Wednesday, July 14, 2010

Gastroenterology Endoscopy Reimbursement Rates at Ambulatory Surgical Centers

Addressing Endoscopy Reimbursement Rates at Ambulatory Surgical Centers

As a cost effective high quality clinical setting, Ambulatory Surgical Centers (ASC) should be an integral part of the Administration’s and Congress’s plan to provide all Americans access to timely care and preventative health services, while reducing overall health care costs.

ASCs are facilities where same day surgeries, and other procedures like gastrointestinal endoscopy, are performed. They provide patients a cost-effective and convenient environment that may be less stressful than the hospital. Fifty-one percent of ASCs are single specialty and the balance provides services in multiple surgical specialties. ASCs play a critical role in offering colorectal cancer screening services to Medicare patients at a substantial savings to Medicare for the same services offered in the Hospital Outpatient Department (HOPD). One study shows that in 2005 ASCs saved Medicare and its beneficiaries $1.1 billion.

In 2008 under Congressional mandate, the Centers for Medicare and Medicaid Services (CMS) implemented a new payment structure that links ASC payments to the HOPD. This linkage makes sense given that the costs are similar in each setting. Unfortunately, the linkage between these two settings has steadily deteriorated. In 2009, ASCs are being paid on average 59% of the HOPD rate for Medicare patients, down from over 80% a few years ago. To date, CMS has reduced ASC payments to a point where many gastroenterologists practicing in an ASC are no longer recovering the cost of providing services to Medicare patients. Regrettably, CMS’ proposed 2010 ASC payment rule would continue this negative payment trend.

Furthermore, CMS has chosen the consumer price index (CPI) to update ASC payment rates in 2010 instead of the hospital market basket index even though ASCs must compete in the same labor market as hospitals, purchase identical medical supplies and equipment and maintain liability insurance. The CPI measures changes in consumer spending, like the price of orange juice.

The GI medical specialty societies have tried unsuccessfully to persuade CMS to change its policy, and now are turning to Congress for a remedy that is budget neutral to Medicare. As lawmakers move forward with reforming the health care into a quality affordable system for all Americans, it is critical that they address the current issues facing ASC reimbursement rates.

The American Society for Gastrointestinal Endoscopy (ASGE), American Gastroenterological Association (AGA) and the American College of Gastroenterology (ACG) have developed specific recommendations to be included in health care reform legislation for improving the ASC payment system.

The ASGE, AGA and ACG recommend that Congress:

1. Fix the relationship between HOPD and ASC payments at 75% of the HOPD rate for the same service provided in the ASC;

2. Update the ASC rate with the hospital market basket to maintain the 75% relationship between the two payment systems each year;

3. Calculate deficit neutrality in a different way, by measuring the change in Part B spending for outpatient surgery based on the savings achieved from the continued migration of procedures for hospitals to ASCs.

ASCs provide a valuable site of service for Medicare beneficiaries. Patient satisfaction is a hallmark of the ASC industry due to convenience, safety, cost and the high level of professionalism. These three legislative changes are budget neutral and will yield overall cost savings to Medicare and its beneficiaries while ensuring continued access to potentially life-saving cancer prevention screening and other GI services.

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