Medicare Answers and Update


    Medicare Alert Prepare for April Changes Now


    Effective April 1, 2001, there will be changes to both Part A and Part B Medicare reimbursement. Your facility may want to revise some of its vendor contracts in preparation for these changes.

    Part A RUG Rate Revisions

    As part of the Benefits Improvement and Protection Act of 2000 (BIPA), Congress has once again modified the Federal component of the Part A RUG rates. The nursing component of the Federal rate has been increased by 16.66%, and the inflationary adjustment was increased from 2.161% to 4.161%.

    In addition, Congress resolved the disparity that had been created when certain Rehab RUG categories were increased by 20% last year. Instead, effective April 1, 2001, all Rehab RUG categories will be increased by 6.7%.

    Note that these changes affect the Federal rate only. For those facilities that are still receiving a blended rate, the facility specific component of the rate is not adjusted effective April 1.

    Part B Diagnostic X-Ray

    Effective April 1, nursing facilities will be reimbursed at the lower of 80% of published fee schedule amounts or actual charges for x-ray services provided to Part B patients. Prior to that date, reimbursement for these services was based on the facility's actual cost.

    Medicare does not recognize uncollected coinsurance on items that are reimbursed based on the published fee schedule as a reimbursable bad debt. This means that for Medicaid patients, a facility will only be able to collect 80% of the fee schedule amount. Depending on the facility's arrangement with its supplier, billing for x-ray services may no longer be profitable.

    Part B Laboratory Services

    Effective April 1, nursing facilities will be reimbursed based on the published fee schedule for laboratory services also. The usual 20% coinsurance does not apply to clinical diagnostic laboratory tests paid under fee schedule. Currently, for CLIA waived tests, such as blood glucose tests, nursing facilities are reimbursed at cost in the certified unit and fee schedule in the non-certified unit. Unless HCFA intervenes, this fee schedule reimbursement could open up a new source of revenue for facilities that have not billed for these tests in the past.

    Remember that glucose testing must be performed under physician orders and it must be medically necessary in order to be covered under Part B.

    Please give us a call if you have questions about how any of these changes will affect your facility.
    If you have questions, contact Health Care Resources for assistance in Medicare reimbursement issues and come back next month for more Medicare Answers and Update.

    Updated 2/28/2001