A Look at How ASCs are Coping with the New CMS Change in Reimbursement: A Checklist

It’s the beginning of the New Year and the much anticipated Centers for Medicare & Medicaid Services (CMS) final rule has been in effect for a short time now. However, with improved reimbursement comes many new regulations and increased responsibility for the ASC.

Hopefully you began preparing early and your transition is going smoothly. Now is the time to re-review the changes with your staff to make sure they understand and are following all the new requirements.

General

Has your center added or is contemplating adding new procedures or new specialties? Did you evaluate additional staff needed, new equipment; additional supplies? Do these procedures require longer operating room (OR) and recovery times?

Once you have completed the evaluation and the board has given their approval, notify medical staff members, anesthesia, clinical staff, materials management, scheduler, coder, etc. If you have added new procedures, requests for additions to Delineation of Privileges (DOP) need to be completed by applicable physicians, approved by the board and added to the medical staff files for those physicians. Don’t forget to add this DOP information to your computer database.

Have you decided to discontinue or cut down on any procedures or specialties? If so, has everyone been notified?

Review your budget. Did you allow for these possible procedure changes, supply changes, equipment changes, revenue changes?

Ask your physician to be very specific in dictating operative reports (i.e., X-rays performed, units of medicine used) so that every available primary and ancillary reimbursement can be captured.

Case costing is always important. However, in specialties such as GI, where there is a reduction in reimbursement with a high number of Medicare patients, the cost is essential to review and attempt to lower by standardization, vendor pricing, economy of time and staffing, etc.

It’s imperative that you continue to carefully examine packaged procedures that are not declared device-intensive. During the four-year transition period, reimbursement for some procedures is much lower during the first one to two years of the phase-in period. This is due to the 65 percent reduction for both the implant and procedure and that implants can no longer be billed separately.

You should already have compared your fee schedule to the new CMS payments and changed any fees which were less than reimbursement allowances. Be sure to add any new procedures and related fees.

Develop an ancillary procedure “cheat sheet” to help determine what ancillaries (Xrays, drugs, biologicals) might be performed with certain procedures. Confer with your clinical staff to determine which procedures are targets for additional charges and specifics as to type. This should help prevent missing some of the additional revenue you want to capture (see table below).

Scheduling

Your scheduler needs to have all of the lists that are available to assist in determining whether a procedure is Medicare approved for an ASC. These include:

• covered procedures 
• inpatient procedures (non-covered) 
• office-based procedures (low reimbursement rate) 
• ancillary procedures 
• device-intensive procedures 
• packaged procedures 
• explanation of payment indicators 

If you have not already gathered this information, most of these lists are available at either www.fasa.org or www.cms.hhs.gov/ASCPayment/04f_CMS-1392-FC(ASC).asp. 

Also provide the scheduler with a copy of the “cheat sheet” for determination if special meds, X-ray equipment, X-ray tech, etc., are needed.

Coding

Be sure your coders are receiving everything they need to code for ancillary services, i.e., drugs (how many units), X-ray procedures (in operative note? on intra-operative form?), etc.

As previously, operative notes should include specific information about implants and special devices. As CMS has packaged reimbursement for these with the procedure, it is important that coders understand not to bill separately for implants. A good idea would be to print a separate list of procedure codes that now include reimbursement for implants to ensure compliance.

Coders should be aware of new modifiers and how they are to be used. One example is modifier 52 (reduced or interrupted services not requiring anesthesia) which may now be used in ASCs.

Billing

Be aware of:

• new claim requirements (i.e., single line for procedure and implant) 
• modifier changes, additions, deletions 
• continuation of the same rules for IOL, NTIOL and corneal tissue acquisition coverage 
• continued use of same claim form instituted in May 2007, CMS-1500

You will need to have compilation of lists, covered procedures, inpatient procedures (noncovered), office-based procedures, ancillary services, device intensive procedures, etc.

You should be aware that there is no change in the multiple procedure discount (100 percent for first procedure, 50 percent each additional procedure), however, there are some procedures that are not subject to the discount. A list of these procedures is available.

Payment indicators provide payment information regarding covered surgical procedures and covered ancillary services, for example, whether a code is designated as packaged, office-based, or device-intensive. Payment indicators must be included on the claim form for each billable CPT. Yes; there is a list for this.

Payment Posting/Collections

Patient co-payment remains at 20 percent with one exception: 25 percent for screening sigmoidoscopy and colonoscopy.

If you did not load your software with the new reimbursement schedule by CPT, your payment poster will need to have a copy of all of the lists mentioned above to determine if proper payment is being received.

Chances are your denial rate will increase during the first three to six months of this year during the period of accommodating to the change.

Ask your payment poster to segregate denials by cause to evaluate trends and get them solved.

Supervisors should be aware of the possible decrease in Medicare reimbursement during the first few months and provide regular reports to the administrator.

Continuing Changes

At the time this article was written, the Conditions of Coverage were still in the proposal stage. From the information provided at that time, recommendations are that if you haven’t already instituted responses to the following new Conditions of Coverage requirements, now is the time.

CMS will begin gathering information from the ASCs this year to determine what areas of performance improvement need to be addressed. Non-compliance may result in loss of CMS’ annual increase for ASCs. For those centers currently having 23-hour stays, if the legislation has not changed and/ or not been finalized, stay tuned to the ASC Association (formerly FASA) and CMS Web sites to determine the outcome.

Review your disaster plan: most ASCs have this in place but it may not contain all CMS requirements such as detailed interaction with community officials. This wording of this requirement is also under scrutiny as many facilities may not be equipped nor have the staffing to provide the type of trauma care required in a disaster.

If you are adding radiology services, did you allot funds for a radiology technician? Did you read the CMS requirements for radiology services? If the Conditions of Coverage for radiology are passed as proposed, expenses may be more than reimbursement.

As proposed at the time of writing, the new patient rights requirements, included signed disclosure of physician ownership prior to date of surgery, explanation of advanced directives, method for patients to file a grievance and increased protection of patient confidentiality. The in-depth requirements outlined by CMS are being questioned as ASCs often do not have the availability of funds or staffing to carry out some of the requirements as stipulated.

Are your physicians, preoperative nursing staff and anesthesia staff aware of and following the new assessment requirements to ensure patient safety and suitability of planned procedures? Again, wording of this Condition of Coverage is being questioned as portions of the proposed standards on patient admission, assessment and discharge are felt inconsistent with accepted medical practices and/or applicable legal standards of care, and may interfere with the efficient delivery of patient care or impose undue burdens on ASCs without any measurable benefits for patient safety.

Review and compare your infection control policies and procedures with the new CMS Conditions of Coverage requirements and update as necessary.

ASCs now have quarterly updates on covered procedures. This will include additions and deletions of procedures and ancillary services, changes in pricing on drugs and other ancillary services.

ASC rate changes will be addressed annually and probably published in November (like the final rule) for launch on January 1. No ASC increase is expected for 2009, however, changes in payment weights and wage adjustments may change reimbursement amounts. Keep watch for these changes (quarterly and annually) on the CMS and ASC Association Web sites.

Reimbursement changes in the second year (2009) of the four-year transition period will be 50 percent of the 2007 ASC reimbursement rate plus 50 percent of the 2009 HOPD (hospital outpatient department) rate — adjusted by payment weights, wage adjustments and discounted by 65 percent.

Reporting of ASC Quality Assurance Performance Improvement (QAPI) data collected for 2008 is to begin in 2009: specifics to be announced.

Keeping up with CMS’ requirements are challenging. However, most bonuses are associated with added responsibility. Remember the reward at the end of the road (in 2011) and perhaps these additional duties will not seem as burdensome.