Chapter 12: Fee Schedule Setup

Overview

Fee Schedule Setup is where you configure billing rates for private payers (commercial insurance, Medicaid managed care, and other non-Medicare payers). Fee schedules define how much your agency charges for each visit type with each payer. This chapter covers:

• Understanding fee schedules vs. HIPPS rates
• Accessing payer fee schedules
• Adding and managing fee schedule rates
• Effective dates and rate changes
• Status management for fee schedules

Who Should Read This Chapter:

• Agency Administrators
• Billing Managers
• Financial Officers
• Reimbursement specialists

Prerequisites:

• Completed payer setup (Chapter 6)
• Completed visit type setup (Chapter 11)
• Understanding of billing and reimbursement basics

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12.1 Understanding Fee Schedules

12.1.1 What is a Fee Schedule?

A Fee Schedule defines the charge amount (billing rate) for each visit type with a specific payer.

Components:

• Payer: The insurance company or payer (e.g., Blue Cross Blue Shield, Aetna, Medicaid Managed Care)
• Visit Type: The type of visit (e.g., SN Visit, PT Evaluation, HHA Visit)
• Charge Amount: The dollar amount your agency charges for that visit type
• Effective Date: When this rate becomes active
• End Date: When this rate expires (optional; if blank, rate is active indefinitely)
• Status: Active or Inactive

Example Fee Schedule Entry:

Payer	Visit Type	Charge Amount	Effective Date	End Date	Status
Blue Cross Blue Shield	SN Visit	$121.00	11/28/2025	-	Active
Blue Cross Blue Shield	HHA Visit	$300.00	12/14/2025	-	Active
Blue Cross Blue Shield	PT Evaluation	$3,020.00	12/5/2025	-	Active

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12.1.2 Fee Schedules vs. HIPPS Rates

Fee Schedules (This Chapter):

• For: Private payers (Blue Cross, Aetna, UnitedHealthcare, Medicaid Managed Care, etc.)
• Structure: Per-visit billing (each visit has a specific rate)
• Configuration: Set in the Payer Setup → Fee Schedule tab
• Example: SN Visit with Blue Cross = $121.00 per visit

HIPPS Rates (Chapter 6):

• For: Medicare only
• Structure: Per-30-day-period billing (paid based on PDGM and HIPPS code)
• Configuration: Set in the Payer Setup → HIPPS Rates tab (for Medicare payer)
• Example: HIPPS code 1AA11 = $2,500.00 per 30-day period

Key Difference:

• Medicare → Uses HIPPS Rates (not fee schedules)
• Private Payers → Use Fee Schedules (not HIPPS rates)

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12.1.3 Why Fee Schedules Are Important

Accurate Billing:

• Ensures claims are submitted with the correct charge amounts
• Prevents under-billing (lost revenue) or over-billing (audit risk)

Contract Management:

• Tracks negotiated rates with each payer
• Allows you to update rates when contracts are renewed

Financial Reporting:

• Compares expected revenue (based on fee schedules) to actual payments
• Identifies discrepancies (e.g., payer paying less than contracted rate)

Claim Submission:

• Fee schedule rates are automatically used when generating claims for private payers
• Reduces manual entry errors

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12.2 Accessing Fee Schedules

Navigation Path

Fee schedules are configured per payer (each payer has its own fee schedule).

1. From the Dashboard: Click the Settings icon (gear icon) in the top-right header bar
2. Select "Payer Setup" from the dropdown menu
3. The Payer Management page opens, showing all configured payers
4. Click on a payer (e.g., "Blue Cross Blue Shield")
5. The Payer Configuration page opens
6. Click the Fee Schedule tab (next to "Profile & Rules" and "HIPPS Rates" for Medicare)

What You'll See:

• Payer Name at the top (e.g., "Payer Configuration: Blue Cross Blue Shield")
• Fee Schedule tab (active)
• Table showing all configured fee schedule rates:
  • Visit Type (e.g., Wound Care Visit, HHA Visit, OASIS - Discharge)
  • Rate ($) (e.g., $300.00, $3323.00)
  • Effective Date (e.g., 12/15/2025)
  • End Date (e.g., "-" for no end date, or a specific date like 12/8/2025)
  • Status (e.g., Active)
  • Actions (Edit and Delete icons)
• + Add Rate button in the top-right corner

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12.3 Adding a New Fee Schedule Rate

12.3.1 Click "+ Add Rate"

1. In the Fee Schedule tab of a payer, click the + Add Rate button (top-right)
2. The Add Fee Schedule Rate modal will open

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12.3.2 Complete the Fee Schedule Rate Form

Visit Type

• Required: Yes
• Format: Dropdown selection
• Purpose: The visit type for which you're setting a rate
• Options: All visit types (standard and custom) from Chapter 11
  • SN Visit
  • PT Evaluation
  • HHA Visit
  • OASIS assessments
  • Custom visit types (if created)

Example:

• Select "SN Visit" to set a rate for skilled nursing visits with this payer

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Charge Amount (Rate)

• Required: Yes
• Format: Dollar amount (up to 2 decimal places)
• Purpose: How much your agency charges this payer for the selected visit type
• Examples:
  • $121.00 - Skilled nursing visit
  • $300.00 - Home health aide visit
  • $3,020.00 - Physical therapy evaluation

Where to Find Rates:

• Payer Contracts: Review your signed contract with the payer
• Negotiated Rates: Rates agreed upon during contract negotiations
• Fee Schedule Documents: Payers often provide a fee schedule document listing rates for all service codes
• Your Billing Department: Your billing manager or financial officer should have this information

Important:

• Enter the contracted rate (not your "usual and customary" charge)
• Payers will reimburse based on the contracted rate, so ensure accuracy

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Effective Date

• Required: Yes
• Format: Date picker (MM/DD/YYYY)
• Purpose: The date this rate becomes active
• Examples:
  • 12/15/2025 - Rate is effective starting December 15, 2025
  • 01/01/2026 - Rate is effective starting January 1, 2026 (common for annual rate updates)

How It Works:

• Claims for visits on or after this date will use this rate
• If multiple rates exist for the same visit type, the system uses the rate with the most recent effective date

Best Practice:

• Set the effective date to match your contract's start date
• For rate changes, create a new fee schedule entry with the new rate and effective date (don't delete the old rate until after the effective date)

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End Date (Optional)

• Optional
• Format: Date picker (MM/DD/YYYY)
• Purpose: The date this rate expires (if applicable)
• Examples:
  • Leave blank (-) - Rate is active indefinitely
  • 12/31/2026 - Rate expires on December 31, 2026 (useful for temporary contracts or rate guarantees)

When to Use End Date:

• Temporary Contracts: Short-term contracts with expiration dates
• Pilot Programs: Special rates for a trial period
• Rate Guarantees: Contracted rates that expire after a certain period

What Happens After End Date:

• The rate becomes inactive automatically
• Claims submitted after the end date will not use this rate (you must add a new rate for the next period)

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Status

• Required: Yes
• Format: Dropdown selection
• Options:
  • ACTIVE - Rate is currently in use for billing
  • INACTIVE - Rate is not used (archived or superseded)

Default: ACTIVE

When to Set Inactive:

• You've replaced this rate with a new rate
• The payer contract has ended
• You no longer accept this payer

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12.3.3 Save the Fee Schedule Rate

After completing all fields:

1. Click Save or Add Rate at the bottom of the modal
2. The system validates:
   • ✅ Visit Type is selected
   • ✅ Charge Amount is a valid dollar amount
   • ✅ Effective Date is provided
   • ✅ No duplicate rate exists for the same payer + visit type + effective date
3. If validation passes, the rate is added
4. A Success toast notification appears: "Fee schedule rate added successfully"
5. The new rate appears in the fee schedule table

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12.4 Editing an Existing Fee Schedule Rate

To update a fee schedule rate:

12.4.1 Locate the Rate

1. In the Fee Schedule tab, locate the rate you want to edit in the table

12.4.2 Click the Edit Icon

1. Click the Edit icon (pencil icon) next to the rate
2. The Edit Fee Schedule Rate modal opens with pre-filled information

What You Can Edit:

• Visit Type (if no claims have been submitted with this rate)
• Charge Amount (rate)
• Effective Date
• End Date
• Status (Active/Inactive)

What You Cannot Edit:

• Payer (fee schedules are payer-specific)
• Historical claims that used this rate (claims are immutable)

12.4.3 Save Your Changes

1. Update the necessary fields
2. Click Save or Update Rate
3. A Success toast notification appears: "Fee schedule rate updated successfully"

Important:

• Editing a rate does not affect past claims (historical data is preserved)
• Editing a rate affects future claims generated on or after the effective date

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12.5 Deleting a Fee Schedule Rate

12.5.1 When to Delete

Delete a fee schedule rate if:

• ❌ The rate was created by mistake and has never been used
• ❌ You want to permanently remove it from the system

Do NOT delete a rate if:

• ✅ Claims have already been submitted using this rate (set it to INACTIVE instead)
• ✅ You're updating rates (create a new rate with a new effective date instead of deleting the old one)

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12.5.2 How to Delete

1. In the Fee Schedule tab, locate the rate
2. Click the Delete icon (trash can icon)
3. A confirmation dialog appears: "Are you sure you want to delete this rate? This action cannot be undone."
4. Click Delete to confirm

Warning:

• Deleting a rate can affect claims if they reference this rate
• Best Practice: Set the rate to INACTIVE instead of deleting

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12.6 Managing Rate Changes and Updates

12.6.1 When Payer Rates Change

Payers often update their fee schedules annually or when contracts are renegotiated.

Scenario: Blue Cross Blue Shield notifies you that SN Visit rates will increase from $121.00 to $130.00 effective January 1, 2026.

How to Handle This:

1. Do NOT edit the existing rate (preserve historical data)
2. Add a new rate:
   • Visit Type: SN Visit
   • Charge Amount: $130.00
   • Effective Date: 01/01/2026
   • End Date: Leave blank (or set based on contract)
   • Status: ACTIVE
3. Click Save

Result:

• Claims for visits before January 1, 2026 use the old rate ($121.00)
• Claims for visits on or after January 1, 2026 use the new rate ($130.00)
• Both rates remain in the system for audit and reporting purposes

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12.6.2 Overlapping Rates (How the System Chooses)

What if multiple active rates exist for the same visit type?

The system uses the rate with the most recent effective date that is on or before the visit date.

Example:

Rate	Effective Date	Status	Rate Amount
Rate 1	01/01/2025	Active	$121.00
Rate 2	01/01/2026	Active	$130.00

• Visit on December 15, 2025: Uses Rate 1 ($121.00)
• Visit on January 5, 2026: Uses Rate 2 ($130.00)
• Visit on January 1, 2026: Uses Rate 2 ($130.00)

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12.7 Viewing Fee Schedules by Payer

12.7.1 Comparing Rates Across Payers

Scenario: You want to see how much different payers reimburse for the same visit type.

How to Do This:

1. Go to Payer Setup
2. Click on Payer A (e.g., Blue Cross Blue Shield)
3. View Fee Schedule tab → Note the rate for "SN Visit" (e.g., $121.00)
4. Go back to Payer Setup
5. Click on Payer B (e.g., Aetna)
6. View Fee Schedule tab → Note the rate for "SN Visit" (e.g., $115.00)

Use Case:

• Identify which payers reimburse the highest rates
• Negotiate better rates with low-paying payers
• Prioritize referrals from high-paying payers (if applicable)

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12.8 Fee Schedules and Claim Generation

12.8.1 How Fee Schedules Are Used in Billing

When generating a claim for a private payer (Chapter 29):

1. System Identifies the Payer:
   • Patient has Blue Cross Blue Shield as their primary insurance
2. System Identifies the Visit Type:
   • Nurse completed an "SN Visit" on December 20, 2025
3. System Looks Up the Fee Schedule:
   • Finds the active rate for Blue Cross Blue Shield + SN Visit effective on or before December 20, 2025
   • Rate: $121.00
4. System Generates the Claim:
   • Claim line includes: Visit Type, HCPCS Code (G0299), Charge Amount ($121.00)
5. Claim is Submitted:
   • Claim is sent to the payer with the correct charge amount

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12.8.2 What Happens if No Fee Schedule Exists?

Problem: A visit is completed, but no fee schedule rate exists for that payer + visit type.

System Behavior:

• The claim cannot be generated (or generates with a $0.00 charge, which will be rejected)
• An error appears: "No fee schedule found for [Payer] + [Visit Type]"
• The visit remains in the Pending Claims queue

Solution:

1. Add the missing fee schedule rate (Section 12.3)
2. Regenerate the claim
3. Submit the claim

Best Practice:

• Set up fee schedules for all common visit types before admitting patients with that payer
• Regularly review the Pending Claims queue for missing fee schedules

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12.9 Troubleshooting Common Issues

Issue 1: "Fee Schedule Not Found"

Error Message: "No fee schedule found for [Payer] and [Visit Type]"

Solution:

1. Go to Payer Setup → Click on the payer
2. Go to Fee Schedule tab
3. Check if a rate exists for the visit type
4. If missing, Add Rate (Section 12.3)
5. Ensure the effective date is on or before the visit date

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Issue 2: "Claim Shows Wrong Charge Amount"

Problem: Claim was generated with an incorrect rate (e.g., $100 instead of $121)

Solution:

1. Check the Fee Schedule for the payer
2. Verify the Effective Date of the rate:
   • If the effective date is after the visit date, the system used an older rate
3. If the rate is incorrect:
   • Edit the rate or add a new rate with the correct amount and effective date
4. Regenerate the claim (do not submit the incorrect claim)

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Issue 3: "Multiple Rates Showing for Same Visit Type"

Problem: Two active rates exist for the same payer + visit type

Solution:

• This is normal if rates changed over time (e.g., January 2025 rate vs. January 2026 rate)
• The system automatically uses the correct rate based on the visit date
• If you have duplicate rates with the same effective date, delete or inactivate one

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Issue 4: "Rate Expired, Claims Not Generating"

Problem: Claims are not generating because the fee schedule rate has an end date in the past

Solution:

1. Check the End Date of the rate
2. If the end date has passed, add a new rate with a new effective date
3. If the end date was set by mistake, edit the rate and remove the end date (set to blank)

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Issue 5: "Payer Contract Changed, Need to Update All Rates"

Problem: Your contract with a payer was renegotiated, and all rates changed

Solution:

1. Do NOT delete old rates (preserve historical data)
2. Add new rates for each visit type:
   • Set Effective Date to the contract's new start date
   • Enter new Charge Amounts based on the new contract
3. The old rates remain active for past claims; new rates apply to future visits

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12.10 Best Practices

✅ Do This:

1. Set Up Fee Schedules Before Admitting Patients:

   • Ensure all common visit types have rates configured for each payer
   • Prevents billing delays and claim generation errors

2. Keep Historical Rates:

   • Do NOT delete old rates when updating
   • Add new rates with new effective dates instead
   • Historical rates are needed for audits, reporting, and claim corrections

3. Use Effective Dates Correctly:

   • Set effective dates to match contract start dates
   • Use end dates for temporary rates or pilot programs

4. Review Fee Schedules Quarterly:

   • Compare contracted rates to actual payments received
   • Identify discrepancies (e.g., payer underpaying)
   • Update rates when contracts are renewed

5. Document Rate Sources:

   • Keep a copy of payer contracts and fee schedule documents
   • Note where each rate came from (contract section, negotiation date)

6. Train Billing Staff:

   • Ensure billing staff know how to add and update rates
   • Review the Pending Claims queue regularly for missing fee schedules

❌ Avoid This:

1. Don't Delete Historical Rates:

   • Deleting rates can break historical claims and reports
   • Use Inactive status instead

2. Don't Guess Rates:

   • Always use the contracted rate from the payer agreement
   • Incorrect rates cause underpayment or overpayment issues

3. Don't Use the Same Rate for All Payers:

   • Each payer has different negotiated rates
   • Set up separate fee schedules for each payer

4. Don't Forget Effective Dates:

   • Claims use the rate based on the effective date
   • Missing or incorrect effective dates cause billing errors

5. Don't Overlook Visit Types:

   • Set up rates for all visit types your agency provides, not just common ones
   • Missing rates for specialized visits (e.g., IV Infusion, Wound Care) cause claim delays

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