OHFAMA has received numerous reports that Anthem is seeking repayment of previously paid commercial claims for foot orthotics, including claims dating back to 2024.
Anthem’s Orthopedic Footwear (CG-DME-20) policy generally limits coverage of orthopedic footwear, including inserts and other shoe modifications, for non-diabetic patients to situations where the item is part of a medically necessary leg brace and is necessary for the brace to function properly. While the policy has been in place for some time, members have raised concerns about recent retrospective recoupments, including situations where practices report that Anthem previously indicated the service was covered and/or that prior authorization was not required.
These developments highlight the importance of understanding the distinction between prior authorization and actual coverage, as well as verifying coverage requirements for specific orthotic devices.
Providers should be aware that, typically, obtaining prior authorization does not necessarily guarantee coverage or payment. Provider agreements commonly include language stating that authorization is not a guarantee of benefits or reimbursement.
For example, if a provider receives prior authorization for coverage of HCPCS code L3000[1], the insurer may interpret the authorization as applying to a device that is part of a multicomponent system, such as a leg brace, rather than as a standalone foot orthotic. If coverage is permitted when the item is furnished as part of an approved multicomponent system, the authorization may not extend to submitting L3000 when only a standalone foot orthotic is dispensed.
It is essential to review each insurer’s provider agreement and applicable medical policies to understand the specific conditions under which orthotic services are eligible for reimbursement.
Providers should verify whether HCPCS code L3000 is covered as a standalone foot orthotic or only when furnished as part of a more extensive device designed to provide support and/or control across the foot and ankle. This may apply to an AFO that includes individual components, not limited to L3000.
Anthem’s policy illustrates how coverage may depend on whether an orthotic item is billed independently or as part of a medically necessary brace. Similar distinctions may arise under Medicare coverage requirements. However, providers should verify the coverage policies of all commercial insurers rather than assume that all commercial insurers follow Medicare guidelines.
When an orthotic component is furnished as part of an AFO, coding and billing should accurately reflect the device provided and comply with the applicable payer’s coding, documentation, and coverage requirements.
The key question for providers is whether an individual commercial insurance plan follows coverage restrictions similar to Medicare or permits L3000 reimbursement as a standalone service.
OHFAMA strongly encourages providers to carefully review their provider agreements and each insurer’s orthotic coverage policies. Before providing services or submitting claims, providers should confirm whether L3000 is covered independently, whether it must be part of a qualifying extensive orthotic device, and what authorization, documentation, and billing requirements apply.
Taking these steps may help reduce the risk of unexpected denials, retrospective recoupments, and repayment demands.
In 2026, section 3901.388 of the Revised Code modified the timeframe for health insurers to recoup payments from healthcare providers. Specifically, it reduces the period during which payment is considered final from two years to one year after the payment is made. Additionally, it stipulates that a third-party payer must initiate the recovery of any overpayment within one year of the payment date, and it requires that providers be given an opportunity to appeal the determination of overpayment without incurring any fees.
In summary, SB 162, became effective October 7, and makes three key changes:
Please be mindful that providers should not assume that the revised one-year timeframe automatically applies retroactively to payments or recoupment requests predating the effective date. The application of the amended law to a particular claim or pending recoupment may depend on the relevant dates and circumstances and should be reviewed with legal counsel. Changes in law apply to the effective date and beyond and are not retroactive.
Providers receiving recoupment requests should continue to address them promptly and carefully. Do not ignore a notice or assume that a request is invalid solely because the original claim was paid more than one year ago.
If a practice receives an overpayment or recoupment request, the recommendation is to consult legal counsel and the practice’s billing team to evaluate the request and determine the appropriate response.
Review the payment date, the date the recovery process was initiated, the insurer’s stated basis for the overpayment, the applicable provider agreement, and any relevant appeal deadlines. Maintain copies of all notices and supporting documentation.
Understanding these requirements and responding within the applicable deadlines can help practices protect their rights and avoid unnecessary repayment disputes.
[1] HCPCS L3000 - Foot, insert, removable, molded to patient model, 'ucb' type, berkeley shell, each