Reimbursement for Certain Services or Items Without Established Rates

Monday, August 19, 2024

To prevent reimbursement that is “substantially in excess of customary or reasonable charges” (a form of abuse per TRICARE policy), TRICARE has established payment thresholds for professional, durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) and parenteral and enteral nutrition (PEN) services that do not have established rates. These payment thresholds will be used until a TRICARE fee schedule or state prevailing rate has been established for the billed service or item. TRICARE has issued this change with a retroactive effective date of June 13, 2022.

This policy does not apply to inpatient or facility services, services provided overseas, or on claims with other health insurance. Please see TRICARE Reimbursement Manual, Chapter 1, Addendum E for complete details.

TRICARE regional contractors will use the following methodology to set payment thresholds for unlisted professional, DMEPOS and PEN codes:

1. Use the TRICARE fee schedule or state prevailing rate for a comparable code or similar item, ensuring the comparable code is based on similarity of function, design, structure, purpose, and features. 
   
   
2. For DMEPOS and PEN codes only, if a comparable code is not available, use the supplier’s price list (SPL) amount.
   
   
3. Reimbursement amounts for covered services will be the lower of billed charges or the established threshold. 

To help expedite claims processing, please include the following on your claim submissions:

• A narrative description of the service or item for any Current Procedural Terminology® (CPT®) or Healthcare Common Procedure Coding System (HCPCS) codes billed that do not have established rates, 
  
  
• A comparable procedure code, 
  
  
• The SPL amount for DMEPOS or PEN codes (if applicable), and 
  
  
• The National Drug Code number, dosage units, and method of administration (if applicable).

We may request additional documentation, such as clinical notes, test results, or other relevant information to help determine medical necessity.