MIR-2006-10B, October 2006

What Is HPSA/PSA?

The following is an overview of Medicare’s bonus program for physicians who provide services in a Health Professional Shortage Area (HPSA) or Physician Scarcity Area (PSA).

Health Professional Shortage Area (HPSA)
Physicians who provide covered professional services in any rural or urban Primary Care Health Professional Shortage Area (HPSA) are entitled to a ten-percent bonus payment. A Health Profess-ional Shortage Area is an area, either urban or rural, designated as having a shortage of health-care professionals. In addition, effective for claims with dates of service on or after July 1, 2004, psychiatrists (Provider Specialty 26) furnishing services in an area designated as a Mental Health HPSA are eligible to receive bonus payments quarterly. If an area is designated as both a Primary Care HPSA and a Mental Health HPSA, only one (1) ten-percent bonus payment will be made for a covered service.

Physician Scarcity Area (PSA)
Medicare will pay a five-percent PSA bonus on a quarterly basis. A single service may be eligible for both the PSA bonus and the HPSA bonus. The PSA bonus will be paid on services rendered on or after January 1, 2005 through December 31, 2007. Only the provider designations of General Practice (01), Family Practice (08), Internal Medicine (11), and Obstetrics/Gynecology (16) will be paid the bonus on zip codes designated as Primary Care PSAs. All other physician provider specialties will be eligible for a Specialty Care PSA bonus for the zip codes designated as specialty PSAs. Dentists, chiropractors, podiatrists, and optometrists are not eligible for a physician scar-city bonus as either primary care or specialty physicians.

 HPSA/PSA Eligibility and Designation
The location of the office or primary service loca-tion of a provider does not determine HPSA/PSA eligibility, nor is HPSA/PSA determined because a beneficiary resides in a HPSA or PSA. The key to HPSA or PSA eligibility is where the service is actually provided (place of service). For example:

• A physician providing a service in his/her office, the patient’s home, or in a hospital qualifies for the bonus payment as long as the specific location of the service is within an area designated as a HPSA or PSA.
• A physician may have an office in a HPSA or PSA, but go outside the designated HPSA/PSA area to provide the service. In this case, the physician would not be eligible for the bonus.
• The office address is not located within a HPSA or PSA. Therefore, the physician is not entitled to a bonus payment for services provided at this address. However, if this same physician travels to a nursing facility, the patient’s home, or a hospital within a HPSA or PSA designated area, the physician would be eligible for the bonus.

PSA Automatic Payments

• Medicare will automatically pay the bonus without the need for a modifier on the claim for services provided in zip code areas that:
  1. Fall within a county designated as a PSA; or
  2. Fall partially within a county designated as a PSA and are considered to be dominant in that county, based on a determination of the U.S. Postal Service; or
  3. Fall within a rural area of a metropolitan statistical area identified through the latest modification of the Goldsmith modification that is determined to be a PSA.
• In some cases, a service may be provided in a county that is considered a PSA, but the zip code is not considered to be dominant for that area. In these cases the bonus payment cannot be made automatically. To receive the bonus for such services, physicians will need to include a new modifier of AR to reflect a physician service provided in a PSA.
• Services submitted with the AR modifier will be subject to validation by Medicare.
• Zip codes that are eligible for automatic payment of the physician scarcity bonus are posted on the CMS Web site at http://www.cms.hhs.gov/HPSAPSAPhysicianBonuses/ .

How to Determine HPSA/PSA Eligibility
The first step in billing for HPSA/PSA bonus payments should be verification of the eligibility of the location where the services were performed.

HPSA/PSA Designations
The Division of Shortage Designation (DSD) of the Public Health Service (PHS) determines HPSA/PSA designations. Requests for additional information on HPSA/PSA designations, withdrawals, or reinstatement of a withdrawn designation should be directed to:

Public Health Services
Division of Shortage Designation
4350 East-West Highway
Room 91-D1
Bethesda, MD 20814

HPSA Locations
Although some HPSAs span entire counties (or other territorial subdivisions within a state), typically, they represent only sections of counties.

Urban HPSAs, particularly in large metropolitan areas, are usually identified by census tract. To help you identify specific street addresses within a census tract, contact your County Planning Office.

Determine Your Census Tract Location
In order to determine your census tract location, you must contact the Bureau of the Census Regional Office. When contacting the Bureau of the Census, identify yourself as an office assistant, physician, or hospital, etc., and the reason for calling. Physicians located in New Jersey should write or call your local planning commission or contact the Bureau of the Census at the following address :

Bureau of the Census
Partnership and Data Services Program
1601 Market Street
21st Floor
Philadelphia, PA 19103
(215) 656-7578

Claim Coding Requirements and Payment
The ten-percent (HPSA) or five-percent (PSA) bonus payment is based on the amount actually paid by Medicare, not the approved amount. Payment is made for services identified on either assigned or unassigned claims.

Some HPSA/PSA areas are designated as auto pay areas based on the zip code. For these auto pay areas, no modifier is required to receive the HPSA/PSA payment. To determine if your area is designated as an auto pay HPSA/PSA area, please visit the Centers for Medicare & Medicaid Services Web site at http://www.cms.hhs.gov/providers/bonuspayment/ .

Physicians whose zip codes are not on the auto pay list must indicate that their services were provided in a bonus-eligible rural or urban HPSA/PSA by using the following modifiers:

QB - service was provided in a rural HPSA for dates of service prior to January 1, 2006.
QU - service was provided in an urban HPSA for dates of service prior to January 1, 2006.
AQ - service was provided in a HPSA for dates of service on or after January 1, 2006.
AR - service was provided in a PSA.

As of January 1, 2006, it is no longer necessary to distinguish between rural or urban HPSA areas.

The QB, QU, or AQ modifier must be reported next to the procedure code. The provider must report the address where the service was actually performed.

The bonus payments are not included with each claim payment. Rather, a quarterly schedule is established for issuing bonus payments. A remit-tance will accompany each quarterly payment.

These payments are taxable and must be reported to the IRS.

When you receive your HPSA/PSA remittance, if you discover that one or more of the claims should not have been paid a bonus, please contact us with the claim information.

Bonus Payments Limited to Professional Services
Health Professional Shortage Area (HPSA)/Physician Scarcity Area (PSA) bonus payments are limited to professional services only.

Eligible Providers
Only the physician specialties listed below are eligible to receive the HPSA bonus payment for services that are rendered in a HPSA:

• Doctors of Medicine
• Doctors of Osteopathic Medicine
• Doctors of Dental Surgery
• Doctors of Chiropractic Medicine
• Doctors of Podiatric Medicine
• Doctors of Optometry

New Jersey Eligible HPSAs
Eligible HPSAs within our New Jersey Medicare carrier service area are listed below. This list of geographic HPSAs is the most current information received from the Centers for Medicare & Medicaid Services.

New York HPSA Service Areas
RURAL Service Areas

The following municipalities within the counties listed below are designated as HPSA:

URBAN Service Areas
Bronx County
Kings County (Brooklyn)
New York County (Manhattan)

Census tract numbers further define these service areas, as not all areas within the above urban counties are designated as HPSA/PSA. If you are unsure if an area is a designated HPSA/PSA, you may visit the following Web site to obtain a census tract number: http://www.ffiec.gov/geocode/default.htm .

After you have obtained a census tract number, you may visit the following Web site to determine if an area is a designated HPSA/PSA: http://www.empiremedicare.com/hpsa/index.htm.

There are seven counties that have not been designated as HPSA:

New York PSA Service Areas
Primary Care PSA Service Areas
The following counties are designated as Primary Care PSA:

Delaware
Greene
Sullivan

Specialty Care PSA Service Areas
The following counties are designated as Specialty Care PSA:

Delaware
Greene

Appeal Rights
If you did not receive a HPSA/PSA bonus payment, but believe that you are entitled, you may request that we reopen the claim.

For New Jersey appeals, write to:

Empire Medicare Services
Part B Appeals
P.O. Box 69202
Harrisburg, PA 17106-9202

For New York appeals, write to:

Empire Medicare Services
Part B Written Correspondence
P.O. Box 2280
Peekskill, NY 10566

You have one year from the date on your original remittance to request a reopening of a HPSA/PSA payment. If a reopening is not requested within the one-year period, the claim will remain finalized.

If the servicing address supports payment of a HPSA/PSA bonus, the reopened claims will be included on your next quarterly payment schedule.

Prepayment Validation – (NY only)
When possible, Medicare will perform a prepayment validation of HPSA/PSA eligibility. If the place of service address on the claim is found to be outside the designated HPSA/PSA areas, the HPSA/PSA modifier will be changed to a CC, and a message will appear on the provider’s remittance. The HPSA/PSA bonus will not be paid on those claims found to be outside the eligible HPSA/PSA areas defined by the Centers for Medicare & Medicaid Services (CMS).

Postpayment Review (NY and NJ)
Each quarter, an analysis is performed on a sample of physicians who received HPSA/PSA bonus payments for the prior quarter.

If we discover, in our review process, that any claims submitted should not have been paid bonus payments, the claims will be adjusted.

It is not necessary to send a check for the HPSA/PSA overpayment amount, as it will be deducted from your future HPSA/PSA bonus payment check. If there is a remaining balance, or there is no HPSA/PSA check to be sent, our accounting department will contact you for the amount due.

© All current procedural terminology (CPT) codes and descriptors copyrighted by the American Medical Association.