The Medicare Prescription Drug Bill signed into law December 8, 2003 included a number of provisions that will impact endoscopy centers and other ambulatory surgery centers (ASCs) in the years ahead. These amendments carry both negative and potentially positive impacts for the Medicare ASC program.In joining forces with the American Society for Gastrointestinal Endoscopy and other ASC organizations, the AGA helped thwart the Medicare Payment Advisory Commission’s (MedPAC) recommendation that the facility fee for any ASC procedure, which under current law exceeds what a hospital outpatient department (OPD) receives for the same procedure, be immediately reduced to the OPD rate. As most GI codes are paid at higher rates in the ASC than the OPD, rejection of the MedPAC proposal prevented reimbursement cuts for GI procedures of between $30 and $50.However, Congress did elect to establish cost-of-living adjustments at the consumer price index minus 3% for 2004, with no update for the period 2005 through 2008. Because the CPI for the relevant period was 3%, it is likely that ASCs will receive no increase in the coming year. However, ambiguity remains as to how the Centers for Medicare and Medicaid Services (CMS) will determine the CPI for purposes of the update and over what base period CMS will use to make the adjustment. Remaining unclear is whether CMS will make adjustments to the rates that were in effect on March 31, 2004, or the rates that were in effect on September 30, 2003.Congress provided guidance to CMS regarding the re-basing of ASC facility fees. The legislation eliminates the requirement that CMS recalculate ASC facility fees on the basis of a cost survey of ASCs. This is likely to be good news for gastroenterologists. When CMS last attempted to re-base rates, it proposed to reduce rates for GI procedures by between 9% and 27%. Under congressional mandate, the General Accounting Office must conduct a study of the relationship between hospital and ASC costs and rates and establish a new rate system by January 2008. As the new legislation requires CMS to implement the new rates in a budget-neutral manner, it effectively prohibits CMS from lowering overall ASC spending when implementing the new payment rates. AGA officials say they “will continue to be vigilant in representing the interests of endoscopic ASCs as these activities are undertaken.”Stories by Les Lang The Medicare Prescription Drug Bill signed into law December 8, 2003 included a number of provisions that will impact endoscopy centers and other ambulatory surgery centers (ASCs) in the years ahead. These amendments carry both negative and potentially positive impacts for the Medicare ASC program. In joining forces with the American Society for Gastrointestinal Endoscopy and other ASC organizations, the AGA helped thwart the Medicare Payment Advisory Commission’s (MedPAC) recommendation that the facility fee for any ASC procedure, which under current law exceeds what a hospital outpatient department (OPD) receives for the same procedure, be immediately reduced to the OPD rate. As most GI codes are paid at higher rates in the ASC than the OPD, rejection of the MedPAC proposal prevented reimbursement cuts for GI procedures of between $30 and $50. However, Congress did elect to establish cost-of-living adjustments at the consumer price index minus 3% for 2004, with no update for the period 2005 through 2008. Because the CPI for the relevant period was 3%, it is likely that ASCs will receive no increase in the coming year. However, ambiguity remains as to how the Centers for Medicare and Medicaid Services (CMS) will determine the CPI for purposes of the update and over what base period CMS will use to make the adjustment. Remaining unclear is whether CMS will make adjustments to the rates that were in effect on March 31, 2004, or the rates that were in effect on September 30, 2003. Congress provided guidance to CMS regarding the re-basing of ASC facility fees. The legislation eliminates the requirement that CMS recalculate ASC facility fees on the basis of a cost survey of ASCs. This is likely to be good news for gastroenterologists. When CMS last attempted to re-base rates, it proposed to reduce rates for GI procedures by between 9% and 27%. Under congressional mandate, the General Accounting Office must conduct a study of the relationship between hospital and ASC costs and rates and establish a new rate system by January 2008. As the new legislation requires CMS to implement the new rates in a budget-neutral manner, it effectively prohibits CMS from lowering overall ASC spending when implementing the new payment rates. AGA officials say they “will continue to be vigilant in representing the interests of endoscopic ASCs as these activities are undertaken.” Stories by Les Lang