Fee Schedule Revised Conversion Factor
On January 5, 2023, the Centers for Medicare & Medicaid Services (CMS) announced an updated CY 2023 physician conversion factor (CF) of $33.8872. This change reflects a 2.5% positive adjustment from the initial CY 2023 physician CF of $33.0607 announced in the CY 2023 Medicare Physician Fee Schedule (PFS) Final Rule.
Before Congress intervened, evaluation and management codes 99213 and 99214 were expected to drop 4% for 99213 and 3% for 99214 (in the top 15 billed codes for practices in 2021 according to Medicare data). Now the drop will be around 1 %.
The revised rate amounts to a 2.1% drop in the conversation factor between 2022 and 2023.
Importance of Updating your Fee Schedule
Many practices haven’t updated their fee schedules in years while others have fee schedules that are so high, they make no sense.
The costs associated with running a medical practice fluctuate due to changes in the cost of equipment, supplies, drugs, and other resources needed to perform tests, procedures, and surgeries. Rates charged by hospitals, doctors, and specialists may change too, impacting the cost of care. By updating your fee schedule regularly, your dermatology practice can ensure to charge a fair price for services while also remaining competitive in the marketplace. This can help to ensure the long-term success and viability of your practice while also providing patients with access to high-quality health care at a reasonable cost.
Additionally, this unrealistic data gives practice providers a false idea of their charges (e.g., practice productivity) as well as the amount that can be collected.
Make sure to put eyes on your practice fee schedule at least once a year to ensure you are reasonably charging for the services provided.
Using Multiple Fee Schedules
If you are using multiple fee schedules, one for each contracted carrier, make sure that the carrier is paying the amount that was negotiated. And, more importantly, keep a close eye on updates as they frequently make changes without informing contracted providers. We advise practices review their top 20 CPT codes and reimbursements at least twice a year.
Medicare & Non-Medicare Fee Schedule
If your practice has only 2 fees schedules: Medicare and non-Medicare. You should update those fee schedules as well. Use the Medicare fee schedule and charge between 100% – 200% for commercial carriers. Any more than that skews the gross charges, and it becomes difficult for the practice to ascertain a true representation of their practice’s productivity as well as the anticipated payments. The Medicare fee schedule is updated and published quarterly so a quick review should show any significant deviations.
Fee Schedule & Reporting
Implement a practice to identify 100% reimbursements. Whenever your staff is posting payments for commercial carriers, if they see a CPT code that is paid at 100%, then that CPT code’s charge should be increased by 10%. Do not increase the entire fee schedule; only for that one code. You should run the report each month.
If you have a separate fee schedule for private pay patients, be sure it doesn’t fall below the Medicare allowable. Charging below Medicare is a violation of your Medicare contract. You also must balance bill patients for their deductible and co-pays. Unless you can show that the patient is medically indigent, an across-the-board write-off policy is illegal. Most patients can and are willing to pay their balance.
Adjusting Fee Schedule
Don’t adjust your fee schedule based on what you believe is a patient’s inability to pay. It’s not fair to those that do. Your policy should be fair and consistently applied to all patients.
Read more from our published resources:
A Surefire Way to Increase Practice Income and Reduce Overhead
Where is your Money Hiding?
About Inga Ellzey and our Dermatology Billing Services
After 27 years of perfecting billing processes, Inga Ellzey continues to be the nation’s leading expert in dermatology billing. Our billing service serves over 100 dermatology practices in 37 states without utilizing any offshore labor. Our goal is to make sure that you and your patients receive the most competent and professional service available on the market today.
If you are interested in speaking with our company about how we can maximize your collections while also improving your process, please contact us or call 888-434-4374.