Is the Medicare Physician Fee Schedule like Greek to you? Relax. We’ll explain it to you in plain English.

What, exactly, is the Medicare Physician Fee Schedule? I used to wonder that when I first entered the world of coding and billing. The whole big truth of it seemed like such a mystery that for a few years I (sort of) faked what I knew about the MPFS because it seemed like such a basic question with such daunting answers.

Well, here at My Coding Career we can just learn without posing. Consider this your VERY BASIC guide to the Fee Schedule — whether you’re new brand new to coding or whether, like me, you’ve worked for awhile without having the overall picture.

Every year, the MPFS outlines the rates physician practices will get for the work that they do (with some extra money for practice expenses and malpractice insurance supposedly built in).

Under the Fee Schedule, each CPT® code is assigned a relative value unit, or RVU. The RVUs are adjusted based on the practice’s geographic location — because expenses like the practice’s rent vary across the country. The conversion factor is the national dollar amount multiplied by the geographically adjusted RVU. The fee schedule is a big deal because that’s where Medicare sets reimbursement (and lots of other payers follow suit). It’s also the place where CMS makes a lot of rules for your practice to follow if you bill Medicare.

A draft revised fee schedule comes out every July for the following year, and CMS gives us all a public comment period when we can complain about it. That’s when you hear specialty societies ask to be paid more, not less. The final rule comes out Nov. 1. It sits around here until Nov. 10, when it’s published in the Federal Register. It takes effect January 1, 2010.

What? My physicians are getting a 21 percent pay cut? When you read the announcement from CMS about the final 2010 fee schedule, it may seem like physicians are getting their payments cut by 21 percent. Don’t wig out like I did the first few times I saw the fee schedule come out. CMS has to put that in because they’re supposed to be following an old law that doesn’t work very well. Congress always comes in at the last minute and restores the pay cut, and they’ll probably do that again this year.

Your cocktail party conversation about the MPFS: If you want to sound smart or, okay, help your practice prepare for one of the biggest fee schedule changes in recent years, understand that the 2010 fee schedules axes consultation coding and, generally, increases reimbursement for primary care while dramatically decreasing reimbursement for certain diagnostic imaging procedures.

Tip: You can also use the Medicare Physician Fee Schedule as a cool tool to help prevent denials. Learn the moves here.

Have more questions about how to read the fee schedule? Write me and I’ll show you the ropes, or, more likely, find someone who can. Or, if you have other coding topics you’d like us to cover in ‘My Skill Sharpener,’ write us and ask!