Interventional Techniques in Ambulatory Surgical Centers: A Look at the New Payment System

Abstract

There has been an explosive increase in procedures performed in surgery centers, with approximately 4,700 Medicare-certified surgery centers in the United States. Total ambulatory surgical center (ASC) payments have increased substantially: $1 billion in 1996, and $2.9 billion in 2006. In June 1998, the Healthcare Financing Administration (HCFA; CMS), proposed an ASC rule in which at least 60% of interventional procedures were eliminated from ASCs and the remaining 40% faced substantial cuts in payments. Following the publication of this rule, based on public comments and demand, Congress intervened and delayed implementation of the rule for several years. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) granted broad statutory authority to the Secretary of Health and Human Services to design a new ASC payment system based on the hospital outpatient payment system. The Centers for Medicare and Medicaid (CMS) published its proposed outpatient prospective system for ASCs in 2006, setting ASC payments at 62% of HOPD payments. This rule faced substantial opposition from providers, patients, and Congress. Consequently, CMS revised the rule with a 4-year transition formula to provide ASCs with 65% of HOPD payments. Based on the new proposed rule, most interventional pain management procedures in ASCs will lose approximately 3% to 5% without taking into account that there have not been any increments since 2004, except for a few small increases for some procedures, along with the addition of office procedures, which can now be performed in an ASC setting. However, payments for procedures moved from the office setting to ASCs remain at the lower office rates, which face substantial cuts on their own. The proposed CMS rule will have widespread effects on physician payments, ASC payments, and particularly interventional pain management physicians.