Medicare: Withdrawing Eyeglass Coverage Recommended Following Cataract Surgery

Published by the Government Accountability Office on 1990-02-08.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                United   States   Genwal   Accounting   Office
                Report to Congressional Requesters               ’

Febmmy   1990
                Withdrawing Eyeglass
                Following Cataract

      United States
GAO   General Accounting Office
      Washington, D.C. 20648

      Human Resources Division


      February 8,199O

      The Honorable Fortney H. (Pete) Stark
      Chairman, Subcommittee on Health
      Committee on Ways and Means
      House of Representatives

      The Honorable Willis D. Gradison, Jr.
      Ranking Minority Member
      Subcommittee on Health
      Committee on Ways and Means
      House of Representatives

      In your February 9,1988, letter, you asked us to examine a number of
      issues relating to Medicare reimbursement for cataract surgery. On
      April 10, 1989, we presented the results of our review in testimony
      before the Subcommittee. In addition to the issues discussed in our testi-
      mony, we also followed up on an earlier GAOrecommendation to the
      Administrator of the Health Care Financing Administration (HCFA)that
      has not been implemented. This recommendation dealt with Medicare’s
      policy of paying for conventional eyeglasses for a beneficiary who has
      undergone cataract surgery and has had his or her natural lens replaced
      by an implanted prosthetic intraocular lens (IOL).

      In brief, there is a disparity between the Medicare policy on coverage of
      conventional eyeglasses for beneficiaries who have undergone cataract
      surgery and those who have not.] Virtually all people 65 years of age
      and older need eyeglasses for near vision (to help with reading and
      other close-up tasks), distance vision, or both. But since its inception,
      Medicare law has generally prohibited paying for conventional eye-
      glasses. HCFA,however, makes an exception for beneficiaries who have
      undergone cataract surgery. In such instances, HCFAconsiders eyeglasses
      to be a prosthetic (artificial) device-and therefore eligible for cover-
      age-even though the function of these glasses is the same as for benefi-
      ciaries who have not had cataract surgery. Eliminating this HCFA-created
      exception to Medicare law would result in an estimated saving of over
      $98 million annually.

      In a March 1984 report,’ we recommended that HCFAchange its policy of
      paying for conventional eyeglasses following cataract surgery. The

      ‘The policy also includes contxt lenses for near or far vision.

      ‘Medicare Reimbursement for Ckxwentional Eyeglasses (GAO/HRD 8444, Mar. 7,1984).

      Page 1                                                GAO/HlW-90.31 Medicare Eyeglass Coverage

             Department of Health and Human Services (HHS) Inspector General
             made the same recommendation in 1988. HCFA has considered the recom-
             mendation, but has not acted on it. As recently as June 1989, HCFA stated
             that it would continue to review the issue, but had no immediate plans
             for a regulatory change. In order to eliminate the inequity to benefi-
             ciaries that currently exists and to provide a uniform Medicare policy,
             HCFA should issue a regulation specifically excluding Medicare coverage
             of conventional eyeglasses and contact lenses for cataract surgery
             patients who have IOL implants.

              The Medicare program, authorized by title XVIII of the Social Security
Background    Act in July 1966, helps pay medical costs for about 28 million people
              65 years of age and older and for about 3 million disabled people. Over-
              all responsibility for administering Medicare lies with HHS. HCFA, as part
              of HHS, develops policies and is responsible for ensuring compliance with
              Medicare legislation and regulations.

              One of the most frequently performed major surgical procedures paid
              for by the Medicare program is cataract surgery. Medicare paid for
              1 million cataract surgery procedures in 1987, at a cost in excess of
              $2 billion. In cataract surgery, the clouded natural lens of the eye is
              removed. To regain vision, the extracted lens is replaced with some type
              of prosthetic lens.

              For cataract patients, physicians may use one or a combination of three
              types of prosthetic devices: cataract eyeglasses, cataract contact lenses,
              or surgically implanted 10~s. The use of 10~sis now the preferred method
              because they offer many advantages over cataract eyeglasses and con-
              tact lenses. In 1987, IOLS were used in about 98 percent of cataract sur-
              gery procedures reimbursed by Medicare. However, IOL and cataract
              contact lenses cannot adjust for both near and distance vision. Typi-
              cally, IOLSor contact lenses are focused for either distance, middle, or
              near vision; conventional eyeglasses are prescribed to improve the
               focusing ability of the eye. For example, if 10~s are focused for distance
               vision, conventional eyeglasses are prescribed for near vision.

               The inability of an IOL to adjust focus is also characteristic of the aged
               natural lens. Nearly everyone over the age of 65 has a problem in focus-
               ing for near vision, Beginning at about the age of 40, the lenses of the
               eyes begin to lose their natural capability for close-up focusing. This
               functional loss continues until a person reaches the age of 45 to 50, mak-
               ing reading difficult without corrective reading glasses.

               page2                                  GAO/HBD9031MedicareEyeglassCoverage

                      According to medical texts and ophthalmologists that we consulted, con-
                      ventional eyeglasses serve the same purpose-to correct the focusing
                      ability of the eyes-for both Medicare beneficiaries who have had cat-
                      aract surgery as well as for beneficiaries who have not. In 1984, HHS’S
                      National Center for Health Statistics reported that 91 percent of people
                      65 years of age and older wore conventional eyeglasses.

                      Medicare law (42 USC. 1395y(aX7)) specifically excluded coverage of
Medicare Law
Excludes Eyeglass     ‘a,  eyeglassesor eye examinations for the purpose of prescribing, fitting, or chang-
                      ing eyeglasses,procedures performed (during the course of any eye examination) to
Coverage to Correct   determine the refractive state of the eyes. .”
Vision Problems
                      Consequently, Medicare regulations do not allow payment for routine
                      eye care or conventional eyeglasses for near or distance vision since
                      both are considered “refractive corrections,” which improve the focus-
                      ing ability of the eye.

                      Although conventional eyeglasses provide essentially the same benefits
HCFA Covers           for all older people, HCFApayment practices differ. HCFAdoes not allow
Eyeglasses as a       payments for conventional eyeglasses to beneficiaries who have not had
Prosthetic Device     cataract surgery. It considers conventional eyeglasses for those benefi-
                      ciaries who have had cataract surgery, however, to be a prosthetic
                      device and therefore eligible for coverage. HCFA’Spolicy is based on the
                      premise that conventional eyeglasses, used with IOLSor cataract contact
                      lenses, are needed to restore the ability of fully functioning natural
                      lenses to focus for near and distance vision. Therefore, HCFAconsiders
                      the combination of IOLS(or cataract contact lenses) and conventional
                      eyeglasses to be prosthetic devices. As such, this combination and
                      related fitting fees are eligible for Medicare payment. Subsequent con-
                      ventional eyeglasses or contact lenses are also eligible for Medicare pay-
                      ment since Medicare coverage of prosthetic devices includes their
                      replacement when medically necessary.

                      We believe HCFA’Spolicy of paying for conventional eyeglasses in such
                      cases is questionable. Although 10~sor cataract contact lenses typically
                      restore distance vision, HCFA’Spolicy is based on the underlying premise
                      that correction of both near and distance vision is needed to restore
                      vision of fully functioning natural lenses. As such, the policy does not
                      consider that for those over the age of 65, a fully functioning natural

                      Page 3                                      GAO/HRINO-31 Medicare Eyeglass Coverage

                        lens does not include the capability for near-vision focusing had a cat-
                        aract not existed.

                        Further inconsistencies are apparent in HCFA’Spayment policy for ser-
                        vices needed to prescribe conventional eyeglasses for patients with IOLS
                        or cataract contact lenses. Although HCFAconsiders the conventional
                        eyeglasses themselves as prosthetic devices and therefore pays for them
                        and related fitting fees, HCFAdoes not pay for the services needed to
                        prescribe the glasses because it considers them routine and not allowed
                        by Medicare.

                        Medicare payments for conventional eyeglasses for beneficiaries under-
                        going cataract surgery have increased significantly, from about
                        $60 million in 1985 to about $98 million in 1987.

                        In March 1984, we recommended that the HCFAAdministrator discon-
Previous Reports Have   tmue payments to cataract patients for conventional eyeglasses worn
Recommended             over IOU or over cataract contact lenses. In an April 11, 1984, letter, the
Discontinuing           HCFAAdministrator agreed that our recommendation had merit and
                        stated that HCFAwas considering a change to its policy. According to a
Payments                July 1985 internal agency document, HCFAofficials concluded that there
                        was no basis for the coverage of corrective eyeglasses. The document
                        states that

                        “Medical information we have reviewed supports the GAO contention that eye-
                        glassesare not an integral part of the prosthetic lens provided to aphakic patients:
                        although eyeglassesfor those patients do serve a refractive need in that they cor-
                        rect near vision, they do essentially no more for the aphakic patient than reading
                        glassesdo for nonaphakic patients who require near vision correction.“”

                         In August 1986, the FCCFA  Administrator        again informed us that HCFAwas
                         still considering the change.

                         In July 1988, the HHSInspector General also recommended that HCFA
                         develop regulations to specifically preclude Medicare from paying for
                         conventional eyeglasses for beneficiaries with 10~s. Because some
                         patients cannot have their vision fully restored after cataract surgery
                         without wearing conventional eyeglasses, HCFAstated in response, it had

                         ‘Aphakiarefersto the absena>
                                                   of the naturallensof theeye.

                         Page4                                         GAO/HRD9@31   MedicareEyeglassCoverage

                       reservations about withdrawing this coverage. In June 1989, HCFA offi-
                       cials informed us that their position, as reflected in comments to the HHS
                       Inspector General report, had not changed.

                       Medicare’s policy of paying for conventional eyeglasses only for benefi-
Conclusion             ciaries who have cataract surgery, but not for other beneficiaries, is
                       unjustified because conventional eyeglasses and contact lenses serve
                       essentially the same function for both groups-the improved ability to
                       focus for near or distance vision. Medicare law generally prohibits pay-
                       ments for this purpose. Thus, payments for eyeglasses after cataract
                       surgery create an inequity that we continue to believe should be elimi-
                       nated,? and they increase program costs unnecessarily. Implementation
                       of our recommendation would save, based on calendar year 1987 pay-
                       ments, over $98 million annually.

                       We recommend that the Secretary of HHS direct the Administrator of
Recommendation to      HCFA to discontinue Medicare payment for all conventional eyeglasses or
the Secretary of HHS   contact lenses following cataract surgery when an IOL is implanted and
                       satisfactory results are achieved.

                       The Secretary of HHS provided written comments on a draft of this
Agency Comments        report. He said he saw some merit in our conclusion and recommenda-
                       tion, and HHS is considering the publication of a Notice of Proposed
                       Rulemaking to withdraw Medicare coverage of conventional eyeglasses.
                       This is essentially the same response made by the HCFA Administrator in
                       commenting on our 1984 report.

                       The American Academy of Ophthalmology (AAO) does not fully support
AA0 Comments           our recommendation to eliminate Medicare payments for conventional
                       eyeglasses following cataract surgery. In commenting on the draft, AAO
                       pointed out that the surgery itself will cause the patient to need a
                       change of eyeglasses prescription that otherwise might not have been
                       needed. Thus, the AAO believes that Medicare should pay at least for the
                       first pair of new eyeglasses or contact lenses following cataract surgery.

                       ‘Medicare should continue to provide cataract glasses and cataract contact lenses to the small per-
                       centage of people that do not rereiw 101s since these glassesor contacts act as substitutes for IOLs.

                       Page 6                                                GAO/HRD9031       Medicare Eyeglass Coverage

                        Although it is true that the surgery and the power of IOLS cause a pre-
                        scription change, we do not believe that this is justification for Medicare
                        payment. Generally, cataract surgery with an IOL implant greatly
                        improves the patient’s overall vision, and-as we pointed out (p.2)-
                        conventional eyeglasses just provide refractive corrections to improve
                        the focusing ability of the eye. The Medicare law excludes coverage of
                        eyeglasses for refractive correction and provides no specific exception
                        to this prohibition.” Further, since eyeglasses serve the same function
                        for cataract and non-cataract patients, paying for these eyeglasses only
                        after cataract surgery creates an inequity in Medicare benefits.

                        AAOalso presented several technical comments that we have incorpo-
                        rated into the report. In summary, AAO, while not endorsing our recom-
                        mendation, did not present facts that would justify continued Medicare
                        payment for conventional eyeglasses after cataract surgery.

                        In a letter dated February 9, 1988, the Chairman and Ranking Minority
Objective, Scope, and   Member of the Subcommittee on Health, House Committee on Ways and
Methodology             Means, requested that GAO study several issues relating to Medicare pay-
                        ments for cataract surgery. On April 10,1989, we testified before the
                        Subcommittee on the results of this review.

                        As part of this request, we also followed up on our 1984 recommenda-
                        tion that HCFA discontinue Medicare payments for conventional eye-
                        glasses for beneficiaries who have undergone cataract surgery. Because
                        HCFA has not acted on this recommendation, we wanted to determine if
                        our 1984 position was still valid.

                         We reviewed medical texts and scientific journals cited by the Public
                         Health Service and the National Academy of Sciences concerning the
                         aging of the human eye; we also interviewed ophthalmologist consul-
                         tants recommended as experts by AAO. From HCFA'S part B Medicare
                         Annual Data System file, we determined the extent of calendar year
                         1987 Medicare payments for eyeglasses and related fees for benefi-
                         ciaries with 10~s.

                         We discussed this matter with HCFA officials and obtained written com-
                         ments on this report from HHS. We also obtained written comments from
                         AAOto confirm the technical accuracy of the findings developed in the
                         body of this report.

                         %xtion 1395y (a)(7) of tltlr 42

                         Page 6                                 GAO/HltB9@31 Medicare Eyeglass Coverage

    We conducted this portion of our review in May and June 1989 in
    accordance with generally accepted government auditing standards.

    We are sending copies of this report to the Chairman, Subcommittee on
    Medicare and Long-Term Care, Senate Finance Committee; the Director
    of the Office of Management and Budget; the Secretary of HHS; the
    Administrator of HCFA; and to other interested parties upon request.
    Please call me at (202) 275-5451 if you or your staff have any questions
    concerning this report. Other major contributors to this report are listed
    in appendix I.

/   Janet L. Shikles
    Director, Health Financing
      and Policy Issues

     Page 7                                 GAO/HUD-90.31 Medicare Eyeglass Coverage
Appendix I

Major Contributors to This Report

TT           r\           Jane L. Ross, Senior Assistant Director, (202) 275-6195
numan    nesources        Terence J. Davis, Assistant Director
Division,                 Jerry G. Baugher, Assignment Manager
Washington, D.C.

                          Frank C. Pasquier, Evaluator-in-Charge
Seattle Regional Office   Susan K. Hoffman, Evaluator

 (106366)                  Page 8                                  GAO/HRD90.31 Medicare Eyeglass Coverage
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