Health plans are focusing on ambulatory surgery centers (ASCs) as a source of cost savings. The same procedure performed in an ASC may be less than it is in other outpatient ambulatory settings.
Acute care facility inpatient admissions will gradually decrease as most health plans are moving services to the outpatient service facilities such as ASCs. The Centers for Medicare and Medicaid Services (CMS) has noticed the value in performing procedures in an ASC setting.
Outpatient surgery volume is expected to increase by approximately 11 percent over the next four years. We will see type of procedures performed in an ASC setting expand to cardiac, neurosurgical and urology.
Prior to January 1, 2017, there was an increase in hospital-owned ASCs (whether 100 percent owned or some percentage of ownership). But that is starting to decrease. Whole ownership is not as attractive as it once was. Reimbursement rates between hospital outpatient visits and free-standing ASCs are starting to level out. Hospitals do want to maintain joint ownership so they can benefit from outpatient procedures otherwise, they would be losing revenue without some percentage of ASC ownership.
There has been an increase in physician-owned ASCs in particular. Large orthopedic groups are establishing mega ASCs and cardiac ASCs. However, not every ASC will have the staff or equipment to move into this space. They’ll need to have cardiac catheterization labs, equipment and cardiac-trained nurses. We may see hospitals creating a joint venture with those.
Three important points about ASCs and the near future
Based on industry trends, ASCs have proven to have better patient satisfaction rates. As a result, we may see the following:
- Facility outpatient will become an audit area of focus for health plans and the Office of the Inspector General (OIG).
- Health plans will approve more surgical procedures as appropriate to be performed in an ASC setting.
- ASCs will become laser focused on providing value. With data to prove it, they are in the 90th percentile or higher for outcomes and patient satisfaction. Health plans will advocate that patients use those centers and ultimately increase their ASC reimbursement.
What ASC growth could means for health plans
ASC growth has been gradual so far. As they become used and growth continues, we’ll start seeing an increase in ASC claim volume. This will drive an increase in auditing and monitoring of those claims.
CMS has proposed adding 142 new device-intensive procedures to the ASC setting. This means health plans will increase spend, since the total device cost will be included in the reimbursement rate when performed in an ASC. It’s still less expensive than a hospital. Health plans should consider including ASCs in their provider networks. They should encourage their use (ASCs are counting on this). ASCs have quality measures in place so health plans can see how good their service is to encourage sending in more cases.
Health plans could see a cost savings due to a decrease in hospital outpatient department (HOPD) spend. As ASCs continue to grow, the OIG has recommended that HOPD rates be reduced to equal ASC rates for certain low-risk procedures.
Studies have shown that only 48 percent of procedures that could be conducted safely in ASCs were actually performed in them. If the balance of these procedures, 52 percent, were performed in ASCs, health care costs could be reduced an extra $41 billion annually.
Don’t start counting those savings just yet
Before health plans can start counting their savings from encouraging use of an ASC, there is something to keep in mind. Let’s take cardiac ASCs as an example. There, only diagnostic or minimally invasive procedures can be performed. If a patient needed to have a stent put in, they’d have to come out of the ASC. Then they’d have to be admitted to a hospital outpatient center to have that procedure. As a result:
- For the health plan, there are two procedures in two facilities and associated charges to be paid.
- For the patient, there are two separate visits and two artery punctures which can increase the mortality risk of the patient.
It remains to be seen whether or not the health plan would be willing to pay for these two procedures. We may start to see CMS and accreditation groups creating regulations to be sure the population is being properly screened for seriousness of a condition before performing certain procedures in an ASC. Health plans may choose not to use an ASC if there is a procedure where an intervention may be needed. They may only allow procedures with high risk of intervention to be performed in a hospital setting rather than at an ASC.
Five actions alerts health plans can create to improve monitoring
Create alerts to flag concerning trends and evaluate immediately as soon as you find something suspicious. Following are some activities you can monitor:
- Increased patient volumes in an ASC could be a red flag that providers are billing services not provided. Be sure to check the total number of operating rooms versus number of procedures performed per day at an ASC causing concern. The number of claims should reflect the number of operating rooms they have. How do you find that information? Some ASCs don’t list it on their websites. Drill down into their National Provider Identifier (NPI) to see the number of operating rooms. Also, look to see if claims are billed on the weekends and call to see if the ASC is open on weekends. Look for spike trending.
- Decreased patient volumes in an ASC may be an alert that claims are being submitted for services not rendered. They cease billing after successfully receiving payment for an amount of time to stay under the radar.
- Procedures performed not within an ASC’s normal specialty. Check for appropriateness of setting. The ASC may not be set up for a particular type of procedure. For example, an ASC with no heart catheterization equipment bills heart catheterizations. Watch what claims are being submitted for a concerning coding pattern or other fraudulent activity. An ASC could decide to branch out into other specialties but doesn’t yet have certifications for the other specialties. They need to fill out an application of intent to perform procedures in other specialties to get their Medicare certification to receive Medicare reimbursements.
- Identify new providers billing for the first time to detect fraudulent claim submissions. If you see claims you haven’t seen before, keep watching to see if they’re there for a bit then just gone. Also check to be sure they are billing correctly for what the ASC is certified for.
- Detect claims for same patient having procedures across different ASCs to identify fraudulent claims. Is the same claim popping up for the same patient but in different ASCs?
- Build out ASC facts and data points. Sometimes simple is a good starting point. For example, how many elevators in the building? If an ASC claims they serve 500 patients but they have one elevator, that’s a red flag. You may be able to find basic data in state or federal regulatory records.
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About the author
Robin Richards, CCS, CDIP, CPC, CHTS
Facility Ideation Leader, Optum Payment Integrity, R&D
Robin Richards, an AHIMA-approved ICD-10-CM/PCS trainer, is a Facility Ideation Leader for Optum Payment Integrity. Richards has more than 25 years of coding experience in hospital and payer settings.