and follow up of the patient (including that required to satisfy item c) must be available; and     
Demonstration of pain relief with a temporarily implanted electrode precedes permanent implantation.  

Medicare Administrative Contractors may find it helpful to work with Quality Improvement Organizations to obtain the information needed to apply these conditions to claims. You can find this information in Medicare's National Coverage Determination (NCD): Electrical Nerve Stimulators (160.7).  

If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.