Healthcare Payment Methods

Questions and Answers

What is a Medicare Participating Provider allowed to do with the fee schedule?

Accept Medicare's fee schedule as payment in full (correct)

Charge higher fees than non-participating providers

Refuse to bill Medicare for services

Charge patients directly for all services

What is the primary disadvantage for Non-Participating Providers?

They cannot set their own fees

They are burdened with additional administrative work (correct)

They cannot accept Medicare patients

They receive lower reimbursement rates

What can Non-Participating Providers charge above Medicare's approved amount?

Up to 30% more than the amount approved

The full billed amount without restrictions

No additional charges are allowed

Up to 15% more than Medicare's approved amount (correct)

What is the 'Limiting Charge' in Medicare reimbursement?

The maximum amount a non-participating provider can charge for covered services Signup and view all the answers

How is the 20% coinsurance for a Participating Provider calculated?

Based on the approved Medicare amount Signup and view all the answers

What happens to amounts billed above the limiting charge for covered services?

Patients are responsible for amounts above the limiting charge Signup and view all the answers

How much does a Non-Participating Provider charge a patient beyond Medicare's covered amount for a 92004 procedure?

$19.45 Signup and view all the answers

What percentage of the reimbursement amount does Medicare pay to Non-Participating Providers?

80 Signup and view all the answers

What is the primary function of the Limiting Charge for Non-Participating Providers?

To restrict the amount a provider can charge above Medicare's approved amount Signup and view all the answers

If a Non-Participating Provider performs a 92004 procedure with a reimbursement of $129.65, what is the patient responsible for paying in total?

$149.10 Signup and view all the answers

Study Notes

Private-Pay Patients

Private-pay patients save practices time and costs related to benefit research, claims filing, reimbursement, and payment posting.
A prompt-pay discount can be offered, but it should not exceed a 20% reduction.
Discounts should also be available to insurers willing to pay immediately.

Insurance Payments and Reimbursement

Creating an Excel chart of common CPT codes and their payments from various payers is beneficial for periodic evaluation.
Accepting an insurance plan means agreeing to its payment terms and fee schedule.
In the U.S., there are twelve regional Medicare Administrative Contractors (MACs) with varying fee schedules by region.
The Federal CMS Physician Fee Schedule lookup tool is essential for researching reimbursements across different CPT codes and regions.

Fee Settings

Setting fees involves understanding practice overhead, financial demographics, and desired patient volume for income.
Fees should not be excessively high or low to avoid deterring patients or struggling to break even.
All patients should be charged the same fee per code, referred to as the “usual and customary fee.”
It is essential not to differentiate fees based on insurance status; a specific code must have a uniform charge.

Medicare Participation

Optometry offices are typically not classified as Medicare facilities, leading to the choice of non-facility fees for reimbursement.
Accepting Medicare requires adherence to its fee schedule, designating providers as either “Medicare Participating Providers” or “Non-Participating Providers.”
Participating Providers receive full reimbursement from Medicare, while Non-Participating Providers receive 95% and can bill patients for the excess up to a "limiting charge."

Limiting Charge

The Limiting Charge for Non-Participating Providers is 15% above what Medicare pays Participating Providers.
Patients are not accountable for any billed amounts exceeding the Limiting Charge for covered services.

Comparison of Provider Types

Example comparison between Doctor A (Participating Provider) and Doctor B (Non-Participating Provider) reveals differing reimbursements:
- Doctor A receives a higher payment with lower patient out-of-pocket costs.
- Doctor B has higher reimbursement but incurs administrative burdens and potential patient dissatisfaction due to additional charges not covered by Medicare.

Implications of Fee Selection

Setting excessively high fees can lead to patient backlash upon receiving their Explanation of Benefits (EOB), creating customer service challenges.
The example highlights that optimal fee setting should consider both operational sustainability and patient access to services.