Anesthesia Coding Alert

Anesthesia providers received encouraging news when CMS announced new conversion factors (CF) for the 2003 Physician Fee Schedule in the Feb. 28 Federal Register. Both the national CF and the anesthesia CF (ACF) increased from their 2002 levels and the initial factors planned for this year. The updated CFs went into effect March 1.

The national average Medicare conversion factor is $36.77, up from $36.1992 in 2002. The national average anesthesia conversion factor is $17.05, a big increase from $16.60 in 2002.

But remember that although the new ACF is $17.05, the actual amount can vary by practice location. Your area's cost of living, business expenses, insurance expenses and other variables combine to create these local ACFs.

For example, local ACFs in California range from $18.65 for San Francisco to $16.92 in some other areas of the state. Some states have local factors right at the national one (such as $17.06 in Arizona), while others are much less (such as $15.16 in South Dakota).

Although most anesthesiologists primarily base claims on the ACF, the national Medicare conversion factor is important, too. Carriers often reimburse pain management services such as diagnostic or therapeutic nerve blocks (codes 64400-64484) or trigger point injections (codes 20552-20553) based on the overall conversion factor since these are considered surgical-type procedures instead of anesthesia services.

Medicare reimbursed January and February 2003 services at the 2002 rate. Services after March 1 will be reimbursed based on the new CFs. So how should you handle claims for services provided in January or February that weren't filed before March 1?

By law, Medicare will pay claims for services rendered in January and February 2003 based on the 2002 Medicare Physician Fee Schedule. Medicare will reimburse claims processed after March 1 according to the new 2003 Medicare Physician Fee Schedule, which is 2.7 percent higher than the 2002 rates used for January and February services.

If you have claims for services rendered in January or February that don't make it through reimbursement channels until after March 1, you'll receive higher reimbursement than you should (because you'll be paid at the 2003 rate instead of 2002). CMS'computer system will be able to correctly handle these claims sometime in July. After these adjustments are made, Medicare will ask overpaid providers to refund the overpayment. Since benefits will be paid at the wrong rate, some co-insurance carriers or patients may also be due refunds at this point.

There are two ways to handle these cases and be prepared for reconciliation, says Scott Groudine, MD, an Albany, N.Y., anesthesiologist: