Certain physicians have been having to do some confusing extra math to figure out how much they can charge Medicare patients in 2012. They are physicians who:
- Are Medicare non-participating (non-PAR); AND
- Don’t accept Medicare assignment on claims (i.e., instead of filing claims for which Medicare pays them directly, they files claims for reimbursement that Medicare sends directly to the patient); AND
- Did not submit at least 10 e-prescribing Medicare claims by June 30, 2011, thereby becoming subject to a 1-percent penalty throughout 2012 on the amount Medicare will pay them.
For services rendered by non-PAR, non-assigned physicians, Medicare pays at 95 percent of the regular Medicare Physician Fee Schedule. The e-prescribing penalty is applied to this allowed amount. Medicare allows non-PAR, non-assigned physicians to charge patients 115 percent of the allowed amount — or, in this case, of the e-prescribing-penalty-adjusted allowed amount.
Here’s how it works. In this example, the original fee schedule amount is $100.
5% non-PAR status deduction: $100 x 5% = $5
1% e-prescribing penalty: $95 x 1% = $0.95
Adjustment total: $5.95
Allowed amount: $100-$5.95 = $94.05
Limiting charge allowed (amount physician may charge patient): $94.05 x 115% = $108.16
Amount Medicare will pay the beneficiary: $94.05 x 80% = $75.24
Patient’s out-of-pocket amount: 108.16-$75.24 = $32.92
Math to GetEasier in 2013
The calculation will get easier starting Jan. 7, 2013, when the penalty for not submitting enough Medicare e-prescribing claims (10 claims by June 30, 2012) goes up to 1.5 percent. Medicare has instructed its payers to post the limiting charge on their websites with the 1.5-percent reduction already calculated out. Non-PAR, non-assigned physicians who are subject to the penalty will only have to calculate the 5-percent non-PAR status deduction and apply the posted limiting charge to determine how much they can charge patients.
For details, see the Centers for Medicare & Medicaid Services’ MLN Matters No. MM7877 (PDF). Also, turn to the E-Prescribing page on the TMA website for information about e-prescribing basics as well as the incentive programs.
Posted Aug. 14, 2012
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