Important Medicare Physician Fee Schedule Update

As you know, the Centers for Medicare and Medicaid Services (CMS) was scheduled to implement a negative 4.4% update in provider payments effective March 1, 2003. CMS has worked with Congress for many months in an effort to correct a defect in the formula generated in part by unanticipated changes in economic conditions. Due to the grassroots efforts of health care providers, Congress has acted—this flaw will be corrected and, instead of a negative 4.4% update, CMS is now preparing to implement a positive 1.6% update effective March 1, 2003.

Based on the corrections to the formula used to calculate the conversion factor, the new 2003 conversion factor is $36.7856. This change means that Medicare Part B payment rates for all covered audiology services, will be higher in 2003 than would otherwise have been the case. The 2003 Fee Schedule will be effective from March 1, 2003 through December 31, 2003.

All physicians and practitioners now have until April 14, 2003, to make their decision to participate in the Medicare program.

Claims processed by February 28, will be paid at the 2002 rate. Claims submitted for January and/or February services but submitted after February 28, will be paid at the 2003 rate. An adjustment will occur after July 1 to recapture the overpayments.

Public display copy of the 2003 Medicare Physician Fee Schedule final rule occurred on February 26, 2003 and published in the Federal Register on February 28, 2003. View display copy at: https://cms.hhs.gov/regulations/pfs/cms1204f2.pdf and Q & A Document at https://cms.hhs.gov/regulations/pfs/fr2003qa.pdf. Implementing instructions will be posted to the CMS Web site as well.

A updated summary of the 2003 Medicare Fee Schedule and explanation of the payment formula on will be posted on the Academy Web site as soon as it is available.