As we reported in a previous article, President Obama signed the Department of Defense appropriations bill into law on Dec. 19, 2009, delaying a 21.2 percent reduction in physician fees until March 1. In response, just days later, the Centers for Medicare & Medicaid Services (CMS) released the January 2010 Physician Fee Schedule (PFS) file that contains the 2010 relative value units (RVUs) and temporary conversion factor.

The amount of time it will take payers to update their systems with the new rates is much greater.

The temporary conversion factor of $36.0846 is effective for Medicare services rendered on or after Jan. 1 through Feb. 28. Unless Congress comes up with another temporary fix or a permanent solution, the 21.2 percent payment cut will go into effect March 1.

Payers are responding to this flip-flopping of rates in different ways. UnitedHealthcare, for example, recently communicated that, while its system is being updated, claims will be paid at the 2009 conversion factor. Payment, however, will not reflect 2010 RVUs or geographic practice cost indices.

“We are expecting updates of relevant fee schedules and anticipate completion by February 27, 2010,” email recipients of the UnitedHealthcare Digest were informed.

UnitedHealthcare says to avoid potential cash flow disruption to physician practices, it will not hold claims for processing during the 60-day limbo. Physicians, however, can alternatively wait to submit claims to UnitedHealthcare until the update process is complete.

6 Responses to “Payers Scramble to Update Systems”

1. Sarah I Says:
   February 4th, 2010 at 12:02 pm

   I really hope they find a permenant fix for the payment reduction to go away. If the 21.2% reduction goes into effect, I will lose my job, since my employer won’t be able to afford most of the staff here.

2. Nidhi Maheshwari Says:
   February 5th, 2010 at 7:48 am

   This is going to have a major impact on the industry, small practices will really suffer and I totally agree with Sarah, a lot of people are going to lose either their jobs or their timings will be cut.As it is the cost to run a practice is huge and if this 21.2% reductions goes into effect it will really put a blow on everyone’s pocket.

3. Laura Cohen Says:
   February 10th, 2010 at 7:44 pm

   I do surgicial coding in a OB/GYN practice. Are reimbursement is already cut and f this 21.2% reduction goes into effect we may not be able to see Medicare patients any longer. This is not a solution to the healthcare problems we are having but creating more. Do you want our doctors to quit practicing medicine?

4. Jen Says:
   February 14th, 2010 at 9:36 pm

   I agree with the previous statements. I feel for the doc’s and us too. Nowhere else can you expect to be charged more every year and still be forced to take a paycut of 20% every year- or at least be threatened by it. If there were a union-which is illegal for some reason- the union would have handled the whole thing decades ago. shame…

5. debby Says:
   February 26th, 2010 at 8:03 pm

   If the cut happens there will be alot of practices that will be forced to no longer accept medicare. This will have a huge impact on the patients who are enrolled with Medicare. As the cost of living increases, the reimbursement decreases. something is wrong with this.

6. Nancy Says:
   March 7th, 2010 at 8:37 am

   I work for a large OB/GYN practice and there has been talk about not taking Medicare patients. This is wrong as they need the care more than the younger generation and they are more at risk. We already have women that do not come in for yearly check ups because they cannot pay on the off year. If Medicare is reduced, can you imagine what National Health Care will be like? This is very sad for the American Public.

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