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12.16.2020

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Kirk Mack

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UPDATE: Understanding 2021 Reimbursement Rate Changes

UPDATE: Understanding 2021 Reimbursement Rate Changes

Editor's note: This post reflects the updates CMS released in early January 2021.

Given the unprecedented year of 2020, most of us are looking forward to change and opportunity in 2021. Eliminating COVID-19 is a high hope, but other medical changes are for certain. In health care, the perennial theme of change is realized through annual updates to regulations, coding changes, new coverage guidelines, and adjustments to the Medicare Physician Fee Schedule (MPFS) and ASC Payment rates.

December brought much excitement to the annual fee schedule update. Published by the Centers for Medicare & Medicaid Services (CMS) in early December — though later than typically released — the Final Rule originally projected a 6 percent and 4 percent reduction in reimbursement for ophthalmology and optometry, respectively. Congress then passed the Consolidated Appropriations Act, 2021 on Dec. 21, which transfers $3 billion to the 2021 MPFS and removes the visit complexity add-on code (G2211), mitigating many of the original reductions. According to the American Medical Association (AMA), the legislation results in a 1% increase for ophthalmology and a 3% increase to optometry. Planning for these adjustments starts with a detailed understanding of the key changes finalized for 2021. We have captured several of those below in the hope that this will assist you in your practice discussions.

2021 Conversion Factor to Impact Some High-volume Procedure Payments

Each year the MPFS conversion factor (CF) translates Medicare relative value units (RVUs) into dollar amounts. Knowing that, the CF for 2021 was first reduced from the 2020 level of $36.09 to $32.41 for a 10 percent reduction. Following the actions taken by Congress, the final 2021 CF landed at $34.89, resulting in a 3.3% reduction from the 2020 level of $36.09. This is an across-the-board adjustment to all services, including surgical procedures, tests, and visits. The table below details the impact to some — but by no means all — common high-volume services performed by ophthalmologists.


Welcomed Increases in ASC Procedure Rates

On the ASC side, CMS, using the hospital market basket, is increasing ASC rates for 2021 by 2.4 percent. As such, and contingent on any changes to the wage indices, some common ASC procedures (listed below) will either see an increase in reimbursement or remain neutral in 2021.

Knowing that, every ASC should aim to collect the full allowed amounts, so updating current fees for the new year is vital. From both the ASC and physician perspective, these reimbursement updates are significant, and by ensuring your fee schedule is current, it will help your practice and ASC better predict and plan for 2021.

Our 2021 Medicare Payment Rates Resources Are Now Available

For both practices and ASCs, knowing the exact allowed amount for your specific location is invaluable to ensure you are not being underpaid. BSM’s Medicare Payment Rates (MPR) resources, specifically developed for eye care services, can help with that.

Our easy-to-use provider MPR resource includes an Excel spreadsheet that incorporates your specific local geographic practice cost index (GPCI), ensuring each code corresponds to the values published by your Medicare Administrative Contractor (MAC). Additionally, it contains the following features:

  • Professional allowed amounts for visits, tests, and procedures;
  • “Eye care-only” allowed amounts;
  • Global fee periods; and
  • Multiple services indicators.

Our ASC MPR resource provides similar information by incorporating locally adjusted rates and the associated wage index for a given area. It also shows multiple procedure adjustments and payment indicators, allowing you to compare your local rate to national rates for each procedure.

Both MPR resources are up to date, and should any rates change throughout the calendar year, those adjustments will be made.

Helpful Reimbursement Resources
Be Proactive

Regardless of the changes that come with each new year, staying abreast of the coding and reimbursement modifications will better equip your practice and ASC to modulate potential negative business impacts for a prosperous year.

PREPARE TODAY: Visit our Medicare Payment Rates page to help you get ahead in 2021. Please direct questions to CodingandCompliance@bsmconsulting.com or call 1-800-832-0609.

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