Pass-through provides vehicle to drive innovation

July 30, 2020

As more novel ophthalmic drugs and devices become available under the CMS “pass-through”designation, practices should be proactive in embracing these products.

Special to Ophthalmology Times®

Reimbursement and coding can be complicated in any specialty and ophthalmology is no exception. Working with products that fall into the pass-through”category from the Centers for Medicare and Medicaid Services (CMS) may introduce some challenges to practices just getting started, but the ability to bring new technologies to patients is well worth it.

Once a practice becomes familiar with pass-through and establishes a process, making successive waves of new technology available to patients under this designation will be easier.

Related: COVID-19: HHS unveils $4 billion in healthcare provider relief payments

Medicare’s prospective payment system basesreimbursement on past claims, so new products with no history of cost or utilization tend to be at a disadvantage.

Congress introduced the transitional pass-through designation as a way to circumvent that bias by providing extra payments, above established facility fees, for certain new drugs and devices.

Although the pass-through designation may seem complex, its aim is quite simple: to provide a way for new drugs and technologies to be introduced and used.

Transitional pass-through makes it financially feasible for surgery centers to provide patients with some of the newest and best interventions that might otherwise be cost prohibitive for them to offer.

Related: Surgeons discuss MIPS, impact of pass-through medications

Pass-through back story
Transitional pass-through status may be new to some in ophthalmology, but it has been on the scene for 2 decades, having debuted in 2000 as Social Security Act 1833(t)(6).

The initiative specified that transitional pass-through payments would be “provided for certain new drugs, devices and biological agents that were not paid for as a hospital outpatient department service, and whose cost is ‘not insignificant’ in relation to the payment for the procedures or services associated with it.”1

When pass-through status is conferred on a product by CMS, a Health Care Common Procedure Coding System (HCPCS) code is designated and must be used during billing to receive reimbursement.

Pass-through is termed “transitional” because it is meant to be a designation afforded to products for the first few years, as they move from new to widely used. Initially, products are bestowed a “C” code and if all goes well, a longer-term “J” code is applied.

The primary benefit of the J code is that a product will have a consistent billing code that can be used across all government and commercial payer plans—as the latter tend to recognize J codes, but not C codes, for reimbursement.

Related: Glaucoma 360: Fostering innovation in the face of costs, policy issues

Just passing through
Some novel approaches to ophthalmic drug delivery are currently available for use under pass-through status, among them dexamethasone intraocular suspension 9% (Dexycu, EyePoint Pharmaceuticals); dexamethasone ophthalmic insert 0.4 mg (Dextenza, Ocular Therapeutix); and phenylephrine ketorolac intraocular solution 1%/0.3%, (Omidria, Omeros). Other examples of ophthalmic pass-through products include iris and corneal prostheses.

Advances in drug-delivery options have expanded postcataract inflammation management, with dexamethasone intraocular suspension 9% and dexamethasone ophthalmic insert 0.4 mg making it possible, in most cases, for patients treated with these products to avoid conventional steroid drops.

Pass-through has helped make these valuable innovations accessible to patients without added cost to the surgery center, surgeon, or Medicare patients with coinsurance (the vast majority of the Medicare population).2

Related: 9 best practices in refractive-cataract surgery planning

Phenylephrine ketorolac intraocular solution 1%/0.3%, a combination of phenylephrine and ketorolac added to ophthalmic irrigating solution during cataract surgery, is indicated for maintaining pupil size by preventing intraoperative miosis and reducing postoperative ocular pain.

In 2018, CMS extended pass-through status for the drug after it had expired.

At Bowden Eye and Associates, which has 3 locations in the Jacksonville area as well as the only single specialty ambulatory surgery center, our 3 fellowship-trained surgeons increasingly rely on intraoperatively delivered sustained-release drugs to manage postoperative inflammation.

Although they were successful in using topical steroids to mitigate inflammation prior to the advent of these newer methods, our surgeons stress that any regimen that relies heavily on patient adherence leaves room for improvement.

Furthermore, as technology has advanced and refractive cataract surgery considerations have been added to the standard surgical process, meeting or exceeding patient expectations is more important than ever, and managing postoperative inflammation is a big part of that.

Related: Procedures set a new horizon in refractive surgery

Conversations
With pass-through products used in the operating room, as with any surgical technology, some preoperative patient counseling is necessary. This is especially the case with intraoperative steroid formulations.

The use of these products will affect both the ultimate postoperative drop burden and the number of prescriptions a patient will need to fill at the pharmacy before surgery.

Our surgical counselors try to strike a balance between briefing patients about the use of intraoperative products like dexamethasone intraocular suspension 9% or dexamethasone ophthalmic insert 0.4 mg and overloading them with information.

We keep the conversation concise and focus on the practical benefits to patients of fewer drops to worry about postoperatively.

To streamline our processes and patient communication, we like to have consistent practices in place from surgeon to surgeon.

Related: ASCRS 2020: Real-world efficacy of DEXYCU data retrospective case study

However, when we start out with a new product or process, we typically confine its use to a single surgeon while we establish a process and work out the kinks. Then we can introduce it to the rest of the surgeons and staff with confidence.

It can also be helpful to establish a timeline for completing this initiation process to keep everyone accountable; with a surgical pass-through item, the process can take a month or so because of patient scheduling. Ideally, as the practice is doing a trial rollout of a surgical pass-through product, patients will get to experience the new technology on both eyes.

Making a practice of explaining the innovation to patients during this period can help foster enthusiasm and word-of-mouth referrals.

Using pass-through products such as dexamethasone intraocular suspension 9% or dexamethasone ophthalmic insert 0.4 mg can take a few more administrative steps, but taking postoperative inflammation management out of the hands of patients is invariably worth the effort.

In addition to discussing this with the patient and perhaps their caregiver or family member, our surgical coordinators contact patients’ primary commercial insurer or secondary insurer, if applicable, to determine whether the pass-through drug is covered and to get precertification approval — a process that is made easier with resources from the manufacturers of each product.

Related: Predictable, branded steroids offer control over surgery

The more we know prior to the day of surgery, the fewer surprises there are for our patients and surgeons.

We ensure that the staff member responsible for encounter verification proactively verifies coverage for these products so the information is available to the surgical counselor, technicians, and surgeon on the day of the cataract consult.

Once verification is complete, the code is added to the chart and flagged for the rest of the care team.

Conclusion
Ophthalmology has a long history as a medical specialty that welcomes innovators and nurtures innovation, so transitional pass-through billing is a natural addition.

It enables surgeons to try new drugs and devices and implement those that offer their patients measurable benefits, while doing so in way that keeps the average cost-per-case favorable to insurers.

About the author

Patti Barkey, COE, OCS9
P: 904/296-0098
E: PattiBarkey@hotmail.com
Dr Barkey is a speaker and consultant for Omeros, Ocular Therapeutix, and EyePoint Pharmaceuticals. She is CEO of Bowden Eye and Associates and Eye Surgery Center of North Florida, LLC, in Jacksonville, Florida.

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References
1. Process and information required to determine eligibility of drugs, biologicals, and radiopharmaceuticals for transitional pass-through status under the hospital outpatient prospective payment system (OPPS). CMS. Updated January 2015. Accessed June 8, 2020. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/drugapplication.pdf

2. Kaiser Family Foundation analysis of the CMS Medicare Current Beneficiary Survey Cost and Use File, 2010.