Otolaryngology Coding Alert

Question: What is the conversion factor for 2008?

North Carolina Subscriber

Answer: 39.7924. The conversion factor for 2008 reflects a 0.5 percent increase from the 2007 rate of 37.8975. Congress passed the Medicare, Medicaid and SCHIP Extension Act of 2007 on Dec. 19, replacing the scheduled 10.1 percent Medicare pay cut for 2008 with the increase.

The catch: The law expires on June 30, so Medicare allowances for the remainder of 2008 are still up in the air. "We could be right back at square one this summer," says Cyndee Weston, executive director of the American Medical Billing Association in Sulphur, Okla.

With the possibility of cuts still looming, your practice should develop an action plan to cope with the shortfalls you could see mid-year -- and beyond if Congress doesn't step in for 2009 as well.

Option 1: Consider not participating with Medicare, either by becoming a non-par provider or by opting out of Medicare services all together and choosing to private contract with Medicare beneficiaries.

"The AMA recently cited a survey that found nearly 65 percent of its members would accept fewer new Medicare beneficiaries, and one-fourth of its members said they would stop seeing Medicare beneficiaries altogether," if the 10.1 percent cut goes though, Weston says.

Option 2: Make some cuts in your office to compensate for potentially lost revenue. Unfortunately your practice may need to make up its losses in other areas. "Sixty-seven percent said they would defer the purchase of information technology," Weston adds.

Option 3: Find new ways to add revenue. Participating in programs like the Physician Quality Reporting Initiative (PQRI) can help you supplement your current reimbursements.

Bottom line: Rejoice in the six-month fix, but don't lose sight of the bigger picture. Start preparing now to collect less from Medicare in July so you won't end up scrambling if a double-digit cut comes your way.