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June 2002
Volume 66 |
Number 6
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PRACTICE MANAGEMENT
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| Negotiating a
Managed Care Contract for Anesthesia: Beyond the Conversion
Factor |
Karin Bierstein, J.D.
Assistant Director of Governmental Affairs (Regulatory)
"In today's increasingly challenging economic environment,
anesthesia groups across the country are looking for creative
ways to enhance revenue for their practices." So writes Hal
Nelson, CPC, Vice-President of Anesthesia Compliance for Per-Se
Technologies and a speaker at ASA's most recent Conference on
Practice Management. Mr. Nelson suggests that negotiating payment
terms for specific services in your managed care contracts is
a fertile area. "Having come from [the payer] side, I can
tell you that savvy negotiation is the name of the game in getting
a good pricing structure. Although a good unit rate [conversion
factor] is important, one should also consider the myriad carve-out
services that can be imbedded in a contract to help augment the
total reimbursement to a group. Listed below are my top 10 items
to ask for when negotiating a contract."
1. Invasive monitoring lines (A-line – Current Procedural
Terminology (CPT) 36620, CVP – 36489 and Swan-Ganz –
93503)
Make sure that the carrier explicitly states that these items
are payable in addition to the anesthesia charge and that no multiple-procedure
discount applies. Also be sure that payment is allowed when the
anesthesiologist places the lines outside the operating room (O.R.),
not in conjunction with an anesthesia service. The current payer
trend is to try to deny these lines as being bundled into the
base unit allowance, so insist that the insurance company "carve
out" these items before signing any contract.
2. Acute pain
Many anesthesia groups have some involvement with acute pain management.
Be certain that your contracts specify that any acute pain service
that is not the primary mode of anesthesia in the case can be
reimbursed separately. This would include epidurals, peripheral
nerve blocks and spinals and is consistent with CPT coding principles.
You also should negotiate separate payment for daily pain management
codes 01996 (epidural management), 99231 (spinal narcotic management)
and patient-controlled analgesia (01997, or 99199 for an unlisted
service if the payer does not recognize 01997). Additional payment
for these acute pain services can result in a large revenue boost
for any group.
3. Obstetrical (OB) anesthesia/ analgesia
Beware of payers who do not carve out OB anesthesia services.
Many will give you an attractive unit rate for all anesthesia
services but will have hidden verbiage within their contracts
capping the units for OB cases at an unreasonably low level. Know
specifically what you will be getting paid for: 1) vaginal deliveries,
2) cesarean sections and 3) labor ending in a cesarean section.
Since "face-to-face" monitoring requirements for obstetrical
anesthesia can be clinically different from O.R. anesthesia, it
is best to incorporate language into the contract stipulating
the payment method for OB anesthesia.
4. Physical status modifiers P3-P5
Many carriers will pay you one to three additional base units
respectively for physical status modifiers P3-P5. These patients
are a higher risk for the anesthesiologist than a P1 or P2 so
the payment should be increased accordingly on these cases. The
carrier should not need to see a specific diagnosis code to substantiate
the physical status modifier billed as long as the preoperative
assessment documentation supports the modifier billed.
5. Qualifying circumstances (extreme age – CPT 99100,
controlled hypothermia – 99116, controlled hypotension –
99135, emergency – 99140)
Depending upon your practice characteristics, these codes can
sometimes equate to substantial increased revenue for a group.
Extreme age is defined as under 1 or over 70 years of age. This
code is extremely helpful for groups that work with a large number
of pediatric cases. Controlled hypothermia and hypotension should
be mandatory requests for any group doing neurosurgical anesthesia
cases. Emergency code 99140 is applicable to all groups for cases
such as emergent appendectomies and other cases where a delay
in treatment would result in an increased risk to life or limb.
6. Transesophageal echocardiography (TEE) services (codes
93312-93318)
Special carve-out payment should be guaranteed for three types
of TEE services performed in conjunction with anesthesia. First,
code 93313 should be paid when the anesthesiologist places the
TEE probe for a cardiologist to interpret. Second, code 93312-26
should be paid in addition to anesthesia when an anesthesiologist
places the TEE probe and personally performs a diagnostic interpretation
with a written report. Lastly, code 93318-26 should be paid when
an anesthesiologist places a TEE probe and performs subsequent
routine monitoring during the case (no diagnostic report). As
is true of invasive monitoring lines, a fee schedule alone for
these codes does not guarantee payment. Only explicit contract
language specifying separate payment will suffice.
7. Monitored anesthesia care (MAC)
Some commercial carriers have begun to insert language into contracts
that limits MAC payment to P3 or higher cases. Your contract should
specify that MAC is paid at the same rate as a general anesthetic,
without regard to the physical status modifier billed.
8. ASA Relative Value Guide (RVG) year used for calculating
unit value
Carriers are infamous for stating that they pay flat fee services
based on the ASA RVG. The $64,000 question is, which year? 1988
or 2002? Make sure that any unit rate agreed upon is tied to current
ASA values and is independent of Medicare, whose base units are
not 100-percent consistent with ASA's. Speaking of Medicare, be
wary of contract rates that are directly tied to Medicare allowances.
In 2002, Medicare payments for anesthesia dropped nationally by
6.9 percent, meaning that unit values for contracts tied to these
rates also took a hit. If you contract at a percentage of Medicare
rates, you may want to specify one particular year (such as 2001)
so that there are no negative changes in reimbursement on an annual
basis.
9. Surgical field avoidance (SFA) and unusual positioning
(UP)
ASA's "Anesthesia Guidelines" (found in the front of
the RVG) allow a minimum of five base units for certain procedures
where SFA or UP is involved. Although this may sound good in theory,
few payers will recognize this additional payment without something
written into the contract. Carriers who pay extra for these items
will need to provide a procedural modifier (such as -22) to represent
this increased risk and alert the payer to reimburse the group
additional units.
10. Use of physician extenders
Some contracts will allow you to bill for services performed by
nurse practitioners or physician assistants employed by the group.
This can come in handy for groups who utilize such extenders within
their practice in both an office and hospital setting (pain visits,
etc.). Since these individuals are typically paid a flat salary
by the group, it does not take long to recoup the extender's employment
costs and generate additional revenue for the practice.
Note: Another item that anesthesia groups may want
to start addressing in their negotiations is payment for concurrent
cases involving residents. As noted in an article by Alexander
A. Hannenberg, M.D., in the May 2001 NEWSLETTER, United Healthcare
requires use of the Medicare modifiers and is now reducing the
payment by 50 percent for concurrent cases whether or not they
involve residents. This is an attempt to capitalize on the Medicare
payment rules, which allow 50 percent of the fee to the anesthesiologist
who is medically directing residents, nurse anesthetists or anesthesiologist
assistants. Private payers such as United Healthcare, of course,
do not make up the other 50 percent through graduate medical education
reimbursement as does Medicare. Anesthesiologists who work with
residents should consider negotiating a continuation of the current
standard that allows 100 percent of the fee for all cases whether
or not they involve residents.
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Karl E. Becker, Jr., M.D., ASA RUC Advisor, left,
Norman A. Cohen, M.D., RUC Alternate, and Laxmaiah
Manchikanti, M.D., ASIPP President, present information
supporting a proposed value for the new CPT code for
epidurolysis of adhesions performed in a single day.
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ASA Helps Interventional Pain Physicians With
New Epidurolyis Code
The American Medical Association/Specialty Society Relative Value
Update Committee (RUC) met in April to recommend RBRVS changes
to Medicare for the 2003 Medicare Fee Schedule. ASA presented
a large number of new and revised CPT™ codes for assignment
of either RBRVS units or ASA base units and was highly successful.
On behalf of the American Society of Interventional Pain Physicians
(ASIPP), which is not a member of the RUC, we presented a new
CPT code for epidurolysis of adhesions performed in a single day.
The existing code applies only if the procedure is performed over
two or three days. Laxmaiah Manchikanti, M.D., President of ASIPP,
joined Karl E. Becker, Jr., M.D., ASA RUC Advisor, and Norman
A. Cohen, M.D., RUC Alternate, at the presenters' table and helped
secure an appropriate value for the one-day procedure [see photo].
(Confidentiality rules prohibit disclosure of the numeric value.)
For 14 out of 15 anesthesia codes, the RUC assigned the exact
number of base units for which we had asked. Four out of four
block codes fared equally well.
The Centers for Medicare & Medicaid Services (CMS) will indicate
whether it agrees with the values that the RUC is recommending
in late June or July. Historically, CMS has accepted more than
95 percent of the RUC's recommendations.
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