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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 state that short-latency somatosensory evoked potentials (SEPs) represent electrophysiologic 
responses of the somatosensory pathways to stimulation. Somatosensory testing involves the application of a 
series of brief electrical stimuli over peripheral nerves (e.g., the median, peroneal, and tibial nerves) and 
recording the resulting evoked potentials over proximal portions of the nerves and central pathways which were 
stimulated, the plexus, spine and/or scalp. Action potentials recorded from these sites are averaged by a 
computer to improve signal clarity, and then displayed in standard formats on the computers screen as well as 
in printed form. 
 
A physician trained in interpreting clinical evoked potential studies analyzes the waveforms. The waveforms 
obtained should be described by nerves being stimulated, the recording sites, peak latencies, interpeak intervals 
(when appropriate), and amplitudes of the significant components. The nerves most commonly stimulated are 
the median nerves at the wrist for testing in the upper extremity, and the posterior tibial nerve at the ankle or 
common peroneal nerve (CPN) at the knee for the lower extremity. 
 
SEPs evaluate the entire somatosensory pathway from the site of stimulation up to the cerebral cortex. It is 
possible to distinguish between lesions located in the peripheral nerve, in the dorsal column spinal cord 
pathway, or higher centers in the brain up through the cortex. In general, there is no need for SEP in the 
diagnosis of most peripheral neuropathies, because the conventional nerve conduction studies or needle 
electromyography (EMG) can identify these types of lesions and no added information is obtained from SEP. 
This local coverage determination (LCD) discusses medically necessary indications and limitations for SEPs. 
 
Indications: 
 
Medicare will consider the use of short-latency SEPs to be medically reasonable and necessary to assist in the 
diagnosis of certain neuropathologic states (as described below), in order to provide information for treatment decisions and also for intraoperative electrophysiological monitoring during spinal surgeries, in which there is 
risk of additional nerve or spinal cord injury. However, it is not anticipated that such monitoring will be 
medically necessary for the typical cervical or lumbar root decompression procedures. 
 
SEPs are used to evaluate the more proximal segments of nerves and the integrity of the central somatosensory 
pathways, when abnormality of conduction through the brain and/or brainstem, spinal cord, and/or peripheral 
nerves is suspected. This utilization would include conditions such as multiple sclerosis, cervical spondylosis 
with myelopathy, coma, spinal cord trauma, myoclonus, Friedreichs ataxia, syringomyelia, spinal cord tumors, 
spinal stenosis and other conditions where there is spinal cord compression. 
 
Limitations: 
 
SEP studies are appropriate only when a detailed clinical history, neurologic examination and appropriate 
diagnostic tests such as imaging studies, electromyogram, and nerve conduction studies make a lesion (or 
lesions) of the central somatosensory pathways a likely and reasonable differential diagnostic possibility. 
 
Nurse practitioners, clinical nurse specialists, and physician assistants are not defined as physicians; therefore, 
they may not function as supervisory physicians under the diagnostic tests benefit. However, when these 
practitioners personally perform diagnostic tests, as provided they may do so in pursuant to State scope of 
practice laws and under the applicable State requirements for physician supervision or collaboration. 
 
Reasonable and necessary services are ordered and/or furnished by qualified personnel. Provision of 
interpretation and/or supervision of these tests will be considered medically reasonable and necessary, only if 
performed by appropriately trained providers. 
 
You can find this rule at the Medicare Local Coverage Determination (LCD) L34433: Somatosensory Testing. 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com. 
 
The Plan contract says that the Plan covers items and services in accordance with Medicare rules.