Correct Coding and Coverage of Ventilators - Revised July 2020

Joint DME MAC Publication

This article has been revised to reflect instructions from the Centers for Medicare & Medicaid Services (CMS) to suspend certain edits for HCPCS code E0467. Code E0467 describes a device that functions as a ventilator but also incorporates additional functionality of suction, oxygen concentration cough stimulation, and nebulization. The HCPCS code is:

Code E0467 became effective for claims with dates of service (DOS) on or after January 1, 2019.

Ventilator technology has evolved to the point where it is possible to have a single device capable of operating in numerous modes, from basic continuous positive pressure (CPAP and bi-level PAP) to traditional pressure and volume ventilator modes. Similarly, the product coded E0467 adds capabilities beyond these ventilator modes to incorporate the functionality of suction, oxygen concentration, nebulization, and cough stimulation. This creates the possibility that one piece of equipment may be able to replace numerous and different pieces of equipment. Equipment with multifunction capability creates the possibility of errors in claims submitted for these items. This article will discuss the application of Medicare proper coding and payment rules for ventilators.

HCPCS Coding

Effective for claims with DOS on or after January 1, 2016, all products classified as ventilators must be billed using one of the following HCPCS codes:

In addition, for claims with DOS on or after January 1, 2019, the following ventilator code is eligible for Medicare billing:

Products previously assigned to HCPCS codes E0450 and E0463 must use HCPCS code E0465. Products previously assigned to HCPCS codes E0460, E0461 and E0464 must use HCPCS code E0466. Suppliers may access the Pricing, Data Analysis, and Coding (PDAC) DMECS Product Classification List to determine proper coding of ventilator products.

Suppliers are reminded that the payment policy requirements for the FSS payment category prohibits FSS payment for devices used to deliver continuous and/or intermittent positive airway pressure, regardless of the illness treated by the device (Social Security Act 1834(a)(3)(A)). This means that products currently classified as HCPCS code E0465, E0466 or E0467 when used to provide CPAP or bi-level PAP (with or without backup rate) therapy, regardless of the underlying medical condition, may not be paid in the FSS payment category. General principles of correct coding require that products assigned to a specific HCPCS code only be billed using the assigned code. Thus, using the HCPCS codes for CPAP (E0601) or bi-level PAP (E0470, E0471) devices for a ventilator (E0465, E0466) used to provide CPAP or bi-level PAP therapy is incorrect coding. Claims for ventilators billed using the CPAP or bi-level PAP device HCPCS codes will be denied as incorrect coding.

There are additional requirements related to billing of code E0467. Code E0467 combines the function of a ventilator with those of any combination or all of the following:

• Oxygen equipment
• Nebulizer and compressor
• Aspirator (suction device)
• Cough stimulator (multiple products)
• Positive airway pressure devices (PAP and RAD)
• Custom fabricated oral appliances

The following HCPCS codes for individual items are included in the functionality of code E0467:

• Ventilators (HCPCS codes E0465, E0466)
• Oxygen and oxygen equipment (HCPCS codes E0424, E0431, E0433, E0434, E0439, E0441, E0442, E0443, E0444, E0447, E1390, E1391, E1392, E1405, E1406, and K0738)
• Nebulizers and related accessories (HCPCS codes E0565, E0570, E0572, E0585, A4619, A7003, A7004, A7005, A7006, A7007, A7012, A7013, A7014, A7015, A7017, A7525, and E1372)
• Aspirator and related accessories (HCPCS codes E0600, A4216, A4217, A4605, A4624, A4628, A7000, A7001, A7002, and A7047)
• Cough Stimulators (multiple items):
  • Mechanical In-Exsufflation devices and related accessories (HCPCS codes E0482 and A7020)
  • High Frequency Chest Wall Oscillation Devices (HFCWO) and related accessories (HCPCS codes E0483, A7025, A7026)
  • Oscillatory positive expiratory pressure device (e.g. Flutter, Acapella and similar items) (HCPCS Code E0484)
• PAP and RAD devices and related accessories (HCPCS codes E0470, E0471, E0472, E0601, A4604, A7027, A7028, A7029, A7030, A7031, A7032, A7033, A7034, A7035, A7036, A7037, A7038, A7039, A7044, A7045, A7046, E0561, E0562)
• Oral Appliances (HCPCS code E0486)

For E0467 claims with dates of service before April 3, 2020:

Claims for any of the HCPCS codes listed above that are submitted on the same claim or that overlap any date(s) of service for E0467 is considered to be unbundling.

In addition, any claim for repair (HCPCS code K0739 for labor and any HCPCS code for replacement items) of beneficiary-owned equipment identified by HCPCS codes listed above is considered as unbundling if the date(s) of service for the repair overlaps any date(s) of service for code E0467.

Claims for code E0467 with a date(s) of service that overlaps date(s) of service for any of the following scenarios are considered as a claim for same or similar equipment when the beneficiary:

• Is currently in a rental month for any of the items listed above
• Owns any of the equipment listed above that has not reached the end of its reasonable useful lifetime.

For E0467 claims with dates of service on or after April 3, 2020:

Any claim for repair (HCPCS code K0739 for labor and any HCPCS code for replacement items) of beneficiary-owned equipment identified by HCPCS codes listed above is considered as unbundling if the date(s) of service for the repair overlaps any date(s) of service for code E0467.

Claims for code E0467 with a date(s) of service that overlaps date(s) of service in a rental month for any of the items listed above are considered as a claim for same or similar equipment.

Suppliers are encouraged to be sure that the correct category of product is provided and billed to avoid errors in HCPCS coding.

Coverage

Items may only be covered based upon the reasonable and necessary (R&N) criteria applicable to the product. The Centers for Medicare & Medicaid Services (CMS) National Coverage Determination Manual (Internet-Only Manual, Publ. 100-3) in Chapter 1, Part 4, Section 280.1 stipulates that ventilators are covered for the following conditions:

[N]euromuscular diseases, thoracic restrictive diseases, and chronic respiratory failure consequent to chronic obstructive pulmonary disease.

These ventilator-related disease groups overlap conditions described in the Respiratory Assist Devices LCD used to determine coverage for bi-level PAP devices. Each of these disease categories are conditions where the specific presentation of the disease can vary from patient to patient. For conditions such as these, the specific treatment plan for any individual patient will vary as well. Choice of an appropriate treatment plan, including the determination to use a ventilator vs. a bi-level PAP device, is made based upon the specifics of each individual beneficiary's medical condition. In the event of a claim review, there must be sufficiently detailed information in the medical record to support the treatment selected.

Upgrades

An upgrade is defined as an item that goes beyond what is medically necessary under Medicare's coverage requirements. In some cases, CMS policy that allows for billing of upgrade modifiers can be used when providing an item or service that is considered beyond what is medically necessary. This is NOT applicable to ventilators in the situations described above.

Although the use of a ventilator to treat any of the conditions contained in the PAP or RAD LCDs is considered "more than is medically necessary", the upgrade billing provisions may not be used to provide a ventilator for conditions described in the PAP or RAD LCDs. CPAP and bi-level PAP items are in the Capped Rental payment category while ventilators are in the FSS payment category. Upgrade billing across different payment categories is not possible. Claims for items billed for upgrade across different payment categories will be rejected as unprocessable.

Payment Category

Ventilators are classified in the FSS payment category. FSS items are those for which there must be frequent and substantial servicing in order to avoid risk to the patient's health (Social Security Act §1834(a)(3)(A)). The monthly rental payment for items in this pricing category is all-inclusive meaning there is no separate payment by Medicare for any options, accessories or supplies used with a ventilator. In addition, all necessary maintenance, servicing, repairs and replacement are also included in the monthly rental. Claims for these items and/or services will be denied as unbundling.

Coverage of Second Ventilator

Medicare does not cover spare or back-up equipment. Claims for backup equipment will be denied as not reasonable and necessary – same/similar equipment.

Backup equipment must be distinguished from multiple medically necessary items which are defined as identical or similar devices, each of which meets a different medical need for the beneficiary. Although Medicare does not pay separately for backup equipment, Medicare will make a separate payment for a second piece of equipment if it is required to serve a different medical purpose that is determined by the beneficiary's medical needs.

The following are examples of situations in which a beneficiary would qualify for both a primary ventilator and a secondary ventilator:

• A beneficiary requires one type of ventilator (e.g. a negative pressure ventilator with a chest shell) for part of the day and needs a different type of ventilator (e.g. positive pressure ventilator with a nasal mask) during the rest of the day.
• A beneficiary who is confined to a wheelchair requires a ventilator mounted on the wheelchair for use during the day and needs another ventilator of the same type for use while in bed. Without two pieces of equipment, the beneficiary may be prone to certain medical complications, may not be able to achieve certain appropriate medical outcomes, or may not be able to use the medical equipment effectively.

Refer to the various LCDs and related Policy Articles referenced above as impacted and to the DME MAC Supplier Manuals for additional information on coverage, coding and documentation of these items.

For questions about correct coding, contact the PDAC Contact Center at (877) 735-1326 or e-mail the PDAC by completing Contact Form located on the PDAC website.