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In a December 2006 cliff-hanger, Congress passed H.R.6111, the Tax Relief and Health Care Act of 2006, reducing the 2007 cut in the national Medicare anesthesia conversion factor (CF) from the projected 13.7 percent to about 8.9 percent. As always, the actual anesthesia CF will vary between localities because of geographic differences in practice costs. A copy of the final 91 locality CFs will appear on the ASA Website as soon as the Washington Office receives the new numbers. Meanwhile, anesthesiologists and their administrators should consult the Web sites of their local Medicare carriers.

The legislation froze the overall conversion factor, which applies to pain medicine, invasive monitoring lines, visits and all other procedures besides anesthesiology services at last year’s value, $37.90. Since most anesthesiologists provide a mix of these services, total Medicare payments to anesthesiologists will drop about seven percent next year, somewhat less than the anesthesia CF change alone would suggest.

Eliminating the five-percent reduction that the Sustainable Growth Rate (SGR) update formula would otherwise have dictated represented a significant (if incomplete) victory for ASA, the American Medical Association and other physician organizations that spent the year engaged in extraordinary efforts to improve Medicare payment. For further information on the legislative endgame, see the Washington Report on page 4.

While Medicare physician payment has generally been frozen at last year’s levels, there have been shifts between specialties. These relative variations reflect the impact of changes in the work values assigned to a number of individual procedures under the last Five Year Review of the Fee Schedule as well as changes in the methodology by which the Centers for Medicare and Medicaid Services (CMS) calculates practice expense values. Anesthesiology is one of the specialties facing large cuts despite the Tax Relief and Health Care Act of 2006 because of these two factors. Thus 7.5 percent of our 2006 Medicare payments will go to fund the increases in work valuation obtained by many other specialties This is what is known as “budget neutrality.” Second, anesthesia services lose another 1.5 percent because our practice expenses are primarily indirect rather than direct (billing and other overhead costs as opposed to clinical supplies.) The Centers for Medicare and Medicaid Services (CMS) chose a methodology for establishing practice expense relative values that bases everything on direct costs, over the protests of all the specialties for whom the hospital is the primary site of service.

If any of the health plans with which ASA members participate attempt to change their payments on the basis of the new Medicare physician fee schedule, it will be important to know that the Medicare cuts reflect Medicare budget mechanisms only – not the true relative value of the work or costs involved in providing anesthesia services.

CPT ^® Code Changes Effective January 1, 2007
number of CPT ^® coding changes appear in the 2007 Current Procedural Terminology (CPT ^®) and, together with their base units, in the ASA RVG™ and Crosswalk^® books. Anesthesiologists’ practice management systems should be updated to reflect all of these changes, which are described fully in Table 2:

If you have not already purchased or ordered your copies of the 2007 editions of the CROSSWALK and Relative Value Guide, please contact the ASA Publications Department at 847-825-5586 or place your order on-line at <www2.ASAhq.org/publications>.

Locked Anesthesia Carts? No More

ASA is delighted to report success — at long last — in its efforts to persuade CMS that anesthesia carts may safely be kept unlocked while in a “secure area.”  Beginning on January 26, 2007, anesthesia carts need not be locked as long as they are in secure areas such as active, staffed operating rooms, critical care units and labor and delivery suites.
 
Anesthesiologists and their hospitals have long been frustrated by the Medicare Conditions of Participation (COP) regulation, enforced through JCAHO surveys, requiring anesthesia carts to be locked between cases whenever “authorized personnel” are not present in the room.  ASA met with CMS officials in 2004 to discuss the problem of potentially delayed access to vital medications. When as a result CMS proposed a change in the regulation, we submitted formal comments to CMS strongly supporting the change and encouraged ASA members to send in their own letters.

We hope that the new regulation, published on November 27 and emphasizing a “secure area” rather than a “locked storage area for anesthesia drugs other than narcotics, will put an end to the difficulties of complying with a rule that did not protect patients. The CMS rewrite of the regulation removes a serious patient safety risk: requiring locked anesthesia carts could potentially cost precious seconds—or more—when anesthesiologists must treat their patients in emergency situations.

Also related to anesthesiology, the November 27 final rule amends another COP regulation to permit the postanesthesia evaluation for inpatients to be completed and documented by any individual qualified to administer anesthesia, instead of only the individual who administered the anesthesia.

A copy of the regulation is available on the ASA Web site, <www.ASAhq.org/Washington/Unlockedanesthesiacarts.pdf>. Please consult the “Practice Management” column in the February 2007 issue of the Newsletter for a discussion of the practical implications of the new rules and for sample guidelines with which you can help your hospitals adopt new policies on anesthesia medication security.