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Anesthesiology Continuing Education (ACE) Program

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Extending Rural Pass-Through to Anesthesiologists

Although Medicare normally pays for the services of anesthesia providers under the Medicare Part B fee schedule, a statutory exception has existed since the 1980s for reimbursing services of an anesthesiologist assistant (AA) or nurse anesthetist rendered to patients in certain rural hospitals. At present, under regulations issued by the Centers for Medicare and Medicaid Services (CMS), an AA or nurse anesthetist employed by or contracting with a hospital located within a rural area can be reimbursed under Medicare Part A on a reasonable cost "pass through" basis as long as the total number of hours per year does not exceed 2,080 and the surgical volume at the hospital does not exceed 800 cases. Under the CMS regulation, the caseload may be covered by more than one AA or nurse anesthetist as long as the total maximum hours do not exceed 2,080.

When the permissible number of surgical cases was increased from 500 to 800 in 2002, ASA formally commented to CMS that such a caseload was not unusual for many anesthesiologists and urged that the pass-through methodology be applied to anesthesiologists as well as AAs and nurse anesthetists. CMS responded that in view of the fact that the statutory exception (42 USC § 1395ww) covered only nurse anesthetists (and, curiously, anesthesiologist assistants who can work only under the supervision of an anesthesiologist), it did not enjoy the power to extend the exception.

ASA urges that the statutory exception, permitting "pass through" reimbursement of AAs and nurse anesthetists be amended to include anesthesiologists as well.

In the 110th Congress, Rep. Henry Cuellar (D-TX) and Rep. Todd Akin (R-MO) introduced H.R. 1866, the Medicare Access to Rural Anesthesiology Act of 2007. This legislation would allow rural hospitals to use Medicare pass-through funds to contract with physician anesthesiologists. Such a provision would help ensure broader availability of anesthesiology medical care in rural America. ASA strongly supports favorable action on similar legislation in the 111th Congress.

Ample precedent exists for Medicare to pay for physician services under Part A. Physician services performed at rural health clinics in a "shortage area" are currently paid for under a Part A compensation arrangement, as hospice-employed physicians are equally paid under Part A. Given clear Congressional interest in improving the quality of and access to health care in rural areas, ASA urges that the statute be amended to authorize CMS to issue regulations permitting "pass through" reimbursement of anesthesiologists on the same basis as currently enjoyed by AAs and nurse anesthetists. Not only would such a step provide a greater incentive for anesthesiologists to work in rural institutions, but it would give effect to the existing authorization for anesthesiologist assistants to work there as well.

For further information, please contact Ronald Szabat, ASA Executive Vice President & General Counsel, or Manuel Bonilla, ASA Associate Director of Congressional and Political Affairs, at (202) 289-2222.

March 2009