Anesthesia practices that accept Visa and MasterCard payments are among the “merchants” that may be able to collect a portion of the fees paid to the card issuers under the proposed settlement in the Payment Card Interchange Fee and Merchant Discount Antitrust Litigation pending in federal District Court in New York.  The class action lawsuit alleges that merchants paid excessive fees for accepting Visa and MasterCard because of an alleged antitrust conspiracy among the Defendant.  According to the complaint, Visa, MasterCard and more than a dozen of the nation's largest credit card issuers conspired to restrain competition by illegally charging higher interchange fees for credit card transactions.  The court granted preliminary approval to the proposed settlement agreement in November, 2012.  On April 11, 2013, the plaintiffs filed for final court approval of the settlement and for attorneys’ fees and expenses.  The court has scheduled a hearing for September 12, 2013 to...

On January 25, 2013, the US Department of Health and Human Services (HHS) Office of Civil Rights (OCR) issued its long-awaited Health Insurance Portability and Accountability Act of 1996 (HIPAA) final omnibus regulations (Final Rule). The Final Rule modified the HIPAA Privacy, Security, Enforcement and Breach Notification Rules (HIPAA Rules) and is comprised of four sub-rules:Final modifications to the HIPAA Privacy, Security, and Enforcement Rules mandated by the Health Information Technology for Economic and Clinical Health (HITECH) Act;A final rule adopting changes to the HIPAA Enforcement Rule to incorporate the increased and tiered civil money penalty structure as set forth by HITECH;A final Breach Notification rule; andA final rule modifying the Privacy Rule as required by the Genetic Information Nondiscrimination Act (GINA).While the Final Rule is effective March 26, 2013, compliance with the provisions of the Final Rule is not required until September 23, 2013. This eight month window between the...

Physicians who refer or order services for Medicare patients must be enrolled in PECOS, the Medicare Provider Enrollment, Chain, and Ownership System database, and physicians who bill Medicare are required to list the name and National Provider Identifier (NPI) of the ordering/referring physician on their claims in order to be paid.  The source of these requirements is Section 6405 of the Affordable Care Act. CMS is about to implement an automatic edit so that claims submitted on or after May 1st for certain services ordered by a physician or healthcare provider who is not enrolled in PECOS, even if his or her name and National Provider Identifier (NPI) are on the claim, will be denied.  This change may affect a relatively small but important set of anesthesiologists, who have raised questions about the issue.  As part of the pre-operative evaluation of surgical patients, anesthesiologists may order clinical laboratory or even imaging...

Benjamin Franklin said, “An ounce of prevention is worth a pound of cure.” It is certain that Mr. Franklin was not speaking about the value of preemptive compliance work, yet the old adage aptly applies to the work done by physician groups to prevent allegations of fraud or abuse. The Office of Inspector General for the Department of Health and Human Services (“OIG”) recently reported that the government expected to set a record of $6.9 billion in recoveries from its investigations and enforcement actions for its fiscal year 2012.1 As the chart in Figure 1 shows2, this $6.9 billion is part of a trend of continuously increasing recoveries. For this reason, many physician groups have implemented compliance programs designed to minimize the chances that the group will commit what the government perceives to be fraud or abuse. One key to effective compliance is an understanding of those issues of particular importance...

ABC is receiving some very good questions from anesthesia and pain practices regarding more details on how the sequestration 2% Medicare payment cut will impact their reimbursement.  We are continuing to monitor various Medicare carriers’ websites, including Palmetto, CGS, Novitas, First Coast Service Options and NHIC. These Q&As can help you track and ensure proper payments.Question:Does the 2% payment reduction under sequestration apply to the payment rates reflected in Medicare fee-for-service fee schedules or does it only apply to the final payment amounts?Answer:Payment adjustments required under sequestration are applied to all claims after determining the Medicare payment including application of the current fee schedule, coinsurance, any applicable deductible, and any applicable Medicare Secondary Payment adjustments. All fee schedules, Pricers, etc., are unchanged by sequestration; it’s only the final payment amount that is reduced. Question:How is the 2% payment reduction under sequestration identified on the electronic remittance advice (ERA) and the standard paper...

All of you are familiar with some of the regulatory requirements that affect your practice, as identified by their acronyms and initials: HIPAA, CMS, CoPs,PQRS, SCIP, ACO, HCAHPS. For hospital-based practices, there are now two additional “ingredients” in our regulatory alphabet soup that will require your attention: OPPE and FPPE. Historically, hospital medical staff appointments and reappointments have been primarily a subjective process, where the clinical chief signed off on credential/privilege requests, perceived competencies and specific skills. The Joint Commission and other accrediting bodies and payers have established more stringent guidelines for the ongoing evaluation of medical staff members. The Ongoing Professional Practice Evaluation (OPPE) and Focused Professional Practice Evaluation (FPPE) are now becoming part of every hospitalbased anesthesia practice’s routine. These evaluations are expected to occur on a regular basis and serve as the key component to the hospital reappointment process. Key Components  In adopting the Accreditation Council for Graduate...

The Centers for Medicare and Medicaid Services (CMS) has been encouraging the growth of accountable care organizations (ACOs) and other integrated models under the impetus of the Affordable Care Act (ACA).  The Federal Trade Commission (FTC), on the other hand, remains fiercely protective of competition.  If competitors coalesce into a single large organization, there will be fewer competitors. The ACA provides that “nothing [in the legislation] shall be construed to modify, impair or supersede the operation of the antitrust laws.”  In October 2011 the FTC jointly with the Department of Justice issued its Final Statement of Antitrust Enforcement Policy Regarding Accountable Care Organizations—following, but not allaying, much criticism of the corresponding proposed rule. The tension between the two drives, integration versus competition, has increased steadily since the passage of the ACA.  A recent and unusual FTC decision to go to court to block the acquisition of a medical group by a hospital...

Failure of the Joint Select Committee on Deficit Reduction to reach agreement on $1.2 trillion in cuts to federal spending, has triggered automatic Federal budget cuts known as sequestration. The cuts were originally scheduled to go into effect January 2, 2013. Congress delayed implementation until March and President Obama signed the order late Friday evening, March 1.The 2% cut is evenly split between domestic and defense programs, with half affecting defense discretionary spending (weapons purchases, base operations, construction work, etc.) and the rest affecting both mandatory and discretionary domestic spending. Only a few mandatory programs, like the unemployment trust fund and, most notably, Medicare (more specifically—provider and hospital payments) are affected.Last Friday, the White House Budget Office provided an 83-page list identifying for each of 1,200 accounts what amount needed to be chopped. Medicare beneficiaries will not be subject to any reductions in their benefits. Rather, the expected $123 billion cut...

Noah Rosenberg, M.D.Resident, Department of Family & Community Medicine, University of Massachusetts Memorial Medical Center, Worcester, MAFred E. Shapiro, D.O.Assistant Professor of Anesthesia, Harvard Medical School, Boston, ISOBS FounderThe Institute for Safety in Office-Based Surgery (ISOBS), an independent, non-profit 501(c)(3) organization, has developed a safety checklist for use in the office-based setting. A recent study to be published in the journal ePlastydemonstrated a more than 75% reduction in the number of surgical complications with use of the ISOBS Safety Checklist (see below for citation). While this positive effect on surgical complications validates much of the data already collected in the inpatient setting, it also clearly emphasizes the need for a tailored patient safety approach to the office-based setting. For that reason, ISOBS has developed a second checklist for use by patients to engage them in office-based surgical safety.The ISOBS Patient Checklist (ISOBS PC) contains a number of questions and concerns every patient...

Anesthesia revenue streams are an attractive target for investors of various stripes. Across the country, ambulatory surgical centers (ASCs) and certain medical specialty groups are looking at beefing up their incomes by sharing in anesthesia profits. At the January 24-26, 2013 ASA Practice Management Conference, Judith Jurin Semo, Esq., who presented an Update on the Company Model, noted that trade press articles encouraging such ventures appear regularly, going back at least to 2004 (Outpatient Surgery).  The “company model” arrangement, which allows a third party to use an intermediate corporation to collect the professional fees while paying the anesthesiologists a negotiated rate, has been the object of considerable concern on the part of the ASA and the anesthesia community at large.  Polled informally, one-third of anesthesiologists report having been approached about participating in a company model. The company model is becoming familiar, but is it legal? The Federal Anti-Kickback Statute The chief...

Christopher Ryan, Esq. Giarmarco, Mullins & Horton, P.C., Troy, MI Neda M. Ryan, Esq. Clark Hill, PLC, Birmingham, MI Reporting post-operative pain management procedures often gives rise to questions, especially toward the beginning of the new year when the Centers for Medicare and Medicaid Services (CMS) issues its National Correct Coding Initiative (NCCI) edits. Historically, epidurals and blocks that are placed pre-operatively for the purpose of managing post-operative pain have been, and still are, separately reportable and not bundled into the anesthesia service itself. The exception to this general rule is when the epidural or block is the anesthetic itself. While CMS has not called for significant changes in 2013, anesthesia providers should, nevertheless, be aware of new post-operative pain management coding changes taking effect January 1, 2013. NCCI Edits  The NCCI edits for 2013 provide, in part, that certain post-operative pain management procedures may only be separately reportable with anesthesia...

“Much has changed in health care since HIPAA was enacted over fifteen years ago,” said HHS Secretary Kathleen Sebelius in the Department of Health and Human Services’ January 17th press release announcing the publication of the long-awaited final omnibus rule with Modifications to the HIPAA Privacy, Security, Enforcement and Breach Notification Rules under the Health Information Technology for Economic and Clinical Health Act and the Genetic Information Nondiscrimination Act. “The new rule will help protect patient privacy and safeguard patients’ health information in an ever expanding digital age.” The final omnibus rule will go into effect on March 26, 2013. Covered entities such as anesthesia and pain medicine practices and billing companies including ABC—and their business associates—must be in compliance by September 23, 2013. The final rule changes HIPAA in several important ways: It toughens the definition and consequences of failure to notify affected parties of security and privacy breaches;It strengthens...

The Centers for Medicare and Medicaid Services (CMS) Contractor Medical Directors (CMDs) recently put together a list of common CMS claim issues that were of concern to various contractors. Several of these items involve services that may impact anesthesia or pain management providers. 1. Use of modifier -59 for imaging with those procedures that now INCLUDE imaging in the code description and payment e.g. paravertebral joint/nerve blocks; transforaminal epidurals, many others. In some cases, the base procedure includes fluoroscopy or CT imaging and the provider decides to perform the service under ultrasound guidance. Since the ultrasound guidance is not “bundled” in the base procedure description, coders are incorrectly appending modifier 59. However, the base procedure includes the payment for the fluoroscopy or CT imaging. It is incorrect to substitute the required and bundled imaging for another type that is not bundled and bill it separately. 2. Billing for “not qualified” personnel...

As happens every year, Congress stepped in at the last minute and blocked the Sustainable Growth Rate (SGR) cuts in Medicare payments to physicians.  On the afternoon of January 1, 2013, the House of Representatives adopted legislation passed earlier that day by the Senate, the "American Taxpayer Relief Act of 2012.” The bill prevented a plunge over the “fiscal cliff” by postponing across-the-board spending reductions and also overrode the 26.5 percent Medicare fee schedule cut that technically had already gone into effect on the morning of passage.   Congress’ action replaced the SGR reduction with a zero percent update for services provided from January 1, 2013, through December 31, 2013. Because of adjustments in the practice expense component of the anesthesia conversion factor (CF), the 2013 national average CF is $0.50 higher than last year’s CF, i.e., $21.9243.  This is 38 percent higher than the $15.93 CF announced in November 2012.   Actual...

The 2013 CPT® Changes and Codebook are now available to health care providers.  Overall, the 2013 changes include 186 new codes, 119 deleted codes, and 263 revised codes. In addition CPT revised 18 modifiers and updated 150 guidelines.  The very good news for anesthesia and pain management providers is only a small handful of these changes directly impact the services they routinely provide.  Following are general comments regarding the 2013 changes: No Anesthesia codes were deleted, revised, or added for 2013.Pain management providers should take note of the four revised codes and one new code in the nervous system section of CPT 2013. The majority of changes occur in the denervation subsection, where CPT revised codes 64612 and 64614 and added 64615 for bilateral chemodenervation of muscles innervated by the facial, trigeminal, cervical spinal and accessory nerves.CPT also changed the parenthetical note for code 76942, ultrasound guidance for needle placement (eg,...

  MEDICARE PAYMENTS AFTER DECEMBER 31st If we go into the New Year without legislation to stop the economy from going over the fiscal cliff—as appears almost certain—there will be no just-in-time SGR fix either.  The Medicare conversion factor applicable to services provided from January 1st onwards will be 26.5% lower, unless and until Congress corrects the problem.  Since the earliest that Medicare will pay claims will be January 14th, however, there is time for Congress to take the necessary action and prevent any remittances from going out at the lower rate, subject to later adjustment.   It is instructive to look at a six-year history of the dates on which Congress passed legislation each year avoiding the impact of the SGR (American Medical News, December 24, 2012): 2006-4.4%0.2%Feb. 8, 2006* 2007-5%0%Dec. 20, 2006 2008 (Jan.–June)-10.1%0.5%Dec. 29, 2007 2008 (July–Dec.)-10.6%0%July 15, 2008* 2009N/A1.1%N/A 2010 (Jan.–Feb.)-21.3%0%Dec. 19, 2009 2010 March-21.3%0%March 2, 2010* 2010...

In a much awaited pronouncement, on June 1, 2012, the U.S. Department of Health and Human Service’s Office of Inspector General issued Advisory Opinion 12-06 addressing the propriety of two popular schemes to extract money from anesthesiologists, the so-called “company model” and the purported “management fee.” The advisory opinion could not be more welcome: Just as Willie Sutton, the bank robber, targeted banks “because that’s where the money is,” owners of ambulatory surgery centers continue seek a share of anesthesia fees. According to a survey conducted by the American Society of Anesthesiologists, 41% of the responding anesthesia practices (125 out of 308) reported being requested by an ASC or its referring physician practice to adopt a company model. Not surprisingly, those 125 practices reported that out of the total 332 requests to participate in a company model entity, the group lost the contract in at least 159 instances. Company Model...

It is a question asked quite often: Is marking a check box on the anesthesia record sufficient documentation?  For medical review and for billing purposes?Check boxes are a very convenient way to document services provided to a patient with minimal time spent dictating or writing out everything that is done.  We see check boxes on pre-operative assessments, anesthesia records and evaluation and management service (E&M) forms, just to name a few.  Templates increase the efficiency of the clinical documentation, but are they an acceptable form of documentation?On November 9, 2012, the Centers for Medicare and Medicaid Services (CMS) issued Transmittal 438, which provides some insight into CMS’ views on the use of templates in medical record documentation and the risks, as well as some guidance.In its Transmittal, CMS stated its position on the use of templates and check boxes:CMS does not prohibit the use of templates to facilitate record-keeping. CMS also does...

Across the United States and the District of Columbia, the average anesthesia managed care contract rate during the first several months of 2012 was $67.94.That figure comes from the latest ASA survey of commercial fees paid for anesthesia services, published in the November issue of the ASA NEWSLETTER.  ASA fields the survey electronically every year, soliciting responses through email, committee list servs, newsletters and the website.  Whether the responses are representative of the specialty is an open question, but the overall consistency of the survey results from year to year, since it was initiated in the mid-1990s, supplies a certain measure of credibility.  The survey leverages the relatively small number of respondents by asking for the conversion factors (“CFs” or “unit rates”) for five of each group’s largest managed care contract rates.The first thing to note is that $67.94 is a weighted average of averages across up to five contracts for each of...

Now that the elections are over, nationwide attention has turned to the so-called “fiscal cliff.”  The fiscal cliff refers to the effective date of automatic cuts in spending combined with increases in taxes mandated by law.   It has been called a year-end “perfect storm” and “taxmageddon.”  One commentator at CNN referred to the fiscal cliff as “the legislative equivalent of a slow-motion train wreck.” Putting politics aside, unless new legislation is enacted between now and the end of the year, the fiscal cliff will have an impact on you and your anesthesia practice.  In this week’s Alert, we summarize some of the changes slated to take effect at the start of 2013.  This is only a summary and not tax advice.  You should consult your tax advisor regarding your response to this possible fiscal cliff.Income TaxesThe table below is based on gross income after exemptions:SingleMarried Filing JointlyCurrent Tax Bracket2013 Tax Bracket$0–$8,700$0–$17,40010%15%$8,700–$35,350$17,400–$70,70015%18%$35,350–$85,650$70,700–$142,70025%28%$85,650–$178,650$142,700–$217,45028%31%$178,650–$388,350$217,450–$388,35033%36%$388,350 +$388,350...