Q:Are physicians eligible to receive bonus payments above and beyond the Medicare fee schedule?

A:Yes. The Omnibus Budget Reconciliation Act (OBRA) of 1987 provides incentive payments to physicians who furnish services to Medicare beneficiaries in rural and urban Health Professional Shortage Areas (HPSAs) beginning Jan. 1, 1989. These incentive payments were established to attract and retain physicians in underserved areas.

Now, the Medicare Modernization Act of 2003 creates a new Physician Scarcity Area (PSA) bonus program effective Jan. 1, 2005. Physicians providing eligible services in the counties with the lowest 20-percent ratio of primary care or specialty physicians to Medicare beneficiaries are eligible. Ophthalmologists are eligible for the specialty physician scarcity bonus for areas designated as specialty PSAs.
Both physicians and optometrists may receive HPSA bonus payments, but optometrists are not eligible for the PSA bonus (dentists, chiropractors and podiatrists also are excluded). Ophthalmologists located in HPSA and PSA areas are eligible for both HPSA and PSA bonuses.

Q:How are bonus payments made?

A:Bonus payments are paid quarterly to providers for professional services. The technical component of diagnostic tests is not eligible for a bonus payment. Bonus payments are based on what Medicare paid for the service rather than the approved amount. The HPSA bonus is 10 percent and the PSA bonus is 5 percent.
Be aware that the quarterly incentive payment does not contain a remittance advice notice, but does list applicable claims.

Q:Can the amount of the payment be appealed?

Yes, CMS clarified this issue regarding HPSA incentive payments:
 • In cases in which a physician is not satisfied with the amount of the incentive payment on either assigned or nonassigned claims, he or she may request a review of the incentive payment. The review request must be made within 60 days of the date when the incentive payment was issued.

 • In cases in which an incentive payment was not made on a claim (assigned or nonassigned), but the physician believes that one should have been made, he or she may request a reopening of that particular claim. The request must be within one year of the claim payment.

Q:How can you determine if a practice is eligible for these bonuses?

Visit the website of the Center for Medicare & Medicaid Services (www.cms.hhs.gov/providers/bonus payment/#psa.com), which lists ZIP codes that will automatically receive bonus payments. Separate ZIP code lists exist for the Primary Care (ophthalmologists and optometrists) HPSA bonus and Specialty Care (ophthalmologists) PSA bonus. Individual carrier websites also list HPSA and PSA eligibility information and claim filing instructions.

Q:If a practice is not on the ZIP code list, does it does not qualify?

Your practice still may be eligible if your area doesn't fall fully within a designated HPSA or the ZIP code is not considered to be dominant for that PSA area. CMS publishes a step-by-step guide to assist in determining eligibility for both bonuses. Go to http://www.cms.hhs.gov/ providers/bonuspayment/guide.pdf.

The ZIP code of where the service is provided determines whether or not the bonus payment is made. If the physician's office is located in a designated bonus area but the hospital is not, services provided in the office would be eligible for a bonus payment, but services performed at the hospital would not be eligible.

Q:Are Medicare claims filed differently to designate eligibility
for bonus(es)?

Yes. Bonuses are paid for the professional component (PC) and not the technical component (TC) of diagnostic services. Diagnostic tests with a PC and a TC are therefore filed on two separate lines. For example, visual field tests would be filed as 92083-TC, or 92083-26. Only the 92083-26 component is eligible for bonuses.

Q:Are additional modifiers required on these claims?

Sometimes. Historically, modifiers QU (urban) and QB (rural) designated services eligible for a HPSA bonus. Effective Jan. 1, 2005, these modifiers are not necessary if your ZIP code is listed as HPSA eligible. The bonus payment will be automatic. Eligible services provided at locations not listed will continue to need the modifiers.

The PSA bonus will be automatic to those ZIP code areas listed on the CMS web site. If an area is not listed, but eligible based on the CMS PSA county list, the modifier AR will be necessary on eligible services to receive the bonus payment.

Q:Are there updates to the eligibility lists?

The HPSA automated file will be updated on an annual basis. Individual Medicare carriers will provide quarterly updates on their websites for changes to HPSA designations. These changes include new designations, changes and withdrawals of designated HPSA areas. Modifiers QU and QB may be required on newly designated areas not posted on the automatic listing.
At present, the PSA designations will be effective for three years, Jan. 1, 2005 to Dec. 31, 2007.

Q:Any further advice on filing these claims?

Some carriers recently published a reminder that global procedures with a technical and a professional component must be billed separately (i.e., 92135-TC and 92135-26). If not, the global service will be returned as unprocessable.

Some physician practices have reported denials for these claims even though they are not eligible for either bonus payment. We believe this is an administrative issue and will eventually be corrected by the carriers.

Ms. McCune is a vice president with the Corcoran Consulting Group, corcoranccg.com. Contact her at 1 (800) 399-6565 or dmccune@corcoranccg. com.