Rowan SOM Faculty Practice Plan

Managed Care and Contracting

Charge Master Preparation and Management

Effective Date: June 2013

Policy:

The University Doctors FPP Charge Master is reviewed annually to ensure that the prices set for the medical services rendered follow the agreed protocols and fall with acceptable limits for the medical specialty and geographic region.

Definitions:

Charge Master Task Force - This committee’s main task is to agree upon the pricing methodology, oversight and management procedures for the medical care that is represented by CPT and HCPCS codes. This Task Force is comprised of representatives from the following departments:

·  Central Billing Office

·  Clinical Practice Administration

·  Financial Decision Support & Revenue Cycle

·  Ethics and Compliance

·  Information Systems and Technology

·  Managed Care

CPI – Consumer Price Index which is set by the Bureau of Labor Statistics. The Philadelphia Metro Area is the geographical area for the southern New Jersey region’s report.

Optum –Ingenix Fee Analyzer – this is a regional reporting tool that provides pricing /charge data from peer groups with similar specialty/PCP billable services.

Percentile – the value of the variable that divides the distribution into 100 groups; the 65th percentile represents out of 100 groups 35 of them use this calculation.

Procedure: Incidental procedures-CPT or HCPCS codes that are performed in conjunction with Medicaid of service but typically are not reimbursed lie venipuncture.

A.  Charge Master Task Force meets to review the following reports to determine the prices for the next fiscal year:

  1. Highest Volume Evaluation and Management Procedure Codes
  2. Highest Volume Specialty Procedures Codes
  3. Unique CPT codes that affect particular billing areas
  4. Charges that vary based on modifiers/place of service or incidental procedures.

B.  External documentation used for review and analyze charges:

  1. Optum-Ingenix Fee Analyzer
  2. Consumer Price Index
  3. Current Year CPT and HCPCS Level II manual
  4. Current Year Medicare Fee Schedule
  5. Top 3 Payers most current reimbursement fee schedule.

C.  Pricing Methodology is set by:

  1. The CDM Task Force which agrees upon and recommends the percentile of the Optum-Ingenix Fee Analyzer for the future fiscal year charges.
  2. Only current billed charges will be revised based on the recommended percentile; all unbilled CPT codes/charges stored in CB/IDX will remain at the existing prices until used.
  3. All evaluation and management and specialist procedure codes will be based on the same percentile for all divisions and/or billing areas in Group 3 of CB/IDX.
  4. Remaining CB/IDX groups will be revised upon request from administrator. Automatic roll/ default to Charge Master will occur if there is no special price listed at the billing area & CPT code level within the group. All groups will roll/default to the Charge Master, Fee Schedule 1 except CARES. The separate groups are:
  5. CARES = Group 7
  6. Psych = Group 4
  7. Employee/Student Health = Group 8
  8. St. Luke’s = Group 6
  9. All charges for immunizations, vaccines, pharmaceuticals and other medical service aids (e.g., weight management nutrition bars) will be set by the Department Administrators and Practice Administrator.
  10. The CBO will provide a list of incidental procedure codes to consider for minimum prices.
  11. If the CPT or HCPSCS code is not listed in the Optum-Ingenix Fee Analyzer then the default pricing methodology will be used:
  12. Default Pricing Method: For Primary Care Services and all evaluation and management codes the charge will be set at 150% of the current year Medicare Fee Schedule. For specialist procedures the default pricing method will be 250% of the current year Medicare fee Schedule.
  13. Unspecified Charges: if there are codes that are not listed on the Optum-Ingenix Fee Analyzer or Medicare Fee Schedule then a request from the performing department and/or the Dept of Ethics and Compliance will be consulted for a similar CPT code/service set. A price will be determined based on collaboration between the Department Chair, Administrator, Practice Administrator and Dept of Ethics and Compliance.
  14. ALL charges are to be rounded to the nearest $5.00 increment.
  15. Any hard coding of modifiers in CB/IDX will require approval from the Dept of Ethics and Compliance.
  16. The Practice Administrator will receive a file of all proposed new charges for each department for review and approval.
  17. The Practice Administrator will consult with each Department Administrator to determine if the proposed charges for the department require any special pricing.
  18. The Chief Financial Officer will approve all final charges/prices for the upcoming year.
  19. Individual CPT adjustments made throughout the year will be approved by the Practice Administrator and the Director of Managed Care.

D.  Special Pricing Requests:

  1. If the department finds that a price or series of prices related to a specific book of business do not reflect the value of the services performed, the price(s) may be altered.
  2. To initiate the review and adjustment of the pricing; the department administrator will email the Practice Administrator with copy to the Director of Managed care and identify CPT code, current charge description and requested revised charge. The revised charge must be based on a percentage of the current year Medicare Fee Schedule and rounded to the nearest $5.00 increment.
  3. The Department Administrator and Practice Administrator must agree on the new charge and send approval to the Director of Managed Care.
  4. The task force will review charges that are outliers to the normal reimbursement amount and determine a special price that fiscal year.

E.  New CPT code prices:

  1. When new CPT codes are implemented at the beginning of each calendar year, the prices will be set based upon the current year Medicare fee schedule.
  2. The charge will be based on the first posted fee schedule using the default pricing methodology described above. If the government determines that a new fee schedule is needed based on actions from the President; the charges can be reconsidered at that time but will need to be initiated by the Department Administrator.
  3. If there is a delay in the posting of the Medicare fee Schedule then the prices for the new codes will be delayed until that time.

F.  Charges added to CB/IDX will follow the IS&T Charge Master Policy. At each Charge Master Task Force Meeting #1; the IS&T team will advise of the requested deliverables for the system update for the future fiscal year. The Charge Master file will be provided to the IS&T staff by the first Friday in June or earlier it possible. Items typically provided are:

  1. Charge master revision for all currently billed CPT, HCPCS and ad hoc codes used for additional medical/clinical services.
  2. Excel file will list all CPT, HCPCS and generic codes, modifiers and billing areas or as requested by IS&T.

Policy & Procedure Approved By: Charge Master Committee

Date: June 2013