CGMs and the Diabetic Market

Published in Wound Care on November 01, 2022

Continuous Glucose Monitoring (CGM) continues to be a hot topic in the wound care space. In a podcast by Industry Matters, Wayne van Halem, president of The van Halem Group, and Joseph Ault, sales manager for GEMCO, discuss CGM audits, qualifications for reimbursement and documentation, as well as the opportunities in the diabetic market.

Current Environment with CGM Audits

Currently, due to the waivers, we are not seeing large volumes of audits in the CGM space; however, we do not believe that will continue. There have been a few larger audits performed by a supplemental medical review contractor (SMRC). Because of the growth in the CGM market, it is likely that CGM audits will increase. The ALJ backlog is nearly caught up, and cases that were submitted just a few months ago are already being assigned to judges. Although the Office of Medicare Hearings and Appeals (OMHA) has enough staff to manage over 150,000 appeals annually within a 90-day timeframe, they are only receiving less than 35,000. That means we are very likely to see a sharp increase in RAC audit activity.

The RACs added CGMs to their list of approved issues for complex reviews in September 2021. Like all other types of DME claims, it is anticipated that there will be more and more audits in the CGM space once the PHE is over and the LCD waivers have ended. As far as audits are concerned through Medicare, the main thing seen we anticipate is suppliers who have had a significant volume increase during the public health emergency will probably see more audits once the PHE is over. For example, if a supplier went from 100 patients to 10,000 patients, they are likely to be audited.

Ultimately, there’s no way around these audits, so it is essential to understand the policy and obtain the proper documentation when it comes to CGMs in order to avoid any significant audit issues.

Qualifying for Reimbursement

A supplier working with a patient who has either Type 1 or Type 2 diabetes will generally qualify for reimbursement of a CGM. Most insurances will pay for CGMs, regardless of whether the individual has Type 1 or Type 2 diabetes, but they must take insulin injections or receive insulin via an insulin pump. Although each insurance has its own guidelines, most private insurances and payers follow Medicare guidelines. The best practice for suppliers is to routinely check the medical policies of the insurances they are billing for in case there are any changes.

In short, patients will qualify for CGM if they have either Type 1 or Type 2 diabetes and are administering insulin three or more times a day, whether that be via syringe insulin pen, an insulin pump, or even inhaled insulin.

Documentation Requirements and Waivers

Similar to other claims for various types of medical equipment, the standard documentation requirements apply to CGMs. Suppliers need a standard written order, proof of delivery, and medical documentation supporting that the patient meets the criteria as stated above.

There have been some waivers to these requirements during the period of the public health emergency, and the purpose of that was to allow patients who may not have been able to access the equipment previously to now have access under the waivers. It is unknown how CMS will manage that after the public health emergency. There is a chance that CMS will not make all those CGM patients stop using CGM, but that's not known for sure. It’s important to keep in mind the intent of the waivers, which was to get patients access to CGMs who were unable to see their physician due to the pandemic. In those cases, claims should be submitted with a CR modifier, but it’s not intended to be used on every single claim. CMS may even consider that an abuse of the waivers if they see that.

From the medical documentation standpoint in the case where suppliers can obtain it, it must support the criteria that was listed in the LCD. This means that the patient has diabetes, they're treated with insulin three or more times a day, their treatment regimen requires frequent adjustment by the beneficiary based on the results of their tests.

For Medicare claims, the key piece of documentation is that they would have to have a face-to-face with their physician within six months prior to document that they meet the criteria, and the physician is going to evaluate their diabetes control. There's the initial evaluation, and then every six months they must go back to their physician again in-person, and they must be assessed to determine that they're adhering to the CGM therapy. In the event of an audit, the supplier must have both the initial visit six months prior to them starting therapy, and then another visit within six months prior to the date of service in question.

This can be a challenge as it is difficult to make sure that the patients are going back to the physicians and the physicians are documenting what they need to. However, one thing that makes it easier is that suppliers are not required for Medicare claims to have refill requests because Medicare just pays a flat bundled rate for supplies, and the beneficiary would be supplied with enough to last them a month. Suppliers would just bill one unit of this bundled K0553 code every 30 days, regardless of when the supplier actually ships the supply. The refill process is a little bit simpler than it is for blood glucose supplies.

For private insurance companies, every insurance is going to have different policies and requirements. Medicare managed care plans follow the Medicare rules for example, but commercial plans can develop their own policies, just like each state Medicaid can develop their own policies. Depending on where the services are provided and which payers the individuals work with, suppliers should be sure to check what that payer policy is.

What the LCD Revisions Mean

There have been changes published to the LCD. As of July 18, 2021, Medicare removed the requirement that any member would need to be tested four times a day. Prior to July 18, the mandate was that the patient had to test their blood sugar four times a day or more and administer insulin three times a day or more. Because Medicare removed the testing criteria on July 18, 2021, the only real guideline is that the patient must administer and adjust insulin three or more times a daily to qualify. This has opened up the space for more patients to be able to receive the supplies that they need.

Considerations for Supplying CGM

The CGM market continues to grow, as evident by the LCD revisions that were published in which they are expanding the market and access for Medicare beneficiaries. A lot of M&A activity has also been seen in this market, which is a good sign as well.

It is key for suppliers to do the work up front to learn how to do it correctly. This will result in plenty of successful opportunities with CGMs. The van Halem Group has many clients who have successfully entered the market after working with them to provide some education, pre-screening, and audit services to make sure things look correct from the very beginning. After that, those suppliers implemented a successful, profitable CGM program. There is a lot of opportunity in the CGM market.

The CGM market is still very much at its infancy, and these products are the biggest thing that's happened to the HME and DME world for years. Prior to the competitive bidding program when Medicare started making test strips extremely profitable with reimbursement, this is similar to what is being seen right now in the CGM world. This is definitely the biggest bubble in the HME and DME space since that time. According to Joseph, over 80% of diabetic patients that qualify for CGMs do not have them. So, we're really at the infancy of these products and life-changing supplies.

Resources and Tools for CGM

GEMCO

VGM has partnered with GEMCO to assist VGM members in being more successful in the diabetic space and market. Most medical equipment providers care for patients with multiple health problems, so it's a natural fit for them to incorporate diabetic supplies and CGMs into their mix to become more profitable. According to Joseph, In the United States, 34.2 million people and 10.5% of which of the population live with diabetes currently. There are an additional 8 million adults that have pre-diabetes. As a result, GEMCO has seen a very strong, steady increase in CGM business as more Type 1 and Type 2 diabetic patients are prescribed technology to help manage their diabetes better.

GEMCO has been a leading NABP-accredited medical supply wholesaler and third-party logistics provider of diabetes supplies and other home health products for 30 years. Their team of experts can help VGM members with the latest products, including insulin delivery, blood glucose monitoring therapies, and assist with general billing and reimbursement questions.

GEMCO also provides return on investment (ROI) calculators for VGM members to understand what the reimbursement and out-of-pocket expenses look like on a monthly, quarterly, and annual basis, as well as an in-depth billing guide to explain all the different HCPCs codes for private insurance, Medicare, Medicaid, how the bundles work, modifiers, etc. to reference when billing CGMs.

Click here to learn more about GEMCO’s partnership with VGM.

The van Halem Group

For suppliers interested in getting started in the CGM market, it is important to make sure to understand those requirements. The van Halem Group is available to help in that regard and provide education, training, clinical pre-screen reviews, and more. For more information or to contact them, visit www.vanhalemgroup.com.

Wound Care Diabetic Program Guide

VGM has a Wound Care Diabetic Program Guide available for members to learn how to start or grow their diabetic business. Click here to access the guide.

The CGM market will only continue to grow. For any questions, reach out to us here. Listen to the original podcast, click here.

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