Medicare Claims Filing with the 3% Reduction

Items to consider when filing medicare claims

We cannot be certain, nor have we been promised, that Medicare Administrative Contractors will have the COVID-19 Relief Package with the new Physician Fee Schedule changes for therapy providers (~9% reduced to 3.6%) loaded in their systems to properly adjudicate claims for dates of service beginning January 1, 2021.

Things to consider:

  • Hold Medicare claims. If you can hold claims until you have been notified that the systems are ready you will mitigate payment issues but, this is probably not practical considering the revenue issues endured during the pandemic.
  • Bill Medicare at your usual, customary, and reasonable rate (UCR). Have your Accounts Receivable staff monitor payments from Medicare recognizing that you, most likely, will be paid at the 9% reduction level for an unknown period of time. This, typically, puts the provider in the “Medicare will automatically make the correction adjustments mode” and eliminates the provider’s need to refile or appeal claims that were paid at the 9% reduction level.
  • Prepare a letter to your Medicare patients. It is important to keep your patient in the loop about the change in the Fee Schedule as they will receive Medicare Summary Notices that will be confusing because they will reflect the 9% reduction. You will need to establish a collection procedure for payment at the time of services that will permit an additional co-insurance payment by the patient once Medicare aligns its systems with the COVID-19 Relief rates. Click here for a sample letter
  • Do Not bill Medicare at its allowable rate. Historically, that permitted Medicare to pay at that rate which then takes the automatic adjustment out of the picture and necessitates a refile or an appeal by the provider to obtain the upward adjustment.