Billing for Materials: Getting Enough Not to Lose Money
BY CLARKE D. NEWMAN, OD, FAAO
The old adage that you never go broke making a profit is important when it comes to billing for specialty contact lens materials. The goal is to charge enough, and more importantly collect enough, to cover the costs of materials.
Billing for materials requires using the Level II section of the HCFA Healthcare Common Procedure Coding System (HCPCS) or "hick-picks." These codes were developed in 1983 to create a common system for healthcare and medical suppliers to bill third-party payers. Remember, Level I are the CPT codes we use for services. Level II are the HCPCS National Codes for materials. Level III are Local Codes.
The V Codes
In contact lens billing, we use the V Codes. Vision services are V0000–V2999. These fall under the DME (durable medical equipment) Regional Carrier. You need to know your regional DME carrier to submit Medicare claims for some lenses. For my region, Region C, the carrier is Palmetto. Since regional carriers deal only with Medicare, private third-party claims need to be filed directly.
An interesting thing applies to Medicare. According to NDC 80.4, hydrophilic contact lenses are only covered when the diagnosis is aphakia. However, this restriction doesn't apply to material codes that don't have the word hydrophilic in them.
V Codes that cover contact lenses are the V2500s. HCPCS lens codes are all per lens. That means that you have to bill two if you dispense two. Also remember to use the right and left modifiers, otherwise it may get denied as a duplicate billing.
Make sure that the code you choose matches the lens that you supply. The V250x codes are the PMMA codes the V251x are the RGP codes, and the V253x codes are the scleral codes. Table 1 contains the contact lens codes.
I'm frequently asked, "What code should I use for the hybrid lenses?" I think the code that best describes them is V2531. These lenses do extend their landing zones onto the sclera, and they are gas permeable.
Setting Appropriate Fees
Finally, set the lens cost to cover material cost, shipping, staff costs for lens verification, scheduling, return costs, restocking fees and a small profit margin. If you keep your profit in your professional fees, then you'll do right by your practice and your patients. CLS
Dr. Newman has been in private practice in Dallas, Texas since 1986 specializing in vision rehabilitation through contact lenses as well as corneal disease management, optometric medicine and refractive surgery.