American Society of Anesthesiologists - Rural Pass Through Legislation

Rural Pass-Through Legislation

< Back

Many states face ongoing challenges in assuring access to medical care services for their citizens living in rural areas. Insufficient Medicare payments and low patient volume have made it particularly difficult for many rural facilities to attract and retain qualified health care providers. In response to these challenges, Congress has enacted a variety of incentive programs to encourage providers to practice in rural areas.

One such program is the anesthesia rural "pass-through" program, created as an incentive for anesthesia providers to practice in small rural hospitals. Under the “pass-through” program, eligible hospitals may use reasonable-costs based Part A funds in lieu of the conventional Part B fee schedule to induce anesthesia providers such as anesthesiologist assistants (a type of physician assistant) and nurse anesthetists to provide anesthesia services in small rural hospitals and critical access facilities. Under the Centers for Medicare and Medicaid Services (CMS) current interpretation of the statute creating the “pass-through” program, eligible rural hospitals are not permitted to use the “pass-through” funds to employ or contract with physician anesthesiologists. Low Medicare Part B anesthesia payments and low patient volume in rural areas also make it difficult for rural hospitals to retain anesthesia providers.

In 2010, the American Society of Anesthesiologists, through formal comment, requested that CMS permit rural hospitals to use the rural pass-through arrangement for anesthesiologists, as well as the other providers. CMS responded that it cannot permit hospitals to use the pass-through arrangement for anesthesiologists without a change in the current law.

In 2013, Senator Ron Wyden (D-OR) and Senator Johnny Isakson (R-GA), members of the powerful U.S. Senate Finance Committee, introduced S. 1444, the Medicare Access to Rural Anesthesiology Act of 2013, legislation to reform the current Medicare rural anesthesia incentive program to include physician anesthesiologists.

In May 2014, Congresswoman Lynn Jenkins (R-KS-02) and Congressman Emanuel Cleaver (D-MO-05) introduced H.R. 4781, companion legislation to S. 1444 introduced in the Senate. These bills would permit certain small, low volume rural hospitals to attract and retain medically-trained anesthesiologist to practice in medically underserved areas. They would also grants rural hospitals enhanced flexibility to use the services of physician anesthesiologists, in addition to the services of anesthesiologist assistants and nurse anesthetists, to best serve their patients surgical anesthesia needs. ASA strongly endorses this legislation as an important mechanism to increase rural patients’ access to high quality, comprehensive, medically managed anesthesia services provided by physician anesthesiologists.

Important Documents:

ASA's One-Page Issue Paper 

Summary of S. 1444

Summary of H.R. 4781

List of all Hospitals Eligible for Rural Pass-Through