Medicare Compliance & Reimbursement

Find out when physician referrals are and are not acceptable.

If you have been searching for an answer to the question of carrier payment rules, and are further baffled by discrepancies between the Centers for Medicare & Medicaid Services' Internet-only manuals and the Medicare Carriers Manual, take some solace in knowing the department is rooting out those problems.

On April 2, CMS sent out a notice which attempted to clarify carrier payment rules.

"These rules apply to tests which physicians are able to purchase from suppliers, e.g. codes that have both a technical component, which can be provided by suppliers and/or supplier personnel, and a professional component, or physician interpretation," explains Brett Baker, Senior Associate of Regulatory Affairs at the American College of Physicians.

So what's the final verdict? If a test is personally performed by a physician or is supervised by a physician, the physician may bill under the normal physician fee schedule rules.

This includes situations in which the test is performed or supervised by another physician with whom the billing physician shares a practice.

CMS recently added language to the Internet version that sets forth the various levels of physician supervision required for diagnostic tests, which can be found in Section 80, Chapter 15 of Pub. 100-02BP.

No special charge or payment constraints are imposed on tests performed by a physician or a technician under the physician's supervision. There are two requirements for all diagnostic tests. Namely, the test must be ordered by the treating practitioner, and the test must be supervised by a physician.

However, CMS looks askance at arrangements that allow physicians to profit from others' work or create a false appearance that the physician has performed or supervised technicians. Such arrangements sometimes involve cardiac scanning services and mobile ultrasound companies leasing their equipment to physicians for the day the equipment is used, then hiring out their staff to the physicians to meet the supervision requirement.

The bona fides of such arrangements may be suspect and could be an attempt to circumvent the prohibition against the mark-up on purchased diagnostic tests, CMS says.  If you have any doubt that a particular arrangement with a physician is a valid relationship, you should report it to the feds. The HHS Office of the Inspector General has responsibility for investigating violations of the act.