Medicare Reimbursement Updates
June 2008

Medicare Rate Refinements

Medicare Part A RUGs: The Bush administration’s proposed Medicare cuts will affect “rural” facilities. The proposed rule that the Centers for Medicare and Medicaid Services (CMS) issued on May 1, 2008, would cut SNF’s payments to account for a “forecasting error” made by CMS in 2005. The proposed correction will cut $133.2 million in Medicare A funding for rural skilled nursing care in FY2009. The per patient day impact would be $11.79 for Ohio rural facilities. AHCA is working to present key points of information that highlight how the proposed rule inappropriately attempts to “correct” a 2005 CMS “forecast error” and the lasting impact of such a reduction on the economy and the industry. There will surely be many debates on this matter before the FY2009 Medicare SNF payment rule is issued in late July.

Medicare Part B Fee Screens: The Medicare, Medicaid, and SCHIP Extension Act of 2007 updated the conversion factor to .5% for Part B fee screens with dates of service January 1, 2008 through June 30, 2008. The conversion factor is set to revert back to the previous amount set in the Final Rule, published in the Federal Register on November 27, 2007, of -10.1%. This will reduce Part B fee screens, on average, around 10%. Recently the House passed The Medicare Improvements for Patients & Providers Act (H.R. 6331). This bill prevents the 10% reduction in payments. Unfortunately the Senate was unable to pass the bill. The House and Senate will be out of session for the Fourth of July recess and will continue to work on this when they return to session.

Therapy Caps and Exception Process

The Medicare Part B therapy caps exception process is scheduled to end June 30, 2008. Effective July 1, 2008, the exceptions to the therapy caps are restricted to those medically necessary services billed by an outpatient hospital. Physical and speech therapy combined has a cap of $1,810 for 2008. In addition, occupational therapy has a cap of $1,810. This limit applies to services provided in a location other than an outpatient hospital. According to CMS, any services provided between January 1, 2008 and June 30, 2008 will count towards the $1,810 cap. Please visit http://www.cms.hhs.gov/MLNMattersArticles/downloads/SE0815.pdf for more information. An 18-month extension of the therapy caps exceptions process is included in The Medicare Improvements for Patients & Providers Act (H.R. 6331). It is expected that when Congress returns on July 8th they will continue to work on passing a bill to extend the therapy caps exception process.

ECS Specialty Seminar

ECS presents a Skilled Nursing Facility Billing – Hot Topics seminar.