by Jared Staheli
June 18th, 2015
Instead of using ABNs and charging beneficiaries for upgraded items, suppliers in certain circumstances may decide to furnish beneficiaries with upgraded equipment but charge the Medicare program and the beneficiary the same price they would charge for a nonupgraded item. The reason for this may be that a supplier prefers to carry only higher level models of medical equipment in order to reduce the costs of maintaining an inventory that includes a wide variety of different models and products. Also, a supplier may be able to reduce its costs for replacement parts and repairs if it includes in its inventory only certain product lines. The supplier may also be accommodating a physician order for an upgrade.
Suppliers are permitted to furnish upgraded DMEPOS items and to charge the same price to Medicare and the beneficiary that they would charge for a non-upgraded item. This policy allows suppliers to furnish to beneficiaries, at no extra costs to the Medicare program or the beneficiary, a DMEPOS item that exceeds what the non-upgraded item that Medicare considers to be medically necessary. Therefore, even though the beneficiary received an upgraded DMEPOS item, Medicare’s payment and the beneficiary’s coinsurance would be based on the Medicare allowed amount for a nonupgraded item that does not include features that exceed the beneficiary’s medical needs.
When a supplier decides to furnish an upgraded DMEPOS item but to charge Medicare and the beneficiary for the non-upgraded item, the supplier must bill for the nonupgraded item rather than the item the supplier actually furnished. The claim must include only the charge and HCPCS code for the non-upgraded item. The HCPCS code for the non-upgraded item must be accompanied by the following modifier:
GL - Medically Unnecessary Upgrade Provided Instead of Non-upgraded Item, No Charge, No ABN
Suppliers must show the upgrade using the ASC X12 837 professional claim format, or in Item 19 of a paper Form CMS-1500 claim, or as an attachment. Tthe supplier must specify the make and model of the item actually furnished, that is, the upgraded item, and describe why this item is an upgrade
Contractors are to pay based on Medicare’s payment amount for the non-upgraded item if it meets Medicare’s coverage and payment requirements. A certificate of medical necessity, if applicable, must be completed for the HCPCS code that identifies the nonupgraded item but not for the upgraded item.
MSN Message: For items accompanied with a GL modifier, use:
MSN 8.51: You are not liable for any additional charge as a result of receiving an upgraded item.