Cochlear Diagnostic Procedures in Hospital Outpatient Settings

Medicare payment for hospital outpatient procedures is distinctly different from Medicare payments to other Part B beneficiaries. The adoption of new Current Procedural Terminology (CPT)* codes for cochlear implant diagnostic analysis in 2003 has seen divergent payment rates assigned in the Hospital Outpatient Prospective Payment System (OPPS) and the Medicare Physician Fee Schedule (MPFS). OPPS applies to all hospital outpatient services except those rendered by rehabilitation therapists, which are paid under MPFS. Currently, the four cochlear implant diagnostic analysis procedures (CPT 92601-92604) are each reimbursed $66 under OPPS.** This is in contrast to the following MPFS rates*** (geographic adjustments apply to both payment systems):

** Federal Register, November 7, 2003, p. 63592
*** www.asha.org/members/issues/reimbursement/analysis-2004mfs.htm


CPT 92601 (Diagnostic analysis of cochlear implant, patient under 7 years of age; with programming) . . . . . . .$130
CPT 92602 (Subsequent reprogramming for patients under 7 years) . . . . . . $91
CPT 92603 (Diagnostic analysis of cochlear implant, age 7 years or older; with programming) . . . . . . .$86
CPT 92604 (Subsequent reprogramming for patients age 7 years or older) . . . . $57.50

The MPFS rates are based partially on surveys conducted by the American Speech-Language-Hearing Association (ASHA) in regard to average time spent by an audiologist in a typical session and costs of equipment and supplies. The OPPS rates, on the other hand, are based on average costs (for established CPT procedures) as reported by hospitals throughout the country. In 2003, the Centers for Medicare and Medicaid Services (CMS) proposed a single rate of $66 under OPPS to apply to each of the cochlear procedures. ASHA protested, with the rationale that CMS should assign temporary classifications intended for new CPT codes until adequate cost data was available from hospitals. CMS rejected ASHA's proposal and implemented the $66 rate.

In OPPS, CPT procedures are assigned to one of more than 450 groups called Ambulatory Payment Classifications (APCs). The cochlear diagnostic codes are currently grouped in APC 365, Level II Audiometry. This is the same payment classification to which certain audiometric tests are assigned (e.g., 92553, 92557, 92561, 92582). ASHA's recommendation to CMS in 2003 was to assign temporary APCs that would have paid rates similar to those in the MPFS. In February, 2004, ASHA proposed an alternative revision. Instead of placing the cochlear procedures in APC 365, we recommended APC 660 (Level II Otorhinolaryngologic Function Tests) which pays $95. Procedures currently under APC 660 include posturography (92548) and sinusoidal rotational test (92546). We believed this to be a reasonable interim solution for the underpaid procedures. CMS will propose rates for 2005 this summer. In any case, within a year or two it is anticipated that a more reasonable rate will be established based on hospital cost data.

CPT codes and descriptors copyright 2003 American Medical Association

Mark Kander is the director of health care regulatory analysis at the American Speech-Language-Hearing Association. You can reach him by phone at 301/897-0139 or by email at mkander@asha.org