Medicare Program; Medicare Coverage of and Payment for Bone Mass Measurements

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

42 CFR Part 410

[HCFA-3004-IFC]

RIN 0938-AI89

Medicare Program; Medicare Coverage of and Payment for Bone Mass

Measurements

AGENCY: Health Care Financing Administration (HCFA), HHS.

ACTION: Interim final rule with comment period.

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SUMMARY: This interim final rule with comment period provides for

uniform coverage of, and payment for, bone mass measurements for

certain Medicare beneficiaries for services furnished on or after July

1, 1998. It implements provisions in section 4106(a) of the Balanced

Budget Act of 1997.

DATES: Effective date: These regulations are effective on July 1, 1998.

Comment date: Comments will be considered if we receive them at the

appropriate address, as provided below, no later than 5 p.m. on August

24, 1998.

ADDRESSES: Mail an original and 3 copies of written comments to the

following address: Health Care Financing Administration, Department of

Health and Human Services, Attention: HCFA-3004-IFC, P.O. Box 26585,

Baltimore, MD 21207-0385.

If you prefer, you may deliver an original and 3 copies of your

written comments to one of the following addresses: Room 309-G, Hubert

H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC

20201, or Room C5-09-26, 7500 Security Boulevard, Baltimore, Maryland

21244-1850.

Comments may also be submitted electronically to the following e-

mail address: HCFA[email protected]. For e-mail and comment procedures,

see the beginning of SUPPLEMENTARY INFORMATION. For information on

ordering copies of the Federal Register containing this document and on

electronic access, see the beginning of SUPPLEMENTARY INFORMATION.

FOR FURTHER INFORMATION CONTACT: William Larson, (410) 786-4639.

(Conditions for Coverage, and Frequency Standards) William Morse, (410)

786-4520. (Physician Fee Schedule Payments)

SUPPLEMENTARY INFORMATION: E-mail comments must include the full name

and address of the sender, and must be submitted to the referenced

address in

[[Page 34321]]

order to be considered. All comments must be incorporated in the e-mail

message because we may not be able to access attachments.

Electronically submitted comments will be available for public

inspection at the Independence Avenue address, below. Because of

staffing and resource limitations, we cannot accept comments by

facsimile (FAX) transmission. In commenting, please refer to file code

HCFA-3004-IFC. Comments received timely will be available for public

inspection as they are received, generally beginning approximately 3

weeks after publication of a document, in Room 309-G of the

Department's offices at 200 Independence Avenue, SW., Washington, D.C.,

on Monday through Friday of each week from 8:30 a.m. to 5 p.m. (phone:

(202) 690-7890).

Copies: To order copies of the Federal Register containing this

document, send your request to: New Orders, Superintendent of

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the GPO Access User Support Team by sending Internet e-mail to

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(202) 512-1530 between 7 a.m. and 5 p.m. Eastern time, Monday through

Friday, except for Federal holidays.

I. Background

A. Current Medicare Coverage

In general, bone mass measurements, using bone mineral

densitometers and bone sonometers, are considered to be the most

valuable objective indicator of the risk of fracture and/or

osteoporosis. The clinical use of these devices is based on the

assumption that bone mass is an important determinant of osteoporotic

fractures, and that bone mass measurements may help reduce the number

of fractures by identifying high-risk individuals, who can then receive

appropriate preventive measures. Because osteoporosis is generally

considered preventable, but not reversible, we believe that early

detection of at-risk individuals is a desirable health outcome.

Before the enactment of the Balanced Budget Act of 1997 (BBA),

Medicare coverage of bone mass measurements and the related physician

interpretation of those procedures were available for some

beneficiaries under sections 1861(s)(1) and (s)(3) of the Social

Security Act (the Act). Section 1861(s)(1) of the Act provides for

general Medicare coverage of physician services, including a

physician's interpretation of the results of tests performed. Section

1861(s)(3) of the Act provides for general Medicare coverage of

diagnostic x-ray, clinical laboratory and other diagnostic tests.

Furthermore, section 1862(a)(1)(A) of the Act provides that Medicare

cover only services that are reasonable and necessary for the diagnosis

or treatment of illness or injury. In developing the current Medicare

policy on bone mass measurements, we determined, based on the advice of

our medical consultants, that certain measurements were consistent with

the provisions of section 1862(a)(1)(A) of the Act.

Medicare coverage policy on bone mass measurements is described in

section 50-44 of the Medicare Coverage Issues Manual (CIM).

Specifically, the CIM provides for coverage of single-photon

absorptiometry (SPA) if it is used in assessing changes in bone density

of beneficiaries with osteodystrophy or osteoporosis. In addition, a

bone biopsy, a physiological test that is a surgically, invasive

procedure, is covered if used for the qualitative evaluation of bone.

Finally, the CIM provides for coverage of photodensitometry, a

noninvasive radiological procedure that attempts to assess bone mass.

The CIM also states that dual-photon absorptiometry (DPA), is a

noncovered service.

In recent years, various new bone mass measurements have been

developed and gained acceptance in the medical community. Since they

have not been excluded from coverage under section 50-44 of the CIM,

most Medicare contractors have begun to pay for the medically necessary

use of these measurements, but some Medicare contractors have not. As a

result, Medicare coverage of bone mass measurements has been

inconsistent in its application with regard to the types of (1)

beneficiaries eligible, (many Medicare contractors have considered bone

mass measurements of estrogen-deficient women to be screening services

and not covered under Medicare) and (2) bone mass measurements

considered to be clinically effective.

B. Recent Legislation

Section 4106(a)(1) of the BBA adds section 1861(s)(15) to provide

for uniform coverage of bone mass measurements under the Part B program

for services furnished on or after July 1, 1998. The law defines a

``bone mass measurement'' to mean (1) a radiologic, radioisotopic, or

other procedure approved by the Food and Drug Administration (FDA) for

the purpose of identifying bone mass, detecting bone loss, or

interpreting bone quality, and (2) it includes a physician's

interpretation of the results of those bone mass measurement

procedures. The law also authorizes Medicare coverage of those

medically necessary approved measurements that are performed for a

``qualified individual'' that fall into at least one of five diagnostic

categories. These include (1) an estrogen-deficient woman at clinical

risk for osteoporosis, (2) an individual with vertebral abnormalities,

(3) an individual receiving long-term glucocorticoid (steroid) therapy,

(4) an individual with primary hyperparathyroidism, and (5) an

individual being monitored to assess the response to, or efficacy of,

an approved osteoporosis drug therapy.

Section 4106(a)(2) of the BBA also requires the Secretary to

establish frequency standards governing the time period when qualified

individuals will be eligible to receive covered bone mass measurements.

Section 4106(b)(2) of the BBA amended section 1848(j)(3) of the

Act, which defines ``physicians' services'' to include a bone mass

measurement as a physician service. Physicians' services as defined in

section 1848(j)(3) are paid for under the physician fee schedule (42

CFR part 414).

[[Page 34322]]

II. Rationale for Coverage of Bone Mass Measurements

We have consulted with appropriate Federal government organizations

and reviewed medical literature regarding (1) the clinical efficacy of

the various available bone mass measurement procedures that the FDA has

approved or cleared for marketing for assessing bone density, (2) the

medical indications for the five categories of Medicare beneficiary

eligible to receive coverage under Medicare for the procedures, and (3)

the frequency standards that the Secretary is required by law to

establish under the new benefit. Based on review of the law and our

research, we have reached the following conclusions on the various

major issues raised by the coverage of bone mass measurements.

A. Clinically Effective Bone Mass Measurements

Section 1861(rr)(1) of the Act, as added by section 4106(a) of the

BBA, defines the term ``bone mass measurement'' to mean, in part, ``a

radiological, radioisotopic, or other procedure approved by the Food

and Drug Administration'' that is ``performed on a qualified person . .

. for the purpose of identifying bone mass or detecting bone loss or

determining bone quality. * * *'' In addition, section 4106(b) of the

BBA amended the law to provide that payment for bone mass measurements

that are covered under this new benefit must be made under the Medicare

physician fee schedule, as provided in section 1848(j)(3) of the Act.

We have interpreted these provisions to mean that the scope of the bone

mass measurement benefit includes bone densitometry or bone sonometry

procedures that are performed with devices that have been approved or

cleared for marketing by the FDA. We are not including payment for

biochemical markers within this benefit at the present time. Even

though biochemical markers have been approved for marketing by the FDA,

they are, in fact, clinical laboratory tests that may be paid for under

the Medicare clinical laboratory fee schedule (sections 1833(a)(1)(D)

and 1833(h) of the Act), rather than under the Medicare physician fee

schedule (many Medicare contractors currently pay for biochemical

markers under the Medicare clinical laboratory fee schedule). We plan

to raise the issue of coverage for biochemical markers used in

measuring bone mass when we implement section 4554 of the BBA

concerning national coverage and administrative policies for clinical

laboratory tests. That section of the statute requires the use of a

negotiated rulemaking process and was announced on June 3, 1998 (63 FR

30166).

The expansion of Medicare coverage to include additional preventive

benefits for bone mass measurement reflects a Congressional intent to

improve the overall health of qualified individuals that is consistent

with medical science. There is a well-established causal relationship

between reduced bone mass and the risk of fracture, particularly in the

hip and spine. Although numerous risk factors exist for the development

of fractures (Heaney, Robert P., M.D., ``Bone Mass, Bone Loss, and

Osteoporosis Prophylaxis,'' Annals of Internal Medicine, Volume 128,

Number 4, pages 313-314 (February 15, 1998)), bone mass is the most

extensively-studied fragility factor, in tandem with considerable

therapeutic options for restoration of bone mass. From a public health

perspective, it has been noted in the medical literature that bone loss

is highly prevalent among elders (Genant, H.K., Guglielmi, G., Jergas,

M., (Eds) ``Bone Densitometry and Osteoporosis'' (Epidemiology of

Osteoporosis) Ross, P.D., pgs 23-25 (1998)), and that only about ten

percent of women in the United States over age 65 have ``normal'' bone

mass.

At present, the FDA has approved or cleared for marketing a number

of different types of bone densitometry or bone sonometry devices (or

techniques) that can be used to perform bone mass measurements on the

human skeleton. According to the information we have reviewed, the

older densitometry x-ray techniques of single photon absorptiometry

(SPA) and dual photon absorptiometry (DPA), which use isotope sources,

have largely been replaced by the newer x-ray techniques of single X-

ray absorptiometry (SEXA) and dual-X-ray absorptiometry (DEXA), which

are superior in terms of accuracy, precision, and shorter exam time. We

understand that the current FDA-recognized, and generally available,

bone densitometry techniques for measuring the peripheral skeleton

include SEXA, peripheral dual-X-ray absorptiometry (pDEXA),

radiographic absorptiometry (RA), and peripheral quantitative computed

tomography (pQCT), all of which are limited to measurement of the

peripheral skeleton, principally the forearm, heel, or fingers.

Recently, the FDA has approved for marketing a bone sonometry device

that estimates bone mass or strength of the heel using ultrasound

measurements. For measurement of the central skeleton, the currently

FDA-approved or cleared, and available techniques are DEXA and

quantitative computed tomography (QCT), both of which can measure the

spine or hip, and the DEXA can measure the peripheral skeleton or whole

body as well.

Based on the medical information we have reviewed, all of the FDA-

approved or cleared bone densitometry and sonometry devices are

currently being used actively in clinical practice, except for the SPA

and the DPA devices. With respect to the last two devices, we

considered not covering bone mass measurements performed on either one

of these devices because they are generally considered to be obsolete

and no longer of any clinical value.

Generally, coverage of medical items or services performed with

FDA-approved or cleared devices is available to Medicare beneficiaries

unless the item or service is precluded from payment by the reasonable

and necessary exclusion in section 1862(a)(1)(A) of the Act, or is

otherwise precluded from payment by one of the other Medicare statutory

exclusions.

Based on our review of the medical information, we have decided to

continue with our present policy of coverage of bone mass measurements

performed on SPA devices and our noncoverage of measurements performed

on DPA devices. Our noncoverage of the DPA procedure was established in

1983, and was based on medical advice received from the Public Health

Service, indicating that it was not demonstrated to be medically

effective, and, thus, should be excluded from coverage by the statutory

``reasonable and necessary'' exclusion of section 1862(a)(1)(A) of the

Act.

Our review of available Medicare claims data for 1995 and 1996

shows that the use of the SPA procedure under the Medicare program has

declined significantly in recent years. However, the claims data

appears to indicate that Medicare beneficiaries may still benefit from

the use of this procedure in some parts of the country. In view of this

evidence, however, we have decided to request comments on the

possibility of withdrawing coverage of the SPA. We expect that certain

remote rural areas may not have bone densitometry or bone sonometry

devices available at present for use in testing Medicare beneficiaries.

Therefore, we are soliciting comments on whether this is, in fact, a

problem that merits the continued coverage of SPA. In assessing this

issue, we request specific examples of problems, within particular

localities, such as remote and rural areas, and details regarding how

such a regulation

[[Page 34323]]

may adversely affect bone mass measurement services.

In regard to the clinical utility of peripheral versus central bone

density devices, there is a consensus that measurements of the central

skeletal sites is the preferred method of assessment. The American

College of Radiology reports that central techniques are associated

with relatively higher predictive relative risk ratios for hip

fractures than peripheral techniques, and allow for more frequent

evaluations because of their intrinsic ability to better assess bone

metabolic activity. Although either central or peripheral techniques

may be used for most bone mass measurement indications, experts

representing the National Osteoporosis Foundation have suggested

clinical situations in which only central studies should be performed

(that is, vertebral abnormalities, glucocorticoid maintenance, and

monitoring the response to osteoporosis drug treatment).

Ultimately, however, it is essential that the physician treating

the beneficiary be afforded flexibility in ordering those diagnostic

measurements that are best suited to the beneficiaries in their special

circumstances. For example, our consultation with the FDA indicated

that peripheral bone mass measurements may be used for monitoring

osteoporosis drug treatment in some cases. Our interim final policy

allows physicians discretion to use peripheral bone mass measurements

in this manner. Given the differential access and convenience of

various bone mass measurement techniques available to Medicare

beneficiaries, the attending physician must be given the option to

order the most appropriate bone mass measurement for a beneficiary in a

particular set of circumstances. Emerging literature on both existing

and new technologies shows that bone mass measurement exists within a

highly dynamic clinical setting, which can only be successfully

approached with flexibility. In other words, there will be a continual

need to reexamine which are the most pertinent bone mass measurement

techniques for generating useful diagnostic information.

In view of these uncertainties about the clinical role of the

peripheral measurement, we plan to monitor the Medicare use of these

measurements. Based on data on the effectiveness of these measurements,

we will reconsider our coverage policy in this regard if warranted.

Although peripheral bone mass measurements have some apparent

advantages in terms of access and convenience, if, over time, these

parameters become more relatively favorable for central bone mass

measurement, then our policies will be correspondingly updated.

B. Medical Indications for Medicare Beneficiaries

As previously mentioned, section 1861(rr)(2) of the Act identifies

five categories of ``qualified individuals'' who may receive Medicare

coverage under the new bone mass measurement benefit. These include the

following: (1) An estrogen-deficient woman at clinical risk for

osteoporosis; (2) an individual with vertebral abnormalities; (3) an

individual receiving long-term glucocorticoid (steroid) therapy; (4) an

individual with primary hyperparathyroidism; or (5) an individual being

monitored to assess the response to or efficacy of an approved

osteoporosis drug therapy. (For purposes of this interim final rule, we

refer to these ``qualified individuals'' as those categories of

Medicare beneficiaries who may receive covered bone mass measurements.)

In addition, section 1861(rr)(2) of the Act provides authority for

further clarification of these categories to help ensure uniform

national standards ``in accordance with regulations prescribed by the

Secretary.''

We have interpreted this section of the statute, and are clarifying

the five categories of Medicare beneficiaries who may receive these

covered services as follows:

An estrogen-deficient woman at clinical risk for

osteoporosis means a woman who has been determined by the physician (or

a qualified nonphysician practitioner) treating her to be estrogen-

deficient and at clinical risk for osteoporosis, based on her medical

history or other findings.

An individual with vertebral abnormalities as demonstrated

by X-ray to be indicative of osteoporosis, low bone mass (osteopenia),

or vertebral fracture.

An individual receiving glucocorticoid (steroid) therapy

equivalent to 7.5 mg of prednisone, or greater, per day for more than 3

months, or if the expected duration of such therapy is more than 3

months. (Review of medical literature has indicated that doses of

steroid therapy lower than 7.5 mg of prednisone per day for periods

shorter than 3 months usually do not result in significant bone loss.)

An individual with primary hyperparathyroidism.

An individual being monitored to assess the response to or

efficacy of an FDA-approved osteoporosis drug therapy.

In regard to the definition of estrogen-deficient women at clinical

risk for osteoporosis, there is agreement among medical experts in the

United States regarding the efficacy of the use of estrogen-replacement

therapy (ERT) in preventing and treating post-menopausal bone loss and

osteoporosis. According to the American Association of Clinical

Endocrinologists ``Clinical Practice Guidelines for the Prevention and

Treatment of Post-Menopausal Osteoporosis'' (March 1996), ERT ``is the

standard of care for preventing and treating post-menopausal bone loss

and should be considered for all estrogen-deficient women without

contradictions.'' In addition, the guidelines provide that ``for

maximal skeletal protection, therapy should begin at the time of

menopause or oophorectomy, although therapy can be initiated at any

time after menopause. Studies indicate that correction of estrogen

deficiency at any age prevents or slows bone loss in post-menopausal

women with osteoporosis.''

However, based on our review of the medical literature and other

information, it appears that not every woman who has been prescribed

ERT may be receiving an ``adequate'' dose of the therapy and, thus, may

not be sufficiently protected against further bone loss. In view of the

difficulty of trying to define the estrogen-deficient statutory

category precisely, we have decided in this interim final rule to allow

a woman's treating physician or other treating practitioner to

determine whether she is estrogen-deficient and at clinical risk of

osteoporosis, based on her medical history or other findings.

C. Frequency Standards

Section 1861(rr)(3) of the Act provides that ``the Secretary shall

establish such standards regarding frequency with which a qualified

individual shall be eligible to be provided benefits'' under the bone

mass measurement provision. The American Association of Clinical

Endocrinologists (AACE), the American College of Radiology, and

National Osteoporosis Foundation appear to be generally in agreement

with respect to the need to follow certain clinical guidelines for

performing follow-up bone mass measurements to the initial bone mass

measurement that is performed. In their 1996 clinical practice

guidelines, the AACE indicated that with the use of the dual-x-ray

absorptiometry, a change in bone mass ``of 5 percent is considered

clinically significant and is usually not observed in less than 2

years.'' For patients taking long-term steroids, or other drug

therapies that have been demonstrated

[[Page 34324]]

to cause a more rapid rate of bone loss, the AACE and others in the

medical community have recommended that Medicare patients should have

more frequent assessment (for example, baseline and after 6 months).

In determining the appropriate frequency interval for follow-up

serial bone mass measurements, we also believe it is necessary to

consider the clinical role that biochemical markers may play in

monitoring the effectiveness of osteoporosis drug therapy. Bone mass

measurement imaging provides one type of skeletal assessment, compared

to assaying biochemical markers that provide a profile of bone

turnover. With respect to quantifying bone loss, multiple collagen

crosslink tests for pyridinoline, deoxypyridinoline, and the

telopeptides can provide adjunct diagnostic information in concert with

bone mass measurement (Siebel, Markus J. and Gangberg, Caren M.,

``Basic Science and Clinical Utility of Biochemical Markers of Bone

Turnover--A Congress Report'', Volume 107, pages 125-133, (1997)).

We have been informed by the FDA that the use of biochemical

markers may be useful in assessing the effectiveness of osteoporosis

treatment. Although we believe that bone mass measurement and

biochemical markers have complementary roles to play in monitoring

osteoporosis drug therapy, there are not yet specific, evidence-based

guidelines for performing both in tandem. However, proper management of

osteoporosis patients, who are on long-term therapeutic regimens, may

require reliance upon such clinical laboratory testing (for example, at

intervals of less than 1 year) after therapy is initiated.

We have decided to establish the following frequency standards for

coverage of bone mass measurements:

In general, coverage for follow-up bone mass measurements

will be limited to only one measurement every 2 years for beneficiaries

who receive coverage of bone mass measurements.

Follow-up bone mass measurements performed more frequently

than once every 2 years may be covered when medically necessary.

Examples of situations where more frequent bone mass measurements

procedures may be medically necessary include, but are not limited to,

the following medical circumstances: (1) Monitoring beneficiaries on

long-term glucocorticoid (steroid) therapy of more than 3 months; and

(2) allowing for a confirmatory baseline bone mass measurement (either

central or peripheral) to permit monitoring of beneficiaries in the

future if the initial test was performed with a technique that is

different from the proposed monitoring method, (for example, if the

initial test was performed using bone sonometry and monitoring is

anticipated using bone densitometry, we will allow coverage of baseline

measurement using bone densitometry).

III. Provisions of the Interim Final Rule

This interim final rule will implement section 4106 of the BBA by

establishing conditions for coverage and frequency standards for bone

mass measurements to ensure that they are paid for uniformly throughout

the Medicare program and that they are reasonable and necessary for

Medicare beneficiaries who are eligible to receive these measurements.

A. Coverage Conditions and Frequency Standards

We are establishing conditions for coverage and frequency standards

for medically necessary bone mass measurements for five categories of

Medicare beneficiaries in Sec. 410.31.

We are defining ``bone mass measurement'' based on the statutory

definition (Sec. 410.31(a)). We are setting forth conditions for

coverage of all of the bone mass measurements that we will cover

effective July 1, 1998. Under the ``reasonable and necessary''

provisions of section 1862(a)(1)(A) of the Act, we are establishing

conditions under which we will cover bone mass measurements

(Sec. 410.31(b)). Consistent with Sec. 410.32 (Diagnostic x-ray tests,

diagnostic laboratory tests, and diagnostic tests: Conditions), we are

providing that coverage be available for the bone mass measurement only

if it is ordered by the physician or a qualified nonphysician

practitioner treating the beneficiary following an evaluation of the

beneficiary's need for the test, including a determination as to the

medically appropriate procedure to be used for the beneficiary. We

believe that bone mass measurements are not demonstrably reasonable and

necessary unless (among other things) they are ordered by the physician

treating the beneficiary following a careful evaluation of the

beneficiary's medical need, and they are employed to manage the

beneficiary's care.

In addition, certain nonphysician practitioners who furnish

services that would be physician services if furnished by a physician,

and who are operating within the scope of the statutory benefit and

their authority under State law or regulations, may also order bone

mass measurements for their patients. Nonphysician practitioners who

meet this definition are physician assistants (section 1861(s)(2)(K)(i)

of the Act), nurse practitioners (section 1861(s)(2)(K)(ii) of the

Act), clinical nurse specialists (section 1861(s)(2)(K)(iii) of the

Act), and nurse-midwives (section 1861(s)(2)(L) and 1861(gg) of the

Act).

To ensure that the bone mass measurement is performed as accurately

and consistently in accordance with appropriate quality assurance

guidelines as possible, we are requiring that it be performed under the

appropriate supervision of a physician as defined in Sec. 410.32(b)(3)

of these regulations. To ensure that the bone mass measurement is

medically appropriate for the five categories specified in the law, we

are providing that it be reasonable and necessary for diagnosing,

treating, or monitoring the condition of the beneficiary who meets the

coverage requirements specified in Sec. 410.31(d).

Furthermore, in Sec. 410.31(c), we are setting forth limitations on

the frequency for covering a bone mass measurement. Generally, we will

cover a bone mass measurement for a beneficiary if at least 23 months

have passed since the month the last bone mass measurement was

performed. However, we will allow for coverage of follow-up bone mass

measurements performed more frequently than once every 23 months when

medically necessary. Examples of situations where more frequent bone

mass measurements procedures may be medically necessary include, but

are not limited to, the following medical circumstances: (1) Monitoring

beneficiaries on long-term glucocorticoid (steroid) therapy of more

than 3 months; and (2) allowing for a confirmatory baseline bone mass

measurement (either central or peripheral) to permit monitoring of

beneficiaries in the future if the initial test was performed with a

technique that is different from the proposed monitoring method.

B. Beneficiaries Who May Be Covered

In Sec. 410.31(d), we offer coverage for a bone mass measurement to

the following Medicare beneficiaries:

A woman who has been determined by the physician or a

qualified nonphysician practitioner treating her to be estrogen-

deficient and at clinical risk for osteoporosis, based on her medical

history and other findings.

An individual with vertebral abnormalities as demonstrated

by an x-ray to be indicative of osteoporosis, osteopenia, or vertebral

fracture.

An individual receiving (or expecting to receive)

glucocorticoid (steroid) therapy equivalent to 7.5 mg of

[[Page 34325]]

prednisone, or greater, per day, for more than 3 months.

An individual with primary hyperparthyroidism.

An individual being monitored to assess the response to or

efficacy of an FDA-approved osteoporosis drug therapy.

C. Waiver of Liability

Under Sec. 410.31(e), a beneficiary who did not know and could not

reasonably have been expected to know that Medicare payment would be

denied for a bone mass measurement under section 1862(a)(1)(A) of the

Act receives protection from financial liability in accordance with

Secs. 411.400 through 411.406 under the limitation on liability

provision of section 1879 of the Act. Existing regulations concerning

limitation on liability in Secs. 411.400 through 411.406 would apply to

denial of bone mass measurements under Secs. 410.31(b) through (d).

Medicare payment may be made for certain claims for a bone mass

measurement if the measurement was excluded from coverage in accordance

with Sec. 411.15(k) as not reasonable and necessary under section

1862(a)(1)(A) of the Act. Similarly, when the beneficiary is protected

and the provider or supplier also did not know and could not reasonably

have been expected to know that payment would be denied, the provider

or supplier also receives protection from financial liability in

accordance with the limitation on liability provision. Consequently,

Medicare payment may be made to the provider or supplier.

D. Payments for Bone Mass Measurements

Medicare payments for covered bone mass measurements will be paid

for under the physician fee schedule (42 CFR part 414) as required by

statute. We are revising the definition of ``physician services'' in

Sec. 414.2 to include bone mass measurements. When bone mass

measurement procedures are furnished to hospital inpatients and

outpatients, the technical components of the procedures are payable

under existing payment methods for hospital services. These methods

include payments under the prospective payment system, on a reasonable

cost basis, or under a special provision for determining pay rates for

hospital outpatient radiology services.

The codes listed below are payable under this benefit.

76075--Dual energy x-ray absorptiometry (DEXA), bone density study, one

or more sites; axial skeleton (e.g., hips, pelvis, spine)

76076--Dual energy x-ray absorptiometry (DEXA), bone density study, one

or more sites; appendicular skeleton (peripheral) (e.g., radius, wrist,

heel)

76078--Radiographic absorptiometry (photodensitometry), one or more

sites

78350--Bone density (bone mineral content) study, one or more sites;

single photon absorptiometry

G0130--Single energy x-ray (SEXA) absorptiometry bone density study,

one or more sites, appendicular skeleton (peripheral) (e.g., radius,

wrist, heel)

G0131--Computerized tomography bone mineral density study, one or more

sites; axial skeleton (e.g., hips, pelvis, spine)

G0132--Computerized tomography bone mineral density study, one or more

sites; appendicular skeleton (peripheral) (e.g., radius, wrist, heel)

G0133--Ultrasound bone mineral density study, one or more sites,

appendicular skeleton (peripheral) (e.g., radius, wrist, heel)

The relative value units and payment amounts for CPT codes 76075,

76076, 76078, and 78350, including their component parts (professional

component (PC) identified by a -26 modifier and technical component

(TC) identified by a -TC modifier), are the same as published in the

Medicare physician fee schedule final rule of October 31, 1997 (62 FR

59048). The payment amounts for G0130, G0132, and G0133 and their

component parts are the same as determined for CPT 78350 and its

components parts under that final rule. The amounts payable for G0131

and its component parts is the same as listed for CPT 76070 and its

component parts under that final rule.

We are revising Sec. 414.50(a), regarding physician billing for

purchased diagnostic tests, to clarify that section does not apply to

payment for bone mass measurements.

E. Conforming Changes

To allow for appropriate placement in the CFR of the bone mass

measurement coverage requirements, we are redesignating Sec. 410.31

(Prescription drugs used in immunosuppressive therapy) as Sec. 410.30.

F. Manual Instructions

Currently, section 50-44 of the Coverage Issues Manual sets forth

instructions for Medicare carriers concerning coverage of bone mass

measurements. The provisions of this interim final rule supersede the

current manual instructions. We intend to revise the instructions to

conform them to this final rule.

IV. Response to Comments

Because of the large number of items of correspondence we normally

receive on Federal Register documents published for comment, we are not

able to acknowledge or respond to them individually. We will consider

all comments we receive by the date and time specified in the DATES

section of this preamble, and, when we proceed with a subsequent

document, we will respond to the major comments in the preamble to that

document.

V. Waiver of Proposed Rulemaking and Delayed Effective Date

We ordinarily publish a notice of proposed rulemaking in the

Federal Register and invite public comment on the proposed rule. The

notice of proposed rulemaking includes a reference to the legal

authority under which the rule is proposed, and the terms of the

proposed rule or a description of the subjects and issues involved (5

U.S.C. 555(b)). This procedure can be waived, however, if an agency

finds good cause that a notice-and-comment procedure is impracticable,

unnecessary, or contrary to the public interest and incorporates a

statement of the finding and its reasons in the rule issued. In

addition, we ordinarily publish a rule not less than 30 days before the

rule's effective date in order to afford persons affected a reasonable

time to prepare for the effective date of the rule. The 30-day delay in

the effective date can be waived for good cause found and published

within the rule.

We find good cause to waive the notice and comment procedure for

these rules implementing section 4106 of the BBA. This rule involves

little exercise of agency discretion, but rather conforms the

regulations to the revisions contained in section 4106 of the BBA.

Notice-and-comment rulemaking is generally considered ``unnecessary''

so far as the public is concerned for such technical, conforming

changes. Indeed, under both the Administrative Procedure Act and the

Social Security Act, interpretative rules are generally exempt from

notice and comment rulemaking (5 U.S.C. 553(b); 42 U.S.C.

1395hh(b)(2)(C)). While this rule interprets the statute, publication

in the Federal Register is necessary to identify the categories of

Medicare beneficiaries who may receive covered bone mass measurements

under section 1861(rr)(2) of the Act and to promote uniform Medicare

coverage of bone mass

[[Page 34326]]

measurements under section 1861(s)(15) of the Act.

We also find good cause to waive the notice and comment procedures

and to waive the 30 day-delay in the effective date because those

procedures would be contrary to the public interest. Section 4106 of

the BBA of 1997 expands Medicare coverage to a larger group of

beneficiaries, and it will enable these individuals to obtain timely

treatment to prevent irreversible bone loss. The explicit provision of

benefits in section 4106 that are implemented by these rules will

provide a broader range of bone mass measurement procedures to a

broader set of beneficiaries. The statute, however, requires the

Secretary to issue regulations in order to implement this benefit.

Thus, any delay in this rule's effective date to permit additional

public participation in the rulemaking process would harm the intended

beneficiaries of this statute. Moreover, although these rules expand

Medicare coverage, the rules do not impose additional documentation

requirements or alter the existing procedures for submitting Medicare

claims. Because many individuals or entities affected by these rules

are already familiar with these procedures, it is expected that the

public would not require 30 days in order to prepare for changes

necessitated by these rules. We will, of course, consider any public

comments received on this interim final rule, and to the extent

necessary, we will issue a final rule with additional clarifications or

expansions.

We also note that in this preamble, we identify a number of interim

1998 codes for bone densitometry and bone sonometry procedures. Since

technology in the bone mass measurement area is changing rapidly, as

new techniques are being approved or cleared for marketing by the FDA,

and as these techniques are being phased into clinical practice in the

United States, there is a need to adopt new codes (or changes in

existing codes) so that the new procedures performed with these

techniques can be billed under Medicare.

For the above reasons, we find good cause to waive the notice of

proposed rulemaking and to issue this final rule on an interim basis.

We are providing a 60-day comment period for public comment. Since we

have referenced existing physician fee schedule relative value units

(RVUs) to establish RVUs on bone mass measurement procedures, we are

inviting comments on these linkages. We will consider comments when we

establish the final RVUs that will be used to compute Medicare payments

for the bone mass measurement codes in 1999. These final RVUs will be

established by the physician fee schedule final rule scheduled for

publication later this year.

VI. Collection of Information Requirements

This document does not impose information collection and

recordkeeping requirements. Consequently, it need not be reviewed by

the Office of Management and Budget under the authority of the

Paperwork Reduction Act of 1995.

VII. Regulatory Impact Statement

We have examined the impacts of this interim final rule under

Executive Order (E.O.) 12866, the Unfunded Mandates Act of 1995, and

the Regulatory Flexibility Act. E.O. 12866 directs agencies to assess

all costs and benefits of available regulatory alternatives and, when

regulation is necessary, to select regulatory approaches that maximize

net benefits (including potential economic, environmental, public

health and safety effects; distributive impacts and equity). A

regulatory impact analysis (RIA) must be prepared for major rules with

economically significant effects ($100 million or more annually). The

benefit changes in this interim final rule due to section 4106 of BBA

1997 will result in additional expenditures of $10 million and $100

million for fiscal years 1998 and 1999, respectively.

Because the expenditures resulting from this interim final rule are

expected to reach $100 million in FY 1999, it is considered a major

rule, and, as required by law, this final rule is subject to

congressional review. Therefore, this interim final rule is being

forwarded to the Congress for a 60-day review period.

The Unfunded Mandates Reform Act of 1995 also requires (in section

202) that agencies prepare an assessment of anticipated costs and

benefits for any rule that may result in annual expenditures by State,

local, or tribal governments, in the aggregate, or by the private

sector, of $100 million. The final rule has no consequential effect on

State, local, or tribal governments. We believe the private sector

costs of this rule fall below these thresholds, as well.

Consistent with the provisions of the Regulatory Flexibility Act,

we analyze options for regulatory relief for small businesses and other

small entities. We prepare a Regulatory Flexibility Analysis (RFA)

unless we certify that rule will not have a significant economic impact

on a substantial number of small entities. The RFA must include a

justification of why action is being taken, the kinds and number of

small entities the interim final rule will affect, and an explanation

of any considered meaningful options that achieve the objectives and

will lesson any significant adverse economic impact on the small

entities.

For purposes of the Act, all physicians are considered to be small

entities. Thus, we have prepared the following analysis, which,

together with the rest of this preamble, meets all three assessment

requirements. It explains the rationale for the purposes of this rule,

details the costs of the rule, analyzes alternatives, and presents the

measures to minimize the burden on small entities.

Section 4106 of the BBA 1997 provides for uniform coverage of

certain bone mass measurements, effective July 1, 1998, subject to

certain frequency and payment limits. Specifically, the revised

coverage will allow periodic coverage of medically necessary bone mass

measurements performed with (1) all of the FDA approved or cleared

devices that are currently in clinical use in the United States, and

for (2) five mandated categories of eligible Medicare beneficiaries,

who meet certain medical indications, including estrogen-deficient

women at clinical risk for osteoporosis. Before enactment of the BBA,

periodic coverage of bone mass measurements was available to certain

beneficiaries in at least four of the five categories in most parts of

the country, but not uniformly throughout the Medicare program. In

addition, coverage of some of the bone mass measurements--particularly

several of the peripheral techniques--has not been available throughout

the United States for imaging Medicare beneficiaries, even though these

techniques have been approved or cleared for marketing by the FDA. In

the case of the fifth category (estrogen-deficient women at clinical

risk of osteoporosis), coverage of bone mass measurements has not been

available in many parts of the country. We estimate that these changes

in the coverage of bone mass measurements will result in an increase in

Medicare payments. These payments will be made to a large number of

physicians, mostly medical specialists such as gynecologists,

radiologists, rheumatologists, and clinical endocrinologists, but also

to certain primary care physicians and hospital outpatient departments

who perform these services.

[[Page 34327]]

Projected Budget Impact of New Benefit

[In millions]

------------------------------------------------------------------------

FY 1998 FY 1999 FY 2000 FY 2001 FY 2002

------------------------------------------------------------------------

$10.......... $100 $140 $180 $190

------------------------------------------------------------------------

We believe that the effect of this rule on beneficiaries will be a

very positive one. Medical experts agree that early detection and

management of disease can lead to substantial reductions in life-

threatening and serious illness. The National Osteoporosis Foundation

estimates that there are over 10 million people in the United States

who have osteoporosis and that another 18 million are at risk for the

disease. Through earlier detection of low bone mass made possible under

the new benefit and the use of appropriate prevention and treatment

measures, our expectation is that the ravaging effects of this disease

among the Medicare population will be reduced in the future.

In accordance with the provisions of Executive Order 12866, this

regulation was reviewed by the Office of Management and Budget.

VIII. Effect of the Contract With America Advancement Act of 1996

(Pub. L. 104-121)

This rule has been determined to be a major rule as defined in

Title 5, United States Code, section 804(2). Ordinarily under 5 U.S.C.

801, as added by section 251 of Pub. L. 104-121, a major rule shall

take effect 60 days after the later of (1) the date a report on the

rule is submitted to the Congress, or (2) the date the rule is

published in the Federal Register. However, section 808(2) of Title 5,

United States Code, provides that, notwithstanding 5 U.S.C. 801, a

major rule shall take effect at such time as the Federal agency

determines if for good cause the agency finds that notice and comment

procedures are impracticable, unnecessary, or contrary to the public

interest. As explained above, for good cause we find that it was

impracticable, unnecessary, or contrary to the public interest to

complete notice and comment procedures before publication of this rule.

Accordingly, pursuant to 5 U.S.C. 808(2), these regulations are

effective on July 1, 1998.

List of Subjects

42 CFR Part 410

Health facilities, Health professions, Kidney diseases,

Laboratories, Medicare, Rural areas, X-rays.

42 CFR Part 414

Administrative practice and procedure, Health facilities, Health

professions, Kidney diseases, Medicare, Reporting and recordkeeping

requirements, Rural areas, X-rays.

For the reasons set out in the preamble, 42 CFR Chapter IV is

amended as follows:

PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS

A. Part 410 is amended to read as follows:

1. The authority citation for part 410 continues to read as

follows:

Authority: Sections 1102 and 1871 of the Social Security Act (42

U.S.C. 1302 and 1395hh), unless otherwise indicated.

2. Section 410.31 is redesignated as Sec. 410.30.

3. New Sec. 410.31 is added to read as follows:

Sec. 410.31 Bone mass measurement: Conditions for coverage and

frequency standards.

(a) Definition. As used in this section unless specified otherwise,

the following definition applies:

Bone mass measurement means a radiologic, radioisotopic, or other

procedure that meets the following conditions:

(1) Is performed for the purpose of identifying bone mass,

detecting bone loss, or determining bone quality.

(2) Is performed with either a bone densitometer (other than dual-

photon absorptiometry) or with a bone sonometer system that has been

cleared for marketing for this use by the FDA under 21 CFR part 807, or

approved for marketing by the FDA for this use under 21 CFR part 814.

(3) Includes a physician's interpretation of the results of the

procedure.

(b) Conditions for coverage. Medicare covers a medically necessary

bone mass measurement if the following conditions are met:

(1) Following an evaluation of the beneficiary's need for the

measurement, including a determination as to the medically appropriate

procedure to be used for the beneficiary, it is ordered by the

physician or a qualified nonphysician practitioner (as these terms are

defined in Sec. 410.32(a)) treating the beneficiary.

(2) It is performed under the appropriate level of supervision of a

physician (as set forth in Sec. 410.32(b)).

(3) It is reasonable and necessary for diagnosing, treating, or

monitoring the condition of a beneficiary who meets the conditions

described in paragraph (d) of this section.

(c) Standards on frequency of coverage--(1) General rule. Except as

allowed under paragraph (c)(2) of this section, Medicare may cover a

bone mass measurement for a beneficiary if at least 23 months have

passed since the month the last bone mass measurement was performed.

(2) Exception. If medically necessary, Medicare may cover a bone

mass measurement for a beneficiary more frequently than allowed under

paragraph (c)(1) of this section. Examples of situations where more

frequent bone mass measurement procedures may be medically necessary

include, but are not limited to, the following medical circumstances:

(i) Monitoring beneficiaries on long-term glucocorticoid (steroid)

therapy of more than 3 months.

(ii) Allowing for a confirmatory baseline bone mass measurement

(either central or peripheral) to permit monitoring of beneficiaries in

the future if the initial test was performed with a technique that is

different from the proposed monitoring method.

(d) Beneficiaries who may be covered. The following categories of

beneficiaries may receive Medicare coverage for a medically necessary

bone mass measurement:

(1) A woman who has been determined by the physician (or a

qualified nonphysician practitioner) treating her to be estrogen-

deficient and at clinical risk for osteoporosis, based on her medical

history and other findings.

(2) An individual with vertebral abnormalities as demonstrated by

an x-ray to be indicative of osteoporosis, osteopenia, or vertebral

fracture.

(3) An individual receiving (or expecting to receive)

glucocorticoid (steroid) therapy equivalent to 7.5 mg of prednisone, or

greater, per day for more than 3 months.

(4) An individual with primary hyperparathyroidism.

[[Page 34328]]

(5) An individual being monitored to assess the response to or

efficacy of an FDA-approved osteoporosis drug therapy.

(e) Denial as not reasonable and necessary. If HCFA determines that

a bone mass measurement does not meet the conditions for coverage in

paragraphs (b) or (d) of this section, or the standards on frequency of

coverage in paragraph (c) of this section, it is excluded from Medicare

coverage as not ``reasonable'' and ``necessary'' under section

1862(a)(1)(A) of the Act and Sec. 411.15(k) of this chapter.

PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES

B. Part 414 is amended to read as follows:

1. The authority citation for part 414 continues to read as

follows:

Authority: Sections 1102, 1871, and 1881(b)(1) of the Social

Security Act (42 U.S.C. 1302, 1395hh, and 1395rr(b)(1)).

2. In Sec. 414.2, in the definition of ``Physician services'', a

new paragraph (7) is added to read as follows:

Sec. 414.2 Definitions.

* * * * *

Physician services * * *

(7) Bone mass measurement.

* * * * *

Sec. 414.50 [Amended]

3. In Sec. 414.50(a), in the first sentence, revise ``If a'' to

read ``For services covered under section 1861(s)(3) of the Act and

paid for under this part 414 subpart A, if a''.

(Catalog of Federal Domestic Assistance Program No. 93.774,

Medicare--Supplementary Medical Insurance Program)

Dated: June 3, 1998.

Nancy-Ann Min DeParle,

Administrator, Health Care Financing Administration.

Dated: June 9, 1998.

Donna E. Shalala,

Secretary.

[FR Doc. 98-16783 Filed 6-19-98; 3:00 pm]

BILLING CODE 4120-01-P