The way Medicare fees are established is extremely complex. To determine the reimbursement amount for each procedure (or CPT code), a conversion factor is multiplied by the relative value units (RVUs) that have been assigned to that procedure, and then an adjustment is made based on the geographic location of the practice. The number of RVUs assigned to a procedure is based on three elelments: the work required for the procedure, the practice expense incurred for the procedure, and the cost of the provider's professional liability insurance.
To find current Medicare fees go to the site of your Medicare contractor.
Members may contact the APA's Practice Management HelpLine by phone 800.343.4671 or email hsf@psych.org with questions.
2012 Medicare Physician Fee Schedule
As Medicare providers are already well aware, this year’s fee schedule has been more confusing than usual. At the last minute in 2011, Congress extended the 2011 fee schedule for the first two months of 2012, averting the approximately 27% fee cut that was demanded by the sustainable growth rate (SGR) mandate. (The SGR mandated fee cut has been overridden by Congress every year for the past decade, which is why the percentage is currently so high.)
In February, when the 2012 budget was finally passed, although the 2011 Medicare fee schedule was by in large maintained, Congress failed to continue the 5% “bump” to psychotherapy services that had been in place since 2009. This additional 5% was a bonus outside the regular Medicare fee schedule that Congress approved for 2009 and that had been extended for two years . It only applied to the psychotherapy codes, and did not affect the fees paid for psychiatric evaluations (90801, 90802) or medication management (90862).
NOTE: Congress’s failure to continue the 5% bonus for March through December means that you will be seeing a 5% drop in the fees you receive when you bill one of the psychotherapy codes under Medicare.
2011 Medicare Fee Schedule
The Medicare Extender Act of 2010 stabilized Medicare physician payments at 2010 rates through the end of 2011.
In addition to providing a 12-month reprieve from the 25 percent Medicare physician payment cut that was scheduled to take effect on January 1, 2011, the law extended the 5% increase in payments for psychotherapy codes that first went into effect in 2008, and was retroactively reinstated for 2010 as part of the health reform legislation passed in March 2010.
Although the bill essentially extended the 2010 fee schedule, there may be some changes in fees allowed for specific procedures because of adjustments made tohe conversion factor, work values of the codes, etc.
It is vital to check your Medicare Contractor's website to be sure you have the correct 2011 fees.
You can find more information about this on the AMA site.