Commercial Reimbursement Benchmarking: Commercial payment rates for medical services as percentage of Medicare Fee-for-Service rates

Milliman maintains a national commercial health insurance claims experience database representing approximately 100 million members and $300 billion in medical allowed charges. We reprice this experience data to Medicare fee-for-service (FFS) payment rates using the Milliman Medicare Repricer. The claims are repriced to the 2020 Medicare FFS fee schedule, and the Medicare-allowed amounts trended to 2021 using area-specific unit price trends. In this white paper, we discuss how the “percentage of Medicare” is calculated, and the variances in reimbursement rates across geographic areas. We also cover the Milliman provider reimbursement benchmarks, provide a comparison to other benchmarks, and discuss benchmarking commercial reimbursement.