NAAOP Government Relations Update

2003 was a very active year for NAAOP’s legislative and regulatory efforts. Clearly the largest issue of the year was Medicare reform, which was enacted on December 8, 2003 and is in the process of being implemented by CMS this year. Although treatment of professional orthotic and prosthetic care in the Medicare bill can generally be considered a “mixed bag,” there are clearly some important victories in the bill. In addition to the Medicare bill and monitoring its implementation, NAAOP continues to be active on several regulatory fronts including a recent victory on an orthotic “coding clarification” issued by the SADMERC.

SADMERC Add-On Coding Clarification Rescinded: NAAOP actively participated in an effort in December 2003 to convince the SADMERC to rescind a “coding clarification” relating to “add-on” orthotic codes. The coding clarification had stated that suppliers of orthotic services may not use add-on L codes in conjunction with “prefabricated” orthotic codes. NAAOP aggressively worked with the SADMERC to explain how the “clarification” would have adversely impacted practitioners and the Medicare program, and would have deprived patients of necessary options that enhance comfort, stability, and, most-importantly, function of orthoses. NAAOP will continue to monitor and react to potentially similar actions in the future.

Competitive Bidding Becomes Law, O&P Spared Major Impact: The recently enacted Medicare bill established nationwide “competitive bidding” starting in 2007 for all DME, supplies, and “off-the-shelf” orthotics. The inclusion of a narrow definition of “off-the-shelf” orthotics, at NAAOP and other groups’ urging, should be considered a victory for the O&P profession since most orthotics and all prosthetics will not be subject to the nationwide system of Medicare competitive bidding that begins in 2007.

O&P Medicare Fee Schedule Frozen through 2006, but Longer-Term Freeze and FEHBP Pricing Avoided: The most immediate ramification stemming from the Medicare reform legislation was a freeze of the entire O&P fee schedule, along with all DME and supplies, at 2003 rates for three years (2004-2006). Despite protests by NAAOP and other interest groups, the provision freezing all O&P was included in the final bill. However, the fee freeze under the Medicare bill continues through 2008 for certain items of DME, clearly indicating a separation between treatment of DME and professional O&P care. Also, O&P was spared application of a provision mandating a cut in reimbursement for the top five utilized DME items in 2005 to the median price reimbursed by the Federal Employees Health Benefits Plan, which would represent a cut in fees of approximately 20% under current levels.

Negotiated Rulemaking Process “Trumped” by Medicare Bill, Analysis Ongoing: The Medicare bill includes a provision that appears to “trump” the failed Negotiated Rulemaking dispute in favor of the position that all O&P care must be provided by health care professionals certified/accredited in the practice of orthotics and prosthetics. The Negotiated Rulemaking process concluded in July of 2003 without resolution of the key sticking point in negotiations-the definition of which providers of O&P care would be considered “qualified providers.” Whether or not Congress intended to settle this issue in the Medicare bill, the provision appears to be very favorable to NAAOP’s position on the issue of the definition of a “qualified provider.” NAAOP will continue to analyze the provision for its specific impact on O&P practice, and continue to meet with CMS officials as the regulations on this provision are implemented.

Direct Access Provision in Medicare Bill Watered Down, MedPAC to Issue Study: The Medicare bill addressed the issue of “direct access” to physical therapists without a physician’s prescription by rejecting a demonstration project and, instead, requiring a study of the issue. Rather than changing the law to allow for direct access or propose a demonstration project, as was included in the original Senate bill, the final bill authorized a study by the Medicare Payment Advisory Commission (MedPAC) on whether physical therapists should be able to self prescribe their services under Medicare, including, potentially, O&P services and devices.

75% Rule Still on Hold, Congress Weighs In: The 75% Rule, which governs whether a hospital or unit is considered a rehabilitation hospital or unit, and, thus, paid in a different manner, is currently on hold pending CMS’s revision of the rule. Although CMS has stated that it will release the final rule shortly, Congress bolstered the arguments of NAAOP and other groups for a continued hold. “Report language” in the Medicare bill and the recently passed Omnibus Appropriations bill directs CMS to continue the delay in publication pending a study to examine the rule’s effectiveness. Although the report language is not law, it nevertheless sends a strong message to CMS that implementation of the 75% Rule as CMS has proposed would be highly restrictive to inpatient rehabilitation care, including inpatient rehabilitation received by amputees and others with orthopedic impairments.

Concern over LMRP Issue Continues: Amidst CMS’s drafting of new rules regarding the 75% Rule, some fiscal intermediaries (FIs) are drafting local medical review policies (LMRPs) intended to constrain and limit the coverage guidelines set by CMS for inpatient rehabilitation. These LMRPs significantly impact O&P patient care in this setting. Because LMRPs must be consistent with all statutes, rulings, and regulations, and may not conflict with CMS National Coverage Decisions or interpretive manuals, the fiscal intermediaries should await CMS guidance on the 75% Rule before implementing revisions to coverage policies for inpatient rehabilitation stays. NAAOP, along with other rehabilitation groups, continues to press CMS to direct FIs to withdraw the current LMRPs and discontinue further action until an independent panel of national clinical experts on inpatient rehabilitative care is convened and has fully examined the issues associated with medical necessity.

NAAOP will continue to monitor the implementation of specific provisions in the Medicare bill as they relate to O&P, particularly competitive bidding and the application of certification/accreditation standards to O&P providers. The 75% Rule and the LMRP issue will also be of continuing concern for O&P and NAAOP will be actively involved to prevent implementation of regulations unfavorable to O&P patients and providers. NAAOP will also continue to closely monitor Congress and the Bush Administration for any potentially deleterious policy initiatives in the future.

If you have questions regarding these issues, please contact Peter Thomas, NAAOP General Counsel, or Dustin May, Legislative Director, Powers, Pyles Sutter, and Verville, PC, at 1-800-622-6740.

  • Written by NAAOP

SADMERC to Rescind Policy on Prefabricated Orthoses Add On Code

NAAOP is pleased to report that its efforts, and the efforts of other O&P organizations, to challenge the SADMERCÂ’s recent coding decision regarding add on codes have been successful. NAAOP has verbally confirmed that the SADMERC will rescind its policy prohibiting the use of add on orthotic codes in conjunction with prefabricated orthotic base codes. This represents a clear victory for NAAOP and the O&P community in maintaining quality orthotic care.

Officials with the SADMERC stated during a recent conference call that “A formal article rescinding the advisory is forthcoming and a clarification letter will be issued in the next publication cycle.” Pursuant to this statement, the advisory was removed from the SADMERC website and the SADMERC will continue to work on this issue and make recommendations to add on codes where appropriate.

On December 23, 2003, NAAOP wrote to the SADMERC and DMERC Medical Directors, stating that the new “coding clarification” policy would adversely impact practitioners and the Medicare program, and would deprive patients of necessary options that enhance the comfort, stability, and, most-importantly, function of orthoses.

Not only does the action by the SADMERC to rescind the advisory elimination the immediate reimbursement impact of the decision, it also eliminates the need to challenge the process in which the coding advisory was issued. The SADMERC originally issues this advisory without following proper notice and comment procedures. Had the coding advisory been allowed to stand, additional policies may have been issued in the future using the same flawed procedure and averting proper notice and comment guidelines.

Please join NAAOP today to ensure that we are able to remain active and vigilant on behalf of the O&P community. Please contact NAAOP at (800) 622-6740 or on the web

  • Written by NAAOP

O&P Facilities’ Obligation to Provide Interpreters

“In a response to the message sent on the listserve regarding an O&P facility’s obligations to provide interpreters to deaf or hard of hearing patients, the following describes an O&P facility’s rights and responsibilities under the Americans with Disabilities Act of 1990 (“ADA”).

O&P facilities are considered “public accommodations” under Title III of the ADA, regardless of the size of the business or number of employees. As a public accommodation, an O&P facility has a responsibility to provide “effective communication” through its policies and procedures with the public, including patients. “Effective communication” does not require the provision of an interpreter for every patient who requests it or who is deaf or hard of hearing. In many instances, note taking and the use of other auxiliary aids and services to achieve effective communication are perfectly acceptable. However the complexity of the communication is largely what determines what form of communication would be considered “effective.” For a routine patient encounter, an interpreter is not required absent extenuating circumstances. However, if the patient encounter involves a more complex set of communications and consideration of more complicated issues, an interpreter may well be required by the ADA.

If the patient requests an interpreter, the practitioner should engage in a dialogue with the patient and/or his/her representative or family members to arrive at the method of communication that suits the particular needs of the patient and the circumstances of the patient visit.

If an interpreter is determined to be required, the O&P facility is obligated to pay for the interpreter entirely and may not impose a surcharge on the patient, even if the reimbursement for the patient service is less than the cost of the interpreter needed for that patient visit. The cost of interpreter services are measured against the revenues of the entire operation, not against the individual requiring the interpreter. In other words, the provision of interpreters or other auxiliary aids and services to deaf and hard of hearing patients is a cost of doing business with the public.

This response is provided to the O&P community as a service of the National Association for the Advancement of Orthotics and Prosthetics (NAAOP). Although drafted by NAAOP’s General Counsel, Peter W. Thomas, it does not constitute legal advice.”

  • Written by NAAOP

House passes a $45 billion legislative package impacting federal health care programs.

This afternoon, the House passed a $45 billion legislative package impacting taxes, trade and federal health care programs. The package now goes to the Senate for consideration.

The massive bills were quickly compiled over the last several days by Senate and House Republican leaders and, among other things, would prevent a scheduled 5% cut in Medicare physician payments in 2007, freezing payments at their current levels. Beginning in July 2007, physicians could receive 1.5% bonus payments in exchange for submission of data on quality measures.

Of importance to NAAOP, the legislation would not cut the O&P Medicare fee schedule and, therefore, O&P will maintain its 4.3% update in 2007. Also, in terms of disability-related policy, the legislation would extend the Medicare therapy cap exception process for an additional year, allowing beneficiaries requiring extensive therapy services to exceed the current Medicare therapy limit.

In order to pay for the physician payment freeze and other costly provisions, lawmakers are targeting the Medicare Modernization Act’s (MMA) “stabilization fund” – set up to entice insurance companies to participate in the Medicare prescription drug program. Other cost-saving provisions include a .5% reduction in Medicaid provider taxes (preempting expected CMS regulations that would have cut payments by 3%) and an “audit program to identify and collect on inaccurate Medicare overpayments and underpayments to specialized contractors.”

During House debate, many Democrats raised concern regarding the procedures and timeframe surrounding consideration of the bill. However, the legislative package is expected to face much greater opposition in the Senate from Members who oppose several of the trade provisions as well as some of the high cost items. Senate rules technically allow debate on the measure until Sunday, but leadership is hoping that they will be able to invoke cloture earlier than that.

We will keep you updated as developments occur.

For a copy of the summary of the healthcare provisions in the bill provided by the House Ways and Means Committee, please contact NAAOP at

  • Written by NAAOP