Have you seen your Medicare "raise"?

It's official. The Medicare Physician Fee Schedule is updated with a 2.2 percent increase for services from June 1, 2010, through Nov. 30, 2010. After failing once again to address the flawed SGR methodology that creates these expensive and cumbersome short-term fixes, Congress passed and the President signed this latest legislation on June 24. But have you seen the money?

If not, it should be forthcoming in short order. The Centers for Medicare & Medicaid Services (CMS) responded promptly to the fix with a message to its contractors to stop paying claims with dates of service after June 1 at the 21.3 percent cut enacted on that date and to hold those claims until the new rates were loaded into the payment system and tested. Claims held during this period will be processed as quickly as possible in the order received, according to CMS. (Some members of the AAFP coding discussion list report having already received payments that reflect the increase.)

In addition to watching for claims paid under the updated fee schedule, your staff may be dealing with claims that were previously paid at the reduced rate and reprocessed to pay the difference. These claims may present some challenges as the co-insurance amounts increase along with the amounts paid by Medicare. Some secondary payers may receive the adjusted Medicare payment notices electronically and automatically pay the difference in co-insurance; others will not. Likewise, any co-insurance due from a patient would increase.

So if you have a patient who previously paid their co-insurance at the reduced level, do you have to send out a statement for an $2 or $3? Not necessarily. The Office of the Inspector General has also responded to the change in fee schedules by issuing guidance that indicates they will not penalize physicians who choose not to bill patients for the difference as long as this is under a policy that applies equally to all Medicare patients or offered in response to financial hardship and does not relate to any kind of inducement to receive more services. Bottom line: If it will cost you more in staff time, printing and postage than the amount being billed, you may want to either write-off the amount or hold the patient balance and bill it when additional charges are incurred.

In the meantime, we will be watching Congress for a solution before Nov. 30, but don't hold your breath. This is an election year.