Durable medical equipment, prosthetics, orthotics and medical supplies (DMEPOS) expenditures have risen rapidly in the auto no-fault sector due to a multitude of factors. In part, these rising costs can be attributed to the incorrect usage in many instances of DMEPOS classification codes submitted to insurance carriers by medical providers.
The current version of the International Classification of Diseases, referred to as ICD-10-CM, is used by medical professionals and contains over 68,000 codes according to the TechTarget website. The previous version, known as ICD-9-CM, consisted of approximately 13,000 diagnostic codes. This most recent revision to the ICD coding system represents not only a significant increase in general diagnostic codes, but the ICD-10-CM was edited to include nearly two times as many category options than contained in the ICD-9-CM.
As part of the automobile no-fault claims and medical provider payment process, insurance carriers and adjusters will often use the Healthcare Common Procedure Coding System (HCPCS). More specifically, Level II of the HCPCS contains the classification codes for DMEPOS along with other medical services and supplies. Due to the multitude of codes and categories for various forms of DMEPOS as well as the overwhelming number of codes under the ICD system, medical providers may unknowingly provide incorrect codes to an adjuster under a no-fault claim involving claimant injuries. Other times, medical providers will submit a bid to the insurance adjuster under a ‘not otherwise classified,’ or NOC code, because they may not know which code to select. Furthermore, the reimbursement levels may be significantly higher if a provider submits the bid under an incorrect code or uses an NOC code. Since both the correct and incorrect codes for DMEPOS can appear to be very similar, it is easier for less experienced adjusters to unintentionally overlook the improper use of codes and therefore pay a higher dollar amount to the medical provider than is necessary.
Additionally, some providers may unbundle DMEPOS services for their patients. Oftentimes this may be an error or inexperience on the part of the provider, but some providers intentionally unbundle a claimant’s DMEPOS services knowing that their payment from the insurance carrier under the no-fault claim will be higher than a bundled DMEPOS claim. If these unbundled claims are not thoroughly reviewed and investigated during the claims process, the insurance carrier will pay more to the provider for the claimant’s DMEPOS services. This incorrect use of coding, whether intentional or otherwise, contributes significantly to the rise in cost of DMEPOS for no-fault claims..
Adjusters have a myriad of duties within a single no-fault claim, and the codes supplied by the provider for DMEPOS services may not always be accurate. It is imperative that an insurance carrier review the codes used for DMEPOS in no-fault claims involving injuries. Northwood’s experienced team is thoroughly trained on HCPCS and implements a front-end authorization process on DMEPOS services for the insurance carriers it partners with. Northwood’s procedures and reviews save insurance carriers time and money by helping reduce the cost of DMEPOS services and ensures the proper reimbursement is allowed to the provider. Please contact Northwood for more information on DMEPOS and automobile no-fault claims.
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