Doctors Receive 1.6 Percent Increase in Medicare Payment Rate

Spectrum staff

The federal government issued a regulation Thursday which will increase Medicare payment rates to doctors.

Under the rule issued by the Centers for Medicare and Medicaid Services, payments for physician services will increase an average of 1.6 percent as of March 1.

"The action CMS is taking today will ensure that the doctors who treat Medicare patients will see an increase in the payments they get for those services, rather than the reduction previously anticipated," Health and Human Services Secretary Tommy Thompson said. "We commend Congress for giving CMS the authority to make these changes, ensuring that Medicare beneficiaries will continue to get healthcare services from the doctors they trust."

Nearly 40 million older Americans and people with disabilities rely on Medicare to pay for medical services.

Physicians are paid for their services according to a fee schedule that is updated annually according to a formula set out in Medicare law. In 2002, the statutory formula required Medicare to reduce rates paid to physicians. The law would have required Medicare to reduce rates again in 2003, but the recently enacted spending bill for fiscal year 2003 allowed CMS to revise figures used in the formula and increase the update for 2003 from a negative 4.4 percent to a positive 1.6 percent.

"This rule restores the confidence of physicians, and patients, that the federal government will be a fair partner in the Medicare program," CMS Administrator Tom Scully said.

Medicare uses the fee schedule to pay for more than 7,000 services rendered to beneficiaries by physicians and other providers.

Because of the change in payment rates, CMS is extending until April 14 the deadline for physicians to decide whether or not they want to participate in Medicare.

Participating physicians are paid using a higher fee schedule than that used for nonparticipating physicians, but agree to accept assignment and to bill beneficiaries only for the 20 percent deductible. Nearly 90 percent of physicians enrolled to treat Medicare beneficiaries chose participating status in 2002, and nearly 95 percent of Medicare claims are submitted on an assignment basis.

 

 

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