HI 00208.095 Group Practice Prepayment Plans

For Medicare purposes, a Group Practice Prepayment Plan (GPPP) is an organization which has a formal arrangement with three or more full time physicians to provide certain health services to the plan’s members who have contributed (or have had contributions made on their behalf) toward the costs of services by the advance payment of premiums or dues. These services may be limited to clinic or doctor’s office visits or may include the full range of hospital and other provider services.

Under Medicare, hospital costs of individuals who are members of GPPP’s are reimbursable in the same manner as other provider services, i.e., the provider bills the Part A intermediary. For Part B nonprovider services, however, special arrangements are necessary inasmuch as charges for physicians’ and other health services associated with GPPP’s are not made on a fee-for-service basis. Plans may elect to be reimbursed directly by CMS on a reasonable cost or reasonable charge related to cost basis; these Plans do not file individual bills for Plan services to Plan members. Plans dealing through area carriers file bills for services to Plan members and are reimbursed by the carrier on a reasonable charge related to cost basis. Whether the Plan deals directly with CMS or through a carrier, services to Plan members furnished outside the Plan are billed in the usual manner through the area carrier.