Determination of Comparable Circumstances

80.7 - Determination of Comparable Circumstances (Rev. 1, 10-01-03) B3-5026 A/B MACs (B) do not make a reasonable charge determination that would be higher than the charge upon which they would base payment to their own policyholders for a comparable service under comparable circumstances. The charge upon which payment is based does not mean the amount the A/B MAC (B) would be obligated to pay. Under certain circumstances, some A/B MACs (B) pay amounts on behalf of their policyholders, which are below the customary and prevailing charges physicians or other persons usually make to the general public. Payments under the medical insurance program are not limited to these lower amounts. “Comparable circumstances” refers to the circumstances under which services are rendered to individuals and the nature of your health insurance programs, and the method used to determine the amounts of payment under these programs. Generally, comparability exists where: • Payment is made under the contractor’s own program on the customary charges of physicians or other persons, and on current prevailing charges in a locality, and • The determination does not preclude recognition of factors such as specialty status and unusual circumstances that affect the amount charged for a service. However, even where there is comparability, coverage limitations applicable under the contractor’s own programs do not necessarily apply to reasonable charge determinations for Medicare purposes. The “current” customary and/or prevailing charges of an A/B MAC (B)’s private health plan refer to the payment screens that are presently in effect, e.g., payment levels actually being used in the A/B MAC (B)’s private business for settling claims submitted by its policy holders or subscribers. A/B MACs (B) must, therefore, continue to apply the comparability limitation based upon their payment screens that are presently in effect, even where an update under their private insurance plans has been deferred. If an A/B MAC (B)’s private health plan allowances are later revised, it will be necessary for the A/B MAC (B) to reexamine the relationship of these new payment levels to those under the Medicare program an initiate the necessary changes through their routine maintenance operations. Responsibility for determining whether an A/B MAC (B)’s program has comparability will fall upon the A/B MAC (B) in reporting pertinent information about its programs to CMS. When the pertinent information has been reported, CMS will advise the A/B MAC (B) whether any of its programs have comparability.