Department of Health and Human Sefices – 

OFFICE OF 

‘ INSPECTOR GENERAL 

MEDICARE CARRIERS’ POLICIES FOR 

TRANSCWNIAL DOPPLERS: 

A NEW TECHNOLOGY 

MARCH 1993 oEI-03-91-m951 
EXECUTIVE SUMMARY 

PUIiiOSE 

This report reviews Medicare carriers’ coverage policies for transcranial dopplers, a 

new technology. 

BACKGROUND 

Transcranial doppler (TCD) is a noninvasive ultrasound technique that measures 

blood flow velocities in the major arteries in the skull. The TCD technology was 

introduced in 1982. 

The Health Care Financing Administration (HCFA) contracts with private insurance 

organizations, called carriers, to make Medicare coverage determinations and disburse 

payments. When HCFA issues policy guidance on a new technology, carriers are 

required to follow it. When no guidance is provided, each carrier establishes its own 

coverage policies. 

Carriers use the HCFA Common Procedure Coding System (HCPCS) to reimburse 

Medicare Part B services, including physician services. The HCPCS is based on the 

Current Procedural Terminolo’~ (CPT) coding system, which was developed by the 

American Medical Association (AMA) in 1966 and updated annually. Effective 

January 1, 1992, two new CPT codes were established for TCD services. Physicians 

use the new codes to claim Medicare reimbursement for TCD tests performed on or 

after that date. 

In a related study (“Medicare Carrier Assessment of New Technologies,” 0EI-Ol-88-

00010), we found inconsistencies in carrier coverage and pricing decisions and a 

significant need for HCFA guidance involving new technologies. We recommended 

HCFA improve its ability to identi~ emerging technologies and make more consistent 

coverage decisions for new technologies. 

METHODOLOGY 

In late 1991, we reviewed earners’ coverage 

1992, we recontacted those carriers that did 

policies and guidelines for TCDS. In early 

not cover TCDS in 1991 to determine if 

they had changed their policies, and, if SO,what had influenced their decisions. We 

also obtained payment information for the two TCD procedure codes for the first 

quarter of 1992 from the Part B Extract Summary System (BESS) file. We obtained 

technical and clinical information on TCDS from medical literature, professional 

provider organizations, and individual physician experts. 

i 
TABLE OF CONTENTS 

EX&UTIVE SUMMARY 

INTRODUCI’ION . . . . . . . . . . . . . . . . . . ..-.....--...-...=...====..===- 1 

Carrier Coverage Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..-00.0-003 

Carrier Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..0000003 

Influence ofCPTCodes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..=- ==..4 

HCFAEfforts . . . . . . . . . . . . . . . . . . . .- . . . . . . . . . . . . . . ..=. ======--==5 

RECOMMENDA~ON . . . . . . . . . . . . . ..-..............-...=--=-==-- -=’7 

COMMENT S. . . . . . . . . . . . . . . . . . . . . * * . . =- . * -- * =* - * . ==- * * - **=-*-.*- 8 

APPENDIXA AmerkanAcademyofNeurologyEWitbkhed andliwestigational 

Uses ofTranscranial Dopplers . . . . . . . . . . . . . . . . . . . . . . . ..A-1 
INTRODUCTION 

P~OSE 

This report reviews 

new technology. 

BACKGROUND 

Medicare carriers’ coverage policies for transcranial dopplers, a 

Transcranial doppler (TCD) is a noninvasive ultrasound technique which measures 

circulation in the major arteries inside the skull. First introduced in 1982, the TCD is 

used to determine changes in blood flow velocity. Increased velocity generally 

indicates a narrowed blood vessel. 

The test is done with a hand-held instrument which transmits ultrasonic energy from a 

probe to a point inside an artery in the brain. Some of the energy is reflected back to 

the probe. It is then analyzed, displayed on a monitor, and recorded graphically. 

According to the American Academy of Neurology’s Repoti of the Z?zerapeutics and 

Technology Assessment Committee, TCD has a number of established and 

investigational uses. Their March 1990 report lists five conditions for which TCD is of 

established value, including detecting severe stenosis in the intracranial arteries. See 

Appendix A for a complete list of uses. 

The Health Care Financing Administration (HCFA) contracts with private insurance 

organizations, called carriers, to make Medicare coverage determinations and disburse 

payments in a local service area. When HCFA issues policy guidance on a new 

technology, carriers are required to follow it. When such guidance is not offered, each 

carrier makes its own coverage determinations. Claims for new or unusual devices, 

tests, procedures, or treatment modalities can present serious coverage issues. 

Carriers use the HCFA Common Procedure Coding System (HCPCS) to reimburse 

for Medicare Part B selvices, which includes physician and outpatient semices. The 

HCPCS is based on a coding system maintained in the Physicians’ Current IYocedural 

Te~ino20gy (CPT) Manual. The American Medical Association (AMA) developed 

CPT codes in 1966 and publishes annual updates. 

Effective January 1, 1992, the AMA established two new codes to represent TCD 

semices. Physicians and other providers of semices use the new codes to claim 

Medicare reimbursement for TCD tests performed on or after that date. First quarter 

1992 allowances nationally for the two codes approached $580,000. 

The Medicare Carriers Medical Directors New Technology Workgroup and HCFA’S 

Coverage and Payment Technical Advisory Group are two entities which evahate new 

technologies for the Medicare program. Composed of medical directors from six 

1 
carriers, the New Technology Workgroup meets periodically to research new 

technologies and make recommendations to HCFA as well as other carriers. The 

HCFA’S Coverage and Payment Technical Advisory Group consists of 10 carrier 

medieal directors who recommend policy decisions on various issues, including new 

technologies, to HCFA’S Bureau of Policy Development. 

In a related study (“Medicare Carrier Assessment of New Technologies,” 0E1-01-88-

00010), we found (1) a significant need for HCFA guidance to carriers on new 

technologies, and (2) earner inconsistencies in coverage and pricing decisions involving 

new technologies. We recommended that HCFA improve its own capability and that 

of the carriers to identi~ emerging technologies and to make more informed, explicit, 

and consistent coverage decisions concerning new technologies. 

In its comments on the earlier report, HCFA recognized that problems exist with 

carriers’ assessment of new technologies and noted that it had taken several initiatives 

to improve technology assessment. The HCFA was concerned that our findings, at 

least in part, were no longer valid because of its efforts. It asked the Office of 

Inspector General to conduct another study to assess the effectiveness of its initiatives. 

We plan to conduct such a study in the fiture. The current report sheds light on the 

larger picture by providing a case study of how coverage and 

made for new technologies. 

METHODOLOGY 

payment policies are 

In late 1991, we contacted 36 Medicare carriers representing 58 geographical 

jurisdictions to obtain their coverage guidelines and policies for TCDS. (Some carriers 

service more than one jurisdiction.) Responses were received from carriers 

representing 56 jurisdictions. In this report, we refer to the jurisdictions as carriers. 

During the first quarter of 1992, we recontacted the carriers that did not cover TCDS 

in 1991 to determine if they had changed their policies. If the carriers had changed 

their coverage policies, we asked what influenced their decisions. We also obtained 

payment information for the two TCD procedure codes for the first quarter of 1992 

from the Part B Extract Summary System (BESS) file. 

We obtained technical and clinical information from medical literature, physician 

experts, and professional organizations, including the Medicare Carriers Medical 

Directors New Technology Workgroup, HCFA’S Coverage and Payment Technical 

Advisory Group, the American Academy of Neurology, the American Society of 

Neuroimaging, the Intersocietal Commission for Accreditation of Vascular 

Laboratories, and the American Institute of Ultrasound in Medicine. 

C)ur review was conducted in accordance with the Interim Standards for hspections 

issued by the President’s Council on Integrity and Efficiency. 

2 
FINDINGS 

Carriers’ coverage policies for transcrankd dopplers are inconsistent. 

Carriers’ coverage decisions are not uniform, despite the fact that some carriers have 

provided for payment since 1988. Currently, 40 of 56 carriers cover TCD tests. 

Several carriers not covering TCD tests consider their use investigationaL 

The 40 earners which cover TCDS differ on the conditions required for payment. Half 

(19 of 40) have no specific coverage criteria. Essentially, payment is made for any 

TCD claim submitted. The 19 carriers with no specific guidelines allowed $188,200 

while the 21 carriers with specific coverage criteria allowed $157,278. 

Twenty-one of 40 carriers covering TCDS make payment decisions based on certain 

conditions or criteria. Fifteen (of 21) carriers base their criteria on the American 

Academy of Neurology (/lAN) position paper, which identifies 5 conditions for which 

TCDS have established value (see Appendix A). The remaining six carriers make 

determinations on an individual basis. 

This lack of consistency among the carriers exists even though TCD technology has 

been on the market for several years. At least two carriers have covered TCDS since 

1988, and four others began coverage in 1989. Five of the six carriers still have no 

specific criteria. In fact, nearly half of the 25 earners that covered TCDS as of 1991 

did not have any specific criteria for coverage. This inconsistency corroborates our 

previous study in which one-third of the carriers stated that, as a group, they are 

minimally consistent in making coverage decisions about new technologies. 

As we stated in our earlier report entitled “Medicare Carrier Assessment of New 

Technologies”: 

Since each of the earners interprets the meaning of demonstrated value 

and general use within its service area, coverage decisions can and do 

vary, reflecting differences in local practice patterns. These variations 

are of concern to some carrier representatives who feel that health care 

has become “a much more uniform process nationally than it was in 1965 

when Medicare was enacted.” One of the medical directors obsemes, 

“the idea of local practice patterns that was accurate 20 to 30 years ago 

no longer applies today.” The carriers are looking for more coordination 

--some even say uniformity--in coverage decisions. 

Some carriers pay for transcranial dopplers despite noncoverage policies. 

Although 16 carriers advised us that they do not cover TCD tests, BESS statistics for 

the first quarter of 1992 disclosed a total of more than $200,000 in allowances for 10 

of the 16 carriers. Total carrier allowances ranged from $254 (Nevada) to $100,000 

3 
(Washington). We contacted these carriers during the first quarter of 1992, with all of 

the contacts occurring in late February or later. At that time, carrier representatives 

informed us that their policies prohibited payment for TCDS. Since the BESS data 

was unavailable at the time we spoke to these carriers, we were unable to verig the 

BESS data with the carriers. 

New CPT codes influenced carriers’ coverage decisions for transcrankl dopplers. 

Prior to January 1, 1992, 31 (of 56) carriers did not cover TCDS. Half (15 of 31) 

reversed their noncoverage determinations on or after January 1, 1992, following the 

introduction of CPT codes representing TCD tests. Twelve of the 15 carriers-­

according to contacts with 8 medical directors and 7 personnel at a supervisory or 

managerial level--cited the new CPT procedure codes as an influence in changing their 

coverage decisions. Seven carriers based the reversals solely on the new codes. 

The creation of a CPT code does not mean a procedure is automatically covered 

under Medicare, although it could signi~ a growing acceptance of the service. It is 

HCFA’S responsibility to determine if a procedure will be covered. However, when 

HCFA does not make a determination, carriers establish coverage policies 

independently. For TCDS, carriers were clearly influenced in their coverage decisions 

by the creation of the new CPT codes. “Physicians increase the pressure on us to 

cover a service when new codes are established,” one medical director said. 

A few carriers also mentioned provider requests, new in-house coverage policies, 

relative value unitsl (even though this payment system is designed to correct 

reimbursement inequities rather than influence coverage policies), and the Medicare 

Carriers Medical Directors New Technology Workgroup as influencing their decisions 

to provide coverage. 

Despite the fact that the Workgroup concurred with the recommended uses outlined 

by the AAN in December 1991, carriers mentioned the new CPT codes as the reason 

for changing TCD coverage decisions more often than the Workgroup. (The 

Workgroup’s recommendations are advisory only. Carriers still have the option to 

grant or deny coverage.) 

Prior to the creation of the new CPT codes, the 25 carriers who covered TCDS used 

existing codes to process claims. While codes varied by carrier, over half used CPT-4 

codes 93850 and 93860 (noninvasive studies of cerebral arteries other than carotid) or 

code 93799 (other procedures unlisted) for claims processing. Because these codes 

encompassed studies other than TCDS, we were not able to identi~ the frequency of 

TCD services. 

1 The relative value unit (RVU) represents the value of a unit of physician work to 

deliver a specific medical semice in relation to the value of other medical services. 

Medicare uses the RVU to calculate reimbursement. 

4 
Our previous study on new technologies revealed carrier vulnerabilities in identifying 

claims involving such techniques, especially when billed under existing codes. A new 

technology billed under an established procedure code would not be recognized as 

new but would be paid as submitted. 

A carrier’s failure to recognize a new technology can lead to problems for 

beneficiaries, physicians, the health care indust~, and program administrators. Any 

Medicare payments, of course, are subject to recovery. However, if not corrected 

promptly, such incorrect payments create an erroneous impression that Medicare now 

pays for the new technology. 

The HCFA efforts to update the coverage process and improve communications with 

carriers do not appear to have resolved problems with carriers’ coverage of this 

technology. 

Our review of TCD policies indicates HCFA’S efforts to update the coverage process 

and improve communications with carriers do not appear to have solved the problems 

with carriers’ assessment of this new technology. We found that carriers still have 

conflicting or non-existent coverage policies for TCDS even though some carriers have 

been paying for it since 1988. 

The inconsistent coverage policies may prevent Medicare payments for appropriate 

tests and allow payments for inappropriate tests. According to some experts, carriers 

may be paying for inaccurate, unnecessary, or inappropriate TCD tests. Concerns 

about the accuracy of TCD tests were raised by experts, providers, and professional 

organizations, and supported by pertinent literature. 

In response to our earlier report, HCFA mentioned several initiatives they had 

undertaken to improve communications with earners. These include: 

b Publishing a proposed rule in the Federal Register which describes the coverage 

process in detail and which makes explicit the criteria that are to be applied 

when making coverage decisions. 

E Requiring carriers to submit a copy of all medical coverage policies to identify 

carriers with widely variant policies. 

P Requiring carriers to have licensed 

b Holding annual Medical Directors’ 

technology assessments. 

physicians as medical directors, 

Conferences with time devoted to new 

5 
Discussing both emerging technology and coverage issues with HCFA’S 

Coverage and Payment Technical Advisory Group, which includes selected 

physicians from earners and HCFA. 

Providing significant pricing guidelines to carriers on new technology. 

The TCD experience suggests that these initiatives have not been successful in 

eliminating problems with assessment and coverage for this new technology. The 

proposed rule has yet to be finalized. 

6 
RECOMMENDATION 

In our earlier study entitled, “Medicare Carrier Assessment of New Technologies,” we 

identified two primary problem areas: (1) a need for HCFA to provide guidance on 

new technologies, and (2) inconsistent carrier policies. Our findings 

technology mirror our conclusions in the earlier study. 

We therefore recommend that HCFA continue its efforts to review, 

guide earner coverage policies of this and other new technologies. 

regarding TCD 

coordinate, and 

7 
COMMENTS 

The-Assistant Secretaxy for Planning and Evaluation concumed with the report. we 

recehed no comments from HCFA. 

8 
APPENDIX A


* 

AMERICAN ACADEMY OF NEUROLOGY POSITION ON TCD 

In March 1990, the Therapeutics and Technology Assessment Subcommittee of the 

American Academy of Neurology (AAN) released a position paper delineating the 

established and investigational uses of TCD. 

Established uses of TCD: 

1.	 Detecting severe stenosis (greater than 65 percent) in the major basal 

intracranial arteries. 

2.	 Assessing patterns and extent of collateral circulation in patients with known 

regions of severe stenosis or occlusion. 

3.	 Evaluating and following patients with vasoconstriction of any cause especially 

after subarachnoid hemorrhage. 

4.	 Detecting arteriovenous malformations and studying their supply arteries and 

flow patterns. 

5.	 Assessing patients with suspected brain death. 

hvestigational uses of TCD: 

1. 

2. 

3. 

4. 

5. 

Assessing patients with migraine. 

Monitoring during cerebral endarterectomy, cardiopulmonary bypass and other 

cerebrovascular and cardiovascular interventions, and surgical procedures. 

Evaluating patients with dilated vasculopathies such as fusiform aneurysms. 

Assessing autoregulation, physiologic, and pharmacologic responses of cerebral 

arteries. 

Evaluating children with various vasculopathies such as sickle cell disease, moya 

moya, and neurofibromatosis. 

A -1

Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

MEDICARE CARRIERS’ POLICIES FOR 

TRANSCRANIAL DOPPLERS: 

A NEW TECHNOLOGY 
OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services’ (HHS) 

programs as well as the health and welfare of beneficiaries served by those programs. This 

statutory mission is carried out through a nationwide network of audits, investigations, and 

inspections conducted by three OIG operating components: the Office of Audit Sewices, the 

Office of Investigations, and the Office of Evaluation and Inspections. The OIG also informs 

the Secretary of HHS of program, and management problems, and recommends courses to 

correct them. 

OFFICE OF AUDIT SERVICES 

The OIG’S Office of Audit Services (OAS) provides all auditing services for HHS, either by 

conducting audits with its own audit resources or by overseeing audit work done by others. 

Audits examine the performance of HHS programs and/or its grantees and contractors in 

carrying out their respective responsibilities and are intended to provide independent 

assessments of HHS programs and operations in order to reduce waste, abuse, and 

mismanagement and to promote economy and efficiency throughout the Department. 

OFFICE OF INVESTIGATIONS 

The OIG’S Office of Investigations (01) conducts criminal, civil, and administrative 

investigations of allegations of wrongdoing in HHS programs or to HHS beneficiaries and of 

un@st enrichment by providers. The investigative efforts of 01 lead to criminal convictions, 

administrative sanctions, or civil money penalties. The 01 also oversees State Medicaid fraud 

control units which investigate and prosecute fraud and patient abuse in the Medicaid program. 

OFFICE OF EVALUATION AND INSPECI’’IONS 

The OIG’S Office of Evaluation and Inspections (OEI) conducts short-term management and 

program evaluations (called inspections) that focus on issues of concern to the Department, 

the Congress, and the public. The findings and recommendations contained in these inspection 

reports generate rapid, accurate, and up-to-date information on the efficiency, vulnerability, 

and effectiveness of departmental programs. 

This report was prepared under the direction of Joy Quill, the Regional Inspector General for 

the Office of Evaluation and Inspections, and Robert A. Vito, Deputy Regional Inspector 

General, Office of Evaluation and Inspections, Region III. Participating in this project were 

the following people: 

REGION HEADQUARTERS 

Robert A. Katz, Project Leader Wayne Powell 

Eileen E. Silk Brian Ritchie 

Cynthia R. Hansford 

To obtain a copy of this report, call the I?hiladelPhia llegional Office at (215) 596-0607.