Military Health System

Payment for non-ancillary professional services, in specified locations outside the 50 U.S. and the District of Columbia, are made utilizing the lesser of (a) billed charges or (b) prospectively determined rates that multiplies the U.S. National CMAC rates by a country specific index factor. The U.S. National CMAC rates are comprised of approximately 7,000 Current Procedural Terminology (CPT) codes. Each CPT code associates with an established CMAC rate. There are a limited number of CPT codes that do not have a U.S. National CMAC established. If these CPT codes are billed to the TRICARE program, they shall be reimbursed at billed charges. The U.S. National CMAC rates utilized in specified locations outside the 50 U.S. and the District of Columbia are paid at “the site of service” location of physicians’ office without regard of the actual location where the service is delivered. This site of service location (physicians’ office) represents the highest reimbursement allowed for all physicians. For example, should a physician, in a specified location outside the 50 U.S. and the District of Columbia, deliver a service in the emergency room, his payment will be based upon the CPT code submitted, and paid at the site of service level of physician office (the highest). Each CPT code rate is multiplied by a specific country index factor and represents the maximum allowed to be paid to professional providers in designated locations outside the 50 U.S. and the District of Columbia. The payment rates are all inclusive. An eligible and a representative procedure code or narrative description must be submitted by the provider or developed by the overseas claims processor.

The country specific index factor is obtained from the World Bank’s International Comparison Program. The index factor, known as Purchasing Power Parity (PPP) conversion factor, is based upon a large array of goods and services or market basket within a specific country which is then standardized and weighted to a U.S. standard and currency. The World Bank defines PPP conversion factor as: “Number of units of a country’s currency required to buy the same amount of goods and services in the domestic market that a U.S. dollar would buy in the U.S.” The use of a country specific index enables a conversion and therefore parity between the U.S. and the specific country in the purchasing of the same amount and type of medical services. TRICARE is utilizing the World Bank’s International Comparison Program country specific index as provided in Figure 1.35-1.

Annually, the Policy and Statistical Analysis Services contractor shall calculate the U.S. National CMAC rates. The data will contain each CPT code, a short description, a U.S. National payment rate, as well as the effective date. On an annual basis, the U.S. National CMAC may increase or decrease as determined by TRICARE. This contractor shall separately supply to the Defense Health Agency (DHA) the country specific index every year or as dictated by the World Bank’s International Comparison program or as determined by TRICARE, which will be included in Figure 1.35-1. The above contractor shall also provide the country specific index adjusted CMAC files, and any updates or corrections, electronically to DHA, which will be provided to the overseas claims processor at least annually, or as specifics may dictate. For those codes that contain a technical as well as professional component, each component shall have a separate supplied payment rate. Updates, additions, changes, revisions or deletions to the CPT codes or country specific index or CMACs will be communicated to the overseas claims processor and shall be considered as routine updates to this payment system and processed under TRICARE Operations Manual (TOM), Chapter 1, Section 4, paragraph 2.4. The adjusted per diems will be available at: http://www.health.mil/Military-Health-Topics/Business-Support/Rates-and-Reimbursement/Foreign-Rates.

Since the payment is on a date of service basis, the professional, and other charges shall be paid for all dates of service that the beneficiary is TRICARE eligible and denied for all dates of services the beneficiary is not TRICARE eligible.

Beneficiary cost-shares are contained in Chapter 2, Sections 1 and 2, and shall be applicable to TRICARE’s applicable professional allowable charges.

Effective January 1, 2013, ancillary services in Panama shall be paid using the lesser of billed charges or 250% of the U.S. National CMAC.