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In
a final rule released Nov. 1, 2007, the Centers for Medicare and
Medicaid Services (CMS) confirmed that effective Jan. 1, 2008, the Medicare
physician payment schedule conversion
factor will be
cut by 10.1 percent to $34.0682. Facing such a steep reduction in
payments, many physicians
may wish to review their Medicare participation options. Physicians
who wish to change their current Medicare participation or
non-participation status for 2008 must do so between Nov. 15 and Dec. 31, 2007.
Prior to that time, carriers are expected to provide each
physician in their area with a CD-ROM containing information about
the 2008 participation
sign-up and a "Medicare Participating Physician/Supplier
Agreement." Actual payment rates may or may not be included this year so
physicians will need to check the carrier web site or
request that the carrier mail payment rates to them at no charge.
CMS also publishes Medicare
Learning Network articles for physicians outlining changes that will
be in effect for the following year. To
help ensure that physicians are making informed decisions about
their contractual relationships with the Medicare program, the AMA has
developed the following brief overview
of the current
situation with respect to the Medicare payment update for2008 and
the various participation
options that are available to physicians. The
AMA is not advising or recommending any one of the three
options described in this document. The purpose of the document is to ensure that
physician decisions about
Medicare
participation are made with complete information about the available
options. Special considerations in the 2008 participation decision As
noted above, Medicare officials have announced that there will be a
payment cut of approximately 10 percent effective Jan. 1, 2008. The AMA
continues to lead an aggressive
campaign to pass legislation that would prevent the cut
and provide a positive update in 2008.
While we will
continue to press for congressional action, there is no guarantee
that Congress will act
before Jan. 1, 2008. We urge you to join us in this campaign. Our
grassroots action center is
located at: www.ama-assn.org/grassroots.
Should developments in Congress affect the participation
decision period for 2008, additional information will be provided at
this site. Once
finalized, Medicare participation and non-participation decisions
are binding for the entire
year. If the rates change due to congressional action
during the participation decision period, however, the
deadline may be extended further as was the case in 2006 and2007. ·
Directories of PAR physicians are provided to senior
citizen groups and individuals who request
them. ·
Carriers provide toll-free claims processing lines to PAR
physicians and process their claims more
quickly. Non-participation Medicare
approved amounts for services provided by non-PAR physicians
(including the 80 percent
from Medicare plus the 20 percent copayment) are set at 95 percent
of Medicare approved
amounts for PAR physicians, but non-PAR physicians can charge more
than the Medicare
approved amount. Limiting
charges for non-PAR physicians are set at 115 percent of the
Medicare approved amount for non-PAR physicians. However, because Medicare
approved amounts for non-PAR
physicians are 95 percent of the rates for PAR physicians,
the 15 percent limiting charge is
effectively only 9.25 percent above the PAR-approved
amounts for the services. With
a 10 percent cut about to be imposed, many physicians may consider
balance billing an extra 9 percent as one means of helping close the gap
between 2007 and 2008 payment amounts.
When considering whether to be non-PAR; however,
physicians should consider whether their total revenues from Medicare, including amounts the
program pays, patient co pays and balance billing, would exceed their total revenues as PAR
physicians, particularly in light of collection costs,
bad debts, and claims for which they do accept assignment. The 95
percent payment rate is not based on whether physicians accept assignment on
the claim, but whether they are PAR
physicians.
When non-PAR physicians accept assignment for their low-income or
other patients, their
Medicare approved amounts are 11
95 percent of the approved amounts paid to PAR physicians for the
same service. Non-PAR physicians would need to collect the full
limiting charge amount
roughly 35 percent of the time they provide a given service in order
for the revenues from the service to equal
those of PAR physicians for the same service. If they collect
the full limiting charge for more than 35 percent of the services
they provide, their Medicare
revenues will exceed those of PAR physicians. Assignment
acceptance, for either PAR or non-PAR physicians, also means that
the Medicare carrier pays the physician the 80 percent Medicare
payment. For unassigned claims, even though the physician is
required to submit the claim to Medicare, the program pays the
patient, and the physician
must then collect the entire amount for the service from the
patient. In
addition, the contract must state unambiguously that by signing the
private contract, the beneficiary: ·
gives
up all Medicare payment for services furnished by the "opt
out" physician; ·
agrees
not to bill Medicare or ask the physician to bill Medicare; ·
is
liable for all of the physician's charges, without any Medicare
balance billing limits; ·
acknowledges
that Medigap or any other supplemental insurance will not pay toward
the services;
and ·
acknowledges
that he or she has the right to receive services from physicians for
whom Medicare
coverage and payment would be available. To
opt out, a physician must file an affidavit that meets the above
criteria and is received by the carrier at least 30 days
before the first day of the next calendar quarter. There is a
90-day period after
the effective date of the first opt-out affidavit during which
physicians may revoke the
opt-out and return to Medicare as if they had never opted
out.
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