The Medicare limiting charge is set by law at 115% of the payment amount for the service furnished by the Non-participating physician.
Details
However, the law sets the payment amount for Non-participating physicians at 95% of the payment amount for Participating physicians (i.e., the fee schedule amount).
Calculating 95% of 115% of an amount is equivalent to multiplying the amount by a factor of 1.0925 (or 109.25%).
Therefore, to calculate the limiting charge, \(x_{limit}\) for a physician service for a locality, multiply the fee schedule amount by a factor of 1.0925:
$$x_{limit} = \dfrac{\sum_{i = 0}^t \sum_{j = 0}^\infty c_i f_{j - i}}{\sum_{i = 0} c_i}$$