New Medicare CAC Meeting on Amniotic Reimbursement: No Surprises Here

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I have been tracking the Medicare billing scams involving amniotic fluid for some time now. This week, Medicare held a critical CAC meeting. What the heck is that and why should you care? Let’s dig in.

Medicare Billing for Amniotic injections

Medicare doesn’t cover amniotic injections for arthritis, tendon/ligament issues, or spinal pain. Period. End of story. However, several companies applied for a reimbursement code for their amniotic products (a common thing to do if you have a product that could be used in surgery) and at the same time snuck in language that suggested uses for their products in these applications. IMHO, these companies have been enticing doctors to commit Medicare fraud by telling them that they can bill Medicare for things like amniotic fluid to treat knee arthritis. They then use a kickback scheme to make it worth it for the doctor. This is usually about an $800 profit for the physician for a 2 cc knee injection.

I have been in contact with multiple experts on this issue including fraud and abuse contractors who are actively investigating these companies. IMHO, this whole house of cards is about to tumble and take out multiple medical practices through multimillion-dollar Medicare clawbacks.

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The Recent Medicare CAC on Amnion

First, what the heck is a “CAC”? This stands for Contractor Advisory Committee. A CAC is basically the interface between doctors and Medicare. The doctors on these panels often review the clinical studies on a specific treatment to see if there’s enough evidence for Medicare to extend coverage. Hence, the fact that we have companies and physicians billing for amniotic injections for pain and that Medicare has scheduled a CAC meeting on whether there is enough evidence to pay for these treatments is a big deal. If you believe that Medicare covers this stuff this was your chance to be vindicated by the medical experts declaring that the evidence is good enough for Medicare to cover it. What happened?

On Wednesday, there was a several-hour CAC meeting that was publically broadcast. I was seeing patients so I couldn’t attend, but I had a helper attend the whole meeting and take notes. The transcript will also be available at some point. The meeting covered the use of amniotic and/or umbilical cord tissue to treat:

1. OA in knee hip and other joints
2. Plantar fasciitis, Achilles tendinopathy
3. Rotator cuff tendinopathy or tear, lateral epicondylitis, carpal tunnel, trigger finger
4. Back pain, cervical facet joints
The general consensus from the CAC members was that the existing research in these areas  DID NOT provide adequate evidence of efficacy or safety due to the low data quality, small sample sizes, methods used, and short time periods studied. In addition, there are few gold-standard randomized controlled trials (RCTs). The existing few papers were characterized as too heterogeneous (meaning comparing not similar things) and mostly published by Amniotic manufacturers. There was one small level 1 study commissioned by an Amniotic company, however, the CAC felt that these results were likely biased in their opinion. The remainder of the existing published research consisted of level 4 or 5 papers.
The conclusion? The existing medical evidence does NOT support that Medicare should cover amnio injections to treat these conditions.

What is the Real Significance of this Meeting?

Based on what I have been told by fraud and abuse contractors, this meeting is likely part of Medicare’s process to unleash the hounds on providers billing for this stuff for these diagnoses. Meaning the fact that a special CAC meeting was called on this topic and the conclusion was that there was no evidence that Medicare should extend coverage is a BAD thing for providers who are routinely billing it. It’s only a matter of time until the hammer drops on both the companies who are doing this and the providers who are billing.

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How Big Will the Hammer Be?

If you’re a clinic that is billing amnio injections to Medicare and they suddenly send a letter wanting all of their money back (a clawback), how much will you owe? Let’s say you’re the average clinic that is able to inject 10 knees a week. Not a stretch since many elderly patients have bilateral knee pain. Each knee is $4,000 in product that Medicare paid. So that’s 40K a week times 50 weeks or 2 million dollars! The high flyer clinics will easily owe much more, in the 3-5 million range and the big clinics who have really imbibed this scam will be in the 5+ range. For most of these clinics, this will mean bankruptcy. For the patients, this will also mean that you may be getting a hefty bill from the clinic because Medicare ultimately decided not to cover this product and service.

The upshot? The Medicare CAC meeting this week just reinforced that this scam is coming to an end. The worst place for a provider to be right now would be on the wrong end of these massive clawbacks that are right around the proverbial corner.

Chris Centeno, MD is a specialist in regenerative medicine and the new field of Interventional Orthopedics. Centeno pioneered orthopedic stem cell procedures in 2005 and is responsible for a large amount of the published research on stem cell use for orthopedic applications. View Profile

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