Services Furnished within a Physician Scarcity Area – AR modifier

Description : Services Furnished within a Physician Scarcity Area (PSA)
Required for Claims : Critical Access Hospitals (CAHs) Electing the Optional Payment Method
(Method II)
Type of Bill: 85X
Coding Guidelines : Services that qualify for the 5% PSA bonus must have an AR modifier.

General Guidelines :

1) Medicare will pay a 5% PSA bonus on a quarterly basis, and the bonus will be based on what Medicare actually paid not on the Medicare-approved payment amount.

2) Payment will be based on where the service is performed and not the address of the beneficiary.

3) The PSA bonus will be paid on services rendered on or after January 1, 2005 through December 31, 2007.

4) On the provider designations of General Practice (01), Family Practice (08), Internal Medicine (11), and Obstetrics/Gynecology (16) will be paid the bonus for the Zip codes designated as primary care PSAs. All other physician provider specialties will be eligible for the specialty scarcity bonus for the zip codes designated as specialty PSAs.

5) Dentists, chiropractors, podiatrists and optometrists are not eligible for the
physician scarcity bonus as either primary care or specialty physicians.