Payment Concerns While Updating Codes

30.2.1 - Payment Concerns While Updating Codes (Rev. 1, 10-01-03) The following instructions apply in situations where the CMS CO does NOT provide pricing guidance via the Medicare Physician Fee Schedule Database (MPFSDB) for physicians’ services. If a new code appears, A/B MACs (B) make every effort to determine whether the procedure, drug or supply has a pricing history and profile. If there is a pricing history, map the new code to previous customary and prevailing charges or fee schedule amounts to ensure continuity of pricing. Since there are different kinds of coding implosions and explosions, the way the principle is applied varies. For example, when the code for a single procedure is exploded into several codes for the components of that procedure, the total of the separate relative value unit or other charge screens established for the components must not be higher than the relative value units or other charge screens for the original service. However, when there is a single code that describes two or more distinct complete services (e.g., two different but related or similar surgical procedures), and separate codes are subsequently established for each, continue to apply the payment screens that applied to the single code to each of the services described by the new codes. If there is no pricing history or coding implosion and explosion, A/B MACs (B) must make an individual consideration determination for pricing and payment of a covered service. Conversely, when the codes for the components of a single service are combined in a single global code, A/B MACs (B) establish the payment screens for the new code by totaling the screens used for the components (i.e., use the total of the customary charges for the components as the customary charge for the global code; use the total of the prevailing charges for the components adjusted for multiple surgical rules if applicable as the prevailing charge for the global code, etc.). However, when the codes for several different services are imploded into a single code, A/B MACs (B) set the payment screens at the average (arithmetic mean), weighted by frequency, of the payment screens for the formerly separate codes.