CFO Regulatory Compliance & Legal Framework 2 — Questions and Answers
Question 1: Under the FDA's regulatory framework, custom-fabricated orthoses are classified as which type of medical device?
- Class I exempt devices (Correct answer)
- Class II devices requiring 510(k) clearance
- Class III devices requiring PMA
- Unclassified investigational devices
Correct answer: Class I exempt devices
Most custom-fabricated orthoses are classified as Class I exempt devices under FDA regulations because they pose minimal risk.
Question 2: Which federal agency is primarily responsible for overseeing the billing and reimbursement practices of Medicare-participating orthotists?
- FDA
- CMS (Centers for Medicare & Medicaid Services) (Correct answer)
- OSHA
- The Joint Commission
Correct answer: CMS (Centers for Medicare & Medicaid Services)
CMS oversees Medicare and Medicaid reimbursement rules, including coverage policies and billing requirements for orthotists.
Question 3: A patient refuses to sign an Advance Beneficiary Notice (ABN) before receiving an orthosis that Medicare may not cover. What should the orthotist do?
- Provide the device and bill Medicare anyway
- Refuse to provide the device until the ABN is signed
- Document the refusal and inform the patient they may be responsible for full payment (Correct answer)
- Cancel the order and refer the patient elsewhere
Correct answer: Document the refusal and inform the patient they may be responsible for full payment
If a patient refuses to sign an ABN, the orthotist should document the refusal and notify the patient they bear financial responsibility if Medicare denies the claim.
Question 4: The National Supplier Clearinghouse (NSC) is responsible for which function related to orthotic practice?
- Credentialing orthotists for state licensure
- Enrolling DMEPOS suppliers in Medicare (Correct answer)
- Setting clinical standards for orthotic fabrication
- Auditing insurance fraud in private pay cases
Correct answer: Enrolling DMEPOS suppliers in Medicare
The NSC enrolls and monitors DMEPOS (Durable Medical Equipment, Prosthetics, Orthotics, and Supplies) suppliers participating in Medicare.
Question 5: Which law mandates that healthcare providers maintain the privacy of patient health information and sets standards for electronic transactions?
- The False Claims Act
- HIPAA (Health Insurance Portability and Accountability Act) (Correct answer)
- The Stark Law
- The Anti-Kickback Statute
Correct answer: HIPAA (Health Insurance Portability and Accountability Act)
HIPAA establishes national standards for protecting patient health information (PHI) and governs electronic healthcare transactions.
Question 6: Under DMEPOS supplier standards, an orthotics practice must maintain a physical location that is open to the public during normal business hours for a minimum of how many hours per week?
- 20 hours
- 30 hours (Correct answer)
- 40 hours
- 50 hours
Correct answer: 30 hours
CMS DMEPOS supplier standards require a physical location accessible to the public at least 30 hours per week.
Question 7: When an orthotist discovers a billing error that resulted in an overpayment from Medicare, what is the legal obligation under the Affordable Care Act?
- Report and return the overpayment within 60 days of identification (Correct answer)
- Apply the overpayment as a credit toward future claims
- Report the error only if the amount exceeds $1,000
- Notify Medicare at the next annual audit
Correct answer: Report and return the overpayment within 60 days of identification
The ACA's 60-day rule requires providers to report and return Medicare or Medicaid overpayments within 60 days of identification to avoid False Claims Act liability.
CFO Regulatory Compliance & Legal Framework 2
Under the FDA's regulatory framework, custom-fabricated orthoses are classified as which type of medical device?