Reimbursement updates

Medicare now pays Home Health Agencies (HHA) separately for disposable negative pressure wound therapy

Kathleen D. Schaum, MS

Advances in electronics and technology have transformed negative pressure wound therapy (NPWT) over the past 17 years. What used to be cumbersome equipment and bulky supplies has morphed into disposable equipment that attaches to a sophisticated fluid management system with small flexible tubing.  In fact, the equipment is small enough to slip into patients’ pockets, and when its 7-day battery is exhausted, the disposable NPWT device is simply thrown away.

These relatively low cost disposable NPWT devices easily fit into the MS-DRG payment rates of acute care hospitals, into the RUG payment rates of skilled nursing facilities, and into the LTCH-DRG payment rates of long term care hospitals. Hospital-based Outpatient Wound Care Departments (HOPDs) are separately paid for the CPT® codes 97607 or 97608 which include the payment for the disposable NPWT device and fluid management system, as well as the work to assess the wound, apply the device, and provide instructions for ongoing care.

Unlike the previous sites of care, the home health agencies’ HHRG payment rates for 60-day episodes of care did not easily accommodate the disposable NPWT technology. This is easily explained: when the HHRG payment system began, NPWT pumps were large pieces of durable medical equipment (DME), which were rented/sold to patients by DME suppliers.  However, disposable NPWT devices, such as the PICO™ Single Use Negative Pressure Wound Therapy System, could not be separately billed to Medicare by DME suppliers, because the equipment did not meet the legal criteria for DME. And the HHRG payment rates could not be adjusted so that the home health agencies could afford to purchase the disposable NPWT devices.

The only way to change the home health Medicare benefit was to change the law.  This was accomplished via section 504 of the Consolidated Appropriations Act of 2015. Effective January 1, 2017 this new law provides Medicare beneficiaries access to disposable NPWT if they receive home health services for which payment is made under the Medicare home health benefit. The ACT requires Medicare to separately pay home health agencies when they furnish new disposable NPWT devices. 

Just like all other home health services, the beneficiaries must receive the disposable NPWT devices under a home health plan of care that is developed in consultation with the agency staff and periodically reviewed by the patients’ physicians. The home health plan of care should cover all pertinent diagnoses, including the types of services and equipment required for the treatment of those diagnoses, as well as any other appropriate items, including the disposable NPWT devices.

Following are a few important 2017 home health agency Medicare reimbursement facts that pertain to disposable NPWT:

  • The American Medical Association established two (2) CPTcodes for NPWT using disposable medical equipment:
    1. 97607 Negative pressure wound therapy (e.g., vacuum assisted drainage collection), utilizing disposable, non-durable medical equipment including provision of exudate management collection system, topical application(s), wound assessment, and instructions for ongoing care, per session; total wound(s) surface area less than or equal to 50 square centimeters.
    2. 97608 total wound(s) surface area greater than 50 square centimeters
  • 97607 and 97608 include reimbursement for the disposable NPWT equipment and, therefore, should only be reported when a new disposable NPWT pump is furnished to the patient and wound assessment and instructions for ongoing care are performed by a licensed nurse (RN or LPN), physical therapist, or occupational therapist in accordance with state law.
  • The home health agency should report either 97607 or 97608 on a separate claim identified as Bill Type 34X (with the appropriate revenue code for the licensed nurse (0559), for the physical therapist (042X), or for the occupational therapist (043X)).

NOTE: Visits performed solely for the purpose of furnishing NPWT using a new disposable NPWT device should not be reported on the home health prospective payment system (HH PPS) claim identified as Bill Type 32X.

  • If the home health agency furnishes a new disposable NPWT pump during the course of an otherwise covered home health agency visit (for example, while also furnishing a catheter change), the home health agency must not include the time spent furnishing the new disposable NPWT in their visit charge or in the length of time reported for the visit on the HH PPS claim identified as Bill Type 32X. In this situation, the home health agency should submit two claims for this service:
  • One identified as Bill Type 34X for the new disposable NPWT pump and related service (with either 97607 or 97608)
  • One identified as Bill Type 32X for the time spent furnishing the catheter change service that is unrelated to the provision of the new disposable NPWT pump

NOTE: Any follow-up visits for wound assessment, wound management, and replacement of a NPWT fluid management system, where a new disposable NPWT pump is not furnished, must be included on a HH PPS claim identified as Bill Type 32X.

  • For CY 2017 home health agencies’ Medicare payment for furnishing a new disposable NPWT pump, as well as a wound assessment and instructions for ongoing care is based on the current year’s Hospital Outpatient Prospective Payment System (OPPS) Medicare allowable rate for 97607 and 97608, which is $292.62. The amount paid to the home health agency by Medicare will be equal to 80% of the lesser of the actual charge or the current year’s OPPS allowable rate. The home health Medicare payment amount will be subject to the area wage adjustment policies in place under the current year’s OPPS and will be subject to sequestration adjustments. The patient or their secondary insurance will pay the remaining 20% to the home health agency.

If you would like to learn more about the new 2017 Medicare payment that home health agencies will receive for providing new disposable NPWT devices, wound assessment and instructions for ongoing use, feel free to register for the nationwide webinar with a  live question and answer session.

  • Tuesday, January 31 at 3:00 pm EST

Register today at www.woundsresearch.com/reimbursement

  • Information on reimbursement in the U.S. is provided as a courtesy. Due to the rapidly changing nature of the law and the Medicare payment policy, and reliance on information provided by outside sources, the information provided herein does not constitute a guarantee or warranty that reimbursement will be received or that the codes identified herein are or will remain applicable.
  • This information is provided “AS IS” and without any other warranty or guarantee, expressed or implied, as to completeness or accuracy, or otherwise. This information has been compiled based on data gathered from many primary and secondary sources, including the American Medical Association, and certain Medicare contractors.
  • Providers must confirm or clarify coding and coverage from their respective payers, as each payer may have differing formal or informal coding and coverage policies or decisions.
  • Providers are responsible for accurate documentation of patient conditions and for reporting of products in accordance with particular payer requirements.

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