OIG recommends adding medical device info to CMS claims forms

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Adding fields for medical device information on claims reimbursement forms would help CMS better track how much Medicare spends on recalled or defective devices, according to HHS’s Office of the Inspector General (OIG).

The OIG memo to CMS Acting Administrator Andy Slavitt offered some preliminary results into an ongoing review of the impact failed devices have on Medicare costs. Current claims forms do have a field for reporting device failures and recalls, but without more specific fields, like why a replacement device was needed, OIG said it has to go to greater lengths to effectively track costs related to these device problems.

“To determine this, we had to subpoena manufacturers to obtain lists of beneficiaries who received recalled or failed devices and review beneficiaries’ medical records. Specifically, we subpoenaed information and reviewed medical records for beneficiaries related to seven devices that had been recalled or that had high failure rates,” the OIG memo said. “For these seven devices, we established complex audit procedures and preliminarily identified $1.5 billion in Medicare payments and $140 million in beneficiary copayments and deductibles for services and procedures associated with recalled or failed devices.”

Citing a U.S. Food and Drug Administration study that said medical device recalls doubled between 2003 and 2012, OIG said CMS could have spent billions of dollars on failed devices without having an easy way to identify that spending. The remedy, according to OIG, is changing claims forms.

“We believe that CMS should collaborate with the Accredited Standards Committee X12 to include the device identifier (DI) portion of the Unique Device Identifier for implantable devices on the next version of the claim forms,” the memo said. “The inclusion of the DI could assist in identifying the costs to Medicare for recalled or defective medical devices, help ensure patient safety and safeguard Medicare trust funds.”