Virginia Administrative Code › Title 12 - HEALTH › Agency 30 - DEPARTMENT OF MEDICAL ASSISTANCE SERVICES › Chapter 80 - METHODS AND STANDARDS FOR ESTABLISHING PAYMENT RATE; OTHER TYPES OF CARE › Section 12VAC30-80-300 - Medicare equivalent of average commercial rate

Current through Register Vol. 40, No. 24, July 15, 2024
Physician supplemental payment amounts shall be calculated
				  using the Medicare equivalent of the average commercial rate (ACR) methodology
				  prescribed by CMS. The following methodology describes the calculation of the
				  supplemental payment. To compute the ACR by commercial payers, calculate the
				  average amount reimbursed for each procedure code (e.g., CPT or HCPCS) by the
				  top five commercial payers for a specified base period. Data from Medicare,
				  Workers' Compensation, and other noncommercial payers and codes not reimbursed
				  by Medicaid are excluded.
(Payer 1 + Payer 2 + Payer 3 + Payer 4 + Payer 5) / (5) =
				  Average Commercial Reimbursement
To compute the reimbursement ceiling, multiply the average
				  reimbursement rate as determined by the number of claims recorded in Medicaid
				  Management Information System (MMIS) for each procedure code that was rendered
				  to Medicaid members by eligible physicians during the base period. Add the
				  product for all procedure codes. This total represents the total reimbursement
				  ceiling.
(Average Commercial Reimbursement) X (Medicaid Count) = Total
				  Reimbursement Ceiling for each Procedure Code
Sum of Total Reimbursement Ceiling for each Procedure Code =
				  Total Reimbursement Ceiling
To determine the Medicare equivalent to the reimbursement
				  ceiling, for each of the billing codes used to determine the reimbursement
				  ceiling, multiply the Medicare rate by the number of claims recorded in MMIS
				  for each procedure code that was rendered to Medicaid members during the base
				  period. Add the product for all procedure codes. This sum represents the total
				  Medicare reimbursement that would have been received. Divide the reimbursement
				  ceiling (commercial payment) by Medicare reimbursement. This ratio expresses
				  the ACR as a percentage of Medicare.
(Medicare Rate) X (Medicaid Count) = Total Medicare
				  Reimbursement for each Procedure Code
Sum of Total Medicare Reimbursement for each Procedure Code =
				  Total Medicare Reimbursement
(Total Reimbursement Ceiling) / (Total Medicare
				  Reimbursement) = Medicare equivalent of the ACR
This single ratio is applied to the Medicare rates for
				  reimbursable Medicaid practitioner services to determine the total allowable
				  Medicaid payment, including both the regular base payment and supplemental
				  payment.
(Medicare equivalent of the ACR) X (Medicare rate per CPT
				  Code for all applicable CPT Codes) = Total Allowable Medicaid Payment
Total Allowable Medicaid Payment - Medicaid Base Payment =
				  Maximum Supplemental Payment
The Medicare equivalent of the ACR demonstration shall be
				  updated every three years. Only the professional component of radiology
				  services and clinical laboratory services is included in the ACR calculation.
				  Claims with a technical component are excluded from the
				  demonstration.
Statutory Authority: § 32.1-325 of the Code of
					 Virginia; 42 USC § 1396 et seq.