Medicare not only cut relative value unit (RVU) reimbursement for 2003 by 4.4 percent in the Physician Fee Schedule but also reduced the number of RVUs granted to numerous codes. The double reduction will force family physicians to economize and consider the value of remaining a Medicare provider or using a Medicare resource-based relative value scale (RBRVS) system. In December, CMS issued the 2003 National Physician Fee Schedule Relative Value File, which many payers use as a base for their fee schedules. Many of the wins and losses included in the fee schedule will carry over to private insurance. Cuts Affect All Payers Some family physicians think the Medicare fee schedule exists in a bubble, but Medicare significantly influences private payers'policies. "Most non-Medicare payers use the Medicare Physician Fee Schedule as a benchmark at the very least," says Chip Hart, marketer for The Physician's Computer Company, which supports and develops computer software to manage clinical and clerical duties. Several carriers use the fee schedule directly.
"Although the RVU system is designed for Medicare reimbursement, virtually every other payer system uses it in one way or another," Hart notes. Awareness of Medicare's actions and directives, therefore, can help practices understand private payers' rules. CMS Reduces Conversion Factor Last year, the Medicare Physician
Fee Schedule reimbursed about $36.20 ($36.1992) per RVU, known as the conversion factor, which represented a 5.5 percent decrease from 2001. For 2003, Medicare will pay about $34.59 ($34.5920) per RVU, which represents a 4.4 percent cut from 2002. Medicare published the final rule, effective March 1, in the Dec. 31, 2002, Federal Register. You may download the document from www.access.gpo.gov/ su_docs/fedreg/a021231c.html (scroll down to CMS and select text or pdf version) or visit the CMS Web site at cms.hhs.gov/physicians/pfs/. (For implementation information, see "Don't Let the Interim Fee Schedule Filing Rules Drive You Crazy" in article 5.) Note: The U.S. Senate has passed an omnibus fiscal year (FY) 2003 appropriations bill (House Joint Resolution 2), which contains language suspending the scheduled 4.4 percent reduction in Medicare physician fees from taking effect on March 1. But the House of Representatives still must conference, agree and vote on the bill. FY 2003 eliminates the 2003 conversion factor (and its 4.4 percent reduction) from the law and maintains the 2002 conversion factor through Sept. 30, 2003. The provision would not change other 2003 fee schedule provisions, such as the RVU changes. Family Practice RVUs Hit Hard Despite the initial bad news of the reduction, family physicians may face bigger reimbursement problems. The 4.4 percent fee schedule cut is not the complete story, says Steven F. Isenberg, MD, FACS, director of physician services for Zotec Solutions Inc., which provides practice management and [...]
