[Federal Register Volume 61, Number 244 (Wednesday, December 18, 1996)]
[Notices]
[Pages 66676-66687]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32016]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES
[BPO-140-N]


Medicare and Medicaid Programs; Quarterly Listing of Program 
Issuances and Coverage Decisions--Second Quarter 1996

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

ACTION: Notice.

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SUMMARY: This notice lists HCFA manual instructions, substantive and 
interpretive regulations and other Federal Register notices, and 
statements of policy that were published during April, May, and June of 
1996 that relate to the Medicare and Medicaid programs. It also 
identifies certain devices with investigational device exemption 
numbers approved by the Food and Drug Administration that may be 
potentially covered under Medicare.
    Section 1871(c) of the Social Security Act requires that we publish 
a list of Medicare issuances in the Federal Register at least every 3 
months. Although we are not mandated to do so by statute, for the sake 
of completeness of the listing, we are including all Medicaid issuances 
and Medicare and Medicaid substantive and interpretive regulations 
(proposed and final) published during this timeframe. We are also 
providing the content of revisions to the Medicare Coverage Issues 
Manual published during the period of April 1 through June 30, 1996. On 
August 21, 1989, we published the content of the Manual (54 FR 34555) 
and indicated that we will publish quarterly any updates. Adding to 
this listing the complete text of the changes to the Medicare Coverage 
Issues Manual fulfills this requirement in a manner that facilitates 
identification of coverage and other changes in our manuals.

FOR FURTHER INFORMATION CONTACT:
Bridget Wilhite, (410) 786-5248 (For Medicare instruction information).
Pat Prete, (410) 786-3246 (For Medicaid instruction information).
Sharon Hippler, (410) 786-4633 (For Food and Drug Administration-
approved investigational device exemption information).
Cathy Johnson, (410) 786-5241 (For all other information).

SUPPLEMENTARY INFORMATION:

I. Program Issuances

    The Health Care Financing Administration (HCFA) is responsible for 
administering the Medicare and Medicaid programs, which pay for health 
care and related services for 38 million Medicare beneficiaries and 36 
million Medicaid recipients. Administration of these programs

[[Page 66677]]

involves (1) providing information to Medicare beneficiaries and 
Medicaid recipients, health care providers, and the public, and (2) 
effective communications with regional offices, State governments, 
State Medicaid Agencies, State Survey Agencies, various providers of 
health care, fiscal intermediaries and carriers that process claims and 
pay bills, and others. To implement the various statutes on which the 
programs are based, we issue regulations under the authority granted 
the Secretary under sections 1102, 1871, and relevant provisions of the 
Social Security Act (the Act) and also issue various manuals, 
memoranda, and statements necessary to administer the programs 
efficiently.
    Section 1871(c)(1) of the Act requires that we publish in the 
Federal Register at least every 3 months a list of all Medicare manual 
instructions, interpretive rules, statements of policy, and guidelines 
of general applicability not issued as regulations. We published our 
first notice June 9, 1988 (53 FR 21730). Although we are not mandated 
to do so by statute, for the sake of completeness of the listing of 
operational and policy statements, we are continuing our practice of 
including Medicare substantive and interpretive regulations (proposed 
and final) published during the 3-month time frame. Since the 
publication of our quarterly listing on June 12, 1992 (57 FR 24797), we 
decided to add Medicaid issuances to our quarterly listings. 
Accordingly, we list in this notice Medicaid issuances and Medicaid 
substantive and interpretive regulations published during April through 
June 1996.

II. Medicare Coverage Issues

    We receive numerous inquiries from the general public about whether 
specific items or services are covered under Medicare. Providers, 
carriers, and intermediaries have copies of the Medicare Coverage 
Issues Manual, which identifies many of those medical items, services, 
technologies, or treatment procedures that can be paid for under 
Medicare. On August 21, 1989, we published a notice in the Federal 
Register (54 FR 34555) that contained all the Medicare coverage 
decisions issued in that manual.
    In that notice, we indicated that revisions to the Coverage Issues 
Manual will be published at least quarterly in the Federal Register. We 
also sometimes issue proposed or final national coverage decision 
changes in separate Federal Register notices. Readers should find this 
an easy way to identify both issuance changes to all our manuals and 
the text of changes to the Coverage Issues Manual.
    Revisions to the Coverage Issues Manual are not published on a 
regular basis but on an as-needed basis. We publish revisions as a 
result of technological changes, medical practice changes, responses to 
inquiries we receive seeking clarifications, or the resolution of 
coverage issues under Medicare. If no Coverage Issues Manual revisions 
were published during a particular quarter, our listing will reflect 
that fact.
    Not all revisions to the Coverage Issues Manual contain major 
changes. As with any instruction, sometimes minor clarifications or 
revisions are made within the text. This notice contains, as Addendum 
IV, reprinted manual revisions as transmitted to manual holders. The 
new text is shown in italics. We have not reprinted the table of 
contents, since the table of contents serves primarily as a finding aid 
for the user of the manual and does not identify items as covered or 
not.

III. How To Use the Addenda

    This notice is organized so that a reader may review the subjects 
of all manual issuances, memoranda, substantive and interpretive 
regulations, coverage decisions, or Food and Drug Administration-
approved investigational device exemptions published during the time 
frame to determine whether any are of particular interest. We expect it 
to be used in concert with previously published notices. Most notably, 
those unfamiliar with a description of our Medicare manuals may wish to 
review Table I of our first three notices (53 FR 21730, 53 FR 36891, 
and 53 FR 50577) and the notice published March 31, 1993 (58 FR 16837), 
and those desiring information on the Medicare Coverage Issues Manual 
may wish to review the August 21, 1989 publication (54 FR 34555).
    To aid the reader, we have organized and divided this current 
listing into six addenda. Addendum I identifies updates that changed 
the Coverage Issues Manual. We published notices in the Federal 
Register that included the text of changes to the Coverage Issues 
Manual. These updates, when added to material from the manual published 
on August 21, 1989 constitute a complete manual as of the end of the 
quarter covered by this notice. Parties interested in obtaining a copy 
of the manual and revisions should follow the instructions in section 
IV of this notice.
    Addendum II identifies previous Federal Register documents that 
contain a description of all previously published HCFA Medicare and 
Medicaid manuals and memoranda.
    Addendum III of this notice lists, for each of our manuals or 
Program Memoranda, a HCFA transmittal number unique to that instruction 
and its subject matter. A transmittal may consist of a single 
instruction or many. Often it is necessary to use information in a 
transmittal in conjunction with information currently in the manuals.
    Addendum IV sets forth the revisions to the Medicare Coverage 
Issues Manual that were published during the quarter covered by this 
notice. For the revisions, we give a brief synopsis of the revisions as 
they appear on the transmittal sheet, the manual section number, and 
the title of the section. We present a complete copy of the revised 
material, no matter how minor the revision, and identify the revisions 
by printing in italics the text that was changed. If the transmittal 
includes material unrelated to the revised section, for example, when 
the addition of revised material causes other sections to be 
repaginated, we do not reprint the unrelated material.
    Addendum V lists all substantive and interpretive Medicare and 
Medicaid regulations and general notices published in the Federal 
Register during the quarter covered by this notice. For each item, we 
list the date published, the Federal Register citation, the parts of 
the Code of Federal Regulations (CFR) that have changed (if 
applicable), the agency file code number, the title of the regulation, 
the ending date of the comment period (if applicable), and the 
effective date (if applicable).
    On September 19, 1995, we published a final rule (60 FR 48417) 
establishing in regulations that certain devices with an 
investigational device exemption approved by the Food and Drug 
Administration and certain services related to those devices may be 
covered under Medicare. That final rule states that we will announce in 
this quarterly notice all investigational device exemption 
categorizations, using the investigational device exemption numbers the 
Food and Drug Administration assigns. Addendum VI includes listings of 
the Food and Drug Administration-approved investigational device 
exemption numbers that have been approved during the quarter covered by 
this notice. The listings are organized according to the categories to 
which the device numbers are assigned (that is, Category A or Category 
B, and identified by the investigational device exemption number). 
Future notices will announce investigational device exemption 
categorizations and the numbers

[[Page 66678]]

assigned by the Food and Drug Administration for the quarter for which 
the notices cover.

IV. How To Obtain Listed Material

A. Manuals

    An individual or organization interested in routinely receiving any 
manual and revisions to it may purchase a subscription to that manual. 
Those wishing to subscribe should contact either the Government 
Printing Office (GPO) or the National Technical Information Service 
(NTIS) at the following addresses:

Superintendent of Documents, Government Printing Office, ATTN: New 
Order, P.O. Box 371954,
    Pittsburgh, PA 15250-7954, Telephone (202) 512-1800, Fax number 
(202) 512-2250 (for credit card orders); or
National Technical Information Service, Department of Commerce, 5825 
Port Royal Road, Springfield, VA 22161, Telephone (703) 487-4630.

    In addition, individual manual transmittals and Program Memoranda 
listed in this notice can be purchased from NTIS. Interested parties 
should identify the transmittal(s) they want. GPO or NTIS can give 
complete details on how to obtain the publications they sell.

B. Regulations and Notices

    Regulations and notices are published in the daily Federal 
Register. Interested individuals may purchase individual copies or 
subscribe to the Federal Register by contacting the GPO at the address 
given above. When ordering individual copies, it is necessary to cite 
either the date of publication or the volume number and page number.
    The Federal Register is also available on 24x microfiche and as an 
online database through GPO Access. The online database is updated by 6 
a.m. each day the Federal Register is published. The database includes 
both text and graphics from Volume 59, Number 1 (January 2, 1994) 
forward. Free public access is available on a Wide Area Information 
Server (WAIS) through the Internet and via asynchronous dial-in. 
Internet users can access the database by using the World Wide Web; the 
Superintendent of Documents home page address is http://
www.access.gpo.gov/su__docs/, by using local using localWAIS client 
software, or by telnet to swais.access.gpo.gov, then login as guest (no 
password required). Dial-in users should use communications software 
and modem to call (202) 512-1661; type swais, then login as guest (no 
password required).

C. Rulings

    We publish Rulings on an infrequent basis. Interested individuals 
can obtain copies from the nearest HCFA Regional Office or review them 
at the nearest regional depository library. We also sometimes publish 
Rulings in the Federal Register.

D. HCFA's Compact Disk-Read Only Memory (CD-ROM)

    Our laws, regulations, and manuals are also available on CD-ROM, 
which may be purchased from GPO or NTIS on a subscription or single 
copy basis. The Superintendent of Documents list ID is HCLRM, and the 
stock number is 717-139-00000-3. The following material is on the CD-
ROM disk:
     Titles XI, XVIII, and XIX of the Act.
     HCFA-related regulations.
     HCFA manuals and monthly revisions.
     HCFA program memoranda.

The titles of the Compilation of the Social Security Laws are current 
as of January 1, 1995. The remaining portions of CD-ROM are updated on 
a monthly basis.
    Because of complaints about the unreadability of the Appendices 
(Interpretive Guidelines) in the State Operations Manual (SOM), as of 
March 1995, we deleted these appendices from CD-ROM. We intend to re-
visit this issue in the near future, and, with the aid of newer 
technology, we may again be able to include the appendices on CD-ROM.
    Any cost report forms incorporated in the manuals are included on 
the CD-ROM disk as LOTUS files. LOTUS software is needed to view the 
reports once the files have been copied to a personal computer disk.

V. How to Review Listed Material

    Transmittals or Program Memoranda can be reviewed at a local 
Federal Depository Library (FDL). Under the FDL program, government 
publications are sent to approximately 1400 designated libraries 
throughout the United States. Interested parties may examine the 
documents at any one of the FDLs. Some may have arrangements to 
transfer material to a local library not designated as an FDL. To 
locate the nearest FDL, contact any library.
    In addition, individuals may contact regional depository libraries, 
which receive and retain at least one copy of most Federal government 
publications, either in printed or microfilm form, for use by the 
general public. These libraries provide reference services and 
interlibrary loans; however, they are not sales outlets. Individuals 
may obtain information about the location of the nearest regional 
depository library from any library. Superintendent of Documents 
numbers for each HCFA publication are shown in Addendum III, along with 
the HCFA publication and transmittal numbers. To help FDLs locate the 
instruction, use the Superintendent of Documents number, plus the HCFA 
transmittal number. For example, to find the Intermediary Manual, Part 
1--Fiscal Administration (HCFA-Pub. 13-1) transmittal entitled 
``Electronic Funds Transfer,'' use the Superintendent of Documents No. 
HE 22.8/6-3 and the HCFA transmittal number 126.

VI. General Information

    It is possible that an interested party may have a specific 
information need and not be able to determine from the listed 
information whether the issuance or regulation would fulfill that need. 
Consequently, we are providing information contact persons to answer 
general questions concerning these items. Copies are not available 
through the contact persons. Copies can be purchased or reviewed as 
noted above.
    Questions concerning Medicare items in Addendum III may be 
addressed to Bridget Wilhite, Bureau of Program Operations, Issuances 
Staff, Health Care Financing Administration, S3-01-27, 7500 Security 
Blvd., Baltimore, MD 21244-1850, Telephone (410) 786-5248.
    Questions concerning Medicaid items in Addendum III may be 
addressed to Pat Prete, Medicaid Bureau, Office of Medicaid Policy, 
Health Care Financing Administration, C4-25-02, 7500 Security 
Boulevard, Baltimore, MD 21244-1850, Telephone (410) 786-3246.
    Questions concerning Food and Drug Administration-approved 
investigational device exemptions may be addressed to Sharon Hippler, 
Bureau of Policy Development, Office of Chronic Care and Insurance 
Policy, Health Care Financing Administration, C4-11-04, 7500 Security 
Blvd., Baltimore, MD 21244-1850, Telephone (410) 786-4633.
    Questions concerning all other information may be addressed to 
Cathy Johnson, Bureau of Policy Development, Office of Regulations, 
Health Care Financing Administration, C5-09-05, 7500 Security Blvd., 
Baltimore, MD 21244-1850, Telephone (410) 786-5241.

(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance, Program No. 93.774, Medicare--
Supplementary Medical Insurance Program, and Program No. 93.714, 
Medical Assistance Program)


[[Page 66679]]


    Dated: December 3, 1996.
Gary Kavanagh,
Acting Director, Bureau of Program Operations.

Addendum I

    This addendum lists the publication dates of the most recent 
quarterly listing of program issuances and coverage decision updates to 
the Coverage Issues Manual. In addition, for a complete listing of the 
prior quarterly updates to the Coverage Issues Manual please refer to 
the January 3, 1995 update (60 FR 132).

July 26, 1995 (60 FR 38344)
November 15, 1995 (60 FR 57435)
April 8, 1996 (61 FR 154)
June 26, 1996 (61 FR 33119)

Addendum II--Description of Manuals, Memoranda, and HCFA Rulings

    An extensive descriptive listing of Medicare manuals and memoranda 
was published on June 9, 1988, at 53 FR 21730 and supplemented on 
September 22, 1988, at 53 FR 36891 and December 16, 1988, at 53 FR 
50577. Also, a complete description of the Medicare Coverage Issues 
Manual was published on August 21, 1989, at 54 FR 34555. A brief 
description of the various Medicaid manuals and memoranda that we 
maintain was published on October 16, 1992, at 57 FR 47468.

        Addendum III.--Medicare and Medicaid Manual Instructions        
                        [April through June 1996]                       
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    Trans. No.                     Manual/Subject/Publication No.       
------------------------------------------------------------------------
                           Intermediary Manual                          
             Part 1--Fiscal Administration (HCFA Pub. 13-1)             
              (Superintendent of Documents No. HE 22.8/6-3)             
------------------------------------------------------------------------
126                  Effective for services performed on or after August 1, 
1978, for the treatment of leukemia, leukemia in remission (ICD-9-CM 
codes 204.00 through 208.91), or aplastic anemia (ICD-9-CM codes 284.0 
through 284.9) when it is reasonable and necessary; and
     Effective for services performed on or after June 3, 1985, 
for the treatment of severe combined immunodeficiency disease (SCID) 
(ICD-9-CM code 279.2), and for the treatment of Wiskott-Aldrich 
syndrome (ICD-9-CM 279.12).
    2. Noncovered Conditions.--Effective May 24, 1996, allogeneic stem 
cell

[[Page 66684]]

transplantation is not covered as treatment for multiple myeloma (ICD-
9-CM codes 203.0 and 238.6).
    B. Autologous Stem Cell Transplantation (Effective for Services 
Performed on or After 04/28/89).--Autologous stem cell transplantation 
(ICD-9-CM procedure code 41.01 or 41.04) is a technique for restoring 
stem cells using the patient's own previously stored cells.
    1. Covered Conditions.--Autologous stem cell transplantation (ICD-
9-CM code 41.01, CPT-4 code 38241) is considered reasonable and 
necessary under Sec. 1862(a)(1)(A) of the Act for the following 
conditions and is covered under Medicare for patients with:
     Acute leukemia in remission (ICD-9-CM codes 204.01, 
lymphoid; 205.01, myeloid; 206.01, monocytic; 207.01, acute erythremia 
and erythroleukemia; and 208.01, unspecified cell type) who have a high 
probability of relapse and who have no human leucocyte antigens (HLA)-
matched;
     Resistant non-Hodgkin's lymphomas (ICD-9-CM codes 200.00-
200.08, 200.10-200.18, 200.20-200.28, 200.80-200.88, 202.00-202.08, 
202.80-202.88, and 202.90-202.98) or those presenting with poor 
prognostic features following an initial response;
     Recurrent or refractory neuroblastoma (see ICD-9-CM 
Neoplasm by site, malignant); or
     Advanced Hodgkin's disease (ICD-9-CM codes 201.00-201.98) 
who have failed conventional therapy and have no HLA-matched donor.
    2. Noncovered Conditions.--Insufficient data exist to establish 
definite conclusions regarding the efficacy of autologous stem cell 
transplantation for the following conditions:
     Acute leukemia not in remission (ICD-9-CM codes 204.00, 
205.00, 206.00, 207.00 and 208.00);
     Chronic granulocytic leukemia (ICD-9-CM codes 205.10 and 
205.11);
     Solid tumors (other than neuroblastoma) (ICD-9-CM codes 
140.0-199.1); or
     Effective May 24, 1996, multiple myeloma (ICD-9-CM code 
203.0 and 238.6).
    In these cases, autologous stem cell transplantation is not 
considered reasonable and necessary within the meaning of 
Sec. 1862(a)(1)(A) of the Act and is not covered under Medicare.
    Transmittal No. 85; section 35-48, CHANGED IMPLEMENTING 
INSTRUCTIONS--EFFECTIVE DATE: SERVICES PERFORMED ON OR AFTER 07/01/96.
    SECTION 35-48, OSTEOGENIC STIMULATION, is revised to expand 
coverage of this procedure and provide additional clarification. The 
following changes have been made.
     Coverage of osteogenic stimulation, used noninvasively or 
invasively, is expanded to include its use as an adjunct to spinal 
fusion surgery for certain patients; and
     Clarification is provided when noninvasive osteogenic 
stimulation is indicated after failed fusion.
35-48 OSTEOGENIC STIMULATION (Effective for services performed on and 
after September 15, 1980.)
    Electrical stimulation to augment bone repair can be attained 
either invasively or noninvasively. Invasive devices provide electrical 
stimulation directly at the fracture site either through percutaneously 
placed cathodes or by implantation of a coiled cathode wire into the 
fracture site. The power pack for the latter device is implanted into 
soft tissue near the fracture site and subcutaneously connected to the 
cathode, creating a self-contained system with no external components. 
The power supply for the former device is externally placed and the 
leads connected to the inserted cathodes. With the noninvasive device, 
opposing pads, wired to an external power supply, are placed over the 
cast. An electromagnetic field is created between the pads at the 
fracture site.
    Noninvasive Stimulator.--The noninvasive stimulator device is 
covered only for the following indications:
     Nonunion of long bone fractures;
     Failed fusion, where a minimum of nine months has elapsed 
since the last surgery;
     Congenital pseudarthroses; and
     As an adjunct to spinal fusion surgery for patients at 
high risk of pseudarthrosis due to previously failed spinal fusion at 
the same site or for those undergoing multiple level fusion. A multiple 
level fusion involves 3 or more vertebrae (e.g., L3-L5, L4-S1, etc).
    Invasive (Implantable) Stimulator.--The invasive stimulator device 
is covered only for the following indications:
     Nonunion of long bone fractures;
     As an adjunct to spinal fusion surgery for patients at 
high risk of pseudarthrosis due to previously failed spinal fusion at 
the same site or for those undergoing multiple level fusion. A multiple 
level fusion involves 3 or more vertebrae (e.g., L3-L5, L4-S1, etc).
    Nonunion, for all types of devices, is considered to exist only 
after six or more months have elapsed without healing of the fracture.
    Transmittal No. 86; section 60-14, NEW IMPLEMENTING INSTRUCTIONS--
EFFECTIVE DATE: Services Beginning on or after September 1, 1996.
    Section 60-14, Infusion Pumps, is revised to exclude coverage of 
vancomycin used with an external infusion pump. There is insufficient 
evidence to support the necessity of using an external infusion pump, 
instead of a disposable elastomeric pump or the gravity drip method, to 
administer vancomycin in a safe and appropriate manner.
    DISCLAIMER: The revision date and transmittal number only apply to 
the italicized material. All other material was previously published in 
the manual and is only being reprinted.
60-14 INFUSION PUMPS
    THE FOLLOWING INDICATIONS FOR TREATMENT USING INFUSION PUMPS ARE 
COVERED UNDER MEDICARE:
    A. External Infusion Pumps.--
    1. Iron Poisoning (Effective for Services Performed On or After 9/
26/84).--When used in the administration of deferoxamine for the 
treatment of acute iron poisoning and iron overload, only external 
infusion pumps are covered.
    2. Thromboembolic Disease (Effective for Services Performed On or 
After 9/26/84).--When used in the administration of heparin for the 
treatment of thromboembolic disease and/or pulmonary embolism, only 
external infusion pumps used in an institutional setting are covered.
    3. Chemotherapy for Liver Cancer (Effective for Services Performed 
On or After 1/29/85).--The external chemotherapy infusion pump is 
covered when used in the treatment of primary hepatocellular carcinoma 
or colorectal cancer where this disease is unresectable or where the 
patient refuses surgical excision of the tumor.
    4. Morphine for Intractable Cancer Pain (Effective for Services 
Performed On or After 4/22/85).--Morphine infusion via an external 
infusion pump is covered when used in the treatment of intractable pain 
caused by cancer (in either an inpatient or outpatient setting, 
including a hospice). Other uses of external infusion pumps are covered 
if the contractor's medical staff verifies the appropriateness of the 
therapy and of the prescribed pump for the individual patient.

    Note: Payment may also be made for drugs necessary for the 
effective use of an external infusion pump as long as the drug being 
used with the pump is itself reasonable and necessary for the 
patient's treatment.

    B. Implantable Infusion Pumps.--

[[Page 66685]]

    1. Chemotherapy for Liver Cancer (Effective for Services Performed 
On or After 9/26/84).--The implantable infusion pump is covered for 
intra-arterial infusion of 5-FUdR for the treatment of liver cancer for 
patients with primary hepatocellular carcinoma or Duke's Class D 
colorectal cancer, in whom the metastases are limited to the liver, and 
where (1) the disease is unresectable or (2) where the patient refuses 
surgical excision of the tumor.
    2. Anti-Spasmodic Drugs for Severe Spasticity.--An implantable 
infusion pump is covered when used to administer anti-spasmodic drugs 
intrathecally (e.g., baclofen) to treat chronic intractable spasticity 
in patients who have proven unresponsive to less invasive medical 
therapy as determined by the following criteria:
     As indicated by at least a 6-week trial, the patient 
cannot be maintained on noninvasive methods of spasm control, such as 
oral anti-spasmodic drugs, either because these methods fail to control 
adequately the spasticity or produce intolerable side effects, and
     Prior to pump implantation, the patient must have 
responded favorably to a trial intrathecal dose of the anti-spasmodic 
drug.
    3. Opioid Drugs for Treatment of Chronic Intractable Pain.--An 
implantable infusion pump is covered when used to administer opioid 
drugs (e.g., morphine) intrathecally or epidurally for treatment of 
severe chronic intractable pain of malignant or nonmalignant origin in 
patients who have a life expectancy of at least 3 months and who have 
proven unresponsive to less invasive medical therapy as determined by 
the following criteria:
     The patient's history must indicate that he/she would not 
respond adequately to non-invasive methods of pain control, such as 
systemic opioids (including attempts to eliminate physical and 
behavioral abnormalities which may cause an exaggerated reaction to 
pain); and
     A preliminary trial of intraspinal opioid drug 
administration must be undertaken with a temporary intrathecal/epidural 
catheter to substantiate adequately acceptable pain relief and degree 
of side effects (including effects on the activities of daily living) 
and patient acceptance.
    4. Coverage of Other Uses of Implanted Infusion Pumps.--
Determinations may be made on coverage of other uses of implanted 
infusion pumps if the contractor's medical staff verifies that:
     The drug is reasonable and necessary for the treatment of 
the individual patient;
     It is medically necessary that the drug be administered by 
an implanted infusion pump; and
     The FDA approved labeling for the pump must specify that 
the drug being administered and the purpose for which it is 
administered is an indicated use for the pump.
    5. Implantation of Infusion Pump Is Contraindicated.--The 
implantation of an infusion pump is contraindicated in the following 
patients:
     Patients with a known allergy or hypersensitivity to the 
drug being used (e.g., oral baclofen, morphine, etc.);
     Patients who have an infection;
     Patients whose body size is insufficient to support the 
weight and bulk of the device; and
     Patients with other implanted programmable devices since 
crosstalk between devices may inadvertently change the prescription.

    Note: Payment may also be made for drugs necessary for the 
effective use of an implantable infusion pump as long as the drug 
being used with the pump is itself reasonable and necessary for the 
patient's treatment.

    THE FOLLOWING INDICATIONS FOR TREATMENT USING INFUSION PUMPS ARE 
NOT COVERED UNDER MEDICARE:
    A. External Infusion Pumps.--
    1. Diabetes (Effective for Services Performed On or After 1/29/
85).--The use of an external infusion pump for the subcutaneous 
infusion of insulin in the treatment of diabetes is not covered.
    2. Vancomycin (Effective for Services Beginning On or After 
September 1, 1996).--Medicare coverage of vancomycin as a durable 
medical equipment infusion pump benefit is not covered. There is 
insufficient evidence to support the necessity of using an external 
infusion pump, instead of a disposable elastomeric pump or the gravity 
drip method, to administer vancomycin in a safe and appropriate manner.
    B. Implantable Infusion Pump.--
    1. Thromboembolic Disease (Effective for Services Performed On or 
After 9/26/84).--According to the Public Health Service, there is 
insufficient published clinical data to support the safety and 
effectiveness of the heparin implantable pump. Therefore, the use of an 
implantable infusion pump for infusion of heparin in the treatment of 
recurrent thromboembolic disease is not covered.
    Transmittal No. 87; Section 35-53, CHANGED POLICY INSTRUCTIONS--
EFFECTIVE DATE: For services performed on or after July 15, 1996.
    Section 35-53, Adult Liver Transplantation, has been revised to 
expand Medicare coverage of liver transplantation to include all end 
stage liver disease diagnoses expect for hepatitis B or malignancies.
    DISCLAIMER: The revision date and transmittal number only apply to 
the italicized material. All other material was previously published in 
the manual and is only being reprinted.
    These instructions should be implemented within your current 
operating budget.
35-53  ADULT LIVER TRANSPLANTATION
    A. General.--Effective July 15, 1996, adult liver transplantation 
when performed on beneficiaries with end stage liver disease other than 
hepatitis B or malignancies is covered under Medicare when performed in 
a facility which is approved by HCFA as meeting institutional coverage 
criteria.
    Coverage of adult liver transplantation is effective as of the date 
of the facility's approval, but for applications received before July 
13, 1991, can be effective as early as March 8, 1990. (See Federal 
Register 56 FR 15006 dated April 12, 1991.)
    B. Follow-up Care.--Follow-up care or retransplantation (ICD-9-CM 
996.82, Complications of Transplanted Organ, Liver) required as a 
result of a covered liver transplant is covered, provided such services 
are otherwise reasonable and necessary. Follow-up care is also covered 
for patients who have been discharged from a hospital after receiving a 
noncovered liver transplant. Coverage for follow-up care is for items 
and services that are reasonable and necessary as determined by 
Medicare guidelines. (See Intermediary Manual Sec. 3101.14 and Carriers 
Manual Sec. 2300.1.)
    C. Immunosuppressive Drugs.--See Intermediary Manual Sec. 3660.8 
and Carriers Manual Secs. 2050.5, 4471, and 5249.

[[Page 66686]]



                       Addendum V.--Regulation Documents Published in the Federal Register                      
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                         FR Vol. 61                                                                 Regulation  
   Publication date         page                    CFR Part                     File code            title     
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04/03/96.............     14640-14658  405, 491..........................  BPD-728-F             Medicare       
                                                                                                  Program;      
                                                                                                  Payment for   
                                                                                                  Federally     
                                                                                                  Qualified     
                                                                                                  Health Center 
                                                                                                  Services.     
04/05/96.............           15266  ..................................  OPL-009-N             Medicare       
                                                                                                  Program; April
                                                                                                  22, 1996,     
                                                                                                  Meeting of the
                                                                                                  Practicing    
                                                                                                  Physicians    
                                                                                                  Advisory      
                                                                                                  Council.      
04/08/96.............     15491-15504  ..................................  BPO-136-N             Medicare and   
                                                                                                  Medicaid      
                                                                                                  Programs;     
                                                                                                  Quarterly     
                                                                                                  Listing of    
                                                                                                  Program       
                                                                                                  Issuances and 
                                                                                                  Coverage      
                                                                                                  Decisions;    
                                                                                                  Third Quarter 
                                                                                                  1995.         
04/22/96.............     17677-17682  413...............................  BPD-805-P             Medicare and   
                                                                                                  Medicaid      
                                                                                                  Programs; New 
                                                                                                  Payment       
                                                                                                  Methodology   
                                                                                                  for Routine   
                                                                                                  Extended Care 
                                                                                                  Services      
                                                                                                  Provided in A 
                                                                                                  Swing-Bed     
                                                                                                  Hospital.     
05/02/96.............     19722-19760  405, 486..........................  BPD-646-FC            Medicare and   
                                                                                                  Medicaid      
                                                                                                  Programs;     
                                                                                                  Conditions of 
                                                                                                  Coverage for  
                                                                                                  Organ         
                                                                                                  Procurement   
                                                                                                  Organizations 
                                                                                                  (OPOs).       
05/03/96.............     19992-20067  ..................................  BPD-846-PN            Medicare       
                                                                                                  Program; Five-
                                                                                                  Year Review of
                                                                                                  Work Relative 
                                                                                                  Value Units   
                                                                                                  Under the     
                                                                                                  Physician Fee 
                                                                                                  Schedule.     
05/09/96.............     21195-21198  ..................................  MB-098-N              Medicaid       
                                                                                                  Program;      
                                                                                                  Limitations on
                                                                                                  Aggregate     
                                                                                                  Payments to   
                                                                                                  Disproportiona
                                                                                                  te Share      
                                                                                                  Hospitals:    
                                                                                                  Federal Fiscal
                                                                                                  Year 1996.    
05/13/96.............     21969-21973  412...............................  BPD-856-FC            Medicare and   
                                                                                                  Medicaid      
                                                                                                  Program;      
                                                                                                  Criteria for a
                                                                                                  Rural Hospital
                                                                                                  To Be         
                                                                                                  Designated as 
                                                                                                  an Essential  
                                                                                                  Access        
                                                                                                  Community     
                                                                                                  Hospital      
                                                                                                  (EACH).       
05/14/96.............     24318-24319  ..................................  ORD-086-N             New and Pending
                                                                                                  Demonstration 
                                                                                                  Project       
                                                                                                  Proposals     
                                                                                                  Submitted     
                                                                                                  Pursuant to   
                                                                                                  Section       
                                                                                                  1115(a) of the
                                                                                                  Social        
                                                                                                  Security Act: 
                                                                                                  February and  
                                                                                                  March 1996    
05/17/96.............     24941-24946  ..................................  BPD-868-NC            Medicare and   
                                                                                                  Medicaid      
                                                                                                  Programs;     
                                                                                                  Announcement  
                                                                                                  of            
                                                                                                  Applications  
                                                                                                  From Hospitals
                                                                                                  Requesting    
                                                                                                  Waivers for   
                                                                                                  Organ         
                                                                                                  Procurement   
                                                                                                  Service Area. 
05/31/96.............     27444-27708  412, 413, and 489.................  BPD-847-P             Medicare       
                                                                                                  Program;      
                                                                                                  Changes to the
                                                                                                  Hospital      
                                                                                                  Inpatient     
                                                                                                  Prospective   
                                                                                                  Payment       
                                                                                                  Systems and   
                                                                                                  Fiscal Year   
                                                                                                  1997 Rates.   
05/31/96.............     27282-27288  417...............................  OMC-004-F             Health         
                                                                                                  Maintenance   
                                                                                                  Organizations:
                                                                                                  Employer      
                                                                                                  Contribution  
                                                                                                  to HMO        
06/10/96.............           29449  412, 413, and 489.................  BPD-847-CN            Medicare       
                                                                                                  Program;      
                                                                                                  Changes to the
                                                                                                  Hospital      
                                                                                                  Inpatient     
                                                                                                  Prospective   
                                                                                                  Payment       
                                                                                                  Systems and   
                                                                                                  Fiscal Year   
                                                                                                  1997 Rates;   
                                                                                                  Correction.   
06/10/96.............           29418  ..................................  MB-098-CN             Medicaid       
                                                                                                  Program;      
                                                                                                  Limitations on
                                                                                                  Aggregate     
                                                                                                  Payments to   
                                                                                                  Disproportiona
                                                                                                  te Share      
                                                                                                  Hospitals:    
                                                                                                  Federal Fiscal
                                                                                                  Year 1996;    
                                                                                                  Correction.   
06/10/96.............     29418-29421  ..................................  MB-098-N              Medicaid       
                                                                                                  Program;      
                                                                                                  Limitations on
                                                                                                  Aggregate     
                                                                                                  Payments to   
                                                                                                  Disproportiona
                                                                                                  te Share      
                                                                                                  Hospitals:    
                                                                                                  Federal Fiscal
                                                                                                  Year 1996.    
06/10/96.............     29409-29410  ..................................  ORD-087-N             New and Pending
                                                                                                  Demonstration 
                                                                                                  Project       
                                                                                                  Proposals     
                                                                                                  Submitted     
                                                                                                  Pursuant to   
                                                                                                  Section       
                                                                                                  1115(a) of the
                                                                                                  Social        
                                                                                                  Security Act: 
                                                                                                  April 1996    
06/13/96.............     30072-30075  ..................................  HSQ-231-N             Medicare,      
                                                                                                  Medicaid, and 
                                                                                                  CLIA Programs;
                                                                                                  Clinical      
                                                                                                  Laboratory    
                                                                                                  Improvement   
                                                                                                  Amendments of 
                                                                                                  1988 Exemption
                                                                                                  of            
                                                                                                  Laboratories  
                                                                                                  in the State  
                                                                                                  of Oregon.    
06/24/96.............     32347-32351  405, 417, 431, 473, and 498.......  BPD-704-FC            Medicare and   
                                                                                                  Medicaid      
                                                                                                  Programs;     
                                                                                                  Provider      
                                                                                                  Appeals:      
                                                                                                  Technical     
                                                                                                  Amendments.   
06/26/96.............           33129  ..................................  BPD-873-N             Medicare       
                                                                                                  Program;      
                                                                                                  Announcement  
                                                                                                  of            
                                                                                                  Collaborative 
                                                                                                  Efforts With  
                                                                                                  the National  
                                                                                                  Institutes of 
                                                                                                  Health to     
                                                                                                  Study the     
                                                                                                  Effectiveness 
                                                                                                  of Lung Volume
                                                                                                  Reduction     
                                                                                                  Surgery.      
06/26/96.............     33119-33129  ..................................  BPO-137-N             Medicare and   
                                                                                                  Medicaid      
                                                                                                  Program;      
                                                                                                  Quarterly     
                                                                                                  Listing of    
                                                                                                  Program       
                                                                                                  Issuances and 
                                                                                                  Coverage      
                                                                                                  Decisions-    
                                                                                                  Fourth Quarter
                                                                                                  1995.         
06/27/96.............           33532  ..................................  OPL-010-N             Medicare       
                                                                                                  Program; July 
                                                                                                  22, 1996      
                                                                                                  Meeting of the
                                                                                                  Practicing    
                                                                                                  Physicians    
                                                                                                  Advisory      
                                                                                                  Council.      
06/27/96.............     33531-33532  ..................................  ORD-088-N             New and Pending
                                                                                                  Demonstration 
                                                                                                  Project       
                                                                                                  Proposals     
                                                                                                  Submitted     
                                                                                                  Pursuant to   
                                                                                                  Section       
                                                                                                  1115(a) of the
                                                                                                  Social        
                                                                                                  Security Act: 
                                                                                                  May 1996.     
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Addendum VI--Categorization of Food and Drug Administration-Approved 
Investigational Device Exemptions

    Under the Food, Drug, and Cosmetic Act (21 U.S.C. 360c), devices 
fall into one of three classes:
    Class I--Devices for which the general controls of the Food, Drug, 
and Cosmetic Act, such as adherence to good manufacturing practice 
regulations, are sufficient to provide a reasonable assurance of safety 
and effectiveness.
    Class II--Devices that, in addition to general controls, require 
special controls, such as performance standards or postmarket 
surveillance, to provide a reasonable assurance of safety and 
effectiveness.
    Class III--Devices that cannot be classified into Class I or Class 
II because insufficient information exists to determine that either 
special or general controls would provide reasonable assurance of 
safety and effectiveness.

[[Page 66687]]

Class III devices require premarket approval.
    Under the new categorization process to assist HCFA, the Food and 
Drug Administration assigns each device with a Food and Drug 
Administration-approved investigational device exemption to one of two 
categories: Experimental/Investigational (Category A) Devices, or Non-
Experimental/Investigational (Category B) Devices. Under this 
categorization process, an experimental/investigational (Category A) 
device is an innovative device in Class III for which ``absolute risk'' 
of the device type has not been established (that is, initial questions 
of safety and effectiveness have not been resolved and the Food and 
Drug Administration is unsure whether the device type can be safe and 
effective). A non-experimental/investigational (Category B) device is a 
device believed to be in Class I or Class II, or a device believed to 
be in Class III for which the incremental risk is the primary risk in 
question (that is, underlying questions of safety and effectiveness of 
that device type have been resolved), or it is known that the device 
type can be safe and effective because, for example, other 
manufacturers have obtained Food and Drug Administration approval for 
that device type. The criteria the Food and Drug Administration uses to 
categorize an investigational device under Category B include the 
following:
    (1) Devices, regardless of the classification, under investigation 
to establish substantial equivalence to a predicate device, that is, to 
establish substantial equivalence to a previously/currently legally 
marketed device.
    (2) Class III devices whose technological characteristics and 
indication for use are comparable to a Pre-Market Approval (PMA)-
approved device.
    (3) Class III devices with technological advances compared to a 
PMA-approved device, that is, a device with technological changes that 
represent advances to a device that has already received PMA-approval 
(generational changes).
    (4) Class III devices that are comparable to a PMA-approved device 
but are under investigation for a new indication for use. For purposes 
of studying the new indication, no significant modifications to the 
device were required.
    (5) Pre-amendments Class III devices that become the subject of an 
investigational device exemption after the Food and Drug Administration 
requires premarket approval, that is, no PMA application was submitted 
or the PMA application was denied.
    (6) Nonsignificant risk device investigations for which the Food 
and Drug Administration required the submission of an investigational 
device exemption. The following information presents the device number, 
category (in this case, A), and criterion code.

G950158 A1
G950168 A2
G950175 A2
G960060 A1
G960066 A2
G960074 A2
G960078 A1
G960101 A2
G960113 A2

    The following information presents the device number, category (in 
this case, B), and criterion code.

G950194 B1
G950210 B1
G950218 B1
G960003 B4
G960021 B2
G960040 B4
G960041 B4
G960043 B1
G960046 B1
G960048 B3
G960052 B2
G960054 B3
G950056 B5
G960057 B2
G960059 B2
G960062 B2
G950100 B1
G950224 B3
G960047 B3
G960064 B2
G960067 B4
G960068 B4
G960069 B4
G960071 B2
G960076 B4
G960083 B3
G960084 B4
G960085 B1
G960086 B1
G960087 B3
G960088 B4
G960090 B1
G960091 B1
G960094 B1
G960095 B1
G960097 B1
G950205 B3
G960044 B3
G960045 B4
G960099 B1
G960100 B1
G960102 B1
G960103 B1
G950104 B1
G960105 B1
G960108 B3
G960109 B3
G960111 B2
G960112 B4
G960134 B4

    Note: Some investigational devices may exhibit unique 
characteristics or raise safety concerns that make additional 
consideration necessary. For these devices, HCFA and the Food and 
Drug Administration will agree on the additional criteria to be 
used. The Food and Drug Administration will use these criteria to 
assign the device(s) to a category. As experience is gained in the 
categorization process, this addendum may be modified.

[FR Doc. 96-32016 Filed 12-17-96; 8:45 am]
BILLING CODE 4120-01-P