Comparative Billing Reports

CBR201612 PAP/RAD and Accessories FAQs

Question Categories:


Clinical and Billing

Report Specifics



What is the purpose of a comparative billing report (CBR) on Positive Airway Pressure (PAP) Devices and Respiratory Assist Devices (RAD) and Accessories?

CBR201612 was created to inform Medicare DMEPOS suppliers about their billing and payment patterns on claims for PAP and RAD devices and Accessories. The CBR team reviewed Fee-for-Service Medicare (Original Medicare) claims with dates of service from January 1, 2015 to December 31, 2015. For more information about CBRs, please visit our website at the link titled, Comparative Billing Reports.

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Why were CPAPs, RADs and accessories selected as a topic for a CBR?

This topic was chosen because the Office of Inspector General (OIG) determined that DMEPOS items are vulnerable to fraud, waste and abuse. One OIG report found that 65 percent of the items related to RADs and 59 percent of the items related to CPAPs had one or more errors. According to the 2016 OIG work plan, there has been an increase in billing and an increase in the number of beneficiaries receiving these items. To review the OIG report and work plan, see the following links:

• Claim Modifier Did Not Prevent Medicare From Paying Millions in Unallowable Claims for Selected Durable Medical Equipment

• Work Plan Fiscal Year 2016

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What is the specific focus of CBR201612?

CBR201612 focuses on DMEPOS suppliers who billed differently than their peers. The metrics included in the report are:

• Average allowed services per beneficiary by category

• Percentage of most costly services by selected categories

• Average allowed charges per beneficiary

To review an example of a mock provider’s CBR, see the following link: CBR201612 Sample CBR.

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What Healthcare Common Procedure Coding System (HCPCS) codes were analyzed?

Table 1 of the CBR lists the categories, HCPCS codes, and descriptions included in the report. To view this information, select the following link: CBR201612 Sample CBR. For additional material about HCPCS coding, see the following web links:

• HCPCS-General Information

• HCPCS Level II Codebook, AMA Store

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Is receiving a CBR an indication that I’m billing incorrectly?

No. Receiving a CBR is not necessarily indicative of incorrect billing; however, it does mean that your billing is different from your peers. There can be many reasons billing patterns vary, which include the region, subspecialty, and patient acuity. If you still have questions and/or concerns after reviewing your CBR, please contact the CBR Support Help Desk by telephone at 1-800-771-4430 or by email at

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Should an audit be expected after receiving a CBR?

No. The CBR team does not have access to medical records to perform audits of claims. The purpose of CBRs is to allow suppliers to compare their billing patterns to those of their peers. It may be beneficial, however, for suppliers to conduct self-audits. Resources that can help with setting up an audit process are located on our CBR website page at the link titled, Self-Audit Help.

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Does the information in the CBR change or alter the documentation and billing requirements established by the Medicare Administrative Contractors (MACs)?

No. The CBR is for informational and educational purposes. It does not alter, change, or negate any of the documentation and billing requirements established by the MACs. If you have questions about billing, please use the following CMS website to access the contact information for your MAC: Review Contractor Directory – Interactive Map.

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Clinical and Billing

What are the qualifications for interpreting a sleep test?

According to LCD L33800, “All sleep tests (Type I – IV, Other) must be interpreted by a physician who holds one of the following:

1. Current certification in Sleep Medicine by the American Board of Sleep Medicine (ABSM); or

2.  Current subspecialty certification in Sleep Medicine by a member board of the American Board of Medical Specialties (ABMS); or

3. Completed residency or fellowship training by an ABMS member board and has completed all the requirements for subspecialty certification in sleep medicine except the examination itself and only until the time of reporting of the first examination for which the physician is eligible; or

4. Active staff membership of a sleep center or laboratory accredited by the American Academy of Sleep Medicine (AASM), Accreditation Commission for Health Care (ACHC), or The Joint Commission (TJC, formerly the Joint Commission on Accreditation of Healthcare Organizations – JCAHO).”

For more information on sleep studies, select the following web link: LCD L33800.

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Can the face-to-face evaluation be done after the sleep test is conducted or after initiation of PAP therapy?

No. LCD L33718, Initial Coverage (criteria A) requires that “the beneficiary has a face-to-face clinical evaluation by the treating physician prior to the sleep test to assess the beneficiary for obstructive sleep apnea.” To review more information about initial coverage, follow the web link titled, LCD L33718 - Initial Coverage.

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What if an order is received for a PAP study but the patient never had a face-to-face evaluation?

According to the Medicare Program Integrity Manual, “For items outlined in 42 CFR 410.38 (g), the following specific date and timing requirements apply:

The date of the face-to-face examination shall be:

• On or before the date of the written order (prescription)

• Be no older than 6 months prior to the prescription date

• Be on or before the date of delivery for the item(s) prescribed.”

This information is also outlined in the Affordable Care Act. To review more details regarding written orders and face-to-face requirements, see the following links:

• Medicare Program Integrity Manual, Chapter 5, Section 5.2.6

• 42 eCFR §410.38

• The Patient Protection and Affordable Care Act, Section 6407

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How often is a face-to-face evaluation required for a beneficiary to be eligible for PAP?

Two face-to-face clinical evaluations of a beneficiary are required before Medicare will cover a PAP device. The first visit must occur prior to the sleep study. The second visit must take place, after the sleep study, between the 31st and 91st day. During the second visit, the physician must review and document improvement of the beneficiary’s condition. Data from the PAP must support use of the device at least 4 hours a night, 70 percent of the nights for a trial period of 30 consecutive days. The following references will provide more information about PAP devices:

• Positive Airway Pressure (PAP) Devices – Physician FAQs

• Physicians, Nurse Practitioners, Physician Assistants and Clinical Nurse Specialists - Are You Ordering PAP Devices For Your Patient?

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What happens if a beneficiary does not meet the requirements for PAP coverage within the 90-day time frame?

According to LCD L33718, “Beneficiaries who fail the initial 12 week trial are eligible to requalify for a PAP device but must have both:

1. Face-to-face clinical re-evaluation by the treating physician to determine the etiology of the failure to respond to PAP therapy; and,

2. Repeat sleep test in a facility based setting (Type 1 study). This may be a repeat diagnostic, titration or split-night study.”

For more information on PAP guidelines, select the following web link: LCD L33718.

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Are there any special documentation requirements for a beneficiary who switches from an E0601 (PAP device) to an E0470 (RAD device) due to ineffective therapy while on the E0601?

Yes. According to LCD L33718, “For beneficiaries changing from an E0601 to E0470 due to ineffective therapy while on E0601 (either during a facility-based titration or in the home setting), the treating physician must document that both of the following issues were addressed prior to changing to an E0470 device:

A. Interface fit and comfort. An appropriate interface has been properly fit and the beneficiary is using it without difficulty. This properly fit interface will be used with the E0470 device; and,

B. E0601 pressure settings. The current pressure setting of the E0601 prevents the beneficiary from tolerating the therapy and lower pressure settings of the E0601 were tried but failed to:

1. Adequately control the symptoms of OSA; or

2.  Improve sleep quality; or,

3. Reduce the AHI/RDI to acceptable levels.”

Additional documentation requirements for PAP devices and treatment of sleep apnea can be found on the CMS website at LCD L33718.

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What are the documentation requirements regarding dispensing orders?

A dispensing order can be verbal or written. Per LCD L33718, “The supplier must keep a record of the dispensing order on file. It must contain: description of the item, beneficiary’s name, prescribing physician’s name, date of the order and the start date, if the start date is different from the date of the order, physician signature (if a written order) or supplier signature (if verbal order)...Signature and date stamps are not allowed.” For complete guidelines, select the following web link: LCD L33718.

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Is monitoring the use of a capped rental item required after the title has been signed over to the beneficiary?

No. Per LCD L33718, “Suppliers are responsible for monitoring utilization of DMEPOS rental items and supplies. No monitoring of purchased items or capped rental items that have converted to a purchase is required. Suppliers must discontinue billing Medicare when rental items or ongoing supply items are no longer being used by the beneficiary.” More information regarding the continued use of a rental item can be located at LCD L33718.

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Report Specifics

How were suppliers selected, and how many received CBRs?

The CBR data team analyzed claims with allowed services for the HCPCS codes included in this CBR and identified those suppliers with different billing patterns when compared to their peers. Approximately 4,400 suppliers were selected to receive the reports; however, suppliers who did not receive a CBR can view a mock report at the following link: CBR201612 Sample CBR.

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How were claims data obtained for this report?

Claims with HCPCS codes covered in this CBR with dates of service from January 1, 2015 to December 31, 2015 were downloaded from the CMS Integrated Data Repository (IDR) and loaded into the Palmetto GBA Medicare Data Warehouse. The suppliers’ data was compared to peer suppliers located in their states (as identified by the National Plan and Provider Enumeration System or NPPES) and the nation. For more information about the IDR, see the following link: CMS Integrated Data Repository (IDR).

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Can you explain what Table 1 means?

Table 1 is a list of PAP Devices, RADs, and Accessories included in this CBR. It lists the categories, HCPCS codes and descriptions for each item. To review an example of a mock supplier’s report, see the following: CBR201612 Sample CBR.

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What does Table 2 mean?

Table 2 is titled Summary of Your Utilization. It lists the categories, HCPCS codes, allowed charges, allowed services, and beneficiary counts for each item. To see Table 2 of the mock supplier’s CBR, please select the web link titled, CBR201612 Sample CBR.

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How are the peers defined?

Each billing supplier was identified by National Provider Identifier (NPI). The peer groups that are used for comparison with individual suppliers were identified, as follows:

• State: All Medicare DMEPOS suppliers with allowed charges for PAP devices, RADs, and accessories who are located in the individual supplier's state, as identified through the NPPES File.

• National:  All Medicare DMEPOS suppliers in the nation who had allowed charges for claims for PAP devices, RADs, and accessories.

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What do the comparison outcomes mean?

The four possible outcomes for the comparisons between the supplier and peer groups are:

• Significantly Higher - supplier’s value is higher than the value of the peer group and the statistical test used confirms significance.

• Higher – supplier’s value is higher than the value of the peer group, but either the statistical test does not confirm significance or there is insufficient data for comparison

• Does Not Exceed - supplier’s value is not higher than the peer value

• N/A (Not Applicable) - supplier does not have sufficient data for comparison

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What does Table 3 mean?

Table 3 provides a statistical analysis of the Average Allowed Services per Beneficiary by Category. To illustrate this, see Table 3 of the mock supplier’s CBR at the following link: CBR201612 Sample CBR. The results of this analysis show the supplier Does Not Exceed their state and national peer groups in any of the categories, according to the results of the t-test.

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What does Table 4 mean?

Table 4 is an example of the Percentage of Allowed Services for Most Costly HCPCS Code by Selected Categories. For an illustration, please refer to Table 4 of the mock supplier’s CBR on our website link at CBR201612 Sample CBR. In the mock supplier’s CBR, the percentages of allowed services for filters (A7039), masks (A7027, A7030), PAP Devices (E0470 and E0471), and tubing (A4604) were calculated and listed in Table 4. In this example the mock supplier has a percentage of nine percent allowed services for HCPCS code A7039 (Filters), which is Significantly Higher than the state average of four percent and the national average of six percent.

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Can you explain Table 5?

Table 5 represents an analysis of the Average Allowed Charges per Beneficiary. For illustration, please refer to the mock supplier’s CBR at the web link, CBR201612 Sample CBR. In this example, the supplier’s average allowed charges per beneficiary were $221.26. The t-test confirms that the supplier’s average Does Not Exceed the state’s percentage of $512.61 or the nation’s percentage of $676.17.

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My allowed charges are “Significantly Higher” than the peer groups on my report. Are my allowed charges being compared to suppliers in other states that have lower fee schedule amounts?

Medicare Physician Fee Schedule (MPFS) allowed amounts vary from area to area, which is why you are compared to both the nation and your state. While these differences may affect average allowed charges per beneficiary, these comparisons are provided so that a provider may get a better idea of where he/she stands in comparison to the nation, and to the providers in his/her state. If a particular area is known to have higher allowed charges than the national or state average, then a higher average would not necessarily indicate any wrong-doing. A geographic practice cost index (GPCI) has been established to account for the variation in practice expenses across the states and nation. More information on the GPCI is available on the CMS website at the link, Documentation and Files - National Physician Fee Schedule and Relative Value Files.

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Where can additional information regarding Medicare guidelines for billing PAP devices, RADs, and accessories be found?

Links for the references and resources used in this CBR can be found at CBR201612 Recommended Links. For information regarding questions about documentation and billing, suppliers are encouraged to contact the DME MACs of their respective geographic areas at Medicare Administrative Contractors (MACs).

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