Reimbursement Roundup

Medicare+Choice payments announced

The majority of Medicare+Choice managed care plans will see their payment rates increase by 2% during fiscal year 2001, the minimum increase guaranteed by the Balanced Budget Act of 1997. Others will receive 3.3% hike, says the Health Care Financing Administration.

"Plans are getting paid more despite the fact that Medicare fee-for-service costs are coming down," said HCFA administrator Nancy-Ann DeParle. "If the Balanced Budget Act hadn’t eparated Medicare+Choice payments from fee-for-service costs, plans would be getting about $1.6 billion less."

Physician compliance guidelines coming

Two sets of rules that will affect physician practices will be coming out in the near future, insiders say. The Office of the Inspector General (OIG) will release its long-awaited compliance guidelines for individual and group physician practices sometime in May. The new guidance is intended for use by practitioners as a model for their compliance efforts. Practices that make a good faith effort to follow the guidelines will be given a unofficial benefit of the doubt should there be questions about their billing methods, note OIG officials.

Also, Department of Health and Human Services (HHS) officials have set the end of June as their target date to publish final rule setting standards for electronic reimbursement transactions, say HHS sources. The original statutory deadline for those rules was February 1998.

Feds loosen reins on nurse anesthetists

After a two-year debate, the Health Care Financing Administration has decided to remove the federal requirement that nurse anesthetists be supervised by physicians when administering anesthesia to Medicare patients. The final rule is expected to be published in the Federal Register in June.

Until now, for anesthesia cases involving Medicare patients, physicians had to supervise nurse anesthetists in order for hospitals and ambulatory surgical centers to be reimbursed for the nonanesthesia portion of a patient’s care. However, for the nurse anesthetists themselves to be reimbursed, Medicare did not require supervision.

Nurse anesthetists provide 65% of the 26 million anesthetics administered in the United States each year and are the sole anesthesia providers in more than 65% of rural hospitals, according to the American Association of Nurse Anesthetists.

Would they dare simplify Medicare?

One item buried in the proposed 2001 federal budget that physician practices are applauding would give the Health Care Financing Administration (HCFA) the internal administrative power to simplify the Medicare program.

Known as the Medicare Alternative Flexible Administrative Arrangements, the proposal would permit HCFA to negotiate administrative arrangements, including simplifying claims processing, reducing billing payment cycle time, and alternative claims and cost settlement processing.

"The use of these special administrative arrangements could be targeted to areas where there is market competition and discount arrangements are common," HCFA said in a statement.

However, there would be a price: In exchange, HCFA wants to tie simplification to reduced payments and price discounts from providers.

Outpatient rehabilitation payments questioned

More than half the Medicare payments made to outpatient rehabilitation facilities during a one-year period were questioned by a recent Office of the Inspector General (OIG) study of pay practices in six states.

The OIG found $173 million out of $263 million outpatient rehabilitation claims for the year ending June 30, 1998, were either "unallowable or highly questionable." One claim even included the cost of a Caribbean vacation, say investigators.

The six states surveyed — Florida, Louisiana, Michigan, New Jersey, Pennsylvania, and Texas — represent nearly half the $572 million that Medicare spends for rehabilitation services nationwide.

In response, the Health Care Financing Administration plans to intensify its medical reviews of rehabilitation claims, say agency officials.