CMS Pub. 100-04, ch. 4, § 250.3.2

Setting

(Rev. 2452, Issued: 04-26-12, Effective: 01-10-12, Implementation: 10-01-12)

When a medically necessary anesthesia service is furnished within a HPSA area by a

physician, a HPSA bonus is payable. In addition to using the PC/TC indicator on the

CORF extract of the MPFS Summary File to identify HPSA services, pay physicians the

HPSA bonus when CPT codes 00100 through 01999 are billed with the following

modifiers: QY, QK, AA, or GC and “QB” or “QU” in revenue code 963. Modifier QB or

QU must be submitted to receive payment of the HPSA bonus for claims with dates of

service prior to January 01, 2006. Effective for claims with dates of service on or after

January 01, 2006, the modifier AQ, physician providing a service in a health professional

shortage area, may be required to receive the HPSA bonus. Refer to §250.2.2 of this

chapter for more information on when modifier AQ is required.

The modifiers signify that a physician performed an anesthesia service. Using the

Anesthesia File (See Section above) the physician service will be 115 percent times the

payment amount to be paid to a CAH on Method II payment plus 10 percent HPSA bonus

payment.

Anesthesiology modifiers:

AA = anesthesia services performed personally by anesthesiologist.

GC =service performed, in part, by a resident under the direction of a teaching physician.

QK = medical direction of two, three, or four concurrent anesthesia procedures involving

qualified individuals.

QY = medical direction of one CRNA by an anesthesiologist.

Modifiers AA and GC result in physician payment at 100% of the allowed amount.

Modifiers QK and QY result in physician payment at 50% of the allowed amount.

Data elements needed to calculate payment:

• HCPCS plus Modifier,

• Base Units,

• Time units, based on standard 15 minute intervals,

• Locality specific anesthesia Conversion factor, and

• Allowed amount minus applicable deductions and coinsurance amount.

Formula 1: Calculate payment for a physician performing anesthesia alone

HCPCS = xxxxx

Modifier = AA

Base Units = 4

Anesthesia Time is 60 minutes. Anesthesia time units = 4 (60/15)

Sum of Base Units plus Time Units = 4 + 4 = 8

Locality specific Anesthesia conversion factor = $17.00 (varies by localities)

Coinsurance = 20%

Example 1: Physician personally performs the anesthesia case

Base Units plus time units - 4+4=8

Total units multiplied by the anesthesia conversion factor times .80

8 x $17= ($136.00 - (deductible*) x .80 = $108.80

Payment amount times 115 percent for the CAH method II payment.

$108.80 x 1.15 = $125.12 (Payment amount)

$125.12 x .10 = $12.51 (HPSA bonus payment)

*Assume the Part B deductible has already been met for the calendar year

Formula 2: Calculate the payment for the physician’s medical direction service when the

physician directs two concurrent cases involving CRNAs. The medical direction

allowance is 50% of the allowance for the anesthesia service personally performed by the

physician.

HCPCS = xxxxx

Modifier = QK

Base Units = 4

Time Units 60/15=4

Sum of base units plus time units = 8

Locality specific anesthesia conversion factor = $17(varies by localities)

Coinsurance = 20 %

(Allowed amount adjusted for applicable deductions and coinsurance and to reflect

payment percentage for medical direction).

Example 2: Physician medically directs two concurrent cases involving CRNAs Base

units plus time - 4+4=8

Total units multiplied by the anesthesia conversion factor times. 50 equal allowed amount

minus any remaining deductible

8 x $17 = $136 x .50 = $68.00 -(deductible*) = $68.00

Allowed amount Times 80 percent times 1.15

$68.00 x .80 = $54.40 x 1.15 = 62.56 (Payment amount)

$62.56 x .10 = $6.26 (HPSA bonus payment)

*Assume the deductible has already been met for the calendar year.

NOTE: For specific guidance on payment for Anesthesia and Teaching Services please

review the following sections:

-

Payment for Anesthesiology Services Pub.100-04, Chapter 12, Section 50

- Teaching Physician Services Pub.100-04, Chapter 12, Section 100.1.2 (4)

Anesthesia.