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Show Page 22 HILL TOP TIMES April 2, 1976 CHAMPUS Explains New Payment Method For Many Benefits Recent changes in the method for determining how much the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) pays for many benefits have created some misunderstandings. To correct these misunderstandings, Defense Department officials emphasize that the recent changes have a slight effect, if any, on most beneficiaries. For some, they actually increase the amount CHAMPUS pays. However, those who receive "high priced" medical help from doctors who decline to participate in CHAMPUS could find themselves paying more out of their own pockets. The new method is viewed as an effort to get the most out of the health care dollar for the greatest number of beneficiaries and to minimize the flow of health care funds to a small percentage of high charging doctors. Also, it provides greater program uniformity and assures that CHAMPUS procedures are consistent with those of the other major Federal medical The prevailing charge: This is the amount charged in the majority of bills for a specific service or supply by all doctors in a geographic area during the previous calendar year. The lowest of these three factors fs considered the "reasonable charge". By law, the amount allowed as the Government's share under CHAMPUS is based on the "reasonable charge', which also includes the beneficiary's - share. The primary impact of the new method is on the way in which the prevailing charge is determined. A time-teste- d standard system is ustdoy Medicare has been adopted. This system sets the prevailing charge at a level high enough to cover the usual charge in three out of four bills for a specific service or supply by all doctors in a geographic area during the previous calendar year. Previously, the level at which the prevailing charge was set (and, hence, the highest level allowed by CHAMPUS) varied from area to area. A number of additional questions have been raised about the new system and its effect on beneficiaries. Following are some of the more frequently asked questions and their answers : Q. Some people believe the new method of determining CHAMPUS payments allows doctors and other providers of medical care to receive only 75 percent of their bill. Is this program, Medicare. The following additional information is provided to combat the misunderstandings: As in the past, many CHAMPUS payments are based on a factor known as a "reasonable charge". These payments include charges for outpatient services and supplies, for maternity care, and for inpatient services and supplies not included in hospital bills. A "reasonable charge" involves consideration of the following three factors: - The actual charge: This is the exact fee charged to a true? Payments allowed by CHAMPUS are not reduced to 75 percent of billed charges. Under the new method, a factor known as the 75th percentile is used, which means simply that the prevailing charge (one of the three factors used to determine the amount allowed by CHAMPUS) i s now set at an amount which is high enough to cover the usual charges for any service or supply in three out of every four bills from all doctors or other providers of medical care in a geographic area during the preceding calendar year. A. No. patient for medical care. The usual charge: This is the amount an individual doctor or other provider of medical care most frequently charges his t patients for a particular service or supply. -- : PREWAY wow: veil sticuld see us new. A Jffittkwe can help you DO-I- .AwVfi: - ' " 5 ' , - - " & ' T Q. What effect does the new method for determining CHAMPUS payments have on the percentage prescribed by law which CHAMPUS pays as its' share of allowable charges for outpatient services or supplies? A. None. The CHAMPUS share of allowable charges remains the same - 80 percent of allowable charges above the deductible for dependents of active duty personnel and 75 percent of allowable charges above the deductible for retirees, their dependents and survivors of deceased active duty and retired personnel. all doctors and other providers of medical care accept CHAMPUS patients? A. No. The decision in this matter is strictly up to the individual doctor or other provider of medical care. Q. Do use a doctor or other provider who does not agree to accept the amount set by CHAMPUS as full payment? If so, what is the financial effect on the Q. Can beneficiaries beneficiaries? A. Yes, beneficiaries can use a doctor or other provider who does not agree to accept the amount allowed by CHAMPUS as full payment. However, they do so at some financial risk because they are responsible for any amount charged by the provider above the amount allowed by CHAMPUS. Thus, it is important in selecting a doctor or other provider that a beneficiary seek out one who agrees, before providing a service or supply, to accept the amount allowed by CHAMPUS as full payment. And it is also important that beneficiaries learn beforehand about a provider's charges. Q. Are there some doctors and other providers who will accept the amount allowed by CHAMPUS as full payment even though their usual and-o- r actual charge for the same service or supply is larger? A. Yes. Many providers will do this. A beneficiary should always determine this before receiving a service or supply. Q. Are there circumstances under which CHAMPUS does not apply the new method? A. Yes. 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