Generally Accepted Standards for DME Coding and Billing: Medicare Advantage Claims, Miscellaneous HCPCS Codes, and CPT 97760

DME Medical Coding and Medical Billing

Disclaimer: This DME Medical Coding article discusses generally accepted coding, billing, documentation, and audit standards at a high level. It is not a legal opinion, expert opinion, or case-specific conclusion. Whether a particular claim is correctly coded, payable, unsupported, overpaid, or otherwise deficient depends on the date of service, payer contract, Medicare Advantage plan policy, applicable CMS guidance, Local Coverage Determination or policy article, medical record, supplier file, claim-line data, and the facts of the individual claim.

Introduction

Durable Medical Equipment, Prosthetics, Orthotics, and Supplies, commonly referred to as DMEPOS, is a highly rules-driven area of health care reimbursement. Claims involving DMEPOS items and related services require careful attention to the proper use of HCPCS Level II codes, CPT codes, modifiers, units, dates of service, medical necessity documentation, orders, supplier records, and proof of delivery.

Medicare Advantage claims add another layer of analysis because Medicare Advantage organizations generally administer Part C benefits through plan contracts, medical policies, utilization-management processes, and claims-adjudication systems, while still operating within the broader Medicare benefit framework for basic benefits. Under federal regulation, Medicare Advantage organizations must provide coverage of, furnish, arrange for, or make payment for services covered under Medicare Part A and Part B for eligible enrollees residing in the plan service area, subject to applicable regulatory exceptions and plan rules.^[1]

This article addresses general industry custom and practice for three recurring DME-related coding issues:

• Use of miscellaneous or Not Otherwise Classified HCPCS codes such as E1399 and A9999;
• Use of CPT 97760 for orthotic management and training;
• The documentation and audit questions that commonly arise when a claim involves DME delivery, patient instruction, fitting, training, or an allegedly nonspecific code.

1. Standard Code Sets Matter in DME and Medicare Advantage Claims

Health care claims are processed using standardized code sets. CMS explains that HCPCS is divided into two principal subsystems: HCPCS Level I, which consists of CPT codes maintained by the American Medical Association, and HCPCS Level II, which CMS maintains for products, supplies, and services not included in CPT, including DMEPOS items used outside a physician’s office.^[2]

HIPAA Administrative Simplification rules also require use of standard transactions and code sets for covered electronic health care transactions. HHS explains that when a health plan or health care provider conducts an identified standard transaction, the transaction must use a standard code set to identify diagnoses and procedures.^[3]

From an industry custom-and-practice perspective, correct coding begins with identifying the actual item, supply, accessory, or professional service furnished, then matching that item or service to the code descriptor, coding guidelines, payer policy, and date-of-service rules in effect at the time of the claim.

2. DMEPOS Coding Is Not Merely a Pricing Exercise

DMEPOS coding is intended to describe the item or service provided. It is not supposed to be driven by the amount a supplier hopes to receive. DME MAC and Pricing, Data Analysis, and Coding contractor guidance instructs suppliers to review product classification lists, coding guidelines, long code narratives, DME MAC publications, LCD-related policy articles, and PDAC resources when selecting HCPCS codes. That same guidance cautions that price and fees are not part of correct coding and that selecting a code based on the fee schedule may result in an incorrect coding determination.^[4]

The practical implication is straightforward: the claim should first answer, “What item or service was furnished?” Only after that should the supplier or provider determine coverage, payment, contractual reimbursement, patient responsibility, or appeal strategy.

3. General Standard for Miscellaneous HCPCS Codes Such as E1399 and A9999

HCPCS codes such as E1399 and A9999 are commonly understood as miscellaneous or Not Otherwise Classified codes. CMS materials identify E1399 as a miscellaneous durable medical equipment code and A9999 as a miscellaneous DME supply or accessory code.^[5]

Generally accepted coding practice is that a miscellaneous, unlisted, nonspecified, or Not Otherwise Classified code should be reserved for situations where no more specific valid HCPCS code accurately describes the item or service furnished. DME MAC guidance states that suppliers are required to correctly code the item billed and that Medicare will deny services reported with NOC codes if valid codes are available for the item.^[6]

Similarly, DME MAC and PDAC guidance advises suppliers to select the code with the descriptor that most closely describes the product, rather than defaulting to a NOC or miscellaneous code. The guidance further explains that long descriptors and coding guidelines may provide more detail than the short code description.^[7]

4. What Documentation Is Generally Expected for NOC or Miscellaneous DMEPOS Codes?

When a claim uses a miscellaneous or NOC HCPCS code, the code itself does not communicate enough detail to permit ordinary automated adjudication. For that reason, Medicare contractor guidance commonly requires additional narrative information.

Noridian’s DME guidance states that items billed with a code narrative indicating miscellaneous, NOC, unlisted, or nonspecified must include a narrative in the electronic claim note or, for paper claims, in Item 19 of the CMS-1500. The guidance identifies expected narrative information such as the item or service description, manufacturer name, product name, model name and number, supplier price-list amount, and related HCPCS code when applicable. For custom-fabricated items, the guidance calls for a complete and clear description of the item, what makes it unique, and a breakdown of materials and labor.^[8]

In an ordinary DMEPOS claim review, use of E1399 or A9999 therefore raises several neutral audit questions:

• Was there a more specific HCPCS code available on the date of service?
• Does the billed miscellaneous code match the actual item, supply, accessory, or service furnished?
• Does the claim include the required narrative and product-identifying information?
• Does the supplier file contain an order, medical necessity support, product documentation, proof of delivery, and payer-policy support?
• Does the claimed item fall within a recognized DMEPOS benefit category, or is the item excluded from coverage?
• Were the same item, accessory, fitting, adjustment, instruction, or management activities already included in payment for another billed code?

CMS has also explained that for claims billed using miscellaneous DMEPOS codes, including A9999 and E1399, MACs determine on a claim-by-claim basis whether the item or service falls within a DMEPOS benefit category and whether the item or service is excluded from coverage under Medicare law, regulation, or program instructions.^[9]

5. General DMEPOS Documentation Standards: Orders, Medical Necessity, Correct Coding, and Proof of Delivery

DMEPOS claims are not supported by a code alone. CMS DMEPOS documentation guidance identifies several core elements needed to justify payment: a Standard Written Order, medical record information when applicable, correct coding, and proof of delivery.^[10]

The DME MAC Standard Documentation Requirements article states that many Medicare audit errors involve incomplete or missing documentation and that DMEPOS suppliers must maintain documentation in the supplier file for seven years from the date of service. The article also states that all claims for items billed to Medicare require a written order or prescription from the treating practitioner as a condition for payment.^[11]

Proof of delivery is also a central DMEPOS control. CMS MLN guidance states that suppliers must maintain proof-of-delivery documentation for seven years from the date of service and that proof of delivery verifies that the beneficiary received the DMEPOS item and helps determine the payment amount.^[12]

6. CPT 97760: Orthotic Management and Training

CPT 97760 is generally associated with orthotic management and training at the initial encounter. CMS transmittal guidance describes CPT 97760 as orthotic management and training, including assessment and fitting when not otherwise reported, for upper extremity, lower extremity, and/or trunk orthotics, initial orthotic encounter, each 15 minutes.^[13]

Because CPT 97760 is a professional service code, coding analysis ordinarily asks whether the documentation supports the professional service described by the code. In practice, that may include review of:

• The provider type and whether the person furnishing the service was qualified under the payer’s rules;
• Whether the encounter was an initial orthotic encounter;
• Whether patient-specific orthotic assessment, fitting, management, and training were documented;
• The body region involved;
• The amount of direct time, when time is part of the code unit;
• Whether the service was separately identifiable from DME delivery, routine supplier instruction, or fitting activities already included in an orthotic or DMEPOS item code;
• Whether the same encounter included another code or L-code that already included fitting, adjustment, evaluation, or supplier services.

CMS outpatient occupational therapy coding guidance notes that, for entities subject to the related LCD, assessment of the patient regarding the orthotic, measurement and/or fitting, supplies to fabricate or modify the orthotic, and time associated with making the orthotic should not be reported with CPT 97760 unless the entity is certain that duplicate payment will not be made to a DMEPOS supplier using the relevant L-code.^[14]

7. Distinguishing Orthotic Management and Training from Routine DME Instruction

A recurring coding issue is the distinction between:

• Professional orthotic management and training that may be described by CPT 97760 when all code, coverage, documentation, and payer requirements are met; and
• Routine beneficiary instruction regarding safe and effective use of a DMEPOS item, which is generally part of the supplier’s obligations when furnishing Medicare-covered equipment.

Federal supplier standards require a DMEPOS supplier to be responsible for the delivery of Medicare-covered items and to maintain proof of delivery. The supplier must also document that the beneficiary received necessary information and instructions on how to use Medicare-covered items safely and effectively.^[15]

Accordingly, a neutral coding review should not assume that every instruction given to a patient about a DME item is separately reportable as orthotic management and training. The documentation should show what was done, who did it, why it was medically necessary, how much time was spent when time is relevant, and whether the activity was distinct from routine supplier instruction, delivery, fitting, warranty, or product-use education.

8. National Correct Coding Initiative and Unbundling Considerations

CMS states that the National Correct Coding Initiative promotes national correct coding methodologies and reduces improper coding, with the goal of reducing improper payments for Medicare Part B and Medicaid claims.^[16]

NCCI is important, but it is not the only source of correct coding requirements. CMS’s NCCI educational materials state that NCCI does not include all possible correct-coding edits or all forms of unbundling, and that providers and suppliers are required to code correctly even where a specific edit does not exist.^[17]

In DMEPOS matters, this means a review should not stop with whether a claim “passed” an automated edit. A complete review may need to evaluate the item, service, medical record, supplier record, policy article, LCD, plan policy, claim narrative, and any related codes billed on the same or related dates of service.

9. Medicare Advantage Context

Medicare Advantage plan claims often involve the same national code sets used throughout the health care system, but the claim may be adjudicated under plan contracts, network rules, medical policies, prior authorization requirements, utilization-management criteria, and encounter-data workflows. Therefore, coding and billing review in the Medicare Advantage context commonly considers both:

• The national coding and Medicare benefit framework; and
• The applicable Medicare Advantage plan policy, provider contract, authorization record, and claim-adjudication rules.

For DMEPOS items and orthotic-related services, a Medicare Advantage review may also examine whether the claim involved an Original Medicare basic benefit, a supplemental benefit, a contracted rate, a capitated arrangement, a delegated vendor, or an encounter submitted for plan reporting rather than traditional fee-for-service reimbursement.

10. Generally Accepted Audit Approach for E1399, A9999, and CPT 97760

A careful, non-conclusory audit or expert review generally proceeds in a structured way:

1. Identify the claim universe. Determine dates of service, claim lines, billed codes, units, modifiers, providers, suppliers, beneficiaries, plans, and adjudication outcomes.
2. Lock the date-of-service rules. Coding rules, LCDs, policy articles, fee schedules, plan policies, and prior authorization rules should be evaluated as of the applicable date of service.
3. Map each claim line to the underlying item or service. For DMEPOS, this may require invoices, manufacturer information, product descriptions, model numbers, order forms, delivery tickets, and patient records.
4. Determine whether a more specific code existed. When a miscellaneous code was used, review whether a more specific HCPCS code more closely described the item, supply, accessory, or service.
5. Review the NOC narrative. For E1399, A9999, or similar codes, determine whether the claim included the necessary narrative and product-identifying information.
6. Review medical necessity and benefit category. Determine whether the item or service was covered under the relevant DMEPOS benefit category and whether the medical record supports the criteria.
7. Review order and delivery documentation. Determine whether the supplier file includes the required order, proof of delivery, and beneficiary instruction documentation.
8. Evaluate CPT 97760 separately from DME delivery. Determine whether documentation supports orthotic management and training at the initial encounter, rather than merely routine product instruction or delivery-related education.
9. Check for duplication or bundling issues. Determine whether fitting, adjustment, training, supplies, management, or instruction were already included in another billed code or item allowance.
10. Avoid overgeneralization. Each claim should be evaluated under the actual documentation and the rules applicable to that date of service and payer context.

11. Documentation Indicators Commonly Reviewed

For miscellaneous DMEPOS codes such as E1399 or A9999, reviewers commonly look for:

• A treating practitioner’s order or prescription;
• Medical record support for the item;
• Product description, manufacturer, model, and item identifiers;
• Claim narrative for the NOC or miscellaneous code;
• Supplier price-list amount or invoice support, when required by payer or contractor guidance;
• Proof of delivery;
• Beneficiary instruction documentation;
• Evidence that no more specific HCPCS code applied;
• Applicable LCD, policy article, plan policy, or authorization support;
• Correct units, modifiers, and date of service.

For CPT 97760, reviewers commonly look for:

• Documentation of an orthotic, not merely a general DME item;
• Initial orthotic encounter documentation;
• Patient-specific assessment, fitting, management, or training;
• Qualified professional involvement, where required;
• Direct time documentation consistent with the billed units;
• Medical necessity for the orthotic management and training service;
• Evidence that the service was not duplicative of fitting, adjustment, delivery, or supplier instruction included in another code.

Conclusion

Generally accepted coding and billing standards for DMEPOS claims require that the billed code accurately describe the item or service furnished, that documentation support medical necessity and coverage, and that suppliers maintain required order and delivery documentation. Miscellaneous codes such as E1399 and A9999 are not substitutes for more specific HCPCS codes when a valid specific code applies. CPT 97760 requires documentation of orthotic management and training consistent with the code descriptor and payer rules, and should be distinguished from routine DME supplier instruction regarding safe and effective use of equipment.

In any audit, litigation, or compliance review, the key question is not merely what code appeared on the claim. The more complete question is whether the claim, medical record, supplier file, payer policy, and date-of-service coding rules align.

Footnotes

1. 42 C.F.R. § 422.101, Medicare Advantage basic benefits requirements. External source. ↩
2. Centers for Medicare & Medicaid Services, “Healthcare Common Procedure Coding System (HCPCS),” explaining HCPCS Level I/CPT and HCPCS Level II. External source. ↩
3. U.S. Department of Health & Human Services, HIPAA Administrative Simplification, transactions and code set standards. External source. ↩
4. CGS Medicare / DME MAC and PDAC, “Basics of Choosing the Correct HCPCS Code – Correct Coding,” discusses long descriptors, closest-code selection, PDAC resources, and the principle that price and fees are not part of correct coding. External source. ↩
5. CMS HCPCS NOC code file identifying A9999 as “Miscellaneous DME supply or accessory, not otherwise specified” and E1399 as “Durable medical equipment, miscellaneous.” External source. ↩
6. Noridian Medicare, “Billing Not Otherwise Classified (NOC) HCPCS Code,” states that correct HCPCS coding is required and that Medicare will deny NOC-coded services if valid codes are available. External source. ↩
7. CGS Medicare / DME MAC and PDAC, “Basics of Choosing the Correct HCPCS Code – Correct Coding,” advises suppliers to use the code that most closely describes the item rather than a NOC or miscellaneous code. External source. ↩
8. Noridian Medicare, “Billing Not Otherwise Classified (NOC) HCPCS Code,” identifying required claim narrative information for NOC-coded DMEPOS items, including description, manufacturer, model, supplier price-list amount, related HCPCS code when applicable, and custom-fabrication details. External source. ↩
9. CMS MLN Matters MM13651, “Medicare Benefit Policy Manual Update: DMEPOS Benefit Category Determinations,” states that miscellaneous DMEPOS codes, including A9999 and E1399, are evaluated by MACs on an individual claim-by-claim basis for benefit category and exclusions. External source. ↩
10. CMS, “DMEPOS General Documentation Requirements,” identifies SWO, medical record information, correct coding, and proof of delivery as documentation requirements to justify payment. External source. ↩
11. CMS Medicare Coverage Database, Article A55426, “Standard Documentation Requirements for All Claims Submitted to DME MACs,” discusses documentation needed to justify payment, seven-year retention, and written order requirements. External source. ↩
12. CMS MLN Matters SE19003, “Proof of Delivery Documentation Requirements,” discusses DMEPOS proof-of-delivery documentation and seven-year retention. External source. ↩
13. CMS Transmittal R3924CP, discussing CPT 97760 as an initial orthotic management and training encounter, each 15 minutes. External source. ↩
14. CMS Medicare Coverage Database, Billing and Coding Article A53064, “Outpatient Occupational Therapy,” discussing orthotics training and cautioning against duplicate payment for assessment, fitting, supplies, fabrication, or modification where payment may already be made under a DMEPOS L-code. External source. ↩
15. 42 C.F.R. § 424.57(c)(12), DMEPOS supplier standards regarding delivery, proof of delivery, and beneficiary instruction on safe and effective use of Medicare-covered items. External source. ↩
16. CMS, “National Correct Coding Initiative (NCCI),” explaining that NCCI promotes correct coding methodologies and reduces improper coding. External source. ↩
17. CMS MLN, “How to Use the Medicare National Correct Coding Initiative (NCCI) Tools,” noting that NCCI does not include all possible combinations of correct coding edits or all kinds of unbundling, and that correct coding is still required even if edits do not exist. External source. ↩

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