Medical Group Management Association
Join Now

Government Advocacy

The voice of medical practices in Washington

Engage with a team that advocates on your behalf and translates complex regulations into focused updates on the latest health issues from Washington.

Implants furnished by an ASC exception

Implants in an ambulatory surgical center (ASC) exception

42 CFR 411.355(f) provides an exception for implants furnished by an ASC, including, but not limited to, cochlear implants, intraocular lenses, and other implanted prosthetics, implanted prosthetic devices, and implanted DME that meet the following conditions:
  • The implant must be furnished by the referring physician or a member of the referring physician’s group practice in a Medicare-certified ASC;
  • The implant is implanted in the patient during a surgical procedure paid by Medicare to the ASC as an ASC procedure;
  • The arrangement for furnishing the implant does not violate the antikickback statute;
  • Billing and claims submission for the implants complies with all federal and state laws and regulations; and 
  • The exception does not apply to any financial relationships between the referring physician and any entity other than the ASC in which the implant is furnished to, and implanted in the patient.
This exception applies to both ownership and compensation arrangements under the Stark law. It enables physicians to make referrals for implantable DME and prosthetic devices, as long as such items are implanted in surgeries performed in ASCs.

Importantly, the exception only applies to ASCs in which the referring physician has a financial relationship (i.e.., an ownership/investment interest or a compensation arrangement). Moreover, it applies only to referrals for implants furnished in the ASC where the surgery occurs.

In commentary to a final rule, CMS noted it requires this exception because, in its absence, physicians could not make referrals to ASCs with which they held ownership/investment interests for surgical procedures involving implants, and therefore the procedures would move to a more costly setting (e.g., a hospital). CMS concluded that physician ownership in the entity would not subject the items to overuse. Further, prosthetic devices implanted in connection with ASC services are subject to payment limits equal to the lesser of the lower or actual charges or a fee schedule amount. This exception does not apply to implants made in any setting other than an ASC (such as a hospital), and all limits and requirements referenced above must also be met for the exception to apply.

CMS has clarified that this exception only applies when the ASC bills for the implantable device and when the implant is paid for as part of the ASC composite rate. When a physician bills for the implant, the billing needs to meet another exception to the Stark law, such as the exception for in-office ancillary services. This point was reiterated in the phase III final rule and in other guidance from
CMS which requires reimbursement for implants furnished in ASC to be reimbursed to the ASC and not to any third party, physician or group, including Sections 10.3-10.4, Pub. 100-4, Medicare Claims Processing Internet Only Manual, Chapter 14.

CMS also clarified that the exception applies solely to implanted prosthetics, implanted prosthetic devices and implanted durable medical equipment. This means, for example, that the exception cannot be used to allow for the implantation of radioactive brachytherapy seeds and for other items that do not meet one of the classifications referenced above.

Shopping Cart

Your cart is empty

Click here if your organization is tax exempt

A State Sales tax exempt certificate must be on file and taxable items cannot be ordered online. For immediate assistance during normal business hours of 7:00am to 5:00pm MT M-Th and 7:00 am to Noon MT on Friday, please call toll-free: 877-275-6462, ext. 1888



Use two letter code for US states
Use three letter code for country
Use two letter code for US states
Use three letter code for country
Use two letter code for US states
Use three letter code for country

Grand Total:
Saved credit card is required for opt-in to autorenew.

Questions? Contact the MGMA Service Center for assistance during checkout or review our return policy for more information.




Thank you for your purchase! If you purchased an event, you will be receiving a follow-up email from our Learning Management System regarding the product/event purchased and no further action is required.