Revenue gain for academic anesthesiology departments if the Centers for Medicare and Medicaid Services provide full reimbursement to teaching physicians.

Abstract

To the Editor:—Following the 1996 publication of new rules regarding payment to teaching physicians, the Centers for Medicare and Medicaid Services (then known as the Health Care Financing Administration) reduced by 50% the payments made to teaching anesthesiologists for medical direction of residents at a ratio of one faculty member to two residents. After 1996, the Centers for Medicare and Medicaid Services paid 100% of allowable charges to a teaching anesthesiologist only when the physician either personally performed the care or medically directed only one resident. Because resident care could not be billed to the Centers for Medicare and Medicaid Services, this change in the teaching rules resulted in a significant reduction in payments to academic anesthesiology groups. 1Recently, the Centers for Medicare and Medicaid Services were asked to reexamine these teaching rules by both anesthesiology societies and Senator Hillary Clinton (written communication to Mr. Thomas Scully, April 2003).Using data from a previously published study, 2we examined the potential financial impact that a change to full reimbursement would have on two of the four academic anesthesiology groups examined in that investigation (the database for the other two groups did not identify Medicare and other payers). Groups A and D (as designated in the previous study) provided care to 2,549 and 7,096 Medicare beneficiaries undergoing surgery during the 1-yr study period. For purposes of analysis, we used the conversion factor for the Galveston, Texas, area ($17.23) and assumed that all anesthetic procedures were performed by anesthesiologists supervising residents at a 1:2 ratio. 3We calculated that the annual revenue lost by the current rules, versus the pre-1996 rules, was $350,000 for group A and $1,070,000 for group D (table 1). The estimated lost revenue per case was similar between the two groups ($137 and $150 for groups A and D, respectively).If the previous rules for full payment (which are similar to the current rules applied to other medical specialties) were applied, the increase in revenue would help academic anesthesiology departments successfully meet their economic challenges.