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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 Indications and Limitations of Coverage 
 
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 patients 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. 
 
You can find this information in Medicare's National Coverage Determination (NCD): Electrical Nerve 
Stimulators (160.7). 
 
 
The rules say Indications and Limitations of Coverage 
 
Electrical nerve stimulation is an accepted modality for assessing a patient's suitability for ongoing treatment 
with a transcutaneous or an implanted nerve stimulator. 
 
Accordingly, program payment may be made for the following techniques when used to determine the potential 
therapeutic usefulness of an electrical nerve stimulator: 
 
A. Transcutaneous Electrical Nerve Stimulation (TENS) 
 
This technique involves attachment of a transcutaneous nerve stimulator to the surface of the skin over the 
peripheral nerve to be stimulated. It is used by the patient on a trial basis and its effectiveness in modulating 
pain is monitored by the physician, or physical therapist. Generally, the physician or physical therapist is able 
to determine whether the patient is likely to derive a significant therapeutic benefit from continuous use of a 
transcutaneous stimulator within a trial period of 1 month; in a few cases this determination may take longer to 
make. Document the medical necessity for such services which are furnished beyond the first month. (See 
160.13 for an explanation of coverage of medically necessary supplies for the effective use of TENS.) 
 
If TENS significantly alleviates pain, it may be considered as primary treatment; if it produces no relief or 
greater discomfort than the original pain electrical nerve stimulation therapy is ruled out. However, where 
TENS produces incomplete relief, further evaluation with percutaneous electrical nerve stimulation may be 
considered to determine whether an implanted peripheral nerve stimulator would provide significant relief from 
pain. 
 
Usually, the physician or physical therapist providing the services will furnish the equipment necessary for 
assessment. Where the physician or physical therapist advises the patient to rent the TENS from a supplier 
during the trial period rather than supplying it himself/herself, program payment may be made for rental of the 
TENS as well as for the services of the physician or physical therapist who is evaluating its use. However, the combined program payment which is made for the physician's or physical therapist's services and the rental of 
the stimulator from a supplier should not exceed the amount which would be payable for the total service, 
including the stimulator, furnished by the physician or physical therapist alone. 
 
B. Percutaneous Electrical Nerve Stimulation (PENS) 
 
This diagnostic procedure which involves stimulation of peripheral nerves by a needle electrode inserted 
through the skin is performed only in a physician's office, clinic, or hospital outpatient department. Therefore, 
it is covered only when performed by a physician or incident to physician's service. If pain is effectively 
controlled by percutaneous stimulation, implantation of electrodes is warranted. 
 
As in the case of TENS (described in subsection A), generally the physician should be able to determine 
whether the patient is likely to derive a significant therapeutic benefit from continuing use of an implanted 
nerve stimulator within a trial period of 1 month. In a few cases, this determination may take longer to make. 
The medical necessity for such diagnostic services which are furnished beyond the first month must be 
documented. 
 
NOTE: Electrical nerve stimulators do not prevent pain but only alleviate pain as it occurs. A patient can be 
taught how to employ the stimulator, and once this is done, can use it safely and effectively without direct 
physician supervision. Consequently, it is inappropriate for a patient to visit his/her physician, physical 
therapist, or an outpatient clinic on a continuing basis for treatment of pain with electrical nerve stimulation. 
Once it is determined that electrical nerve stimulation should be continued as therapy and the patient has been 
trained to use the stimulator, it is expected that a stimulator will be implanted, or the patient will employ the 
TENS on a continual basis in his/her home. Electrical nerve stimulation treatments furnished by a physician in 
his/her office, by a physical therapist or outpatient clinic are excluded from coverage by 1862(a)(1) of the Act. 
(See 160.7 for an explanation of coverage of the therapeutic use of implanted peripheral nerve stimulators 
under the prosthetic devices benefit.) See 160.27 for an explanation of coverage of the therapeutic use of 
TENS under the durable medical equipment benefit. You can find this information in Medicare's National 
Coverage Determination (NCD): Assessing Patient's Suitability for Electrical Nerve Stimulation Therapy 
(160.7.1). 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.