Here are eight key notes on ambulatory surgery center reimbursement for 2016.
1. CMS payment for 2016. The Centers for Medicare and Medicaid Services released the final payment rule for ambulatory surgery centers and hospital outpatient departments for 2015 last October. The payment is updated annually for inflation based on the Consumer Price Index percentage increase for all urban consumers. For 2016, the update is 0.8 percent and the multifactoral productivity adjustment is 0.5 percent. As a result, the CPI-U update factor is 0.3 percent — higher than the 0 percent proposed earlier in 2015 but still leaves ASC payments lower than hospital outpatient department reimbursement.
2. Quality reporting will impact CMS pay. ASCs are subject to a 2 percent decrease in annual payment if they don't report quality statistics based on the Ambulatory Surgical Center Quality Reporting Program guidelines. The ASCs must meet 11 required and one voluntary measure, or see the reduction applied to CMS reimbursement in 2018. CMS requested comment on outcomes measures for consideration in the future:
• Normothermia outcomes assessing the percentage of patients with surgical procedures under general or neuroaxial anesthesia lasting 60 minutes or more and are normothermic within 15 minutes of arriving in the PACU
• Unplanned anterior vitrectomy, which assesses the percentage of cataract surgery patients with unplanned vitreous removal present in the anterior eye chamber
3. BCBS acknowledges economic advantage of outpatient surgery. Blue Cross Blue Shield Association surveyed outpatient procedure costs and found a significant difference in hysterectomy, lumbar spine surgery, gallbladder removal and angioplasty costs performed in the outpatient setting versus the inpatient setting. Patients who underwent outpatient procedures in 2014 saved $320 on average for lumbar spine surgeries, $483 for hysterectomies and $924 on gallbladder removals. The average overall cost decrease was:
• Hysterectomy: $4,505
• Lumbar spine surgery: $8,475
• Gallbladder removal: $11,262
• Angioplasty: $17,530
4. New procedures on the CMS ASC payable list. There were at least 16 new procedures added to the CMS ASC payable list for 2016. The new procedures are significant because many private payers base their payment rates on a percentage of Medicare rates, and in some cases payers are weary of paying for procedures not on the ASC payable list. The new codes include spine procedures and general surgery. Here are the new codes:
1. Lumbar spine process distrac: 0171T
2. Lumbar spine process add: 0172T (0172T)
3. Vasc embolize/occlude venous: 37241
4. Vasc embolize/occlude artery: 37242
5. Vasc embolize/occlude organ: 37243
6. Image cath fluid peri/retro: 49406
7. Closure of vagina: 57120
8. Repair urethrovaginal lesion: 57310
9. Vaginal hysterectomy: 58260
10. Vag hyst including t/o: 58262
11. Lsh uterus above 250: 58544
12. Laparo-vag hyst complex: 58553
13. Laparo-vag hyst w/t/o compl: 58554
14. Tlh w/t/o uterus over 250: 58573
15. Remove spine lamina 1 thr: 63046
16. Decompress spinal cord thc: 63055
5. Colonoscopy pay cuts. CMS's 2016 final rule included reimbursement cuts for colonoscopy, with some procedure reimbursement cut more than 17 percent. The top 10 lower GI codes for 2016 by final RVU percentage change include:
• Colonoscopy with snare polypectomy (CPT code 45385): -12 percent
• Colonoscopy (CPT code 45373): -9 percent
• Colorectal cancer screen, high risk (CPT code G0105): 0 percent
• Colorectal cancer screen, low risk (CPT code G0121): 0 percent
• Colonoscopy with hot biopsy (CPT code 45384): -11 percent
• Colonoscopy with submucosal injection (CPT code 45381): -13 percent
• Flexible colonoscopy with ablation (CPT code 45388): -15 percent
• Flexible sigmoidoscopy with biopsy (CPT code 45331): -1 percent
• Flexible sigmoidoscopy (CPT code 45330): -13 percent
• Colonoscopy with control of bleeding (CPT code 45382): -16 percent
6. Bundled payments and price transparency. Surgery centers are beginning to leverage their cost-effectiveness by bundling payments for certain procedures — often spine and orthopedic procedures — and competing for cash-pay and medical tourist patients, as well as contracts with self-funded employers. The bundle often includes surgery, anesthesia and postoperative treatment for 90 days.
7. Patient payment responsibility growing. Many patients have higher deductibles and co-pays than in the past, meaning ASCs are spending more time on patient collections and a larger percentage of the payment is coming from patients. Navicure conducted a 2015 survey to understand patient payment trends and how ASCs are collecting. They found:
1. Patient payments represent 21 percent to 40 percent of overall revenue in 72 percent of the responding surgery centers.
2. Only one-third of the surgery center respondents felt patient collections was a high priority.
3. Patient payments were estimated to represent around $1.4 million to $2.7 million of overall revenue for an individual ASC.
4. Among ASCs performing more than 100 procedures per month, many still rely on manual processes for collecting patient payments; 38 percent collect patient payments by mail and 41 percent take credit/debit card payments via phone.
5. There 32 percent of respondents who identified patients who are unable to pay as their top challenge, followed by 30 percent who said patients were slow to pay.
8. Payer mix by region. The ASC's payer mix plays a big role in profitability, but varies according to factors like geography, size and specialty mix. According to the VMG Multi-Specialty ASC Intellimarker 2012, 58 percent of gross charges for all surgery centers come from commercial payers; 24 percent come from Medicare. Here is the breakdown by region:
• West: 21 percent Medicare, 56 percent commercial
• Southwest: 27 percent Medicare, 59 percent commercial
• Midwest: 15 percent Medicare, 62 percent commercial
• Southeast: 31 percent Medicare, 51 percent commercial
• Northeast: 25 percent Medicare, 59 percent commercial