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Family Practice Coding Alert

Reader Question:

Varying Rates

Question: Can a practice have different charges for patient types, i.e., Medicaid, Medicare, commercial and private payer?

New Jersey Subscriber

Answer: This is not a recommended practice for a variety of reasons:

Varying rates may result in price discrimination charges.

Management of multiple fee schedules is difficult and fraught with potential error. Staff members would have to keep various charges for different payers straight and may assign them inaccurately, resulting in lost revenue.

Charging different fees may harm patient relations. Its difficult to explain to one patient why another patient was charged less for the same procedure.

Coders should also be aware that fees submitted on HCFA and electronic claim forms are entered into a reasonable and customary (R&C) or prevailing fee database. Every time you discount your fee on a claim, you help the insurance industry lower the R&C allow-ances for that CPT code.

One exception to consider applies to self-pay patients. In these cases, you may want to bill your full fee, but allow a charity write-off so you can collect a lesser amount for cash paid at time of service.