Basics of Preauthorization for DME

Preauthorization is a process through which a request for provisional affirmation of coverage is submitted for review before a durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) item is furnished to a beneficiary and before a claim is submitted for payment. Preauthorization helps ensure that applicable coverage, payment, and coding rules are met before supplies are delivered. Preauthorization may be needed before certain services can be rendered or equipment supplied. Every insurance company has its unique guidelines for preauthorization for DME, still, in this article, we shared the basics of preauthorization for general understanding purposes.

DME coverage is subject to the member’s benefit plan. Members may be responsible for paying a portion of the DME’s cost in the form of a co-pay/coinsurance and/or deductible. Generally, the DME provider will notify the member when co-pays/coinsurance and/or deductibles are due. You can submit a pre-authorization request in multiple ways. Most insurance companies accept preauthorization requests for DME through online (provider portal); by fax; and by phone. You will receive notification about pre-authorization requests by fax, via standard U.S. mail; and online (provider portal). In the event there is an urgent request for equipment requiring preauthorization that needs to be ordered on a weekend or on a holiday, most of the payers provide an emergency prior approval phone line.

Key Elements of Preauthorization for DME

1. DME Preauthorization Request Checklist

DME preauthorization request checklist list includes the preauthorization request form; certificate of medical necessity; written prescription; and patient’s medical records with details (such as diagnosis, patient history, physical exam findings, progress notes, medication list, wound or incision/location).

2. Certificate of Medical Necessity

The requesting physician, not the DME supplier, is responsible for completing the certificate of medical necessity for all prescribed DME items. The certificate of medical necessity may, however, be submitted by the requesting physician, discharging facility, or DME supplier. A preauthorization request submitted without a certificate of medical necessity will be denied for lack of information. Waiting to submit the preauthorization request until this is ready will save time and reduce rework. Filling out the certificate of medical necessity form involves:

Certifying the patient’s need. The treating physician must certify in writing the patient’s medical need for equipment and attest the patient meets the criteria for medical devices and/or equipment.
Issuing a plan of care. The treating physician must issue a plan of care for the patient that specifies: the type of medical devices, equipment and/or services to be provided; and the nature and frequency of these services.

3. Written Prescription

To initiate coverage of DME, the requesting physician must issue a prescription, or other written order on personalized stationery, which includes:
Member’s name and full address
Provider’s signature (Signature stamps are not acceptable.)
Date the provider signed the prescription or order
Description of the items needed
Start date of the order (if appropriate)
Diagnosis
A realistic estimate of the total length of time the equipment will be needed (in months or years)
Electronic requests for DME preauthorization should be accompanied by a fax containing the written prescription and any applicable certificate of medical necessity forms.

4. Reconsideration and Appeals Process

Cases that do not meet medical necessity may be reconsidered (have a peer-to-peer discussion) or appealed.

Reconsideration process: A reconsideration is a post-denial, pre-appeal opportunity to provide additional clinical information. Reconsideration must be requested within 2 to 3 weeks of the initial denial date. Peer-to-peer (P2P) review requests can also be made verbally or in writing. P2P results in either a reversal or an upholding of the original decision. The requestor and the member are notified via mail and fax.
Appeals process: Insurance companies generally mention the appeals process in the denial letter. The provider can submit appeals in the same ways (online, phone, fax) as they submitted a preauthorization request.

DME suppliers who submit bills to insurance companies must keep the provider’s original written order or prescription in their files. Providers are advised to document the medical need for and utilization of DME items in the member’s chart and to ensure information about the member’s medical condition is correct. In the event of a medical audit, payers may require copies of relevant portions of the patient’s chart to establish the existence of medical need as indicated in the certificate of medical necessity form submitted with the preauthorization request.

Preauthorization for Medicare

CMS recently announced the final rule for certain DMEPOS items. This final rule establishes a preauthorization process for certain DMEPOS items through two steps. First, the rule establishes a Master List of DMEPOS items that are frequently subject to unnecessary utilization and potentially subject to preauthorization based on certain criteria. Second, it creates a ‘Required Prior Authorization List,’ a subset of items on Master List that are subject to preauthorization. CMS announced that it would inform the public of those items on the Required Prior Authorization List by publishing a notice in the Federal Register with 60 days’ notice before implementation.

It could be difficult for DME suppliers and providers to keep track of DME items requiring preauthorization. Legion Healthcare Solutions can assist you in preauthorization for DME items. We are a leading medical billing company providing complete billing and coding services. Our experienced billers are fully aware of the DME items list requiring preauthorization. We are well-versed in the preauthorization process for DME for various insurance companies. To know more about our preauthorization services for DME, contact us at 727-475-1834 or email us at info@legionhealthcaresolutions.com

Reference: DME Preauthorization Request Checklist