(Medicare Claims Processing Manual)

The OCE will also return to the provider claims for which s pecified devices are billed without the procedure code that is necessary for the device to have therapeutic benefit to the patient.  If the claim is returned to the provider for failure to pass the edit, the hospital will need to modify the claim by either  correcting the device code or ensuring that one of the required procedure codes is on the claim before resubmission.      61.2.1  Bypass Edit Modifier CG for Claims on Which Specified Procedures are to be Reported With Device Codes                            (Rev.4513, Issued: 02- 04-2020, Effective: 01- 01- 2020, Implementation: 01- 06-2020)   For certain device- intensive procedures, providers may bypass the device edit requiring at least one device HCPCS code for the procedure. For sit uations where no device was performed with certain device -intensive procedures, providers may bypass the edit by reporting modifier CG.   61.3 - Billing for Devices Furnished Without Cost to an OPPS Hospital or Beneficiary or for Which the Hospital Receives a Full or Partial Credit and Payment for OPPS Services Required to Furnish the Device  (Rev. 1657, Issued: 12- 31-08, Effective: 01- 01-09, Imp lementation: 01 -05-09)  61.3.1 - Reporting and Charging Requirements When a Device is Furnished Without Cost to the Hospital Prior to January 1, 2014  (Rev. 2903, Issued: 03- 11-14, Effective: 04- 01-14, Implementation: 04- 07-14)  Effective January 1, 2007, t he definition of modifier - FB is  Item Provided Without Cost to Provider, Supplier or Practitioner, or Credit Received for Replacement Device (Examples, but not Limited to:  Covered Under Warranty, Replaced Due to Defect, Free Samples).   When a hospital f urnishes a device received without cost or with full credit from a manufacturer, the hospital must append modifier - FB to the procedure code (not the device code) that reports the service provided to furnish the device.  The hospital must report a token charge for the device (less than $1.01) in the covered charge field.  This includes circumstances in which the cost of a replacement device is less than the cost of the device being replaced, such that the hospital incurs no net cost for the device being ins erted.  For example, if a device that originally cost $20,000 fails and is replaced by a device that costs $16,000 and for which the manufacturer gives a credit of $16,000,  there is no cost to the hospital for the device being inserted and the hospital would append modifier - FB to the procedure code and report a token charge for the device.   61.3.2 - Reporting and Charging Requirements When the Hospital Receives Full Credit for the Replaced Device against the Cost of a More Expensive Replacement Device Prio r to January 1, 2014  (Rev. 2903, Issued: 03- 11-14, Effective: 04- 01-14, Implementation: 04- 07-14)  When a hospital replaces a device with a more expensive device and receives a credit in the amount that the device being replaced would otherwise cost, the hospital must append modifier - FB to the procedure code (not on the device code) that reports the service provided to replace the device.  The hospital must charge the difference between its usual charge for the device being implanted and its usual charge f or the device for which it received credit.  This charge should be billed in the covered charge field.   Hospitals should not report modifier - FB when the hospital receives a partial credit for a replacement device when the amount of the credit is less than  the amount that the device would otherwise cost the hospital.  For example, a device fails in the 6th month of a 1 year warranty and under the terms of the warranty, the hospital receives a credit of 50 percent of the cost of a replacement device.  The ho spital should not append modifier - FB to the procedure code in which the device is implanted.  See the Medicare Claims Processing Manual, Pub 100- 04, Chapter 4, 61.3.3 for billing instructions pertaining to partial credit situations.   61.3.3 - Reporting R equirements When the Hospital Receives Partial Credit for the Replacement Device Prior to January 1, 2014  (Rev. 2903, Issued: 03- 11-14, Effective: 04- 01-14, Implementation: 04- 07-14)  When a hospital receives a partial credit of 50 percent or more of the cost of a new replacement device due to warranty, recall, or field action, the hospital must append modifier - FC to the procedure code (not on the device code) that reports the service provided to replace the device.   61.3.4 - Medicare Payment Adjustment P rior to January 1, 2014  (Rev. 2903, Issued: 03- 11-14, Effective: 04- 01-14, Implementation: 04- 07-14)  Effective January 1, 2007, Medicare payment is reduced by the full offset amount for specified procedure codes reported with modifier -FB.  Effective Janu ary 1, 2008, Medicare payment is reduced by the partial offset amount for specified procedure codes reported with modifier -FC.  Effective January 1, 2009, payment is only reduced for procedure codes that map to the Ambulatory Payment Classification groups  (APCs) on the list of APCs subject to the adjustment that are reported with modifier -FB or - FC and that are present on claims with specified device HCPCS codes.    The Integrated Code Editor (I/OCE) assigns a payment adjustment flag when a procedure code i n an APC subject to an offset adjustment is billed with modifier - FB or -FC and a specified device HCPCS code.  The payment adjustment flag communicates to the OPPS PRICER that the payment for the procedure code line is to be reduced by the established full or partial offset amount for the APC to which the procedure code is assigned.  The I/OCE uses the offset APC payment rate (APC payment amount minus the established offset amount) as the rate used in the I/OCEs determination of which multiple procedure line(s) will be discounted.  The OPPS PRICER then applies the multiple procedure discounting and terminated procedure discounting factors after offsetting the unadjusted APC payment rate.  The offset reduction also is made to the unadjusted payment rate bef ore wage adjustment, which ensures that the beneficiary's coinsurance is based on the reduced amount.  NOTE : The tables of APCs and devices to which the offset reductions apply, and the full and partial offset amounts, are available on the CMS Web site at:  www.cms.hhs.gov/HospitalOutpatientPPS/.  61.3.5 - Reporting and Charging Requirements When a Device is Furnished Without Cost to the Hospital or When the Hospital Receives a Full or Partial Cre dit for the Replacement Device Beginning January 1, 2014 (Rev. 3181, Issued: 01- 30-15, Effective: 07-01-15, Implementation: 07-06-15)   Effective January 1, 2014, when a hospital furnishes without cost an initial placement of a medical device as part of a clinical trial  or a free sample medical device or when a hospital furnishes without cost a new replacement device or with a credit of 50 percent or more of the cost of a new replacement from a manufacturer, due to warranty, recall, or field action, the hospital must report the amount of the device credit in the amount portion for value code FD (Credit Received from the Manufacturer for a Medical Device).  Also effective January 1, 2014 hospitals must report one of the following condition codes when the va lue code FD is present on the claim:    49 Product Replacement within Product LifecycleReplacement of a product earlier than the anticipated lifecycle.    50 Product Replacement for Known Recall of a ProductManufacturer or FDA has identified the product for recall and therefore replacement.    53 Initial placement of a medical device provided as part of a clinical trial or free sample  Code is for outpatient claims that have received a device credit upon initial medical device placement in a clinical trial or a free sample.   No-Cost Device Coding    When a hospital furnishes a device for which it incurs no cost, (these cases include, but are not limited to, dev ices replaced under warranty, due to recall, or due to defect in a previous device; devices provided in a clinical trial; or devices provided as a sample) the hospital charge for a device furnished to the hospital at no cost should equal $0.00.  However, s ome hospitals billing systems require that a charge be reported for separately billable codes in order for the claim to be submitted for payment, even items for which the hospital incurs no cost.  Hospitals paid under the OPPS that implant a device furnis hed at no cost to the hospital shall report a charge of zero for the device, or, if the hospitals billing system requires that a charge be entered, the hospital shall submit a token charge (e.g. $1.00) on the line with the device code.   CMS recognizes that showing a charge for a device that has been furnished without cost is not optimal, but showing a token charge in this circumstance will allow claims for reasonable and necessary services to be adjudicated.   61.3.6 - Medicare Payment Adjustment Beginning January 1, 2014  (Rev. 2903, Issued: 03- 11-14, Effective: 04- 01-14, Implementation: 04- 07-14)  Effective January 1, 2014, Medicare payment is reduced by the amount of the device credit for specified procedure codes reported with value code FD.  The paymen t deduction is limited to the full device offset when the FD value code appears on a claim.  Payment is only reduced for procedure codes that map to the Ambulatory Payment Classification groups (APCs) on the list of APCs subject to the adjustment that are reported with value code FD and that are present on claims with specified device HCPCS codes.   The OPPS Pricer deducts the lesser of the device credit or the full unadjusted device offset amount from the Medicare payment for a procedure code in an APC subject to the adjustment when billed with value code FD on the claim.  This deduction is made from the Medicare payment after the multiple procedure discounting and terminated procedure discounting factors are applied, units of service are accounted for, and after the APC payment has been wage adjusted.  When two or more procedures assigned to APCs subject to the adjustment are reported with value code FD the OPPS Pricer  will apportion the device credit to the applicable line on the claim for each procedure assigned to an APC subject to the adjustment.  When value code FD is reported on a claim where multiple APCs would be subject to the adjustment, the OPPS Pricer appo rtions the device credit to each of those lines.  The percentage of the device credit apportioned to each applicable line is based on the percentage that the unadjusted payment of each applicable line represents, relative to the total unadjusted payment for all applicable lines.    NOTE:  The tables of APCs and devices to which the offset reductions apply, and the full and partial offset amounts, are available on the CMS Web site at: www.cms.hhs.gov/HospitalOutpatientPPS/.   61.4 - Billing and Payment for Brachytherapy Sources  (Rev. 1445, Issued:  02-08-08; Effective:  01-01- 08; Implementation:  03 -10-08)  61.4.1 - Billing for Brachytherapy Sources - General  (Rev. 2718, Issued: 06- 07-13, Effective: 07-01-13, Implementation: 07-01-13)