CMS Imposes Prior Authorization for Specified Outpatient Procedures

February 4, 2020

Monica Lelevich
Director, Audit Services
PARA HealthCare Analytics, an HFRI Company

Medicare recently finalized a plan that will require hospitals to obtain prior authorization before performing certain outpatient procedures. Understanding these changes will be critical to avoid unnecessary denials beginning on July 1, 2020.

The new prior authorization rules, which were outlined in the 2020 Medicare Hospital Outpatient Prospective Payment System (OOPS), are primarily for services that are sometimes performed for cosmetic purposes and have been identified by the Centers for Medicare and Medicaid Services (CMS) as being at-risk for incorrect payment due to medical necessity concerns.

The prior authorization final rule was published in the Federal Register on Nov. 12, 2019, in Section XIX under “Prior Authorization Process and Requirements for Certain Hospital Outpatient Department (OPD) Services.”

Masking cosmetic procedures

According to the rule, CMS conducted an analysis of over 1 billion claims relating to outpatient department services (OPD) dating from 2007 to 2017. The agency determined that utilization volume increased significantly during that period, from approximately 90 million to 118 million. In addition, the Medicare allowed amount for OPD more than doubled, from $31 billion in 2007 to $65 billion in 2017.

To reduce improper outpatient claims, CMS specifically targeted Medicare cosmetic surgical procedures that may be combined with, or masquerade as, therapeutic services. CMS’ analysis indicated the following outpatient procedure categories had higher-than-expected volume:

  1. Blepharoplasty
  2. Botulinum toxin injections
  3. Panniculectomy
  4. Rhinoplasty

July 2020 deadline

Prior authorization for the specified list of procedures found under these categories (see below) must be obtained for services performed on or after July 1, 2020. In theory, the authorization process should take no more than 10 days. Either the physician or the hospital may submit the request for prior authorization, but the hospital will remain ultimately responsible for ensuring that authorization is obtained prior to the surgical procedure.

To help prevent unnecessary denials, be sure your staff is fully aware of the specific procedures that now require prior authorization. Be sure to watch for news from your local Medicare Administrative Contractor (MAC) as the July 1 implementation date approaches because the MACs will be responsible for organizing the authorization request process.

Table 65: Proposed List of Outpatient Services That Would Require Prior Authorization [1]

Code (i) Blepharoplasty, Eyelid Surgery, Brow Lift, and Related Services
15820 Removal of excessive skin of lower eyelid
15821 Removal of excessive skin of lower eyelid and fat around eye
15822 Removal of excessive skin of upper eyelid
15823 Removal of excessive skin and fat of upper eyelid
67900 Repair of brow paralysis
67901 Repair of upper eyelid muscle to correct drooping or paralysis
67902 Repair of upper eyelid muscle to correct drooping or paralysis
67903 Shortening or advancement of upper eyelid muscle to correct drooping or paralysis
67904 Repair of tendon of upper eyelid
67906 Suspension of upper eyelid muscle to correct dropping or paralysis
67908 Removal of tissue, muscle, and membrane to correct eyelid dropping or paralysis
67911 Correction of widely opened upper eyelid
Code (ii) Botulinum Toxin Injection
64612 Injection of chemical for destruction of nerve muscles on one side of face
64615 Injection of chemical for destruction of facial and neck nerve muscles on both sides of face
J0585 Injection, onabotulinumtoxina, 1 unit
J0587 Injection, rimabotulinumtoxinb, 100 units
Code (iii) Panniculectomy, Excision of Excess Skin and Subcutaneous Tissue (Including Lipectomy), and Related Services
15830 Excision, excessive skin and subcutaneous tissue (includes lipectomy); abdomen, infraumbilical panniculectomy
15847 Excision, excessive skin and subcutaneous tissue (includes lipectomy), abdomen (e.g. Abdominoplasty) (includes umbilical transposition and fascial plication) (list separately in addition to code for primary procedure)
15877 Suction assisted removal of fat from trunk
Code (iv) Rhinoplasty, and Related Services
20912 Nasal cartilage graft
21210 Repair of nasal or cheek bone with bone graft
21235 Obtaining ear cartilage for grafting
30400 Reshaping of tip of nose
30410 Reshaping of bone, cartilage, or tip of nose
30420 Reshaping of bony cartilage dividing nasal passages
30430 Revision to reshape nose or tip of nose after previous repair
30435 Revision to reshape nasal bones after previous repair
30450 Revision to reshape nasal bones and tip of nose after previous repair
30460 Repair of congenital nasal defect to lengthen tip of nose
30462 Repair of congenital nasal defect with lengthening of tip of nose
30465 Widening of nasal passage
30520 Reshaping of nasal cartilage
Code (v) Vein Ablation and Related Services
36473 Mechanochemical destruction of insufficient vein of arm or leg, accessed through the skin using imaging guidance
36474 Mechanochemical destruction of insufficient vein or arm or leg, accessed through the skin using imaging guidance
36475 Destruction of insufficient vein of arm or leg, accessed through the skin
36476 Radiofrequency desctruction of insufficient vein of arm or leg, accessed through the skin using imaging guidence
36478 Laser desctruction of incompetent vein of arm or leg, accessed through the skin
36479 Laser desctrustion of insufficient vein of arm or leg, accessed through the skin using imaging guidance
36482 Chemical destruction of incompetent vein of arm or leg, accessed through the skin using imaging guidance
36483 Chemical destruction of incompetent vein of arm or leg, accessed through the skin using imaging guidance

Your AR specialists

Healthcare Financial Resources (HFRI) specializes in accounts receivable recovery and resolution and serves as a virtual extension of your hospital central billing office to help you quickly resolve and collect more of your insurance accounts receivable.

We utilize proprietary intelligent automation and staff specialization to efficiently process all claims regardless of size or age. In addition to our resolution capabilities, HFRI also can provide denial management assistance by conducting root cause analysis and recommend process improvements to help decrease aged and denied claims going forward.

Contact HFRI today to learn more about how we can help you with your hospital’s accounts receivable management.

[1] Federal Register / Vol. 84, No. 218 / Tuesday, November 12, 2019 / Rules and Regulations. Pages 61450-61451.

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