PostHeaderIcon Temporary fix to what seem like permanent problem


President Obama signed H.R.4691 – Temporary Extension Act of 2010 into law on 3/2/10

Time and money spent on administering health care is a necessary cost, but when this goes to the extreme, one must take note and wonder. Medicare, our largest “insurance” in the nation is closely controlled by government rules and regulations. One would say that the government, that wants to lower health care cost, would not create additional burden for providers and insurance companies in the form of, well, additional administrative cost.

The freshly signed H.R. 4691 is a prime example of administrative government squander. This bill allows two Medicare fixes on the temporary basis; patches a 21.5% physicians pay cut, and extends the physical therapy exception process.

Pay rates for doctor services are calculated by a formula based on the GDP, the number of beneficiaries, and other variables. It has been in place for 13 years.  Due to drop in the GDP and increase in the number of beneficiaries, the doctors were to receive a 21.5% pay cut on January 1st. This law allows a temporary override, leaving doctors pay at present level until March 31, 2010.  

Physical therapy enables patients to regain their mobility after surgery, injury, illness, etc. Caps on therapy services were put in place to control Medicare expenses. The cap exception process allows some individuals to continue therapy, above the annual limit, when suffering from additional complex medical conditions.  For example, Parkinson’s disease qualifies a Medicare beneficiary to receive more physical therapy services under the exception rule.

A physical therapy service exception has expired on December 31, 2009. Once a beneficiary reaches their limit, they are notified and must pay out of pocket for additional services.  The new extension allows payment and now, claims need to be resubmitted, or reprocessed.

Starting on April first the same, insane, process will begin.  Medicare intermediaries will hold claims and wait for the government to fix payment rates.

The administrative nightmare is going on behind the scenes.  The Medicare contractors (actual insurance companies) are holding claims for two weeks, and then release them, applying rates that is in effect at that time. Most certainly these insurance companies had and will have administrative cost increase related to the frequently changing regulations that need to be added to their systems. Would someone remind the government that they suppose to lower the administrative cost instead of increasing it?

Leave a Reply

The authentication requires knowledge of second grade arithmetic; please resolve the equation below, prior to continuing: * Time limit is exhausted. Please reload CAPTCHA.