The Centers for Medicare & Medicaid Services (CMS) has established 2 new HCPCS modifiers that will affect reimbursement rates for the year 2017. The first new HCPCS modifier is FX, which is X-ray taken using film.

The Consolidated Appropriations Act of 2016 (Section 502(a)(1)) Medicare Payment Incentive for the Transition from Traditional X-Ray Imaging to Digital Radiography and Other Medicare Imaging Payment Provision amends the Social Security Act by reducing the payment amounts under the Physician Fee Schedule (PFS) by 20 percent for the technical component (and the technical component of the global fee) of imaging services that are X-rays taken using film.

Beginning January 1, 2017, claims for X-rays using film must include modifier FX. A payment reduction of 20 percent applies to the technical component (and the technical component of the global fee) for X-ray services furnished using film for which payment is made under the Medicare Physician Fee Schedule (MPFS).

Also the Medicare Administrative Contractor (MACs) will compare the OPPS Facility and Non-Facility Payment fields to the Medicare Physician Fee Schedule (MPFS) Facility and Non-Facility amounts and use the lower amount. The FX modifier will reduce whichever of these two amounts applies by 20 percent.

The second new modifier is PN, which is non-excepted service provided at an off-campus, outpatient, provider-based department of a hospital. CMS issued an IFC where modifier PN is further discussed:

CMS-1656-IFC— Establishment of Payment Rates under the MPFS for Non-Excepted Items and Services Furnished by an Off-Campus Provider-Based Department of a Hospital:

"In conjunction with issuing the CY 2017 OPPS and ASC final rule with comment period, CMS also issued an IFC. The changes implemented through this IFC are intended to provide a billing mechanism for hospitals to report and receive payment under the MPFS for non-excepted items and services furnished by off-campus PBDs to Medicare beneficiaries in CY 2017. Physicians furnishing such services will continue to be paid on the professional claim and will be paid at the facility rate under the MPFS consistent with current payment policies for physicians practicing in an institutional setting.

Under this IFC, CMS is establishing interim final site-specific rates under the MPFS for the technical component of all non-excepted items and services. Hospitals will be paid under the MPFS at these newly established MPFS rates for non-excepted items and services, which will be billed on the institutional claim and must be billed with a new claim line modifier “PN” to indicate that an item or service is a non-excepted item or service. For CY 2017, the payment rate for these services will generally be 50 percent of the OPPS rate (there are some exceptions that are spelled out in the IFC, including that payment for separately payable drugs will not be reduced). Packaging, and certain other OPPS policies, will continue to apply to such services. We are seeking public comments on the new payment mechanisms and rates detailed in the IFC and, based on these comments, will make adjustments as necessary to the payment mechanisms and rates through rule-making that could be effective in CY 2017."

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