The American Orthotic and Prosthetic Association (AOPA) is suing the Department of Health and Human Services over 2011 rule changes for prosthetic reimbursements requiring physician documentation, which the association claims is wreaking financial havoc on O&P practitioners due to prepayment audits and retroactive application.
Filed in Washington, D.C. federal district court, AOPA's lawsuit claims the Centers for Medicare & Medicaid Services' rules were implemented through "Dear Physician" letters, not the federal rulemaking process, in violation of the Administrative Procedure Act and the Medicare Act, and that the changes were based on flawed conclusions from an HHS Inspector General Report.
That OIG report suggested there was growing fraud in the field of orthotic and prosthetics, in part due to lack to a lack of physician documentation and increases in per-patients costs.
Asking the court to invalidate the rules, AOPA argues that the OIG report misinterpreted several nuances in orthotic and prosthetic healthcare. Patients typically don't go to their physicians when they have problems with prosthetic devices as OIG assumed, AOPA said, but rather see the prosthetists that install and help manage the devices -- and they often aren't physicians. Patients also typically don't take complaints to the specialist that first prescribed the prosthetic or performed the amputation, AOPA said.
The association does acknowledge rising costs for prosthetics, but attributes them to "a quantum leap" in prosthetic technology driven by the influx of complex amputees from the wars in Iraq and Afghanistan, as well as a CMS-approved fee schedule increase.
AOPA also argues the OIG report failed to track whether or not O&P providers were qualified practitioners, as specified in the SCHIP Benefits Improvement and Protection Act of 2000, which decribed qualified as physical or occupational therapists, state-licensed practitioners or board-certified practitioners.
Since the 2011 rule changes, CMS and Medicare contractors have been denying payments to prosthetic suppliers that don't provide specific documentation from physicians who prescribed the devices, even when other documentation justifies medical necessity, AOPA said.
AOPA director Tim Fise said the industry has experienced some closings of small providers and consolidation in part because of the financial pressures of the denied reimbursements and pre-payment audits, with some of the association's members having up to 50 percent of their revenue in limbo.
The new rules, AOPA's lawsuit claims, are "forcing practitioners to choose between meeting the patient's immediate need for a prosthesis by providing a less sophisticated device, rather than endure long delays in case triggered by the paper chase with physicians."
Fise, an attorney and former executive director of the American College of Gastroenterology, also criticized Medicare's increasing use of recovery audit contractors. "RAC auditors' independence is fundamentally compromised by the fact that they are paid a commission based on a percentage of the claims dollars they claw back."
Thirty-five members of the U.S. House recently sent a letter to HHS, which does not comment on ongoing litigation, making a similar point about RAC's use in the O&P field.