Calculate the Impact of MPPR

Cardiovascular and ophthalmology technical service providers will feel the penny pinch.

By Uma Nachiappan, CPC, CCS

Effective Jan. 1, 2013, the Centers for Medicare & Medicaid Services (CMS) expanded its Multiple Procedure Payment Reduction (MPPR) policy to cover diagnostic cardiovascular and ophthalmology procedures. Providers rendering the technical component (TC) of such services can expect lower payments and should know how these payments are calculated.
Will MPPR Affect Your Practice?
Payers apply the MPPR when the same provider renders two or more procedures for the same patient during the same encounter, with the assumption that pre- and post-procedure services will overlap, and therefore shouldn’t be reimbursed in full for each procedure. Per change request (CR) 7848 (which applies to all providers who are paid based on the Medicare Physician Fee Schedule (MPFS)), CMS has extended the concept of the MPPR to diagnostic cardiovascular and ophthalmology procedures.
Providers are now paid a reduced amount on additional TC services—or the TC of global services (the TC plus professional component (PC))—when multiple services are performed for the same patient:

• In the same session, on the same day of service;
• By the same physician or by multiple physicians in the same group practice (same group National Provider Identifier (NPI)); and
• For claims with dates of service on or after Jan. 1, 2013.

When multiple services meet the above criteria, the highest-valued TC reported would be allowed at 100 percent of the fee schedule amount. Subsequent procedures would be paid at reduced rates, as shown in Table A:
Table A: The effects of the MPPR policy on payments

Identify Services Subject to MPPR
You can identify specific services covered under MPPR using the “multiple procedure” column of the National Physician Fee Schedule Relative Value file. Diagnostic cardiovascular services subject to the MPPR are identified with a “6,” while diagnostic ophthalmology services subject to the MPPR are identified with a “7.” Such services are categorized as:

• Global services: codes for which both PC and TC may be submitted
• The TC of diagnostic cardiovascular and ophthalmology services
• The PC of diagnostic cardiovascular and ophthalmology services
• Standalone, TC-only codes (PC/TC indicator 3 in the physician relative value unit (RVU) file)
• Global-only codes: standalone codes for which there are associated codes that describe the PC of the test only and TC of the test only (PC/TC indicator 4 in the physician RVU file)

To determine which of the reported services qualifies as the “highest valued,” follow Table B.
Table B: Determine the highest-valued service

Examples Show the Way
The examples that follow illustrate how payments are made for each of these types of service.
Example 1: Global Services
Steps for arriving at the final allowable amounts shown in Table C:

 
 
 
 
Step 1: In Table D, notice that all of the codes have an indicator 6. This means they are subject to MPPR for diagnostic cardiovascular services.

Step 2: Identify the technical and professional code rates for the billed global codes.
Step 3: Order the TC of the billed services based on their allowable amount in the fee schedule and identify the primary and subsequent
procedures (see Table E).

Step 4: Calculate the primary procedure allowable. The PC and TC portion is allowed at 100 percent (see Table F).

Step 5: Calculate the allowable for subsequent procedures. The PC portion is at 100 percent and the TC portion is at 75 percent (see Table G).

Example 2: TC of Diagnostic Cardiovascular and Ophthalmology
Steps for arriving at the final allowable amount shown in Table H:

Step 1: All of the codes have an indicator of 7, which means they are subject to MPPR – diagnostic ophthalmology services.
Step 2: Identify the rates for the billed services, as shown in Table I.

Step 3: Order the billed services based on their allowable amount in the fee schedule and identify the primary and subsequent procedures (see Table J).

Step 4: Calculate the allowable for the primary procedure, as shown in Table K.

Step 5: Calculate the allowable for subsequent procedures. The TC portion is 80 percent, as shown in Table L.
Example 3: PC of Diagnostic Cardiovascular and Ophthalmology Services
Billed services and final allowable amounts are shown in Table M. The indicator for these codes is 7, which means they are subject to MPPR – diagnostic ophthalmology services. Per this MPPR, the PC of the diagnostic ophthalmology services for subsequent procedures is allowable at 100 percent of the fee schedule.

Example 4: TC-only Codes
Steps for arriving at the final allowable for each code shown in Table N:

Step 1: As shown in Table O, all of the codes have an indicator of 6, which means they are subject to MPPR – diagnostic cardiovascular services.
Step 2: Identify the rates for the billed services, as shown in Table O.

Step 3: Order the billed services based on their allowable amount in the fee schedule and identify the primary and subsequent procedures (see Table P).

Step 4: Calculate the allowable for the primary procedure (see Table Q).

Step 5: Calculate the allowable for subsequent procedures. The TC portion is 75 percent, as shown in Table R.

Example 5: Global Test-only Codes
Steps for arriving at the final allowable amounts shown in Table S:

Step 1: All of the codes have an indicator of 6, as shown in Table T, which means they are subject to MPPR – diagnostic cardiovascular services.

Step 2: Billed codes are global codes; you must identify the related PC-only and TC-only codes for the services reported, as shown in Table U.

Step 3: Identify the allowable fee schedule amount for related PC and TC codes (see Table V).

Step 4: Billed codes are global codes. To find the highest and the subsequent procedures, use the values of the related TC-only codes
(see Table W).

Step 5: Calculate the allowable for the primary procedure. The primary PC is allowed at 100 percent and the primary TC is allowed 100 percent, as shown in Table X.

Step 6: Calculate the allowable for subsequent procedures. The PC-related portion is 100 percent and TC-related portion is 75 percent (see Table Y).
Points to Keep in Mind
Billers need to be aware of how the payments are made by payers. It’s a good idea to remember the following items while considering payment for these services:

• MPPR reductions for the TC of diagnostic cardiovascular and ophthalmology procedures do not apply to services provided prior to Jan. 1, 2013.
• The highest priced TC is always allowed at 100 percent of the fee schedule.
• The PC of diagnostic cardiovascular and ophthalmology services is not subject to MPPR reduction.
• MPPR is independently applied to diagnostic cardiovascular and ophthalmology services.
• The reduction applies to the TC of global services alone.
• For services subject to the MPPR and the OPPS cap on imaging, the lower of either the MPPR-reduced payment or the OPPS cap is allowed.
• Services performed over multiple sessions and reported with modifier 59 Distinct procedural service are not subject to MPPR.
• Global procedure code rates are always the sum of the PC-only code rate and TC-only code rate.

References:
CMS transmittal 1149
MLN Matters® MM7848

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