Q&A: Billing for purchased services

February 19, 2010

Get your questions answered on marking up purchased services.

Q: We have contracted with a nuclear imaging company to come to our office and conduct imaging studies with its equipment and staff. The company has a qualified medical doctor on retainer to read the images. We pay the imaging company for the studies and bill the global service ourselves. I'm not certain this company is correct when it tells us that it's perfectly okay to purchase all the services from that company and then bill the service as if we performed it, marking up the fee it charges us. I seem to recall something about purchased services but can't find any information on it. Can you assist?

A: The Medicare Claims Processing Manual, Chapter 13, Radiology Services and Other Diagnostic Procedures, 20.2.4.2, indicates that to bill and receive Part B payment for a technical service, the professional service has to be performed by the purchasing physician. The purchased technical service may not be marked up. The claim should identify the provider of the purchased service and how much was paid for it, and the contractor must be enrolled as a provider in the Medicare program. In the past, it was permissible to mark up the professional component, but new rules were put into effect in 2009. The arrangement you describe should be reviewed by a good healthcare attorney who is knowledgeable about recent changes to the rules for purchased diagnostic services.