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Hospital outpatient departments, ASCs eligible for separate reimbursement for Omidria

HCPCS code C9447 can be used as of January 1.

Issue: January 10, 2015

ByPaul M. Larson, MBA, MMSc, COMT, COE, CPC, CPMA

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On May 30, 2014, the U.S. Food and Drug Administration approved Omidria. It is used during cataract and lens replacement surgery to maintain pupil size by preventing intraoperative miosis and to reduce postoperative pain. A 4 mL single-patient-use vial of Omidria is diluted in a standard 500 mL container of balanced salt irrigating solution for use during the procedure; it requires no change in the surgeon’s operating routine.

The FDA-approved package insert notes that Omidria (phenylephrine and ketorolac injection 1%/0.3%, Omeros) is, “For administration to patients undergoing cataract surgery or intraocular lens replacement.” No other indications are listed. The table below contains all of the applicable CPT codes that fit these indications. While the list of codes is long, practically speaking there are only three codes that are commonly encountered. These three, based on the most recently published Medicare utilization data (CY 2012), are 66982, 66984 and 66986.

Paul M. Larson

Refractive lens exchange

Some refractive surgeries involve the natural lens of the eye. No specific code describes clear lens extraction or refractive lens exchange. In the absence of a code match, CPT instructs billers to use an unlisted code. CPT directs us as follows:

“Select the name of the procedure or service that accurately identifies the service performed. Do not select a CPT code that merely approximates the service provided. If no such procedure or service exists, then report the service using the appropriate unlisted procedure or service code.”

In this case, 66999 (unlisted procedure, anterior segment of eye) likely applies; 66984 and 66982 cannot be used because cataract is not present and the purpose of the surgery is solely refractive. With few exceptions, refractive lens exchange is a non-covered, elective service; the patient is financially responsible for professional and facility fees, including Omidria.

Source: Larson PM

Coverage and payment

Special Ambulatory Payment Classification (APC) groups in the Outpatient Prospective Payment System (OPPS), which governs Part B Medicare reimbursement to hospital outpatient departments and ASCs, have been created to accommodate payment for new technology services and innovative medical devices, drugs and biologicals. This provision created a means, called transitional pass-through status, for Medicare to temporarily pay above and beyond the prospective payment rate of the associated APC for these specifically designated new drugs and medical devices. The period for this extra payment typically lasts for 24 to 36 months. Transitional pass-through designation for designated drugs or biologicals is for payment purposes — it does not imply a coverage decision. Coverage determinations are made only through CMS’ National Coverage Decision or by action of a medical director of a Medicare Administrative Contractor.

The Medicare Claims Processing Manual, Chapter 4, §50.3, notes:

“APCs. OCE identifies these and assigns the appropriate APC. Pricer establishes payment at 95 percent of the average wholesale price minus the portion of the otherwise applicable APC payment amount. Pricer will determine the proper payment amount for these APCs as well as the coinsurance and any applicable deductible. … Certain new designated drugs and biologicals may be approved for payment, and their payment will be calculated in the same manner as listed above for current designated drugs and biologicals. Pricer identifies these new designated drugs and biologicals separately from the current designated drugs and biologicals.”

Omidria meets the CMS requirements under the OPPS, was granted pass-through status in October 2014 and can be used on claims with dates of service on or after Jan. 1, 2015. The new HCPCS code, C9447 (injection, phenylephrine and ketorolac, 4 mL vial), is assigned to APC 1663 within the national OPPS payment schedule for hospital outpatient departments and ASCs. For the first 6 months after the market launch of Omidria, which is planned for the first quarter of 2015, the Part B Medicare payment rate depends on the manufacturer’s wholesale acquisition price, which is $465 per single-patient use vial, plus 6%; payment rates are then adjusted quarterly and are based on average selling price plus 6% after two quarters of sales data are collected. Other third-party payers may follow CMS’ payment policies but are not obliged to do so.

Surgeon payment

Irrigation and aspiration is an inherent part of cataract and lens replacement surgery, so the surgeon’s reimbursement for the procedure includes the use of Omidria. Only the facility receives separate payment for the supply. Significantly, the surgeon should not purchase it for later sale to a facility, nor should the facility seek payment from the surgeon as a way to decrease costs.

Beneficiary copayment

Importantly, when a product is granted pass-through status under Part B Medicare, no copayments apply to the reimbursement of the product. Other parts of the same claim are not affected; the usual deductibles and copayments apply to cataract surgery.

Conclusion

Omidria helps maintain a dilated pupil during cataract and lens replacement surgery and reduces postoperative pain. Beginning in January 2015, hospital outpatient departments and ASCs are eligible to receive separate reimbursement for Omidria, using HCPCS code C9447, in addition to the usual reimbursement for their facility fee. The payment rate for Omidria for the first 6 months will be based on the manufacturer’s wholesale price, which is currently $465 per single-patient-use vial, plus 6%. Payment rates subsequently are adjusted quarterly and will be average selling price plus 6%.