Pediatric Coding Alert

Bad news: 2007 fee schedule decreases circ, lumbar puncture total RVUs

The 2007 Physician Fee Schedule is all about highs and lows: You'll jump for joy over 99213's increased values ... and then weep over the payment cuts to 54150 and 62270.

Medicare has released its final rule on the new fee schedule and its changes, like those made to circumcision RVUs, that will impact you the most. "Most of your payers use the Medicare RBRVS physician fee schedule to determine your reimbursement rates," which is why it is important to monitor these fees even though your patients aren't Medicare patients, according to Physician's Computer Company's In the News article "Medicare Conversion Factor for 2006 Returned to 2005 Level."

Mixed bag: "On the positive side, [the new fee schedule] increases values for cognitive services like 99213 and 99214," says Chip Hart, director of Physician's Computer Company (PCC) Pediatric Solutions consulting group in Winooski, Vt. But to make that increase, the conversion factor was cut across the board and the relative value units (RVUs) for many procedures were reduced, he says. Here is the lowdown on the latest rates. 1. Calculate Fees With a New Conversion Factor To maintain mandated budget neutrality, the Centers for Medicare & Medicaid Services (CMS) cut the conversion factor (CF) by 5 percent. To find out approximately how much an insurer will pay for a code using the 2007 rate, you now need to multiple the code's total RVUs by 35.9848, instead of the 2006 CF of 37.8975. Tip: "You should encourage private payers not to adopt the 2007 conversion factor decrease, which is not directly relevant to the private sector," says Richard Tuck, MD, FAAP, a pediatrician at PrimeCare of Southeastern Ohio.

Don't overlook: When determining a code's payment rate, make sure to choose the total RVU that represents where the service is performed. Use the "transitional non-facility total" listed in column P of the national physician fee schedule to calculate the code's office payment. Look to column R or the "transitional facility total" for the hospital or facility value.

"The fully implemented RVUs [columns Q and S] will not become effective until 2010, so there is a five-year transitional period" that gradually phases in more significant increases and decreases, says Karen Walker, administrator at Pediatric Services of Florida in St. Petersburg.

2. Welcome More Cognitive Work Credit When analyzing Medicare fee schedule changes, remember that everyone eats from the same pie. Any way you slice a pie -- bigger pieces for some and smaller ones for others -- you still have the same allocation, says Barbara J. Cobuzzi, MBA, CPC, CPC-H, CPC-P, CHCC, president of CRN Healthcare Solutions, a coding and reimbursement consulting firm in Tinton Falls, N.J. [...]