NON PAR PROVIDERS
Non-participating Providers” do in fact participate with Medicare. Non-par providers generally do not accept assignment on a regular basis; however, can choose to accept assignment on a case-by-case basis and be reimbursed at the non-par level. Non-par providers must bill Medicare, but Medicare reimburses the patient versus the provider. The amount patients receive from Medicare will be 5% less than the par-allowed amount and the patient pays the provider for services rendered.A non-par provider can legitimately increase reimbursement by charging the “limiting fees”, which represent the maximum allowable reimbursement. Limiting fees, as well as, par and non-par allowed fees can vary by region, state, and even city and can be found at http://www.cms.gov/.
Participating Versus Nonparticipating Differential
For services/supplies rendered prior to January 1, 1994, the amounts allowed to nonparticipating physicians, under the fee schedule may not exceed 95 percent of the participating fee schedule amount. Payments to other entities under the fee schedule (physiological and independent laboratories, physical and occupational therapists, portable x-ray suppliers, etc.) are not subject to this differential unless the entities are billing for a physician’s professional service. When a nonparticipating nonphysician is billing for a physician’s professional service, Medicare’s allowance could not exceed 95 percent of the fee schedule amount.
For services/supplies rendered on or after January 1, 1994, payments to any nonparticipant may not exceed 95 percent of the fee schedule amount or other payment basis for the service/supply. This five percent reduction applies not only to nonparticipating physicians, physician assistants, nurse midwives, and clinical nurse specialists but also to entities such as nonparticipating portable x-ray suppliers, independently practicing physical and occupational therapists, audiologists, and other diagnostic facilities. Furthermore, these nonparticipating entities including physicians, are subject to the five percent reduction not only when they bill for services paid for under the physician fee schedule, but also when they bill for services that are legally billable under the physician fee schedule, but which are based upon alternative payment methodologies. As of January 1, 9994 and beyond, the services/supplies included in this latter category are drugs and biologicals provided incident to physicians services. The
payment basis for these drugs and biologicals is the lower of the average wholesale price (AWP) or the estimated acquisition cost (EAC). Therefore, the Medicare payment allowance for “incident to” drugs and biologicals billed by and a nonparticipant cannot exceed 95 percent of whichever is lower than the AWP or the EAC.
