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    How payer perspective guides reimbursement

    Practices often struggle with this confusing concept

    Doctors are quite accustomed to hearing the question, sometimes several times a day, “Will insurance pay for it?” The correct answer often depends on coverage. A clear understanding of the distinction between covered and non-covered services is vital to successful practice management. This area is especially crucial to device manufacturers, as the success or failure of their product may hinge on coverage determinations. 

    Fortunately, there is considerable information about this topic throughout the Medicare literature. Private payers include references to covered versus noncovered services in their policies as well. Although private payers’ approaches often mirror those of Medicare, differences may occur.

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    This is a broad ranging concept impacting all specialties. In ophthalmology, coverage is highly relevant to many conditions including cataract, glaucoma, macular degeneration, eyelid pathology, and dry eye syndrome. Coverage also affects testing services.

    Medicare applies these criteria when determining if a service or item is covered: The service must fit within a defined benefit category, must be medically reasonable and necessary, and must not be excluded from coverage. Some services (such as routine eye exams) are excluded from coverage by statute. Others are excluded based on policy considerations determined either locally or nationally. Local Coverage Determinations (LCDs) express policy determinations by local medical carriers, and far outnumber National Coverage Determinations which serve a similar function on a national basis.

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    The medically reasonable and necessary (“R and N”) standard can be understood by reviewing this definition:

    "Medical necessity is defined as the need for an item(s) or service(s) to be reasonable and necessary for the diagnosis or treatment of disease, injury or defect. The need for the item or service must be clearly documented in the patient’s medical record. Medically necessary services or items are: appropriate for the symptoms and diagnosis or treatment of the patient’s condition, illness, disease or injury; and provided for the diagnosis or the direct care of the patient’s condition, illness, disease or injury; and in accordance with current standards of good medical practice; and not primarily for the convenience of the patient."

    Economic requirements

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