Samuel A. Collins
Question: I recently noticed that on some claims, the VA, UnitedHealthcare and Optum Health reduce fees based on a “multi-therapy” discount. What is happening – and is there any way to prevent it?
As you note, with some plans – and it starts with Medicare (CMS) – there is a payment protocol that may be referred to as a multi-therapy discount, but its official name is the multiple-procedure payment reduction (MPPR). This protocol means that if a health care provider performs multiple procedures during a single patient encounter, Medicare (and many commercial insurers) typically will pay “full price” for only the highest-valued procedure. The subsequent procedures will be reduced, as there is overlap.
Why It Happens
Most medical and surgical procedures include pre-procedure, intra-procedure and post-procedure work. When multiple procedures are performed at the same patient encounter, there is often overlap of the pre-procedure and post-procedure work.
For instance, if three units of a service were completed in a single visit, the pre- and post-service associated with the code would overlap. For this reason, the MPPR reduces the portion of the value of the service that coincides with that overlap.
In these circumstances, per the Centers for Medicare and Medicaid Services, “reduction in reimbursement for secondary and subsequent procedures will occur. Payment at 100% for secondary and subsequent procedures would represent reimbursement for duplicative components of the primary procedure.”
These duplicated elements include cleaning the room and equipment; education, instruction, counseling and coordinating home care; greeting the patient and providing the gown; obtaining measurements (e.g., range of motion); and post-therapy patient assistance.
Breaking Down the Numbers
The subsequent services are reduced by 50% of the practice expense (PE) associated with the code. Note this is not 50% of the code value, but only the portion that is considered PE. The PE is one of three categories that make up the relative value unit (RVU):
- Physician Work RVU: The relative level of time, skill, training, and intensity to provide each given service. This is based upon individual CPT codes, which are re-analyzed at least every five years.
- Practice Expense RVU: Expenses that go into running the practice, not including physician time. This may include items such as rent, equipment, supplies and non-physician staff.
- Malpractice RVU: Payment associated with the professional liability expenses.
The PE equates to about 44% of the total value of the code; a 50% reduction would mean about a 7-20% reduction of the total. This is why you will notice the reduction is not large – often between $3-$10, depending on the value of the service. However, those amounts still add up and reduce reimbursement overall.
Can You Limit Reductions?
The only way to limit these reductions is not to bill payers who utilize them, or not bill multiple services per visit, which is not reasonable, as doing so will fully impact reimbursement. However, having policies in place can help create clarity for you and your staff:
- Ensure relevant staff members understand MPPR and its implications for coding and billing.
- Make sure clinical and billing staff know to list the highest-value procedure first, followed by others in descending order of value. (Use RVU to rank.)
- Different payers may have varying MPPR rules. Be aware of these differences when negotiating managed care contracts.
- Some codes are exempt, including E/M services, CMT spinal and extraspinal, acupuncture, or any CPT that is noted as modifier 51 exempt.
Editor’s Note: Have a billing question? Submit it via email to Sam at sam@hjrossnetwork.com. Your question may be the subject of a future column. Note that submission of a question is acknowledgment that it may be referenced (anonymously) in his column.
