[Federal Register Volume 87, Number 9 (Thursday, January 13, 2022)]
[Rules and Regulations]
[Pages 2051-2058]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-00572]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 410 and 414

[CMS-6081-N]


Medicare Program; Updates to Lists Related to Durable Medical 
Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Conditions of 
Payment

AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of 
Health and Human Services (HHS).

ACTION: Updates to and selection of certain codes.

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SUMMARY: This document announces the updated Healthcare Common 
Procedure Coding System (HCPCS) codes on the Master List of DMEPOS 
Items Potentially Subject to Face-to-Face Encounter and Written Order 
Prior to Delivery and/or Prior Authorization Requirements. It also 
announces the initial selection of HCPCS codes on the Required Face-to-
Face Encounter and Written Order Prior to Delivery List and the updates 
the HCPCS codes on the Required Prior Authorization List.

DATES: The implementation is effective on April 13, 2022. Prior 
authorization will be implemented in 3 incremental phases, with the 
final phase being national implementation. Phase 1 includes 1 state per 
jurisdiction and is effective April 13, 2022, Phase 2 includes 4 States 
per jurisdiction and is effective July 12, 2022, and Phase 3 is 
nationwide and is effective October 10, 2022.

FOR FURTHER INFORMATION CONTACT: 
    Susan Billet, (410) 786-1062.

[[Page 2052]]

    Emily Calvert, (410) 786-4277.
    Stephanie Collins, (410) 786-3100.
    Jennifer Phillips, (410) 786-1023.
    Olufemi Shodeke, (410) 786-1649.

SUPPLEMENTARY INFORMATION:

I. Background

    Sections 1832, 1834, and 1861 of the Social Security Act (the Act) 
establishes benefits and the provisions of payment for Durable Medical 
Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) items under 
Part B of the Medicare program.
    Section 1834(a)(1)(E)(iv) of the Act provides conditions of 
coverage specific to Power Mobility Devices (PMDs). Specifically, it 
provides that payment may not be made for a covered item consisting of 
a motorized or power wheelchair unless a physician (as defined in 
section 1861(r)(1) of the Act), physician assistant (PA), nurse 
practitioner (NP), or clinical nurse specialist (CNS) (as such non-
physician practitioners are defined in section 1861(aa)(5) of the Act) 
has conducted a face-to-face examination of the individual and written 
a prescription for the item.
    Section 1834(a)(11)(B) of the Act requires a physician, PA, NP, or 
CNS to have a face-to-face encounter with the beneficiary within the 6-
month period prior to the written order for certain DMEPOS items (or 
other reasonable timeframe as determined by the Secretary of the 
Department of Health and Human Services (the Secretary)).
    Section 1834(a)(15)(A) of the Act authorizes the Secretary to 
develop and periodically update a list of DMEPOS items that the 
Secretary determines, on the basis of prior payment experience, are 
frequently subject to unnecessary utilization and to develop a prior 
authorization process for these items.
    In 2006, we issued Final Rule ``Medicare Program; Conditions for 
Payment of Power Mobility Devices, including Power Wheelchairs and 
Power-Operated Vehicles'' (71 FR 17021) to implement the requirements 
for a face-to-face examination and written order prior to delivery for 
PMDs, in accordance with legislation found in section 302(a)(2) of the 
Medicare Prescription Drug, Improvement, and Modernization Act of 2003 
(Pub. L. 108-173), as codified in amended section 1834(a)(1)(E)(iv) of 
the Act. This regulation applied to all power mobility devices--
including power wheelchairs and power operated vehicles (hereinafter 
referred to as PMDs). The requirements for PMDs mandated a 7-element 
order/prescription for payment.
    In the November 16, 2012 Federal Register, we published final rule 
titled ``Medicare Program; Revisions to Payment Policies Under the 
Physician Fee Schedule, DME Face-to-Face Encounters, Elimination of the 
Requirement for Termination of Non-Random Prepayment Complex Medical 
Review and Other Revisions to Part B for CY 2013'' (77 FR 68892) 
requiring face-to-face encounter and written order prior to delivery 
for specified DMEPOS items, in accordance with the authorizing 
legislation found section 6407 of the Patient Protection and Affordable 
Care Act of 2010 (Pub. L. 111-148) and amended section 1834(a)(11)(B) 
of the Act. The regulation, as codified in 42 CFR 410.38, specified the 
inclusion criteria for creating a list of DMEPOS items to be subject to 
face-to-face encounter and written order prior to delivery 
requirements. It also mandated a 5-element order/prescription for 
payment of specified DMEPOS items.
    In the December 30, 2015 Federal Register, we published final rule 
titled ``Medicare Program; Prior Authorization Process for Certain 
Durable Medical Equipment, Prosthetics, and Supplies'' (80 FR 81674), 
in accordance with section 1834(a)(15) of the Act, we established the 
Master List of Items Frequently Subject to Unnecessary Utilization. The 
2015 Master List included certain DMEPOS items that the Secretary 
determined, on the basis of prior payment experience, are frequently 
subject to unnecessary utilization, and created a prior authorization 
process for these items.
    On November 8, 2019, we published a final rule titled, ``Medicare 
Program; End-Stage Renal Disease Prospective Payment System, Payment 
for Renal Dialysis Services Furnished to Individuals with Acute Kidney 
Injury, End-Stage Renal Disease Quality Incentive Program, Durable 
Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) Fee 
Schedule Amounts, DMEPOS Competitive Bidding Program (CBP) Amendments, 
Standard Elements for a DMEPOS Order, and Master List of DMEPOS Items 
Potentially Subject to a Face-to-Face Encounter and Written Order Prior 
to Delivery and/or Prior Authorization Requirements'' (84 FR 60648). 
The rule became effective January 1, 2020, harmonizing the lists of 
DMEPOS items created by former rules and establishing one ``Master List 
of DMEPOS Items Potentially Subject to Face-To-Face Encounter and 
Written Orders Prior to Delivery and/or Prior Authorization 
Requirements'' (the ``Master List''). Items are selected from the 
Master List for inclusion on the Face-To-Face Encounter and Written 
Orders Prior to Delivery List and/or Prior Authorization List through 
the Federal Register.

II. Provisions of the Document

    This document serves to publish three separate lists. First, it 
provides an update to the Master List of items from which we can select 
to include on the Required Face to Face Encounter and Written Order 
Prior to Delivery List, and/or Required Prior Authorization List. This 
document also serves to announce the initial selection of items to be 
included on the Required Face-to-Face Encounter and Written Order Prior 
to Delivery List. Lastly, it updates the items included on the Required 
Prior Authorization List.

A. Master List of DMEPOS Items Frequently Subject to Unnecessary 
Utilization

    The Master List includes items that appear on the DMEPOS Fee 
Schedule and meet the following criteria, as established in 84 FR 
60648:
    <bullet> Have an average purchase fee of $500 or greater that is 
adjusted annually for inflation, or an average monthly rental fee 
schedule of $50 or greater that is adjusted annually for inflation, or 
items identified as accounting for at least 1.5 percent of Medicare 
expenditures for all DMEPOS items over a recent 12-month period, that 
are also--
    ++ Identified in a Government Accountability Office (GAO) or 
Department of Health and Human Services Office of Inspector General 
(OIG) report that is national in scope and published in 2015 or later 
as having a high rate of fraud or unnecessary utilization; or
    ++ Listed in the 2018 or subsequent year Comprehensive Error Rate 
Testing (CERT) program's Medicare Fee-for-Service (FFS) Supplemental 
Improper Payment Data Report as having a high improper payment rate.
    <bullet> Any items with at least 1,000 claims and $1 million in 
payments during a recent 12-month period that are determined to have 
aberrant billing patterns and lack explanatory contributing factors 
(for example, new technology or coverage policies that may require time 
for providers and suppliers to be educated on billing policies). Items 
with aberrant billing patterns would be identified as those items with 
payments during a 12-month timeframe that exceed payments made during 
the preceding 12-months by the greater of--
    ++ Double the percent change of all DMEPOS claim payments for items 
that meet the previous claim and payment

[[Page 2053]]

criteria, from the preceding 12-month period; or
    ++ Exceeding a 30 percent increase in payments for the items from 
the preceding 12-month period.
    <bullet> Any items statutorily requiring a face-to-face encounter, 
a written order prior to delivery, or prior authorization.
    In the November 2019 final rule noted previously, we described the 
maintenance process of the Master List as follows:
    <bullet> The Master List will be updated annually, and more 
frequently as needed (for example, to address emerging billing trends), 
and to reflect the thresholds specified in the regulations.
    <bullet> Items on the DMEPOS Fee Schedule that meet the payment 
threshold criteria set forth in Sec.  414.234(b)(1) are added to the 
list when the item is also listed in a CERT, OIG, or GAO report 
published after 2020, and items not meeting the cost (approximately 
$500 purchase or $50 rental) thresholds may still be added based on 
findings of aberrant billing patterns.
    <bullet> Items are removed from the Master List 10 years after the 
date the item was added, unless the item was identified in an OIG 
report, GAO report, or having been identified in the CERT Medicare Fee 
for Service Supplemental Improper Payment Data report as having a high 
improper payment rate, within the 5-year period preceding the 
anticipated date of expiration.
    <bullet> Items are removed from the list sooner than 10 years if 
the purchase amount drops below the payment threshold.
    <bullet> Items already on the Master List that are identified on a 
subsequent OIG, GAO, or CERT report will remain on the list for 10 
years from the publication date of the new report.
    <bullet> Items are updated on the Master List when the Healthcare 
Common Procedure Coding System (HCPCS) codes representing an item have 
been discontinued and cross-walked to an equivalent item.
    <bullet> We will notify the public of any additions and deletions 
from the Master List by posting a notification in the Federal Register 
and on the CMS Prior Authorization website at https://www.cms.gov/research-statistics-data-systems/medicare-fee-service-compliance-programs/prior-authorization-and-pre-claim-review-initiatives.
    This document provides the annual update to the Master List of 
DMEPOS Items Potentially Subjected to a Face-to-Face Encounter and 
Written Order Prior to Delivery and/or Prior Authorization Requirements 
stated in the November 2019 final rule (84 FR 60648). As noted 
previously, we adjust the ``payment threshold'' each year for 
inflation. Certain DMEPOS fee schedule amounts are updated for 2021 \1\ 
by the percentage increase in the consumer price index for all urban 
consumers (United States city average) CPI-U for the 12-month period 
ending June 30, 2020, adjusted by the change in the economy-wide 
productivity equal to the 10-year moving average of changes in annual 
economy-wide private non-farm business multi-factor productivity (MFP). 
The productivity adjustment is 0.4 percent and the CPI-U percentage 
increase is 0.6 percent. Thus, the 0.6 percentage increase in the CPI-U 
is reduced by the 0.4 percentage increase in the MFP resulting in a net 
increase of 0.2 percent for the update factor for CY 2021.
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    \1\ CY 2021 Update for Durable Medical Equipment, Prosthetics, 
Orthotics and Supplies (DMEPOS) Fee Schedule (December 4, 2020): 
https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Transmittals/r10504cp.
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    For CY 2021, the 0.2 percent update factor was applied to the CY 
2020 average price threshold of $500, resulting in a CY 2021 adjusted 
payment threshold of $501 ($500 x 1.002). This results in a CY 2021 
adjusted purchase price threshold of $501. An update factor of 0.2 
percent was applied to the CY 2020 average monthly rental fee of $50, 
resulting in an adjusted payment threshold of $50.10 ($50 x 1.002). 
Rounding this figure to the nearest whole dollar amount results in a CY 
2021 adjusted monthly rental fee threshold of $50.
    A total of 31 HCPCS codes (see Table 1) meeting the criteria 
outlined previously are added to the Master List. Of these 31 HCPCS 
codes, 18 are added because these items meet the updated payment 
threshold and are listed in an OIG or GAO report of a national scope or 
a CERT DME and DMEPOS Service Specific Report(s) or both, and 13 are 
added for being identified as accounting for at least 1.5 percent of 
Medicare expenditures for all DMEPOS items over a recent 12-month 
period.

                  Table 1--Additions to the Master List
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         HCPCS                             Description
------------------------------------------------------------------------
A4352..................  Intermittent Urinary Catheter; Coude (Curved)
                          Tip, With Or Without Coating (Teflon,
                          Silicone, Silicone Elastomeric, Or
                          Hydrophilic, Etc.), Each.
A5121..................  Skin Barrier; Solid, 6 x 6 Or Equivalent, Each.
A6203..................  Composite Dressing, Sterile, Pad Size 16 Sq.
                          In. Or Less, With Any Size Adhesive Border,
                          Each Dressing.
A6219..................  Gauze, Non-Impregnated, Sterile, Pad Size 16
                          Sq. In. Or Less, With Any Size Adhesive
                          Border, Each Dressing.
A6242..................  Hydrogel Dressing, Wound Cover, Sterile, Pad
                          Size 16 Sq. In. Or Less, Without Adhesive
                          Border, Each Dressing.
A7030..................  Full Face Mask Used With Positive Airway
                          Pressure Device, Each.
A7031..................  Face Mask Interface, Replacement For Full Face
                          Mask, Each.
E0467..................  Home Ventilator, Multi-Function Respiratory
                          Device, Also Performs Any Or All Of The
                          Additional Functions Of Oxygen Concentration,
                          Drug Nebulization, Aspiration, And Cough
                          Stimulation, Includes All Accessories,
                          Components And Supplies For All Functions.
E0565..................  Compressor, Air Power Source For Equipment
                          Which Is Not Self-Contained Or Cylinder
                          Driven.
E0650..................  Pneumatic Compressor, Non-Segmental Home Model.
E0651..................  Pneumatic Compressor, Segmental Home Model
                          Without Calibrated Gradient Pressure.
E0652..................  Pneumatic Compressor, Segmental Home Model With
                          Calibrated Gradient Pressure.
E0656..................  Segmental Pneumatic Appliance For Use With
                          Pneumatic Compressor, Trunk.
E0657..................  Segmental Pneumatic Appliance For Use With
                          Pneumatic Compressor, Chest.
E0670..................  Segmental Pneumatic Appliance For Use With
                          Pneumatic Compressor, Integrated, 2 Full Legs
                          And Trunk.
E0675..................  Pneumatic Compression Device, High Pressure,
                          Rapid Inflation/Deflation Cycle, For Arterial
                          Insufficiency (Unilateral Or Bilateral
                          System).
E0740..................  Non-Implanted Pelvic Floor Electrical
                          Stimulator, Complete System.
E0744..................  Neuromuscular Stimulator For Scoliosis.
E0745..................  Neuromuscular Stimulator, Electronic Shock
                          Unit.
E0764..................  Functional Neuromuscular Stimulation,
                          Transcutaneous Stimulation Of Sequential
                          Muscle Groups Of Ambulation With Computer
                          Control, Used For Walking By Spinal Cord
                          Injured, Entire System, After Completion Of
                          Training Program.
E0766..................  Electrical Stimulation Device Used For Cancer
                          Treatment, Includes All Accessories, Any Type.
E1226..................  Wheelchair Accessory, Manual Fully Reclining
                          Back, (Recline Greater Than 80 Degrees), Each.
E2202..................  Manual Wheelchair Accessory, Nonstandard Seat
                          Frame Width, 24-27 Inches.
E2203..................  Manual Wheelchair Accessory, Nonstandard Seat
                          Frame Depth, 20 To Less Than 22 Inches.
E2613..................  Positioning Wheelchair Back Cushion, Posterior,
                          Width Less Than 22 Inches, Any Height,
                          Including Any Type Mounting Hardware.

[[Page 2054]]

 
L0830..................  Halo Procedure, Cervical Halo Incorporated Into
                          Milwaukee Type Orthosis.
L1005..................  Tension Based Scoliosis Orthosis And Accessory
                          Pads, Includes Fitting And Adjustment.
L1906..................  Ankle Foot Orthosis, Multiligamentous Ankle
                          Support, Prefabricated, Off-The-Shelf.
L2580..................  Addition To Lower Extremity, Pelvic Control,
                          Pelvic Sling.
L2624..................  Addition To Lower Extremity, Pelvic Control,
                          Hip Joint, Adjustable Flexion, Extension,
                          Abduction Control, Each.
L7368..................  Lithium Ion Battery Charger, Replacement Only.
------------------------------------------------------------------------

    The following five HCPCS codes (see Table 2) are removed from the 
Master List because they no longer have a DMEPOS Fee Schedule price of 
$501 or greater, or an average monthly rental fee schedule of $50 or 
greater, and are identified as accounting for at least 1.5 percent of 
Medicare expenditures for all DMEPOS items over a recent 12-month 
period or both.

                 Table 2--Deletions From the Master List
------------------------------------------------------------------------
         HCPCS                             Description
------------------------------------------------------------------------
A4253..................  Blood Glucose Test or Reagent Strips for Home
                          Blood Glucose Monitor, Per 50 Strips.
A4351..................  Intermittent Urinary Catheter; Straight Tip,
                          With or Without Coating (Teflon, Silicone,
                          Silicone Elastomer, Or Hydrophilic, Etc.),
                          Each.
E2369..................  Power Wheelchair Component, Drive Wheel Gear
                          Box, Replacement Only.
E2377..................  Power Wheelchair Accessory, Expandable
                          Controller, Including All Related Electronics
                          and Mounting Hardware, Upgrade Provided At
                          Initial Issue.
L3761..................  Elbow Orthosis (Eo), With Adjustable Position
                          Locking Joint(S), Prefabricated, Off-The-
                          Shelf.
------------------------------------------------------------------------

    The full updated list is available in the download section of the 
following CMS website: https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/DMEPOS/Prior-Authorization-Process-for-Certain-Durable-Medical-Equipment-Prosthetic-Orthotics-Supplies-Items.

B. Items Subject to Face-to-Face Encounter and Written Order Prior to 
Delivery Requirements

    In the November 2019 final rule, we stated that since the face-to-
face encounter and written orders are statutorily required for PMDs, 
they would be included on the Master List and the Required Face-to-Face 
Encounter and Written Order Prior to Delivery List in accordance with 
our statutory obligation, and would remain there.
    The Required Face-to-Face Encounter and Written Order Prior to 
Delivery List, as specified in Sec.  410.38(c)(8), is comprised of PMDs 
and those items selected from the Master List (as described in Sec.  
414.234(b)) to require a face-to-face encounter and a written order 
prior to delivery as a condition of payment.
    The rule established a process of placing items on the Required 
Face-to-Face Encounter and Written Order Prior to Delivery List, 
including that they be communicated to the public and effective no less 
than 60 days after a Federal Register document publication and CMS 
website posting.
    We note that following the publication of the November 2019 final 
rule (84 FR 60648), the serious public health threats posed by the 
spread of the 2019 Novel Coronavirus (COVID-19) became known, and 
subsequently the addition of new items on the Required Face-to-Face 
Encounter and Written Order Prior to Delivery List was placed on hold.
    We also note that in an interim final rule with comment period 
titled ``Medicare and Medicaid Programs; Policy and Regulatory 
Revisions in Response to the COVID-19 Public Health Emergency'' and 
published on April 6, 2020 (84 FR 19230), we stated that ``to the 
extent an NCD or LCD (including articles) would otherwise require a 
face-to-face or in-person encounter for evaluations, assessments, 
certifications or other implied face-to-face services, those 
requirements would not apply during the PHE for the COVID-19 
pandemic.'' This language does not apply to the face-to-face encounter 
and written order prior to delivery requirements stemming from 42 CFR 
410.38 and section 1834 of the Act; therefore, the ongoing direction 
provided in the April 2020 rule is not affected by this document. The 
list of DMEPOS items selected and promulgated in this document will 
require a face-to-face encounter (conducted either via telehealth or 
in-person), per 42 CFR 410.38, effective after 90 days' notice.
    At this time, we believe it appropriate to add a limited list of 
items that pose a risk to the Medicare Trust Funds, to be subject to 
additional practitioner oversight via the face-to-face encounter and 
written order prior to delivery requirements.
    To assist stakeholders in preparing for implementation of the 
Required Face-to-Face Encounter and Written Order Prior to Delivery 
List, we are publishing the proposed code additions and providing 90 
days' notice.
    Per statutory requirements, Table 3 lists DMEPOS HCPCS codes for 
PMDs. Section 1834(a)(1)(E)(iv) of the Act explicitly requires a face-
to-face and written order for PMDs; therefore, PMDs require a face-to-
face encounter per statute. To reflect this, PMDs will both be placed 
and will remain on the Required Face-to-Face Encounter and Written 
Order Prior to Delivery List indefinitely.
    Section 1834(a)(11)(B) of the Act authorizes the Secretary to 
select other DMEPOS HCPCS codes that will require a face-to-face 
encounter and written order prior to delivery as a condition of 
payment. In addition to PMDs, this Federal Register document announces 
the addition of seven other DMEPOS HCPCS codes, not required by 
statute, that are selected from the Master List to be placed on the 
Required Face-to-Face Encounter and Written Order Prior to Delivery 
List as listed in Table 4, based on our regulatory authority at 42 CFR 
410.38.

[[Page 2055]]



          Table 3--Statutorily Required Power Mobility Devices
------------------------------------------------------------------------
         HCPCS                             Description
------------------------------------------------------------------------
K0800..................  Power Operated Vehicle, Group 1 Standard,
                          Patient Weight Capacity Up To And Including
                          300 Pounds.
K0801..................  Power Operated Vehicle, Group 1 Heavy Duty,
                          Patient Weight Capacity, 301 To 450 Pounds.
K0802..................  Power Operated Vehicle, Group 1 Very Heavy
                          Duty, Patient Weight Capacity 451 To 600
                          Pounds.
K0806..................  Power Operated Vehicle, Group 2 Standard,
                          Patient Weight Capacity Up To And Including
                          300 Pounds.
K0807..................  Power Operated Vehicle, Group 2 Heavy Duty,
                          Patient Weight Capacity 301 To 450 Pounds.
K0808..................  Power Operated Vehicle, Group 2 Very Heavy
                          Duty, Patient Weight Capacity 451 To 600
                          Pounds.
K0813..................  Power Wheelchair, Group 1 Standard, Portable,
                          Sling/Solid Seat And Back, Patient Weight
                          Capacity Up To And Including 300 Pounds.
K0814..................  Power Wheelchair, Group 1 Standard, Portable,
                          Captains Chair, Patient Weight Capacity Up To
                          And Including 300 Pounds.
K0815..................  Power Wheelchair, Group 1 Standard, Sling/Solid
                          Seat And Back, Patient Weight Capacity Up To
                          And Including 300 Pounds.
K0816..................  Power Wheelchair, Group 1 Standard, Captains
                          Chair, Patient Weight Capacity Up To And
                          Including 300 Pounds.
K0820..................  Power Wheelchair, Group 2 Standard, Portable,
                          Sling/Solid Seat/Back, Patient Weight Capacity
                          Up To And Including 300 Pounds.
K0821..................  Power Wheelchair, Group 2 Standard, Portable,
                          Captains Chair, Patient Weight Capacity Up To
                          And Including 300 Pounds.
K0822..................  Power Wheelchair, Group 2 Standard, Sling/Solid
                          Seat/Back, Patient Weight Capacity Up To And
                          Including 300 Pounds.
K0823..................  Power Wheelchair, Group 2 Standard, Captains
                          Chair, Patient Weight Capacity Up To And
                          Including 300 Pounds.
K0824..................  Power Wheelchair, Group 2 Heavy Duty, Sling/
                          Solid Seat/Back, Patient Weight Capacity 301
                          To 450 Pounds.
K0825..................  Power Wheelchair, Group 2 Heavy Duty, Captains
                          Chair, Patient Weight Capacity 301 To 450
                          Pounds.
K0826..................  Power Wheelchair, Group 2 Very Heavy Duty,
                          Sling/Solid Seat/Back, Patient Weight Capacity
                          451 To 600 Pounds.
K0827..................  Power Wheelchair, Group 2 Very Heavy Duty,
                          Captains Chair, Patient Weight Capacity 451 To
                          600 Pounds.
K0828..................  Power Wheelchair, Group 2 Extra Heavy Duty,
                          Sling/Solid Seat/Back, Patient Weight Capacity
                          601 Pounds Or More.
K0829..................  Power Wheelchair, Group 2 Extra Heavy Duty,
                          Captains Chair, Patient Weight Capacity 601
                          Pounds Or More.
K0835..................  Power Wheelchair, Group 2 Standard, Single
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity Up To And Including 300
                          Pounds.
K0836..................  Power Wheelchair, Group 2 Standard, Single
                          Power Option, Captains Chair, Patient Weight
                          Capacity Up To And Including 300 Pounds.
K0837..................  Power Wheelchair, Group 2 Heavy Duty, Single
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity 301 To 450 Pounds.
K0838..................  Power Wheelchair, Group 2 Heavy Duty, Single
                          Power Option, Captains Chair, Patient Weight
                          Capacity 301 To 450 Pounds.
K0839..................  Power Wheelchair, Group 2 Very Heavy Duty,
                          Single Power Option, Sling/Solid Seat/Back,
                          Patient Weight Capacity 451 To 600 Pounds.
K0840..................  Power Wheelchair, Group 2 Extra Heavy Duty,
                          Single Power Option, Sling/Solid Seat/Back,
                          Patient Weight Capacity 601 Pounds Or More.
K0841..................  Power Wheelchair, Group 2 Standard, Multiple
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity Up To And Including 300
                          Pounds.
K0842..................  Power Wheelchair, Group 2 Standard, Multiple
                          Power Option, Captains Chair, Patient Weight
                          Capacity Up To And Including 300 Pounds.
K0843..................  Power Wheelchair, Group 2 Heavy Duty, Multiple
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity 301 To 450 Pounds.
K0848..................  Power Wheelchair, Group 3 Standard, Sling/Solid
                          Seat/Back, Patient Weight Capacity Up To And
                          Including 300 Pounds.
K0849..................  Power Wheelchair, Group 3 Standard, Captains
                          Chair, Patient Weight Capacity Up To And
                          Including 300 Pounds.
K0850..................  Power Wheelchair, Group 3 Heavy Duty, Sling/
                          Solid Seat/Back, Patient Weight Capacity 301
                          To 450 Pounds.
K0851..................  Power Wheelchair, Group 3 Heavy Duty, Captains
                          Chair, Patient Weight Capacity 301 To 450
                          Pounds.
K0852..................  Power Wheelchair, Group 3 Very Heavy Duty,
                          Sling/Solid Seat/Back, Patient Weight Capacity
                          451 To 600 Pounds.
K0853..................  Power Wheelchair, Group 3 Very Heavy Duty,
                          Captains Chair, Patient Weight Capacity, 451
                          To 600 Pounds.
K0854..................  Power Wheelchair, Group 3 Extra Heavy Duty,
                          Sling/Solid Seat/Back, Patient Weight Capacity
                          601 Pounds Or More.
K0855..................  Power Wheelchair, Group 3 Extra Heavy Duty,
                          Captains Chair, Patient Weight Capacity 601
                          Pounds Or More.
K0856..................  Power Wheelchair, Group 3 Standard, Single
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity Up To And Including 300
                          Pounds.
K0857..................  Power Wheelchair, Group 3 Standard, Single
                          Power Option, Captains Chair, Patient Weight
                          Capacity Up To And Including 300 Pounds.
K0858..................  Power Wheelchair, Group 3 Heavy Duty, Single
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity 301 To 450 Pounds.
K0859..................  Power Wheelchair, Group 3 Heavy Duty, Single
                          Power Option, Captains Chair, Patient Weight
                          Capacity 301 To 450 Pounds.
K0860..................  Power Wheelchair, Group 3 Very Heavy Duty,
                          Single Power Option, Sling/Solid Seat/Back,
                          Patient Weight Capacity 451 To 600 Pounds.
K0861..................  Power Wheelchair, Group 3 Standard, Multiple
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity Up To And Including 300
                          Pounds.
K0862..................  Power Wheelchair, Group 3 Heavy Duty, Multiple
                          Power Option, Sling/Solid Seat/Back, Patient
                          Weight Capacity 301 To 450 Pounds.
K0863..................  Power Wheelchair, Group 3 Very Heavy Duty,
                          Multiple Power Option, Sling/Solid Seat/Back,
                          Patient Weight Capacity 451 To 600 Pounds.
K0864..................  Power Wheelchair, Group 3 Extra Heavy Duty,
                          Multiple Power Option, Sling/Solid Seat/Back,
                          Patient Weight Capacity 601 Pounds Or More.
------------------------------------------------------------------------


             Table 4--Non-Statutorily Required DMEPOS Items
------------------------------------------------------------------------
         HCPCS                             Description
------------------------------------------------------------------------
E0748..................  Osteogenesis Stimulator, Electrical, Non-
                          Invasive, Spinal Applications.
L0648..................  Lumbar-Sacral Orthosis, Sagittal Control, With
                          Rigid Anterior And Posterior Panels, Posterior
                          Extends From Sacrococcygeal Junction To T-9
                          Vertebra, Produces Intracavitary Pressure To
                          Reduce Load On The Intervertebral Discs,
                          Includes Straps, Closures, May Include
                          Padding, Shoulder Straps, Pendulous Abdomen
                          Design, Prefabricated, Off-The-Shelf.
L0650..................  Lumbar-Sacral Orthosis, Sagittal-Coronal
                          Control, With Rigid Anterior And Posterior
                          Frame/Panel(S), Posterior Extends From
                          Sacrococcygeal Junction To T-9 Vertebra,
                          Lateral Strength Provided By Rigid Lateral
                          Frame/Panel(S), Produces Intracavitary
                          Pressure To Reduce Load On Intervertebral
                          Discs, Includes Straps, Closures, May Include
                          Padding, Shoulder Straps, Pendulous Abdomen
                          Design, Prefabricated, Off-The-Shelf.
L1832..................  Knee Orthosis, Adjustable Knee Joints
                          (Unicentric Or Polycentric), Positional
                          Orthosis, Rigid Support, Prefabricated Item
                          That Has Been Trimmed, Bent, Molded,
                          Assembled, Or Otherwise Customized To Fit A
                          Specific Patient By An Individual With
                          Expertise.
L1833..................  Knee Orthosis, Adjustable Knee Joints
                          (Unicentric Or Polycentric), Positional
                          Orthosis, Rigid Support, Prefabricated, Off-
                          The Shelf.
L1851..................  Knee Orthosis (KO), Single Upright, Thigh And
                          Calf, With Adjustable Flexion And Extension
                          Joint (Unicentric Or Polycentric), Medial-
                          Lateral And Rotation Control, With Or Without
                          Varus/Valgus Adjustment, Prefabricated, Off-
                          The-Shelf.
L3960..................  Shoulder Elbow Wrist Hand Orthosis, Abduction
                          Positioning, Airplane Design, Prefabricated,
                          Includes Fitting And Adjustment.
------------------------------------------------------------------------

    As previously stated, PMDs are included on the Required Face-to-
Face Encounter and Written Order Prior to Delivery List per statutory 
obligation. For the other DMEPOS items, we considered factors such as 
operational limitations, item utilization, acute needs, pandemic 
impacts, cost-benefit analysis (for example, comparing the cost of 
review versus the anticipated amount of improper payment identified), 
emerging trends (for example, billing patterns, medical review 
findings), vulnerabilities identified in official agency reports, or 
other analysis.
    In selecting these items, we must balance our program integrity 
goals with the needs of patients, particularly those in need of medical 
devices to assist with functional activities and ambulation within 
their home. In other words, we must ensure the appropriate application 
and oversight of the face-to-face encounter requirements. In 
consideration of access issues, we note that the regulation 42 CFR 
410.38 allows

[[Page 2056]]

for use of telehealth, as defined in 42 CFR 410.78 and 414.65, when 
appropriate to meet our coverage requirements for beneficiaries.
    We also believe transparency and education will aid in compliance 
with these payment requirements and continued access. As such, we will 
make information widely available to the public at appropriate literacy 
levels regarding face-to-face encounter requirements, prior 
authorization, and necessary documentation for items on Required Face-
to-Face Encounter and Written Order Prior to Delivery and Prior 
Authorization Lists.
    We believe additional practitioner oversight of beneficiaries in 
need of items represented by these HCPCS codes will help further our 
program integrity goals of reducing fraud, waste, and abuse. It will 
also help ensure beneficiary receipt of items specific to their medical 
needs. For items on the Required Face-to-Face Encounter and Written 
Order Prior to Delivery List (Tables 3 and 4), the written order/
prescription must be communicated to the supplier prior to delivery. 
For such items, we require the treating practitioner to have a face-to-
face encounter with the beneficiary within the 6 months preceding the 
date of the written order/prescription. If the face-to-face encounter 
is a telehealth encounter, the requirements of 42 CFR 410.78 and 414.65 
must be met for DMEPOS coverage purposes.
    Consistent with Sec.  410.38(d), the face-to-face encounter must be 
documented in the pertinent portion of the medical record (for example, 
history, physical examination, diagnostic tests, summary of findings, 
progress notes, treatment plans or other sources of information that 
may be appropriate). The supporting documentation must include 
subjective and objective beneficiary specific information used for 
diagnosing, treating, or managing a clinical condition for which the 
DMEPOS item(s) is ordered. Upon request by CMS or its review 
contractors, a supplier must submit additional documentation to support 
and substantiate the medical necessity for the DMEPOS item or both.
    The Required Face-to-Face Encounter and Written Order Prior to 
Delivery List is available on the following CMS website: https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Medical-Review/FacetoFaceEncounterRequirementforCertainDurableMedicalEquipment.

C. Items Subject to Prior Authorization Requirements

    The November 8, 2019 final rule (84 FR 60648) maintained the 
process established in the December 30, 2015 final rule (80 FR 81674) 
that when items are placed on the Required Prior Authorization List, we 
would inform the public of those DMEPOS items on the Required Prior 
Authorization List in the Federal Register with no less than 60 days' 
notice before implementation, and post notification on the CMS website.
    The Required Prior Authorization List specified in Sec.  
414.234(c)(1) is selected from the Master List (as described in Sec.  
414.234(b)), and those selected items require prior authorization as a 
condition of payment. Additionally, Sec.  414.234 (c)(1)(ii) states 
that CMS may elect to limit the prior authorization requirement to a 
particular region of the country if claims data analysis shows that 
unnecessary utilization of the selected item(s) is concentrated in a 
particular region.
    The purpose of this document is to inform the public that we are 
updating the Required Prior Authorization List to include six 
additional Power Mobility Devices (PMDs) and five additional Orthoses 
HCPCS codes. To assist stakeholders in preparing for implementation of 
the prior authorization program, we are providing 90 days' notice.
    The following six HCPCS codes for PMDs and five HCPCS codes for 
Orthoses are added to the Required Prior Authorization List:

       Table 5--Additions to the Required Prior Authorization List
------------------------------------------------------------------------
         HCPCS                             Description
------------------------------------------------------------------------
K0800..................  Power operated vehicle, group 1 standard,
                          patient weight capacity up to and including
                          300 pounds.
K0801..................  Power Operated Vehicle, Group 1 Heavy Duty,
                          Patient Weight Capacity, 301 To 450 Pounds.
K0802..................  Power Operated Vehicle, Group 1 Very Heavy
                          Duty, Patient Weight Capacity 451 To 600
                          Pounds.
K0806..................  Power Operated Vehicle, Group 2 Standard,
                          Patient Weight Capacity Up To And Including
                          300 Pounds.
K0807..................  Power Operated Vehicle, Group 2 Heavy Duty,
                          Patient Weight Capacity 301 To 450 Pounds.
K0808..................  Power Operated Vehicle, Group 2 Very Heavy
                          Duty, Patient Weight Capacity 451 To 600
                          Pounds.
L0648..................  Lumbar-Sacral Orthosis, Sagittal Control, With
                          Rigid Anterior And Posterior Panels, Posterior
                          Extends From Sacrococcygeal Junction To T-9
                          Vertebra, Produces Intracavitary Pressure To
                          Reduce Load On The Intervertebral Discs,
                          Includes Straps, Closures, May Include
                          Padding, Shoulder Straps, Pendulous Abdomen
                          Design, Prefabricated, Off-The-Shelf.
L0650..................  Lumbar-Sacral Orthosis, Sagittal-Coronal
                          Control, With Rigid Anterior And Posterior
                          Frame/Panel(S), Posterior Extends From
                          Sacrococcygeal Junction To T-9 Vertebra,
                          Lateral Strength Provided By Rigid Lateral
                          Frame/Panel(S), Produces Intracavitary
                          Pressure To Reduce Load On Intervertebral
                          Discs, Includes Straps, Closures, May Include
                          Padding, Shoulder Straps, Pendulous Abdomen
                          Design, Prefabricated, Off-The-Shelf.
L1832..................  Knee Orthosis, Adjustable Knee Joints
                          (Unicentric Or Polycentric), Positional
                          Orthosis, Rigid Support, Prefabricated Item
                          That Has Been Trimmed, Bent, Molded,
                          Assembled, Or Otherwise Customized To Fit A
                          Specific Patient By An Individual With
                          Expertise.
L1833..................  Knee Orthosis, Adjustable Knee Joints
                          (Unicentric Or Polycentric), Positional
                          Orthosis, Rigid Support, Prefabricated, Off-
                          The Shelf.
L1851..................  Knee Orthosis (Ko), Single Upright, Thigh And
                          Calf, With Adjustable Flexion And Extension
                          Joint (Unicentric Or Polycentric), Medial-
                          Lateral And Rotation Control, With Or Without
                          Varus/Valgus Adjustment, Prefabricated, Off-
                          The-Shelf.
------------------------------------------------------------------------

    We believe prior authorization of these six additional HCPCS codes 
for PMDs and five HCPCS codes for Orthoses will help further our 
program integrity goals of reducing fraud, waste, and abuse, while also 
protecting access to care. For PMDs, the OIG has previously reported 
that Medicare has inappropriately paid for items that did not meet 
certain Medicare requirements.\2\ Lower limb orthoses (LLO) and lumbar-
sacral orthoses (LSO) have been identified by CMS' Comprehensive Error 
Rate Testing (CERT) program as two of the top 20 DMEPOS service types 
with improper payments over the past several years. Since 2016, LLOs 
have had an improper payment rate above 60 percent, with projected 
improper payments ranging between $235 and $501 million. Similarly, 
LSOs have had an improper payment rate above 32 percent, with projected 
improper payments ranging between $116 and $177 million, since 2016. 
Additionally, in 2019, the Department of Justice (DOJ) announced

[[Page 2057]]

federal indictments and law enforcement actions stemming from 
fraudulent claims submitted for medically unnecessary back, shoulder, 
wrist, and knee braces\.\ Administrative actions were taken against 130 
DMEPOS companies that were enticing Medicare beneficiaries with offers 
of low or no-cost orthotic braces. The investigation found that some 
DME companies and licensed medical professionals allegedly participated 
in health care fraud schemes involving more than $1.2 billion in 
loss.\3\
---------------------------------------------------------------------------

    \2\ OIG Report A-09-12-02068--Medicare Paid Suppliers For Power 
Mobility Device Claims That Did Not Meet Federal Requirements For 
Physicians' Face-To-Face Examinations Of Beneficiaries (January 
2015): https://oig.hhs.gov/oas/reports/region9/91202068.pdf.
    \3\ Federal Indictments & Law Enforcement Actions in One of the 
Largest Health Care Fraud Schemes Involving Telemedicine and Durable 
Medical Equipment Marketing Executives Results in Charges Against 24 
Individuals Responsible for Over $1.2 Billion in Losses (April 9, 
2019): https://www.justice.gov/opa/pr/federal-indictments-and-law-enforcement-actions-one-largest-health-care-fraud-schemes.
---------------------------------------------------------------------------

    These codes will be subject to the requirements of the prior 
authorization program for certain DMEPOS items as outlined in Sec.  
414.234. We will implement a prior authorization program for the six 
newly added codes for PMDs nationwide and five newly added codes for 
Orthoses in 3 phases. This phased-in approach will allow us to identify 
and resolve any unforeseen issues by using a smaller claim volume in 
phase one before implementing phases 2 and 3. State selection for the 
three phases was completed based on utilization data for the items 
selected.
    <bullet> For phase 1, which begins on the date specified in the 
DATES section, we selected the State in each DME MAC jurisdiction with 
the highest utilization: New York, Illinois, Florida, and California.
    <bullet> For phase 2, which begins on the date specified in the 
DATES section of this document, we selected the next three States with 
the highest utilization in each DME MAC jurisdiction: Maryland, 
Pennsylvania, New Jersey, Michigan, Ohio, Kentucky, Texas, North 
Carolina, Georgia, Missouri, Arizona, and Washington.
    <bullet> For phase 3, which begins on the date specified in the 
DATES section of this document, prior authorization expands to all 
remaining States and territories not captured in phases 1 and 2.
    The prior authorization program for the 51 codes currently subject 
to the DMEPOS prior authorization requirement will continue 
uninterrupted.
    Prior to providing an item on the Required Prior Authorization List 
to the beneficiary and submitting the claim for processing, a requester 
must submit a prior authorization request. The request must include 
evidence that the item complies with all applicable Medicare coverage, 
coding, and payment rules. Consistent with Sec.  414.234(d), such 
evidence must include the written order/prescription, relevant 
information from the beneficiary's medical record, and relevant 
supplier-produced documentation. After receipt of all applicable 
required Medicare documentation, CMS or one of its review contractors 
will conduct a medical review and communicate a decision that 
provisionally affirms or non-affirms the request.
    We will issue specific prior authorization guidance for these 
additional items in subregulatory communications, including final 
timelines customized for the DMEPOS item subject to prior 
authorization, for communicating a provisionally affirmed or non-
affirmed decision to the requester. In the December 30, 2015 final rule 
(80 FR 81674) we stated that this approach to final timelines provides 
flexibility to develop a process that involves fewer days, as may be 
appropriate, and allows us to safeguard beneficiary access to care. If 
at any time we become aware that the prior authorization process is 
creating barriers to care, we can suspend the program. For example, we 
will review questions and complaints from consumers and providers that 
come through regular sources such as 1-800-Medicare.
    The updated Required Prior Authorization List is available in the 
download section of the following CMS website: https://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/DMEPOS/Downloads/DMEPOS_PA_Required-Prior-Authorization-List.pdf.

III. Collection of Information Requirements

    This document provides updates to the Master List and announces the 
selection of HCPCS codes to be placed on the Required Face-to-Face 
Encounter and Written Order Prior to Delivery List and Required Prior 
Authorization List.
    Additionally, this document announces the continuation of prior 
authorization for 51 HCPCS codes, and the addition of six HCPCS codes 
for PMDs and five HCPCS codes for Orthoses on the Required Prior 
Authorization List. There is an information collection burden 
associated with this program that is currently approved under OMB 
control number 0938-1293, which expires March 31, 2022. This package 
accounts for burdens associated with the addition of items to the 
Required Prior Authorization Lists and assumes a burden for 2021 of 
approximately $10 million for providers to comply with the required 
information collection. We will reassess this burden soon and will seek 
comment on our assessment in a Federal Register notice as required 
under the Paperwork Reduction Act of 1995.

IV. Regulatory Impact Statement

    We have examined the impact of this regulatory document as required 
by Executive Order 12866 on Regulatory Planning and Review (September 
30, 1993), Executive Order 13563 on Improving Regulation and Regulatory 
Review (January 18, 2011), the Regulatory Flexibility Act (RFA) 
(September 19, 1980, Pub. L. 96-354), section 1102(b) of the Act, 
section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 
1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 
1999), and the Congressional Review Act (5 U.S.C. 804(2)).
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
Regulatory Impact Analysis (RIA) must be prepared for major rules with 
significant regulatory action/s and/or with economically significant 
effects ($100 million or more in any 1 year). This regulatory document 
is not significant and does not reach the economic threshold and thus 
is not considered a major regulatory document. Per our analysis, the 
additional items being added to the prior authorization program 
(excluding PMDs) \4\ have an estimated net savings of $14.8 million. 
Gross savings is based upon a 10 percent reduction in the total amount 
paid for claims in Calendar Year 2019. We deducted from the gross 
savings the anticipated cost for performing the prior authorization 
reviews in order to estimate the net savings. Our gross savings 
estimate of 10 percent is based on previous results from other prior 
authorization programs,

[[Page 2058]]

including prior authorization of other DMEPOS items.
---------------------------------------------------------------------------

    \4\ The additional PMD codes that will be added were not 
included in the data analysis because PMD codes are already part of 
a successful prior authorization program. Since some PMDs are 
already subject to prior authorization, other PMDs may demonstrate 
billing shifts across the policy groups, and as such, savings are 
more difficult to accurately forecast and may be less identifiable.
---------------------------------------------------------------------------

    The RFA requires agencies to analyze options for regulatory relief 
of small entities. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and small governmental 
jurisdictions. Most hospitals and most other providers and suppliers 
are small entities, either by nonprofit status or by having revenues of 
less than $8.0 million to $41.5 million in any 1 year. Individuals and 
States are not included in the definition of a small entity. We are not 
preparing an analysis for the RFA because we have determined, and the 
Secretary certifies, that this regulatory document will not have a 
significant economic impact on a substantial number of small entities.
    In addition, section 1102(b) of the Act requires us to prepare an 
RIA if a rule may have a significant impact on the operations of a 
substantial number of small rural hospitals. This analysis must conform 
to the provisions of section 604 of the RFA. For purposes of section 
1102(b) of the Act, we define a small rural hospital as a hospital that 
is located outside of a Metropolitan Statistical Area for Medicare 
payment regulations and has fewer than 100 beds. We are not preparing 
an analysis for section 1102(b) of the Act because we have determined, 
and the Secretary certifies, that this regulatory document will not 
have a significant impact on the operations of a substantial number of 
small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. In 2021, that 
threshold is approximately $158 million. This regulatory document will 
have no consequential effect on State, local, or tribal governments or 
on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule or other regulatory document) that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has Federalism implications. Since this regulatory 
document does not impose any costs on State or local governments, the 
requirements of Executive Order 13132 are not applicable.
    In accordance with the provisions of Executive Order 12866, this 
document was reviewed by the Office of Management and Budget.
    The Administrator of the Centers for Medicare & Medicaid Services 
(CMS), Chiquita Brooks-LaSure, having reviewed and approved this 
document, authorizes Lynette Wilson, who is the Federal Register 
Liaison, to electronically sign this document for purposes of 
publication in the Federal Register.

    Dated: January 10, 2022.
Lynette Wilson,
Federal Register Liaison, Centers for Medicare & Medicaid Services.
[FR Doc. 2022-00572 Filed 1-12-22; 8:45 am]
BILLING CODE P