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MPFS final rule: Multiple-procedure pay reduction for diagnostic imaging

Radiology Administrator's Compliance and Reimbursement Insider, January 1, 2006

By Stacie L. Buck, RHIA, LHRM

On November 2, 2005, CMS published the Medicare Physician Fee Schedule final rule, which includes several changes that affect radiology facilities, including a multiple-procedure payment reduction that is anticipated to have a significant impact.

Under the multiple procedure payment reduction, CMS will reduce payments for the technical component of certain diagnostic imaging procedures that are performed during the same session. CMS believes that there are limited additional costs when these procedures are performed on contiguous body parts during a single session with a patient.

In the proposed rule, CMS identified 11 "families" of procedures that fell under this reduction and called for a 50% payment reduction when two or more procedures in the same family were performed during the same session. Those families remained the same in the final version of the rule.

However, based on feedback from the American College of Radiology and other interested parties, CMS modified the proposed reduction schedule, deleting codes 76830 and 76645 from the list of procedures, pending further study. It also decided to phase in the payment reduction during the next two years while the agency reviews this policy.

This means that in 2006, when a facility performs two or more procedures in the same family during the same session, the exam with the highest relative value units will be paid at 100%. CMS will reduce payment for all additional procedures within that same family by 25% of the fee schedule amount.

In 2007, CMS will reduce reimbursement for additional procedures by an additional 25% of the fee schedule amount. According to the proposed rule, the payment reduction will not be applied to the professional component of services.

For example, a physician diagnoses a patient with lung cancer. He or she suspects metastasis based on the patient's current symptomology. The following CT scans are performed on the patient during the same session:

  • 71270 —CT chest without and with contrast

  • 74170 —CT abdomen without and with contrast

  • 72194 —CT pelvis without and with contrast

    In this case, code 71270 would be paid at 100% and the technical component of codes 74170 and 72194 would each be paid at 75% of the fee schedule amount.

    Under the current rule, CMS would pay 50% of the fee schedule amount for the technical components of codes 74170 and 72194 in 2007.

    The 11 families as published in the final rule can be found in the box on p. 3 of the PDF of this issue. The families of procedures are based on claims data that show that these procedures are often performed in combination, most likely during a single session.

    Several individuals asked CMS for clarification about the proposed rule's definition of a "single session." CMS has defined a single session as more than one of the imaging services in a single family provided to the patient during one encounter in which the multiple-procedure reduction would apply.

    On the other hand, if a patient has a separate encounter on the same day for a medically necessary reason and receives a second imaging service from the same family, CMS considers these studies as provided in separate sessions. In the latter case, physicians should use modifier -59 to indicate multiple sessions, and the multiple procedure reduction does not apply.

    For example, a brain magnetic resonance imaging scan is performed on a patient in the morning, the results of which later in the day reveal the need for a magnetic resonance angiography (MRA) to evaluate the carotid arteries. These are considered separate sessions, and both procedures will be reimbursed at 100% of the fee schedule amount. Submit the second procedure (i.e., the MRA) with the -59 modifier appended.

    Medicare carriers will establish edits to ensure that separate sessions are not inappropriately scheduled for contiguous body area imaging in attempts to bypass the reduction. Using the -59 modifier to bypass the payment reduction in which separate sessions are not medically necessary constitutes fraud.

    Physician self-referral changes

    Under the physician self-referral statute and regulations, a physician is prohibited from making referrals for certain services referred to as designated health services (DHS) to an entity with which he or she (or an immediate family member) has a financial relationship, unless an exception applies.

    For 2006, CMS proposed adding diagnostic and therapeutic nuclear medicine procedures to the list of DHS to which the self-referral ban applies.

    However, to minimize the effect on providers of nuclear medicine services and allow them time to restructure current arrangements, CMS has delayed the effective date of this change to January 1, 2007.

    Contrast material

    In the final rule, CMS announced that it will delay the implementation of separate payment for high osmolar contrast material (HOCM). Payment for HOCM will continue to be included as part of the practice expense associated with the procedure for 2006.

    Insider source

    Stacie L. Buck, RHIA, LHRM, vice president, Southeast Radiology Management, 512 SW St. Lucie Crescent, Stuart, FL 34994, 772/600-0324; stacie@southeastrad.com.

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