ACR: Private payors use local Medicare fee schedules incorrectly

DRA affecting physician reimbursements with private payors. Source: Piper Report

The ACR has learned some of its members are having trouble developing appropriate contract payments with a number of private payors, as the private payors are utilizing local Medicare Physician Fee Schedules (MPFS) that include the budget neutral adjustments in the professional component and capped rates due to the Deficit Reduction Act (DRA) in the technical component. 

It was not, however, intended for managed care/private payor plans to include the adjustments in their fee schedules. Private payors should utilize the unadjusted fee schedules, which may be accessed here, according to the ACR.

In response to comments from providers who were concerned about the potential adverse affect of applying the budget neutrality adjustor to all physician work relative value units (RVUs), the 2007 Medicare Physician Fee Schedule Final Rule, published Dec. 1, 2006, states the following:

“We share the commenters’ concerns about transparency and recognize the Medicare PFS is used by other payors and for other purposes than just Medicare payments. To maintain a high level of transparency in the fee schedule, the Addendum B published in this rule will show the RVUs without the budget neutrality adjustment applied. This will serve as a reference for any interested party and should help to minimize any confusion about the unadjusted codes.”

Local Medicare contractors are not required by the Centers for Medicare & Medicaid Services (CMS) to post the unadjusted national MPFS on their websites, however, the ACR said it is working with its Carrier Advisory Committee and Managed Care Networks to accomplish this and is also making direct contact with private payors to correct the problem.

The ACR urges all members to bring the issue to the attention of group contracting representatives to ensure that appropriate reimbursements are received.