The current standard for billing for multiple surgical procedures was established by a Harvard (Hsiao) study in 1993. This standard was accepted by the Centers of Medicare and Medicaid Services (CMS) for implementation beginning January 1, 1995, and has been followed by many private third-party payers. To assist you in billing for such procedures, the American Society for Surgery of the Hand has prepared the following information.
Current Standard of Payment
Under current rules, Medicare claims for multiple procedures are to be paid at the lower of:
The billed amount; and one hundred percent (100%) of the fee schedule amount for the highest valued procedure, and fifty percent (50%) of the fee schedule amount for the second through the fifth highest valued procedures. If more than five procedures are billed, the sixth and subsequent procedures are subject to manual review and payment “by report.”
The current Medicare Carriers Manual Part 3 (Claims Process) provides detailed information on what is and is not allowed for surgical billing for Medicare patients. See the file containing the excerpt from the Manual (Section 4826, Claims for Multiple Surgeries, Section C, Items 9-12) at the bottom of this page.
For non-Medicare patients, certain individual states, such as Delaware also have criteria in place for payment of multiple procedures. Check with your state Insurance Commissioner’s Office to find out if there are applicable regulations in your state.
Working with Private Payers
Often, third party payers agree, pursuant to a contract, to reimburse providers according to a certain formula or schedule of rates. Many of those payers have incorporated the Medicare standard for billing multiple surgical procedures into their reimbursement policy. Before signing any contract with a third-party payer, review the payer’s policy on multiple surgical procedure payment. The policy should be clearly delineated up front so that you will know what to expect in terms of payment.
Working with Medicare carriers and other third-party payers to correct errors in claims payment can be a time-consuming and sometimes frustrating process. In the event a Medicare carrier has paid a claim or claims in a manner inconsistent with the standard set forth in the Medicare Carriers Manual, you may find the “Sample Letter to Medicare Carrier” helpful in contesting that decision. Similarly, the “Sample Letter to Third-Party Payer” may be useful in communicating with a private third party payer that has failed to pay a claim or claims in accordance with your contracted rates.
Please note that the preceding information should not be construed as legal or other professional advice on any specific facts or circumstances. The information is intended solely for general purposes, and you should consult your own advisors concerning your own situation and any specific questions you may have.
Sample Letter to Medicare Carrier.doc
Sample Letter to Third Party Payer.doc