Just when you though reimbursement couldn’t get more complicated…

Most of us as nurse practitioners don’t entirely understand how we’re paid. Sure, our employer cuts us a check once or twice a month. But, what I’m talking about here isn’t wages, rather reimbursement. Our employers must seek reimbursement by Medicare, Medicaid, and insurance companies for the services we render as NPs. 

While contacting Medicare to request reimbursement for the cost of a patient encounter seems simple in theory, the process is highly complex. The requested dollar amount will be run through a series of codes and equations, determining a different total based on the location where you practice as well as the complexity of the service provided. Then, if the encounter was billed by you as a nurse practitioner rather than a physician, the reimbursement amount will be adjusted further…in most cases that is. 

Traditionally, reimbursement for services rendered by healthcare providers has been based on the amount and complexity of care provided. This is known as the fee-for-service model. Problems have arisen with the fee-for-service model in that more care does not always equal the best care. The fee-for-service model, for example, incentivizes physicians and nurse practitioners to order tests and treatment the patient may not need. Providers who see more patients, do more procedures, and order more tests earn the most, regardless of the patient’s experience or outcome. In a healthcare climate where the cost of medical care is continually on the rise, policymakers are looking for a way to compensate providers that is more in line with quality of care and the nation’s goal or reducing healthcare costs. 

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As a nurse practitioner you may have noticed that over the past few years the Centers for Medicare and Medicaid Services (CMS) has already begun the transition from rewarding the amount of care provided to the quality of care provided. Increasingly, measures such as glycemic control among diabetic patients and adherence to statin therapy for patients with coronary artery disease are financially rewarded. 

Last month, CMS took an unprecedented leap toward the implementation of a provider reimbursement model based on quality of care and other performance measures. The ruling on the Medicare Access and CHIP Reauthorization Act (MACRA), in its 1,000+ page glory, was finalized in October. 

Overall, MACRA changes the way physicians, nurse practitioners, and physician assistants will be reimbursed by Medicare. MACRA repeals the Sustainable Growth Rate Formula (SGR) that was introduced in 1997 to determine payment for healthcare services, replacing it with a new model. MACRA ties provider’s reimbursement rates to meeting certain performance measures such as clinical quality and resource utilization.

The new ruling will undoubtedly leave medical practices scrambling to comply with new guidelines and to maximize reimbursement under the new policy. If you’re a nurse practitioner, expect a few changes coming your way. 


You Might Also Like: Medicare vs. Medicaid – Which Pays Nurse Practitioners More?


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