Medicare vs. private payers: What urologists need to know

April 1, 2010

Private payer rules differ from Medicare rules. From payment for procedures to globals, bundling, coverage, and modifier usage, private payers are not required to use Medicare rules.

How Medicare, private payers differ

'Incident to' billing. Medicare has very strict "incident to" rules. The doctor has to be in the suite and immediately available in order for a service to be billed. The service provided is reported as if the billing provider provided the service.

Private payers may have a more relaxed rule. Specifically, one Blue Cross plan requires that a physician be within 20 miles of the office and immediately available by phone. Others require only phone coverage, and still others have different distances for proximity when the service is provided. You may need to check with your payer for the specifics.

Bundling. This is a big issue. Most urology offices rely on Medicare's Correct Coding Initiative to determine the correct way to bill multiple procedures. Approximately 80% of all payers use McKesson Corp. software for their bundling edits and not the Medicare CCI edits.

The McKesson edits are very flexible, allowing payers to turn edits on and off as they choose. For example, they can choose to bundle urine analysis into your office visits, or they can choose not to pay for the –25 modifier. They can also choose not to pay for any procedure that is designated as a "separate procedure" if another service is provided on the same date. On the other hand, the payer may pay for two procedures performed together even though Medicare does not.

Unfortunately, McKesson does not allow for the publication of some of its edits, and most payers do not choose to make all of their edits public. As such, you are required to discover these edits by trial and error, at least until we are able to detect these edits and share them across practices. Also note that payers do not always behave consistently, even when patients have similar benefits.

Office supplies. Do you have a payer that pays you the same for a cystoscopy in the office as it does for one performed at the hospital? If so, the payer is not paying you for your office supplies. Some payers will pay for supplies in the office if they are separately reported using Healthcare Common Procedure Coding System codes. You may be able to negotiate a "facility fee" for performing certain procedures in your office with other payers.