Medicare Reimbursement: Timely Q & As
by Federal Regulatory Affairs Staff
October 12, 2004 -- In the current health care system, it can be a challenge to stay on top of changes affecting payment for psychological services. The APA Practice Organization regularly fields questions from members concerning reimbursement under Medicare and private insurance. To help members stay informed about current payment issues, some of the questions received recently by the APA Practice Organization -- and the answers to those questions -- are provided below.
Q: Will Medicare’s reimbursement rates increase or decrease in 2005?
A: Medicare’s reimbursement rates are scheduled to increase by 1.5 percent in 2005. The increase is due to action taken by Congress in 2003 that adjusted the reimbursement formula for three years (2003-2005). The APA Practice Organization will continue to advocate for an appropriate formula for reimbursement rates for 2006 and beyond.
Q: Why do insurance carriers insist that I use the ICD-9 physical diagnosis codes instead of the DSM-IV codes? When I use the ICD-9 codes, why do I still receive rejections based on incorrect use of diagnostic codes?
A: The ICD-9 CM (International Classification of Diseases, Ninth Revision, Clinical Modification) is now the official system for assigning codes to diseases associated with inpatient, outpatient, and physician/practitioner office utilization in the U.S.
Under the Health Insurance Portability and Accessibility Act (HIPAA), insurance companies who accept and process insurance claims electronically are only required to accept ICD-9-CM diagnosis codes. The APA Practice Organization provides a crosswalk that can be used to convert DSM-IV diagnosis codes into ICD-9 diagnosis codes.
In many cases, insurance carriers are looking for ICD-9 codes with five digits, indicating the highest level of specificity. When your claims are rejected based on incorrect diagnostic codes, contact the insurance company that issued the claim denial for more information.
Q: I work for a clinic in a rural area. Recently a psychiatrist at the clinic began receiving a 10 percent “bonus” from Medicare. If we both provide psychotherapy services to Medicare beneficiaries, and we bill for the same services using the same codes, why don’t I receive the bonus?
A: In order to promote health services in underserved areas, Congress established new bonuses for physicians working in “health care professional shortage areas” (HPSAs) as part of the 2003 Medicare Modernization Act. Unfortunately, the law did not include bonuses for other health care professionals, such as psychologists, dentists, chiropractors, podiatrists and optometrists, working in HPSAs. The APA Practice Organization is aware of the discrepancy this creates in areas where there is a shortage of mental health providers and is currently evaluating possible strategies to eliminate this discrepancy.
More information about HPSA bonus payments is available from the Centers for Medicare & Medicaid Services Web site at: www.cms.hhs.gov/
medlearn/matters/mmarticles/2005/SE0449.pdf
Q: I am employed by a hospital and frequently work with patients who suffer from physical health problems. According to my billing department, Medicare keeps rejecting my claims because they do not have a proper revenue code. How can I resolve this problem?
A: Medicare may be rejecting your claims because the billing department at your hospital is using the wrong revenue code on your claim. Because psychologists are usually considered mental health providers, your hospital’s billing software may have automatically assigned a mental health revenue code to your health and behavior claims. It is very important that the revenue code reflect the patient’s diagnosis, rather than the type of practitioner who is furnishing the service. When you provide health and behavior services, make sure your billing department uses a revenue code that matches the patient’s physical health diagnosis.
The PracticeUpdate will periodically feature answers to frequently asked questions regarding reimbursement.
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