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By the Numbers

Medicare and Cochlear Implant Coverage

Windmill, Ian M. PhD

doi: 10.1097/01.HJ.0000602904.45825.24
Special Section: Updates in CI Candidacy
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Dr. Windmill is the clinical director of the division of audiology at Cincinnati Children's Hospital Medical Center and a past-president of the American Academy of Audiology (AAA).

As baby boomers continue to age, the number of individuals receiving Medicare benefits will increase by an estimated 50 percent over the next 20 to 30 years.1 Given the high proportion of individuals over the age of 65 with hearing and/or vestibular loss, the number of patients needing audiologic services will also continue to increase substantially.

Figure 1.

Figure 1.

Figure 2.

Figure 2.

Table 1

Table 1

Table 2

Table 2

The Medicare program, managed through the U.S. Department of Health's Centers for Medicare and Medicaid Services (CMS), has four parts. Part A is the payment system for hospitals. Providers, particularly those in outpatient or private practice settings, are paid through Part B. Part C is managed through private contractors commonly known as Medicare Advantage programs. Part D is the prescription drug coverage program. Audiologists are primarily paid through Part B, although they may also be paid via Medicare Advantage programs. The data and information that follow are specific to Part B of the Medicare program.

Medicare regulations state that audiology services are considered “other diagnostic tests” and therefore will reimburse audiologists only for conducting those procedures associated with the assessment of hearing and not for any services associated with hearing loss treatment. Consistent with this regulation, Medicare will reimburse audiologists for diagnostic procedures such as the diagnostic analysis associated with the initial and subsequent programming of cochlear implants (CIs) as well as the evaluation of auditory rehabilitation status as part of the auditory performance assessment of the hearing device recipients.

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MEDICARE, CIs, AND AUDIOLOGY

Procedures associated with CIs are either provided within facilities (i.e., hospitals), generally on an outpatient basis, or through non-facilities (i.e., independent providers such as audiologic private practices, ENT practices, etc.). The fee Medicare assigns to each procedure is based on the relative value of work, practice expense, and malpractice expense associated with the delivery of that service. Hospitals are assumed to incur different expenses from those of independent practices (e.g., rent), so they are reimbursed at lower rates.

Medicare identifies an allowable amount for each procedure—the allowed payment for each procedure every year for providers in facilities and non-facilities. This allowed amount is the total reimbursement for the procedure, irrespective of the submitted charge amount. Providers at either a facility or non-facility are reimbursed under Medicare Part B, which requires beneficiaries to pay 20 percent of the allowable amount. As such, Medicare only pays 80 percent of the identified allowable amount, with the provider responsible for collecting the remaining 20 percent from the beneficiary. The Medicare allowable for any given procedure varies somewhat by geographic location due to differences in practice expenses (e.g., rent is higher in New York City than in Cincinnati, OH.)

Within the Common Procedural Terminology (CPT) Code Set (CPT® is a registered trademark of the American Medical Association) are four CPT codes related to CI programming and two codes related to the evaluation of auditory rehabilitation status.2 These include:

  • CPT 92601: Diagnostic analysis of a CI patient below 7 years old; with programming
  • CPT 92602: Diagnostic analysis of a CI patient below 7 years old; subsequent programming
  • CPT 92603: Diagnostic analysis of CI, age 7 years or older; with programming
  • CPT 92604: Diagnostic analysis of CI, age 7 years or older; subsequent reprogramming
  • CPT 92626: Evaluation of auditory rehabilitation status; first hour
  • CPT 92627: Evaluation of auditory rehabilitation status; each additional 15 minutes

Except on very rare occasions, Medicare does not reimburse any provider for CPT 92601 or 92602 since these codes are reserved for patients below 7 years old. Additional codes can be used within the context of CIs (e.g., L7510 for repair of a prosthetic device; 92585 for auditory evoked responses, etc.), but these codes can be used with other devices or for purposes not associated with CIs. Due to these factors, the remainder of this article will focus on the codes associated with the diagnostic evaluation of CIs for patients over 7 years old (CPT 92603 and 92604) and codes associated with the evaluation of auditory rehabilitation status (CPT 92626 and 92627).

Specific to CPT 92626 and 92627, audiologists may use these codes whenever they are evaluating the auditory function of a patient either before or after the patient receives a hearing device, including hearing aids, CIs, osseo-integrated implants, or brainstem implants.2 While many cochlear implant centers use these codes for pre- and post-implant evaluation, some centers may be using this code for the evaluation of auditory function pre- and post-hearing aid fitting or evaluation of function pre- and post-implantation of an osseo-integrative device. As such, data about 92626 or 92627 must be understood in the context of assessment beyond CIs.

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MEDICARE PAYMENT FOR CI SERVICES

In 2019, the National Payment Amount Medicare allowable for the initial programming of a CI (CPT 92603) for older patients is $157.49 for providers who bill as part of a private practice (non-facility) and $125.06 when the services are provided in a facility (Table 1). The allowable amount for the subsequent CI reprogramming is $93.70 for non-facilities and $69.92 for facilities. The 2019 Medicare allowable for CPT 92626 is $91.90 and $77.84 for non-facilities and facilities, respectively (Table 2). CPT code 92627 is charged in 15-minute increments and thus the Medicare allowable is about one-quarter of the amount for CPT 92626, which reflects 31 to 60 minutes worth of services. The allowable amount for CPT 92627 is $23.07 for non-facilities and $18.38 for facilities.

Figure 1 shows the changes in reimbursement for CPT 92603 and 92604 for non-facilities and facilities since 2007. Ignoring 2007 data, which are not in line with the data from 2008 to the present, the Medicare allowable for CPT 92603 for non-facilities can be seen to have steadily increased since 2008 until 2019. Though not to the same degree, the allowable for subsequent programming at non-facilities has also increased since 2008. The allowable for both initial and subsequent programming at facilities, however, is fairly flat, and, if anything, slightly lower in 2019 than it was in 2008. Similar trends can be seen in Figure 2, which shows the changes in reimbursement for the evaluation of auditory rehabilitation status since 2007. Again, the allowable amount for a non-facility has increased over time while that for facilities has slightly decreased. These trends can be viewed as positive for private practices but not for hospitals, although these may or may not be offset by cost-of-living changes over time.

Medicare collects available data on charges, allowables, and payments for all procedures. These data can be accessed on the Medicare website, and are provided on a calendar year basis.3 Included in the Medicare data sets available for review are the number of times each CPT code was billed, the total and average amount billed for each CPT code, and the total and average amount allowed. In 2017, Medicare allowed nearly 3,000 charges for CPT code 92603 from more than 600 providers. Tables 1 and 2 show Medicare data for codes typically associated with CIs in 2017, the latest year with data available for review.3 These data are for charges and payments for the traditional Medicare program, and do not include payments for these codes through Medicare Advantage programs. More than 95 percent of these charges came from non-facilities such as private practices, ENT practices, etc. It should be noted that databases specific to codes do not distinguish the type of provider that submitted the code or received the payment. Data gleaned from other databases, however, show that audiologists submitted the vast majority of these codes, although this code was also submitted under the name of an otolaryngologist on many occasions.

Medicare allowed $450,000 in payments for the 3,000 services for the initial analysis of CIs (CPT 92603). The actual Medicare payments for CPT 92603 were $329,443, with an average payment of $124.62 to facilities and $151.80 to non-facility providers. The difference between the total and average allowable and the total and average amount actually paid reflects the responsibility of the beneficiary for 20 percent of the cost. In essence, the Medicare allowable reflects what practices should collect for CI services, while the amount paid reflects Medicare's 80 percent share of the cost.

As can also be seen in Table 1, Medicare recognized over 900 providers who submitted more than 23,000 charges for CPT 92604 (diagnostic analysis of CIs with subsequent programming). This significantly higher number of services associated with CPT 92604 compared with CPT 92603 is not unexpected since CI recipients must be monitored and CIs are, if necessary, reprogrammed over time. As the number of CI recipients increases, so too would the number of submissions of CPT 92604. Medicare allowed over $2 million in payments for 92604 and paid nearly $1.5 million. The average payment for 92604 was about $63.

For the codes associated with the evaluation of auditory status, 1,123 providers submitted more than 25,000 charges for CPT 92626 (Table 2). Nearly 10,000 charges were submitted for CPT 92627. Both of these codes are timed, and 92627 is only submitted in 15-minute increments when the time for the evaluation exceeds one hour (92626). In terms of time, these codes combined would indicate that about 27,500 hours were devoted to the evaluation of auditory status in patients with hearing loss. The average allowable for CPT 92626 was slightly more than $92, with the average payment of about $68. The average allowable for CPT 92627, the evaluation of auditory rehabilitation status each additional 15 minutes, was $23.70, with the average payment being $17.94.

Medicare allowed nearly $2.5 million in charges for evaluation of the auditory rehabilitation status and made payments of over $1.8 million. Again, the allowed charges reflect the total a practitioner should collect with Medicare payments accounting for 80 percent of the total and the beneficiaries being responsible for the other 20 percent. For the four codes most often associated with CIs, the total charges submitted in 2017 were over $12 million. Medicare allowed slightly more than $5.1 million and paid $3.7 million. These figures only reflect the services provided to Medicare beneficiaries, and do not reflect charges submitted for payments made by other third-party payers or by individual patients.

The CPT codes commonly used to bill for cochlear implant services are not reserved for audiologists but can be billed by other providers. As noted earlier, Medicare payments for specific codes do not distinguish between providers. In 2017, the following specialties submitted charges for codes 92603, 92604, 92626, and 92627: audiology, otolaryngology allergy, neurology, and allergy. Charges were submitted under the audiologist's name in about 85 percent of the cases for codes associated with diagnostic evaluation of CIs and over 93 percent of the time for the evaluation of auditory rehabilitation status codes. Medicare data do not distinguish the type of service provided, so whether CPT 92626 or 92627 was used exclusively for implants for different types of devices is unknown.

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INSIGHTS FROM TRENDS

Payments from Medicare for many audiologic codes, including those for CI services in hospital facilities, have been fairly flat over the past six to seven years.4 In contrast, payments from Medicare for audiologic codes associated with CI services have seen a steady, albeit small, increase in payments over the same time period for providers working in the non-facility setting. While the increase in payments for CI services in the non-hospital setting is positive, this may not mean increases in profitability.

Since 2013, the increase in payments for CPT 92603 was slightly over $10 per patient, while the increase for 92604 since 2013 is slightly more than $5 per patient/charge. For a practice that had maintained 30 new implants per year with 30 new programming (92603) and 150 subsequent programmings per year (92604), these differences would mean a practice is collecting about $1,100 more in 2019 than in 2013 for the same services. These increases may or may not be sufficient to offset cost-of-living changes. As stated previously, the data presented here are strictly for traditional Medicare payments, and profitability within a practice is obviously influenced by many factors, including the volume of Medicare patients. As with other services, the profitability of providing CI care will vary from practice to practice.

While it is unknown how many individual Medicare beneficiaries received a CI, the numbers do suggest a substantial number of people were implanted. Given the longer life span of these devices, the numbers also suggest that the number of services for subsequent programming and evaluation of auditory rehabilitation status will continue to increase over the next decade.

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REFERENCES

1. Henry J Kaiser Family Foundation. (2013) Projected change in Medicare enrollment, 2000-2050. https://www.kff.org/medicare/slide/projected-change-in-medicare-enrollment-2000-2050. Accessed on July 24, 2019.
2. American Academy of Audiology, 2019. Coding for evaluation of auditory rehabilitation status (CPT codes 92626 and 92627) accessed August 1, 2019 at https://www.audiology.org/practice_management/coding/coding-evaluation-auditory-rehabilitation-status-cpt-codes-92626-and.
3. Medicare National HCPCS Aggregate Summary Table CY2017. https://data.cms.gov/Medicare-Physician-Supplier/Medicare-National-HCPCS-Aggregate-Summary-Table-CY/2zuc-y5mm. Accessed on August 1, 2019.
4. Windmill IM and Freeman BA: Medicare, Hearing Care and Audiology: Data Driven Perspectives. Audiology Today, March/April, 2019.
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