What health insurance benefit(s) category covers cochlear implant replacement supplies?
It depends. Under Medicare, cochlear implant supplies are covered under the prosthetic benefit of Part B, which includes supplies and repairs necessary for the effective use of the prosthetic device. Cochlear implant supplies are typically covered by commercial insurers under either the medical-surgical or the durable medical equipment (DME) benefit category.
What is a Prosthetic Device?
The technical definition of a prosthetic device is equipment that replaces all or part of the function of a permanently inoperative or malfunctioning external body member or internal body organ. In plain English, this means the cochlear implant replaces the hearing function of the ear.
What is Durable Medical Equipment (DME)?
The technical definition is items of medical equipment owned or rented that are placed in the home of an insured to facilitate treatment and/or rehabilitation. DME generally consist of items which can withstand repeated use.
What is HIPAA?
HIPAA stands for the “Health Insurance Portability and Accountability Act” which is a federal law that mandates national compliance standards for the electronic exchange of health care data. These standards include multiple requirements specifying what medical and administrative code sets should be used; requiring the use of national identification systems; and specifying the types of measures required to protect the security and privacy of personally identifiable health care information.
What is a Deductible?
The amount a health plan member or Medicare beneficiary has to pay out of pocket (typically each year) before the insurance will start to provide payments.
What is Coinsurance?
The percentage of the allowed payment amount that you will need to pay out of pocket for a covered service based on your plan’s coverage criteria. The plan pays the remainder of the allowed amount for the service. Coinsurance requirements are typically listed in your plan’s Summary of Benefits.
What is a Copayment?
The fixed dollar amount you pay per covered service at the time the care is provided. Copayment amounts may vary by type of service and are typically listed on your Summary of Benefits.
What is In-Network?
Refers to the use of providers who are contracted participants in the health plan's provider network. Members who use in-network providers typically receive higher benefits coverage, which means that there is typically less out-of-pocket liability for the patient.
What is Out-of-Network?
The use of health care providers who have not contracted with the health plan to provide services. Members enrolled in preferred provider organizations (PPO) and point-of-service (POS) health plans can go to out-of-network providers and still obtain reimbursement for covered expenses, but they typically pay additional costs in the form of higher deductibles and coinsurance and may be subject to maximum caps on benefits. Because fees are not contractually negotiated with out-of-network providers, health plans typically calculate reimbursement amounts for these providers based on the lower of the actual charge or the “usual, customary and reasonable” (UCR) charge as determined by the plan. Members are typically responsible for any charges that exceed the UCR amount in addition to any applicable deductible or coinsurance.
What does “ASSIGNMENT” mean in relationship to filing a claim for my health plan?
When a supplier “accepts assignment” for a claim, it means that the supplier has agreed to accept the health plan’s determination of the allowable cost of the equipment or supplies as full payment, even if the allowable amount is less than the supplier’s charge. The patient is responsible for any applicable deductible or co-insurance, and the patient’s benefits are “assigned” to the supplier. If your plan requires you to pay a coinsurance percentage, that amount is calculated based on the allowable cost. For assigned claims, the supplier cannot bill you for the difference between their charge and the health plan’s allowance.
A supplier may accept assignment on a case-by-case basis, always accept assignment, or never accept assignment. If the supplier does not accept assignment for a claim, it means the patient is responsible for any balance of the supplier’s charge beyond the health plan payment amount. When suppliers or providers do not accept assignment, the patient is typically required to pay the entire charge at the time of order by check, credit card, or other financing plan.
For Medicare and Tricare claims, the “limiting charge” does not apply to medical equipment suppliers. The limiting charge refers to the highest amount non-participating providers can charge patients for an item or service when they do not accept assignment.
Medicare Terminology:
What is a Medicare allowed amount?
The amount Medicare determines to be the maximum amount allowable for any Medicare covered service. These amounts typically differ for participating and non-participating Medicare providers.
What does it mean to be a “participating supplier” under Medicare?
Medicare allows suppliers the option of whether to enroll as a participating or a non-participating supplier under their program. Medicare participating providers are those who have signed agreements to accept assignment for all Medicare claims and covered services.
What does it mean to be a “non-participating supplier” under Medicare?
Suppliers who choose not to sign the participation contract are referred to as non-participating suppliers. Non-participating suppliers may choose to accept assignment on a claim-by-claim basis, except where the Centers for Medicare and Medicaid Services (CMS) requires mandatory assignment (e.g., Medicare covered drugs, home dialysis equipment and supplies, etc.). Advanced Bionics is a non-participating supplier under Medicare.
What does “accepting Medicare assignment” mean?
An arrangement whereby a provider of service or supplier agrees to accept the Medicare-approved amount as full payment for covered services and supplies. Medicare typically pays 80% of the approved amount directly to the provider or supplier of service after the beneficiary meets the annual Part B deductible. The beneficiary is also responsible for paying 20% co-insurance.
What does it mean to “NOT accept Medicare assignment” for supplies?
A supplier or service provider that has not signed an agreement to accept the Medicare-approved amount as payment in full for all covered claims and services. Non-participating providers may decide whether to accept assignment on each individual claim. Reimbursement is payable directly to the Medicare beneficiary. Patient responsibility includes the difference between the Medicare reimbursement and the supplier’s list price.
What is a CMS-1500 claim form?
It’s the universal standard claim form accepted by all insurance carriers when billing for durable medical equipment. CMS is the acronym for the Centers for Medicare and Medicaid Services (CMS).
What is a HCPCS code?
The Health Care Procedure Coding System (HCPCS) is a uniform set of codes used by health care providers and medical suppliers to report professional services, procedures and supplies. The HCPCS coding system contains multiple levels of codes including the American Medical Association's Current Procedural Terminology (CPT) coding system for reporting healthcare provider services (Level I codes) and HCPCS codes for reporting medical supplies and other services (Level II codes).
What HCPCS codes are applied to cochlear implant supplies?
Cochlear implant supplies are described by the following HCPCS Level II codes:
What is a diagnosis code or ICD-9 diagnosis code?
The International Statistical Classification of Diseases and Related Health Problems (commonly known by the abbreviation ICD-9) is a detailed coding system for virtually all known diseases and injuries. It is published by the World Health Organization and is used world-wide for reporting health insurance claims as well as capturing morbidity and mortality statistics and for other medical purposes.
What ICD-9 diagnosis codes are applied to cochlear implant billing?
The most common diagnosis for cochlear implant patients is 389.10 – Hearing loss, sensorineural
Why do some customers have to pay in advance for supplies and others do not?
This depends on the specific health plan and whether Advanced Bionics accepts assignment with that plan.
Advanced Bionics is currently accepting Medicare assignment for cochlear implant supplies and for sound processor replacement orders when the processor being replaced is at least five years old. This means that in the absence of any supplemental insurance, customers typically will be required to pay only 20% of the Medicare allowed payment amount (the standard Medicare customer co-insurance) prior to shipment of their supplies. If Advanced Bionics believes that Medicare will not provide payment for certain supplies, we will notify you ahead of time and request that you complete an Advance Beneficiary Notice (ABN) stating that you will be responsible for any charges that Medicare may not cover or allow.
For Medicaid customers in the states where Advanced Bionics is a participating Medicaid provider, Advanced Bionics will not request customers to pay upfront for supplies that are medically necessary.
For HMO plans, if supplies are approved through the referral process by the HMO, Advanced Bionics will only request patients to provide payment in advance for the deductible, co-payment, coinsurance and/or any non-covered supplies if applicable. Your Primary Care Physician (PCP) should handle the referral process when they are notified by Advanced Bionics of an order request. The referral request is typically referred to as an “Out-of-Network Referral Authorization Request.” PCP’s will request that you receive benefits at the In- Network level (case only basis) because Advanced Bionics is the only provider that can provide your medically necessary supplies.
Other employer provided or individual health plans such as PPOs, may not provide reimbursement directly to Advanced Bionics because we are non-participating providers. Advanced Bionics requests advance payment from customers for their supplies, and we will submit a courtesy bill to the health plan as a non-assigned claim so customers can obtain reimbursement directly from the plan after the claim is received.
How long does it typically take for a health plan to provide reimbursement?
It typically takes at least 30 to 45 days for patients to receive reimbursement from health plans.
What if I paid in advance for my supplies, but I have not received reimbursement from my health plan after 45 days?
Please contact your health plan directly by calling the telephone number listed on your insurance card. Give the insurance representative your policy number and the date of service, which is the shipping date indicated on your invoice. The representative should be able to provide you with the status of your claim and inform you how to get your claim paid. Generally, you must contact your health plan directly, because they will not release information to suppliers for non-assigned claims due to HIPAA privacy regulations.
What if your claim is denied as “not a covered benefit,” but you believe it should be covered?
Please contact your health plan to determine the plan’s benefits and coverage criteria. In many instances, the plan may have processed the claim under the wrong benefit category. If your cochlear implant supplies are denied as Durable Medical Equipment (DME), provide the HCPCS codes for cochlear implant supplies and find out if these codes are specifically excluded from coverage or covered under another insurance benefit (please specify the above HCPCS codes). If you have insurance coverage through your employer, you may also contact your Human Resources Department or Plan Administrator to request information on written exclusions. If you have DME coverage and there are no written exclusions, then your insurance carrier should pay the claim according to the DME plan guidelines.
What if your claim is denied as “hearing aid supplies are not a covered benefit?”
Cochlear implant supplies are not appropriately categorized as hearing aid supplies. Your cochlear implant supplies should be covered under benefits for DME or prosthetic implant supplies. Contact your health plan directly and request that the claim be reprocessed under your DME benefit.
What if your claim is applied to your “out-of-network benefit level?”
This can usually be appealed for in-network coverage. Most health plans will approve your appeal at the in-network level because Advanced Bionics is the only provider from which you can receive your medically necessary supplies. You do not have the option to go to an in-network provider.
What if your claim is denied as “not medically necessary?”
Please have your Audiologist/Physician submit a letter of medical necessity (LMN) to your health plan. This letter states the reasons justifying your order of these supplies to support your cochlear implant system.
