In re Local Coverage Determination Joint & Consolidated Complaint: Nerve Conduction Studies and Electromyography, DAB CR5587 (2020)

Page 2

DECISION

The records of the foregoing local coverage determinations (LCDs) are complete and adequate to support the validity of the LCD provisions at issue under the reasonableness standard.  Review of the challenged LCDs is complete with the issuance of this decision, and the Aggrieved Parties are entitled to request further review by the Appellate Division of the Departmental Appeals Board (Board).

I.  Background

On July 31, 2017, the Office of Medicare Hearings and Appeals (OMHA) received a joint and consolidated complaint (Complaint1) from 24 Medicare beneficiaries2 who requested through their single representative that nine LCDs, each titled "Nerve Conduction Studies and Electromyography," be reviewed pursuant to 42 C.F.R. pt. 426.  Rather than forwarding the Complaint to the Civil Remedies Division (CRD) of the Board, OMHA returned the Complaint to the representative on August 8, 2017, advising him that the Complaint should be filed with the CRD as OMHA has no jurisdiction to review LCD complaints.  On August 29, 2017, the Aggrieved Parties' representative mailed the Complaint to the CRD.  The Complaint was assigned to me and an acknowledgment was sent to the Aggrieved Parties' representative on October 2, 2017.  On October 16, 2017, the representative filed correspondence requesting a waiver from electronic filing and adding an additional Medicare beneficiary to the Complaint.

On October 30, 2017, I issued an "Acknowledgment of Receipt of Acceptable Complaint; Order to File LCD Records; Briefing Schedule; and Denial of Waiver" (Acknowledgment and Order).  In the Acknowledgment and Order, I denied the

Page 3

representative's request for a waiver from electronic filing and granted the request to add another beneficiary to the Complaint.  Acknowledgment and Order, para. I.  I also evaluated the Complaint as required by 42 C.F.R. § 426.410(b) through (e) and found that the requirements for a joint complaint were satisfied, making the Complaint acceptable, and all 25 beneficiaries were accepted as Aggrieved Parties.3  Acknowledgment and Order, para. II.  The Complaint indicates that all but four of the Aggrieved Parties elected to receive the service and have a claim filed, but the disposition of any claims filed is unknown.  DAB E-File Item #15a at 9, 15, 20, 25, 30, 35, 40, 41, 46, 51, 55, 59, 63, 71, 77, 83, 87, 91, 96, 101, 106, 110, 117, 120, and 127.  I required the Aggrieved Parties' representative to serve copies of the Complaint upon the MACs and CMS.  I also required that each MAC serve upon the Aggrieved Parties' representative and my office the LCD record for the LCD issued in their respective jurisdictions.

On November 11, 2017, the Aggrieved Parties' representative certified service of the Complaint upon each of the MACs.  DAB E-File Item #16.

On December 29, 2017, Cahaba Government Benefit Administrators, LLC (Cahaba) filed the LCD record for L34265, marked as CMS Exhibit (Ex.) 1.  However, on February 26, 2018, Cahaba filed a motion to dismiss the Complaint related to LCD L34265 because the LCD was retired on February 25, 2018.  The motion also stated that Cahaba was no longer a MAC.  Pursuant to 42 C.F.R. § 426.325(a), only LCDs currently in effect may be challenged.  A retired LCD is not subject to review.  42 C.F.R. § 426.325(b)(2).  I am prohibited from reviewing a retired LCD.  42 C.F.R. § 426.405(d)(4).  Pursuant to 42 C.F.R. § 426.420(e)(1), I must dismiss a complaint related to a retired LCD.  The Aggrieved Parties have not opposed the motion to dismiss.  Accordingly, the Complaint is dismissed as to LCD L34265, which was issued and then retired by Cahaba.

On December 20, 2017, National Government Services, Inc. (NGS) filed the LCD record for L35098 marked as CMS Ex. 300.  NGS also filed a list of proprietary records with the administrative law judge's (ALJ) copy of the LCD record and filed these records by mail.

Page 4

On December 21, 2017, Noridian Healthcare Solutions, LLC (Noridian) filed the LCD record for L36524 marked as CMS Exs. 400 and 401.  Noridian also filed on December 21, 2017, the LCD record for L36526 marked as CMS Exs. 500 and 501.

CGS Administrators, LLC (CGS) filed the LCD record for L35897 marked as CMS Ex. 100 on December 21, 2017.  CGS also filed with the ALJ's copy of the LCD record a confidential record log listing one document filed by mail.

On December 28, 2017, Wisconsin Physicians Service Insurance Corp. (WPS) filed the LCD record for L34594 marked as CMS Ex. 800.  WPS also filed with the ALJ's copy of the LCD record a privileged record log listing one document filed by mail.

Novitas Solutions, Inc. (Novitas) filed the LCD record for L35081 marked as CMS Ex. 600 on December 28, 2017.  Novitas filed with the ALJ's copy of the LCD record an extensive privilege and proprietary information log listing documents filed by mail.  Novitas also filed, with the ALJ's copy of the LCD record, a motion to seal CMS Ex. 600 to prohibit disclosure of "Personally Identifiable Information" (PII) of providers and Contractor Advisory Committee members contained in the documents filed by mail, for which a privilege was asserted or which constituted purportedly proprietary information.  The Novitas motion, which is unopposed, is granted and CMS Ex. 600 is sealed to the extent necessary to prohibit disclosure of PII related to providers and Contractor Advisory Committee members or information that is marked as proprietary contained in CMS Ex. 600 (the version filed only with the ALJ by mail).  This seal is intended to extend to all parties except Novitas, and to preclude release of such information by the Board, including any division and personnel thereof.

On December 28, 2017, First Coast Service Options, Inc. (First Coast) filed the LCD record for L34859 marked as CMS Ex. 200.  First Coast filed with the ALJ's copy of the LCD record a privilege and proprietary information log listing documents filed by mail.  First Coast also filed a motion to seal communication between First Coast and its Contractor Advisory Committee members.  The First Coast motion, which is unopposed, is granted and CMS Ex. 200 (the version filed only with the ALJ by mail) is sealed to the extent necessary to prohibit disclosure of PII related to Contractor Advisory Committee members and any clearly marked proprietary information contained in CMS Ex. 200.  This seal is intended to extend to all parties except First Coast, and to preclude release of such information by the Board, including any division and personnel thereof.

On December 29, 2017, Palmetto GBA (Palmetto) filed the LCD record for L35048 marked as CMS Ex. 700.

On January 18, 2018, the Aggrieved Parties filed their consolidated statement in response to the LCD records produced (AP Statement), in accordance with 42 C.F.R. § 426.425(a).  Noridian filed its response as permitted by 42 C.F.R. § 426.425(b) on February 19, 2018.

Page 5

WPS filed its response on February 23, 2018.  Novitas, CGS, First Coast, NGS, and Palmetto each filed its response pursuant to 42 C.F.R. § 426.425(a) on February 27, 2018.

The Aggrieved Parties filed a sur-reply and amendment of their sur-reply on March 9, 2018 and March 10, 2018 (AP Sur-Reply).  The Aggrieved Parties' new representative submitted a second sur-reply on March 20, 2018 (AP Sur-Reply II).

As required by 42 C.F.R. § 426.420(c)(2), Novitas, WPS, NGS, Palmetto, CGS, and First Coast notified the parties that each of their respective LCDs were revised.4  CGS filed its revised LCD marked as CMS Ex. 101.  First Coast filed its revised LCDs as CMS Exs. 202 and 203.  NGS filed its revised LCDs and Article5 marked as CMS Ex. 300, pages 51 through 169.  Novitas filed its revised LCDs marked as CMS Exs. 602 and 603.  Palmetto filed its revised LCD marked as CMS Ex. 701.  WPS filed its revised LCDs as CMS Exs. 801 and 802.

CMS Exs. 100, 101, 200, 202, 203, 300, 400, 401, 500, 501, 600, 602, 603, 700, 701, 800, 801, and 802 are admitted and considered as evidence.  CMS Ex. 1, the LCD record for L34265 that was retired by Cahaba, is not admitted as evidence.  All documents submitted by the Aggrieved Parties in support of the Complaint are admitted and considered as evidence.  DAB E-File Items ##15, 15_a-h, 16, 16_a.

Page 6

II.  Discussion

A.  Applicable Law

Section 1831 of the Social Security Act (the Act) (42 U.S.C. § 1395j), establishes the supplementary medical insurance benefits program for the aged and the disabled known as Medicare Part B.  Qualified individuals must elect to participate in the Medicare Part B program, which is funded by an enrollee's premiums and appropriations from the federal government.  The coverage or benefits of Medicare Part B are described in sections 1832, 1833, and 1834 of the Act (42 U.S.C. §§ 1395k, 1395l, and 1395m).  However, section 1862 of the Act (42 U.S.C. § 1395y), which is applicable to both Medicare Part A and Part B, provides that no payment may be made for items or services that "are not reasonable and necessary for the diagnosis or treatment of illnesses or injury or to improve the functioning of a malformed body member . . . ."  The Secretary of the Department of Health and Human Services (Secretary) has provided by regulation that any services not reasonable and necessary for one of the purposes listed in the regulations are excluded from coverage under Medicare.  42 C.F.R. § 411.15(k).  The Medicare Benefit Policy Manual, CMS Pub. 100-02, ch. 16, §§ 10 and 20, provides that no payment can be made for items and services that are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.

The administration of Medicare Part B is through contractors.  Act §§ 1842, 1874A (42 U.S.C. §§ 1395u, 1395kk-1).  The Act provides for both National Coverage Determinations (NCD) and LCDs.  Act § 1869(f)(1)(B) and (2)(B) (42 U.S.C. § 1395ff(f)(1)(B) and (2)(B)).  An LCD is a determination by a MAC applicable to the area served by the contractor as to whether or not a particular item or service is reasonable and necessary within the meaning of section 1862(a)(1)(A) of the Act and covered by Medicare.  Act § 1869(f)(2)(B); 42 C.F.R. § 400.202.

Local coverage determination (LCD) means a decision by a fiscal intermediary or a carrier under Medicare Part A or Part B, as applicable, whether to cover a particular service on an intermediary-wide or carrier-wide basis in accordance with section 1862(a)(1)(A) of the Act.  An LCD may provide that a service is not reasonable and necessary for certain diagnoses and/or for certain diagnosis codes.  An LCD does not include a determination of which procedure code, if any, is assigned to a service or a determination with respect to the amount of payment to be made for the service.

42 C.F.R. § 400.202.

Page 7

Pursuant to section 1862(l)(5)(D) of the Act, the Secretary must require the MACs who issue LCDs to make them available on the MAC and CMS websites, including the full text of the LCD; access by hyperlink to the proposed LCD and responses to comments submitted to the MAC regarding the proposed LCD; a summary of evidence considered by the MAC and a list of the sources of the evidence; and an explanation of the rationale that supports the LCD.

In the absence of an NCD or an LCD, individual claims determinations are made based upon an individual beneficiary's particular fact situation.  68 Fed. Reg. 63,692, 63,693 (Nov. 7, 2003) (citing Heckler v. Ringer, 466 U.S. 602, 617 (1984) (recognizing that the Secretary has discretion to either establish a generally applicable rule or to allow individual adjudication)); 42 C.F.R. §§ 426.420(a), (b), (e)(1), 426.460(b)(1), 426.488(b).

Review of an LCD is distinct from review of an individual claim determination.  68 Fed. Reg. at 63,692-94; 42 C.F.R. § 426.310(a) (individual claims appeals processes are established by 42 C.F.R. pt. 405 subpts. G and H, pt. 417 subpt. Q, and pt. 422 subpt. M).  The right to administrative and judicial review of individual claims determinations is established by sections 1869(a) through (d) of the Act, and the regulations of the Secretary governing review are at 42 C.F.R. §§ 405.1000 through 405.1140.  Individual claims determinations are not subject to review under the LCD process.  68 Fed. Reg. at 63,707.  Pursuant to the Act and the Secretary's implementing regulations, the Board has the authority to review NCDs; ALJs assigned to CRD have the authority to review LCDs subject to further review by the Board; and individual claims determinations are reviewed by ALJs assigned to OMHA subject to further review by the Medicare Appeals Council.6

Section 1869(f)(2)(A) of the Act (42 U.S.C. § 1395ff(f)(2))7 provides for the review of an LCD by an ALJ subject to the limitations that:  (1) a complaint must be filed by or on behalf of one who meets the definition of an aggrieved party; (2) the ALJ must review the

Page 8

record of the LCD; (3) only if the record is determined by the ALJ to be incomplete or to lack adequate information to support the validity of the LCD, will the ALJ permit discovery and the taking of evidence to evaluate the reasonableness of the LCD; (4) the ALJ may consult appropriate scientific and clinical experts; and (5) the ALJ will "defer only to the reasonable findings of fact, reasonable interpretations of law, and reasonable applications of fact to law by the Secretary."  Act § 1869(f)(2)(A)(i)(III).  An aggrieved party may request that the Board review an adverse ALJ determination.  Act § 1869(f)(2)(A)(ii).

An aggrieved party is one who has standing within the meaning of section 1869(f)(5) of the Act:

An action under this subsection seeking review of a national coverage determination or local coverage determination may be initiated only by individuals entitled to benefits under part A, or enrolled under part B, or both, who are in need of the items or services that are the subject of the coverage determination.

The Secretary promulgated regulations pursuant to sections 1102 and 1871 of the Act (42 U.S.C. §§ 1302 and 1395hh), implementing sections 1869(f)(1) and (f)(2) of the Act for the review of NCDs and LCDs.  68 Fed. Reg. at 63,692; 42 C.F.R. § 426.100.  The regulations are found at 42 C.F.R. Part 426.  The procedures for review of an LCD are in 42 C.F.R. pt. 426, subpt. D (42 C.F.R. § 426.400 et. seq.).  The regulatory history for the regulations states that the regulations expanded the definition of an aggrieved party "to include a beneficiary who received a service, but whose claim for the service was denied extending an opportunity to that beneficiary" to file a complaint for an NCD or LCD review.  68 Fed. Reg. at 63,693-95.

Section 1869(f)(2) of the Act establishes a two-phase LCD review process by the ALJ.  The ALJ reviews the LCD record and, if he or she determines that the record is complete with adequate information to support the validity of the LCD, review is complete.  If the ALJ reviews the record and determines that the record is incomplete or lacks adequate information to support the validity of the LCD, then further process is required, including discovery and the taking of evidence.  The Secretary's regulations establish a review procedure consistent with that specified by Congress.  The regulations provide that after an aggrieved party files a statement as to why the LCD is not valid8 and the contractor responds, "the ALJ applies the reasonableness standard to determine whether the LCD

Page 9

record is complete and adequate to support the validity of the LCD."  42 C.F.R. § 426.425(c)(1).  "Issuance of a decision finding the record complete and adequate to support the validity of the LCD ends the review process."  42 C.F.R. § 426.425(c)(2).  If the ALJ does not determine that the LCD record is complete and adequate to support the validity of the LCD, then the regulation provides for discovery and the taking of additional evidence.  No hearing was intended by the drafters or required by the language of the regulation for the first phase review.  68 Fed. Reg. at 63,700, 63,710.

The reasonableness standard is defined at 42 C.F.R. § 426.110, as:

[T]he standard that an ALJ or the Board must apply when conducting an LCD or an NCD review.  In determining whether LCDs or NCDs are valid, the adjudicator must uphold a challenged policy (or a provision or provisions of a challenged policy) if the findings of fact, interpretations of law, and applications of fact to law by the contractor or CMS are reasonable based on the LCD or NCD record and the relevant record developed before the ALJ or the Board.

Further clarification of the reasonableness standard intended by the drafters is provided by the notice of final rule-making at 68 Fed. Reg. at 63,703-04.  The drafters of the regulation discussed the reasonableness standard adopted as follows:

We are using the statutory language from sections 1869(f)(1)(A)(iii) and (f)(2)(A)(i) of the Act, which instructs adjudicators to defer only to the reasonable findings of fact, reasonable interpretations of law, and reasonable applications of fact to law by the Secretary.

The logical corollary is that the ALJs and the Board must accord deference if the contractor's or CMS's findings of fact, interpretations of law, and application of fact to law are reasonable.  The concept of deference is one that is generally applied by courts to administrative decisionmaking (sic), in recognition of the expertise of a program agency.  Thus, we view the statute as setting out a reasonableness standard that recognizes the expertise of the contractors and CMS in the Medicare program—specifically, in the area of coverage requiring the exercise of clinical or scientific judgment.

So long as the outcome is one that could be reached by a rational person, based on the evidence in the record as a whole (including logical inferences drawn from that

Page 10

evidence), the determination must be upheld.  This is not simply based on the quantity of the evidence submitted, but also includes an evaluation of the persuasiveness of the material.  If the contractor or CMS has a logical reason as to why some evidence is given more weight than other evidence, the ALJs and the Board may not overturn the determination simply because they would have accorded more weight to the evidence in support of coverage.  In some situations, different judgments by different contractors may be supportable, especially if explained by differences such as the ready availability of qualified medical professionals in one contractor's area, but not in another.  Moreover, an ALJ or the Board may not determine that an LCD is unreasonable solely on the basis that another Medicare contractor has issued an LCD that permits coverage of the service at issue, under the clinical circumstances presented by the complaint.

For legal interpretations, the reasonableness standard would not be met if an interpretation is in direct conflict with the plain language of the statute or regulation being interpreted. Moreover, an interpretation in an LCD would not meet the reasonableness standard if it directly conflicts with an NCD or with a CMS Ruling.  So long as an interpretation is one of the readings permitted by the plain language of the law and can be reconciled with relevant policy, however, it must be upheld, even if the ALJ or the Board might have reached a different result if interpreting the statute or regulation in the first instance.

68 Fed. Reg. at 63,703-04.

Pursuant to 42 C.F.R. § 426.330, the aggrieved party bears the burdens of proof and persuasion.  The burden of persuasion is judged by a preponderance of the evidence.

B.  Jurisdiction

My jurisdiction or authority is clearly delineated at 42 C.F.R. §§ 426.405, 426.450, and 426.455.  I am limited to addressing the issues of whether or not the LCD record is complete and adequate to support the validity of the LCD under the reasonableness standard.  42 C.F.R. § 426.450(a).

Page 11

C.  Issue

At this phase in the review process, the issue is whether or not the LCD records are complete and adequate to support the validity of the challenged LCD provisions under the reasonableness standard.9

Whether the Aggrieved Parties are actually entitled to Medicare coverage for the items or services that their physicians state they require is not an issue before me.

D.  Findings of Fact, Conclusions of Law, and Analysis

My conclusions of law are set forth in bold followed by the pertinent facts and analysis.

1.  Based upon the evaluation required by 42 C.F.R. § 426.425(c)(1), I conclude that the LCD records are complete and adequate to support the validity of the LCD provisions at issue under the reasonableness standard.  42 C.F.R. § 426.450(a)(4).

a.  The LCD Provisions in Issue

There are eight LCDs remaining at issue before me – L35897, L34859, L35098, L36524, L36526, L35081, L35048, and L34594.  All the LCDs provide that both NCS and EMG are usually required for diagnosis of peripheral nervous system disorders, and that the intensity and extent of testing with EMG and NCS are matters of clinical judgment and may require modification during testing.  The LCDs state that NCS are used to measure action potentials resulting from peripheral nerve stimulation.  The LCDs specifically recognize that there are two types of NCS – sensory and motor – that record action potentials over a stimulated nerve or from an innervated muscle.  An EMG study records the intrinsic electrical properties of skeletal muscles.  EMG results reflect the integrity of the connection between a nerve and the innervated muscle as well as the integrity of the muscle.  The LCDs state that EMGs are better for evaluating axonal (relating to the nerve fiber extending from the nerve cell body) and muscle involvement while NCS are better for detection of myelin sheath (the insulation covering the axon) and axonal involvement.  CMS Ex. 100 at 22-23;10 CMS Ex. 200 at 3-4; CMS Ex. 300 at 3-4; CMS Ex. 400 at 9-11; CMS Ex. 500 at 9-10; CMS Ex. 600 at 3-4; CMS Ex. 700 at 68-70; CMS Ex. 800 at

Page 12

3-4, 6.  The descriptions of NCS and EMG and the purpose for each stated in the LCDs are not disputed.

The LCDs state that NCS performed without EMG may only provide part of the information necessary to diagnose muscle, nerve root, and most nerve disorders and result in misleading or missed diagnoses.  Therefore, both NCS and EMG are usually necessary.  The LCDs provide that NCS performed alone are usually considered not medically necessary, except in the case of a diagnosis of carpal tunnel syndrome.  CMS Ex. 100 at 26; CMS Ex. 200 at 5-6; CMS Ex. 300 at 7; CMS Ex. 400 at 15; CMS Ex. 500 at 14; CMS Ex. 600 at 5; CMS Ex. 700 at 70-71; CMS Ex. 800 at 7.  The LCDs provide that examinations that:  (1) are conducted using portable hand-held devices or devices incapable of real-time wave-form display and analysis; and (2) which devices are incapable of both NCS and EMG testing will not be paid separately but must be included in the evaluation and management (E/M) service.  The LCDs cite the Axon II™ as an example of a device that does not meet the requirement for separate payment for use of the device.  CMS Ex. 100 at 27; CMS Ex. 200 at 7; CMS Ex. 300 at 8; CMS Ex. 400 at 17; CMS Ex. 500 at 17; CMS Ex. 600 at 6; CMS Ex. 700 at 71; CMS Ex. 800 at 8.  As discussed in more detail hereafter, the gist of the Aggrieved Parties' Complaint is that use of the Axon II™ is not separately payable under the terms of the LCDs.  The Aggrieved Parties do not dispute that separate payment for use of the Axon II™ device is specifically precluded because the Axon II™ is capable of NCS testing, but not EMG.

CGS filed its revised LCD L35897 marked as CMS Ex. 101.  DAB E-File #83.  Review of the revised LCD reveals no change in the provisions from the LCD prior to revision that are at issue in this case.  NCS testing with the Axon II™ device is not separately payable but is included in the E/M service.  CMS Ex. 101 at 10.

First Coast filed two revisions of its LCD L34859 marked as CMS Exs. 202 and 203.  DAB E-File Item #84a, #96.  Review of the revised LCDs reveals no change in the provisions from the LCD prior to revision that are at issue in this case.  NCS examination with the Axon II™ device is not separately payable but is included in the E/M service.  CMS Exs. 202 at 6, 203 at 7.

NGS filed its first and second revisions of LCD L35098, both marked CMS Ex. 300.  DAB E-File Item #78, #100.  The first revision is marked CMS Ex. 300, pages 51 through 93.  Review of the first revision reveals no change in the LCD provisions that are at issue in this case.  CMS Ex. 300 at 58.  The second revision is marked CMS Ex. 300, pages 94 through 169.  Review of the second revision reveals that NGS removed the reference to Axon II™ from the LCD L35098 but provided in its related Article A57668 that examination with a device incapable of both NCS and EMG is not separately payable and lists the Axon II™ as an example.  CMS Ex. 300 at 101-02, 112.  The rationale for requiring both NCS and EMG stated in the revised LCD is no different from that stated in the LCD before revision.  CMS Ex. 300 at 99-100.  I conclude that reading the second

Page 13

revision of the LCD and its related Article together is necessary to determine the policy followed by NGS and its application of its revised LCD.  Together, the two documents show that NGS has determined on a carrier-wide basis that NCS testing with the Axon II™ without EMG testing, is not reasonable and necessary and not payable by Medicare.

Noridian revised both LCD L36524 and LCD L36526 at least four times since October 2018.  However, Noridian failed to comply with 42 C.F.R. § 426.420(c)(2) and (d) and file notice of the revisions.  The current LCD and prior revisions are publically available at https://www.cms.gov/medicare-coverage-database/overview-and-quick-search.aspx.  The revised LCDs contain no changes to the provisions at issue in this case.  NCS examination using the Axon II™ is not separately payable.

Novitas filed two revisions of LCD L35081 marked as CMS Exs. 602 and 603.  DAB E-File Item #74, #98.  The revised LCDs contain no changes to the provisions at issue in this case.  NCS examination using the Axon II™ is not separately payable.  CMS Exs. 602 at 10, 603 at 8.

Palmetto filed its revised LCD L35048 marked as CMS Ex. 701.  DAB E-File Item #81.  The revised LCD contains no changes to the provisions at issue in this case.  NCS examination using the Axon II™ is not separately payable.  CMS Ex. 701 at 7.

WPS filed two revisions of LCD L34594 marked as CMS Exs. 801 and 802.  DAB E-File Item #75, #79, #94.  The revised LCDs contain no changes to the provisions at issue in this case.  NCS examination using the Axon II™ is not separately payable.  CMS Exs. 801 at 8, 802 at 9.

It is important to understand that the MACs have, by an Article in the case of NGS and by LCDs in the case of the other MACs, issued the carrier-wide determinations that:

(1) a NCS study alone without EMG examination is usually considered not medically necessary (or as characterized in some of the determinations, NCS alone is merely a screening test), except in limited cases involving the evaluation for carpal tunnel syndrome; and

(2) Testing performed by devices incapable of real-time wave-form display and of both NCS and EMG testing, for example, the Axon II™, is not separately payable under the Medicare program, which I construe to be a determination that examination with the Axon II™ alone is not reasonable or medically necessary.

The determinations do not prohibit Axon II™ use and do not preclude compensation as part of E/M services.  Most of the determinations provide that any reimbursement for testing using the Axon II™ is included in the reimbursement for E/M services, i.e., an

Page 14

examiner may not separately bill for and be reimbursed by Medicare for an NCS evaluation using Axon II™, at least not without  also performing EMG.

Several of the contractors provided evidentiary support in the LCD records that reflected the bases for their determinations.  The evidentiary support was in the form of position papers of recognized organizations with pertinent expertise and learned articles.  Some of the contractors' LCD records contained only abstracts of articles or minimal or no evidentiary support.  Because the NGS Article and the LCDs of the other MACs set forth the same reasonable and necessary determinations, it is unnecessary to separately consider each LCD and the Article or to review all the evidence submitted by the various contractors under the reasonableness test.  Rather, I summarize here some of the persuasive and credible evidence from the various LCD records.

The American Association of Neuromuscular & Electrodiagnostic Medicine (AANEM) in a position statement published in 2006,11 expressed concern that "NCSs without needle EMG has the potential of compromising patient care."  CMS Ex. 200 at 62; CMS Ex. 600 at 417; CMS Ex. 700 at 122: CMS Ex. 800 at 338.  The AANEM position statement explained that an NCS performed without an EMG may result in missing essential data necessary for an accurate diagnosis.  The AANEM stated that it is important that NCS and EMG be performed together for an accurate diagnosis, except in a few unique situations.  One such situation is where NCS is performed by someone who is not a trained physician, and then this requires referral to a physician trained in electrodiagnostic medicine for an EMG, and the physician will usually need to repeat the NCS prior to the EMG to ensure a quality study.  The repeat NCS is necessary to ensure quality care but wastes scarce healthcare money.  CMS Ex. 200 at 63-65; CMS Ex. 600 at 418-20; CMS Ex. 700 at 123-25; CMS Ex. 800 at 339-41.

AANEM's "Recommended Policy for Electrodiagnostic Medicine" states that the AANEM was founded in 1953 and, as of publication of the policy, numbered 5,000 physicians, mostly neurologists and physiatrists.  AANEM states it is the largest organization worldwide dedicated solely to the advancement of neuromuscular medicine.  AANEM's stated goal is to improve patient care through education, research, and quality assurance.  CMS Ex. 600 at 422.  The Aggrieved Parties have not questioned the AANEM or its reputation, except as noted hereafter.  AANEM's policy states that it believes performing an NCS without an EMG potentially compromises patient care and, in the majority of cases, NCS and EMG should be conducted and interpreted on-site and in real-time.  CMS Ex. 600 at 423.  AANEM recommends that an NCS not be performed

Page 15

without needle EMG except in unique circumstances, and they should be performed and reported together when possible.  CMS Ex. 600 at 436-37, 525.  AANEM first issued its policy in September 1997 with updates in 1998, 1999, 2000, 2001, 2002, and 2004.  The copy in evidence shows the recommended policy was updated on August 30, 2014.  The policy was endorsed by the American Academy of Neurology in 1998, 2002, and 2004; and by the American Academy of Physical Medicine & Rehabilitation in 1998, 2002, and 2004.  CMS Ex. 600 at 437.12

An undated AANEM "Model Policy for Needle Electromyography and Nerve Conduction Studies" states an EMG and NCS are usually required for a clinical diagnosis of peripheral nervous system disorders and performing one does not eliminate the need for the other.  NCS may be performed without an EMG, such as in the case of entrapment neuropathies, but that is the exception rather than normal practice.  CMS Ex. 700 at 131.  The model policy states that examination with portable hand-held devices that are incapable of real-time wave-form display and analysis should be included in the E/M service and not be paid separately.  CMS Ex. 700 at 136.  The model policy also provides that NCS without needle EMG should be the exception rather than a standard practice.  CMS Ex. 700 at 139.

In a letter to WPS dated August 7, 2014, the AANEM supported and recommended revisions to the WPS LCD L34594 (one of the LCDs at issue in this Complaint).  The AANEM letter specifically recognized the provision of the LCD providing that examination with devices not capable of both NCS and EMG is not separately payable.  CMS Ex. 800 at 361-62.  AANEM sent a similar letter dated December 29, 2016, to CGS regarding LCD L35897.  The AANEM recommended that CGS consider separate payment for NCS in cases of carpal tunnel syndrome, the use of blood thinners, or patient refusal.  CMS Ex. 100 at 74-75, 85-86.  Review of LCD L35897 reflects that CGS did not accept the AANEM's recommendation to make NCS separately payable in situations involving the use of blood thinners or patient refusal, but made NCS payable without EMG only for a diagnosis of carpal tunnel syndrome with a high pre-test probability.13  CMS Ex. 101 at 8.

The LCD record for LCD L34594 issued by WPS includes a document titled "American Association of Sensory Electrodiagnostic Medicine [AASEM] Consensus & Practice

Page 16

Policy Guidelines" dated October 19, 2015.  A subtitle is "Pain Fiber Nerve Conduction Study (PF-NCS)," under which is the statement that federal ALJs have found pf-NCS reasonable and necessary and entitled to payment by Medicare.  The document appears to advocate pf-NCS for diagnosis and treatment of pain associated with radiculopathy.  CMS Ex. 800 at 528, 532.  The document instructs providers on how to report pf-NCS testing to obtain payment from insurers.  CMS Ex. 800 at 529-30.  The document attempts to distinguish AANEM guidance (described above) on the basis that it relates only to larger nerve fiber testing as opposed to small pf-NCS.  The document reports that ALJs in several Medicare appeals (I infer the ALJs are assigned to OMHA and were conducting individual Medicare claims adjudications as in the case of the decisions filed with the Complaint) have concluded that use of the Axon II™ for small pf-NCS is reasonable and necessary and payable by Medicare.  The document, though not a model of clarity, takes issue with the position of the AANEM and the draft of LCD L34594 (which was likely in its public comment phase of development) that testing with the Axon II™ is not covered because it cannot perform both NCS and EMG.  CMS Ex. 800 at 530.  The document does not specifically address the position of the AANEM and the provisions of the draft LCD that provide that NCS is not separately payable without an EMG.  However, the tenor of the document is that NCS testing by the Axon II™ should be separately payable as use of the instrument is reasonable and necessary for small pain fiber evaluation.  Although not specifically stated, the document includes no denial that the Axon II™ cannot perform both NCS and EMG.  CMS Ex. 800 at 533-34.  In support of AASEM'S position, the document asserts that the use of pf-NCS is the "Gold Standard for diagnosing pain fiber pathology" and EMG tests "have never been used for such studies."  CMS Ex. 800 at 532.  The document cites some authority for the proposition that many patients complain of spine pain and a high number of spinal surgeries are failures.  CMS Ex. 800 at 532.  However, the paper cites no authority to support the assertion that pf-NCS is the gold standard or even commonly done and no authority for the proposition that pf-NCS without EMG is generally accepted in the medical community.  The document concludes by advocating for the use of Axon II™, describing it as being able to perform small nerve fiber evaluation that cannot be effectively performed by EMG.  The document also attacks the AANEM positions, alleging self-interest on the part of its members.  CMS Ex. 800 at 533-34.  In adopting LCD L34594, WPS appears not to have accepted the AASEM's position regarding the use of the Axon II™ or that NCS should be separately payable without an EMG.

I conclude based on my review that the challenged LCD provisions are completely consistent with the AANEM's-recommended policies and position statements that NCS

Page 17

and EMG be performed together, except in the limited circumstance of carpal tunnel syndrome.14

b.  The Aggrieved Parties' Complaint

The Aggrieved Parties characterize their Complaint as follows:

The LCDs have been or are each being misapplied or misused, to deny Small Pain Fiber (SPF) Nerve Conduction Study (NCS) testing, when appropriately claimed under CPT Code 95909, this when SPF/NCS testing is performed with a Neuroscan (now AXON-II) system.

Complaint at 5-6.  The Aggrieved Parties further allege:

[T]he LCDs which have been or are being used to deny reimbursement of claims submitted by physicians for their performance of SPF/NCS tests, using the Pain DX Neural Scan (now Axon-II) systems, are in every case LCDs intended to govern MOTOR nerve testing.  But again, they are inappropriately used and/or misapplied by the CMS contractors to deny SENSORY SMALL PAIN FIBER (SPF) nerve testing, which leads one to conclude that the name "AXON" does not belong in these LCDs.  There is no argument that an AXON system does NOT perform MOTOR nerve testing, nor was it ever intended to.  The name of the equipment, Axon-II, which performs small pain fiber testing, does not belong in a motor nerve EMG LCD, nor should such LCDs be used to deny SPF testing performed by an AXON-II, but they have been and are being misused and/or misapplied for that purpose.

Complaint at 7.15

Page 18

On superficial reading, the Aggrieved Parties' Complaint and AP Statement appear to only request removal of the name "Axon II™" from the LCDs.  However, reading the Aggrieved Parties' Complaint and AP Statement more carefully in the context of the actual LCD provisions shows that simply removing the name "Axon II™" from the LCDs would not remedy the Complaint.  The MACs have, by an Article in the case of NGS and LCDs in the case of the other MACs, issued the carrier-wide determinations that:

(1) NCS examination alone without EMG examination is usually considered not medically necessary (or as characterized in some of the determinations NCS alone is merely a screening examination), except in limited cases involving the evaluation for carpal tunnel syndrome; and

(2) Testing performed by devices incapable of real-time wave-form display and of both NCS and EMG testing, for example, the Axon II™, is not separately payable under the Medicare program, which I construe to be a determination that examination with the Axon II™ alone is not reasonable or medically necessary.

The Aggrieved Parties do not deny that the Axon II™ is incapable of performing both NCS and EMG.  The Aggrieved Parties clearly desire to be compensated by Medicare for NCS, including NCS using the Axon II™, without having to also undergo EMG testing currently required by the LCDs and Article, and not simply have NCS reimbursed as part of E/M services.  Therefore, the most meaningful and accurate reading of the Aggrieved Parties' Complaint and the AP Statement is that they want two things:

1.  Removal of the name "Axon II™" from the LCDs and Article; and

2.  A determination that the MACs' determinations that NCS without EMG is not reasonable and necessary, except in the limited case involving carpal tunnel syndrome, without also listing as an exception small pain fiber testing, does not meet the reasonableness test.16

Page 19

Because there is no dispute that the Axon II™ does not perform both NCS and EMG and removal of the name alone from the LCDs would not resolve the Aggrieved Parties' Complaint, the focus must be upon the second of the Aggrieved Parties' desired results rather than the first.

In support of their position, the Aggrieved Parties submitted "a peer review consensus gathered in 2012 by the AASEM" from over fifty "certified providers in 23 states" who perform nerve conduction testing.  Complaint at 8.  A document titled "National Peer Review and Consensus and Statements by Physicians and Practitioners qualified to give

Page 20

such statements" was filed with the Complaint.17  The document refers to 53 physicians in 23 states with AASEM certification of qualification and/or 12 or more "CME" credits.  The document states that CPT Code 95904 is the correct code for small pain fiber NCS performed with the Axon II™ and Prometheus Potentiometer systems.  The Aggrieved parties also filed 49 forms signed by physicians titled either "Consensus & Statement" or "Consensus Form."  Although the forms signed by the physicians are in two different formats, the substantive content is essentially the same.  The forms state that NCS does not require EMG absent muscle weakness or atrophy.  Some of the statements indicate that the physician uses the Neural-Scan™ or Axon II™ device, the devices are not portable, data recording and interpretation is done onsite, the devices are FDA-approved, and in their opinion the devices are effective for the purpose used.  The opinion that NCS does not require EMG absent muscle wasting and atrophy purports to be supported by American Medical Association (AMA) guidance that if a nerve problem is suspected, an NCS is performed, and the NCS is followed by "[c]ompletion of indicated needle EMG studies." E.g., DAB E-File Item Number 15c at 6 and 22 (emphasis in original).  The AMA statement referred to is not offered as evidence and it is not possible to determine whether the physicians who signed the statements correctly interpreted AMA guidelines as recommending EMG only in the case of muscle wasting and atrophy.  The opinions are not inconsistent with the AANEM guidelines and the LCD provisions which do not preclude use of NCS for purposes of evaluation to be covered as part of E/M services but which also require EMG for diagnosis and Medicare payment.  Furthermore, the evidence does not permit me to determine the ratio of the 49 physicians to the universe of  physicians qualified to perform electrodiagnostic testing, i.e., while the 49 physicians signed copies of the same two versions of the consensus statement or form, that fact alone does not establish what is accepted practice among electrodiagnostic physicians.  To the contrary, the AANEM's position is good evidence that the opinions of the 49 physicians are not consistent with accepted practice.

The Aggrieved Parties also filed and refer to several OMHA ALJ decisions that concluded NCS using the Axon II™ (or a similar device) was reasonable and necessary for individual beneficiaries.  Complaint at 8-11, 13-14.  OMHA ALJ decisions were filed by the Aggrieved Parties with the Complaint.  DAB E-File Item #15_f, #15_g.  Although all the decisions offered show that relief was granted in one form or another to the Medicare beneficiaries or the suppliers who conducted electrodiagnostic testing, all are limited to whether NCS testing was reasonable and necessary for the individual beneficiary or beneficiaries involved.  None of the decisions specifically addressed whether NCS and EMG are both required to be performed to be reasonable and necessary.  It appears that at least two ALJs ordered payment for NCS alone without explaining the deviation from an

Page 21

existing LCD that required NCS be done with EMG to be compensable.  DAB E-File Item #15_f at 17-21, 26-33.  OMHA ALJs and attorney adjudicators hear and decide cases involving denied claims for coverage of care and services provided to Medicare-eligible beneficiaries.  42 C.F.R. §§ 405.900, 405.1000.  It is important to know that CMS and/or a MAC do not generally participate in coverage hearings before OMHA ALJs and attorney adjudicators.  42 C.F.R. §§ 405.1010, 405.1012.  ALJs and attorney adjudicators are not bound by LCDs, but are instructed to give them substantial deference if applicable in a particular case.  42 C.F.R. § 405.1062(a).  If an OMHA ALJ or attorney adjudicator determines not to follow an LCD, they are supposed to explain why in the decision and their decisions are not binding except in the individual case decided and have no precedential effect.  42 C.F.R. § 405.1062(b).  Indeed, OMHA ALJs and attorney adjudicators are expressly forbidden to review or set aside an LCD.  42 C.F.R. § 405.1062(c).

The Aggrieved Parties assert that the AASEM trains physicians and staff in sensory small pain fiber NCS testing and the AANEM trains neurologists and their staff in motor nerve testing using NCS and EMG.  Complaint at 11.  The Aggrieved Parties imply that AASEM should be given greater credibility than the AANEM regarding small pain fiber NCS testing.  The Aggrieved Parties have provided no evidence about the AASEM that permits judging that the AASEM is more credible than the AANEM, such as the number of AASEM members, the credentials of AASEM, any policy statements of the AASEM regarding the performance of NCS without EMG, the scientific basis for any such policy statements, or the general acceptance of AASEM in the medical community that performs electrodiagnostic testing.  On the other hand, the LCD records provide much information regarding the AANEM, its pertinent policies, and the basis for its policies.  Therefore, the AANEM opinions expressed in their policies must be accorded greater weight than the AASEM opinions in applying the reasonableness standard.

The Aggrieved Parties presented evidence that a clinical trial was authorized to be conducted by the AASEM to study neurological ischemia lower extremity pain and swelling.  The study start date was March 2012 and was to be completed by March 2021.  DAB E-File Item #15_g at 3-14.  The stated study purpose is to "evaluate the efficacy treatment (sic) of lower extremity pathologies derived from neurological ischemia disorders using the combination of Monochromatic Infrared Photo Energy (MIRE) and Transcutaneous Electrical Nerve Stimulation (TENS) therapies."  DAB E-File Item #15_g at 3.  The study provides for the use of Neural Scan™ or Axon II™ for evaluation of study participants.  DAB E-File Item #15_g at 9, 12.  The fact that this clinical study was approved using the Axon II™ for participant evaluation is some evidence that the Axon II™, which has been approved by the FDA, has some value to those conducting the study.  The issue before me is whether or not the provisions of the LCDs that prevent Medicare payment when NCS is done without EMG, except in the case of carpal tunnel syndrome, meet the reasonableness standard.  The fact that an approved study is using the

Page 22

Axon II™ is considered as evidence under the reasonableness standard, but it is simply outweighed by other evidence of record.

c.  Application of the Reasonableness Standard

Section 1862(a)(1)(A) of the Act provides that Medicare Parts A and B may not pay for any items or services that are "not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member."  Section 1869(f)(2)(B) of the Act provides:

[T]he term "local coverage determination" means a determination by a fiscal intermediary or a carrier under part A or part B, as applicable, respecting whether or not a particular item or service is covered on an intermediary-or carrier-wide basis under such parts, in accordance with section 1862(a)(1)(A).

The Secretary defined an LCD consistently with section 1869(f)(2)(B) of the Act, as follows:

Local coverage determination (LCD) means a decision by a fiscal intermediary or a carrier under Medicare Part A or Part B, as applicable, whether to cover a particular service on an intermediary-wide or carrier-wide basis in accordance with section 1862(a)(1)(A) of the Act.  An LCD may provide that a service is not reasonable and necessary for certain diagnoses and/or for certain diagnosis codes.  An LCD does not include a determination of which procedure code, if any, is assigned to a service or a determination with respect to the amount of payment to be made for the service.

42 C.F.R. § 400.202 (emphasis added).

The definition of LCD under the Act and regulations is precise.  An LCD is a determination of the Medicare contractor as to whether or not a particular item or service meets the reasonable and necessary requirement of section 1862(a)(1)(A) of the Act.  An LCD is used by a contractor to determine Medicare coverage for an item or service for an individual Medicare-eligible beneficiary, without review of the beneficiary's personal medical condition.  I do not review whether an item or service is reasonable and necessary for an individual Medicare beneficiary, as I am limited to reviewing an LCD and whether or not it meets the reasonableness standard.  Act § 1869(f)(2)(A); 42 C.F.R. §§ 426.325(b)(4), (5), (11), (12), 426.405(d)(5).

Page 23

The regulation provides that after receiving:  (1) the LCD record; (2) the AP's statement of why the LCD is not valid, including evidence submitted in support of that position; and (3) the contractor's response to the AP's statement, I am to apply the reasonableness standard to determine whether the LCD record is complete and adequate to support the validity of the LCD.  42 C.F.R. § 426.425(c)(1).  During an LCD review, the aggrieved party bears the burden of proof and the burden of persuasion for the issues raised in the complaint.  42 C.F.R. § 426.330.  I conclude based on my review discussed above that the LCD records are complete and adequate to support the validity of the LCDs at issue in this case.  Accordingly, the LCD review process ends with this decision subject to any further appeal to the Board.  42 C.F.R. §§ 426.425(c)(2), 426.465.

Under the reasonableness standard as defined by 42 C.F.R. § 426.110, I must uphold the challenged LCD provisions "if the findings of fact, interpretations of law, and applications of fact to law by the contractor or CMS are reasonable based on the LCD or NCD record and the relevant record developed before the ALJ or the Board."  42 C.F.R. § 426.110.  If the challenged LCD "could be reached by a rational person, based on the evidence in the record as a whole (including logical inferences drawn from that evidence)," the challenged provisions must be upheld as reasonable.  68 Fed. Reg. at 63,703.  Consideration of the quantity of the evidence submitted and an evaluation of the persuasiveness of the material is appropriate.  The reasonableness standard cannot be met if the challenged LCD provision "is in direct conflict with the plain language of the statute or regulation being interpreted," or with an NCD, or a CMS Ruling.  "So long as an interpretation is one of the readings permitted by the plain language of the law and can be reconciled with relevant policy, however, it must be upheld, even if the ALJ or the Board might have reached a different result if interpreting the statute or regulation in the first instance."  68 Fed. Reg. at 63,703-04. In deciding the issue of whether or not the LCD record is complete and adequate to support the validity of the challenged LCD provision, I am required to consider the contractors' findings of fact, interpretations of law, and application of the facts to law when applying the reasonableness standard.  42 C.F.R. § 426.450(b)(4).

The LCDs and Article provisions challenged by the Aggrieved Parties are:

(1) NCS examination alone without EMG examination is not medically necessary (or, as characterized in some of the determinations, NCS alone is merely a screening examination), except in limited cases involving the evaluation for carpal tunnel syndrome; and

(2) Testing performed by devices incapable of real-time wave-form display and both NCS and EMG testing, for example, the Axon II™, is not separately payable under the Medicare program, which I construe to be a determination that examination with the Axon II™ alone is not reasonable or medically necessary.

Page 24

The determinations of the MACs that performing NCS without EMG is not reasonable and necessary except in the cases involving the evaluation of carpal tunnel syndrome, is consistent with and supported by the various statements of the AANEM found in the LCD records as described above.  The fact that AASEM and 49 physicians have expressed different opinions than the AANEM does not make the MACs' reliance on the statements of the AANEM unreasonable.  The Aggrieved Parties do not deny that the Axon II™ is incapable of both NCS and EMG.  Therefore, the MACs' listing of Axon II™ as an example of a device for which testing with that device alone is not separately payable and is only recoverable as part of E/M services is also not unreasonable.  The MACs' findings of fact, interpretations of law, and application of the facts to law reflected by the challenged LCD provisions are reasonable based on the LCD records and the relevant evidence presented for my consideration.  42 C.F.R. § 426.100.  Therefore, the challenged LCD provisions, which I conclude are not in conflict with the Act, regulations, NCDs, or CMS Rulings, must be upheld.

2.  The proprietary or privileged data submitted by the contractors under seal is not material to my determination as to whether the LCD records are complete and adequate to support the validity of the challenged LCD provisions.

The regulations permit that the LCD record served on the ALJ may be different than that served upon the Aggrieved Parties.  The regulation provides that a contractor must file with the ALJ under seal any proprietary or privileged information but such information need not be served upon the Aggrieved Parties.  42 C.F.R. §§ 426.418(b)(1), 426.419(b).  In this case, NGS, CGS, WPS, Novitas, and First Coast each filed documents with me pursuant to 42 C.F.R. § 426.419 which they alleged to be proprietary or for which they asserted a privilege.  I have reviewed each of the documents submitted by the contractors and conclude that none of the documents are material to the issue before me, i.e., whether or not the LCD records are complete and adequate to support the validity of the challenged LCD provisions under the reasonableness standard.  Accordingly, I conclude that further development with regard to whether those documents were properly withheld from the Aggrieved Parties is unnecessary at this stage of the review process.  The documents for which privileges were asserted will not be released to the Aggrieved Parties, and will not be uploaded to DAB E-File, but will remain with the paper record for potential appellate review.

Page 25

3.  Issuance of this decision finding the LCD records complete and adequate to support the validity of the challenged LCD provisions ends the review process.  42 C.F.R. § 426.425(c)(2).

The LCD records are complete and adequate to support the validity of the challenged LCD provisions under the reasonableness standard.  "Issuance of a decision finding the record complete and adequate to support the validity of the LCD ends the review process."  42 C.F.R. § 426.425(c)(2).

III.  Conclusion

The LCD records are complete and adequate to support the validity of the LCD provisions at issue under the reasonableness standard.  Therefore, review of the challenged LCDs is complete.

IV.  Appeal Rights

The parties are notified pursuant to 42 C.F.R. §§ 426.450 and 426.465 of their right to appeal this Decision to the Board for review.  Unless there is good cause shown, an appeal must be filed within 30 days of the date of this decision.  42 C.F.R. § 426.465(e).  An appeal must include the full names and addresses of the parties, including the name of the LCDs at issue, the date this decision was issued, the docket number for this case (C-17-1189), a statement identifying the parts of this decision that are being appealed, and a statement explaining why this decision should be reversed.  42 C.F.R. § 426.465(f)(1)-(3).

The Aggrieved Parties may appeal to the Board any part of this decision that states a provision of an LCD is valid under the reasonableness standard.  42 C.F.R. § 426.465(a)(1).