Endoscopic Anesthesia Revisited: An Update on the Impact of the New GI Codes

Summary

Endoscopy has been the subject of much debate and review over the past few years. While many of the policy changes in recent years have been positive for anesthesia and encouraged the expansion of this line of business we are bracing for payor pushback that may cause some rethinking of group endoscopy strategies. 

Few topics have captured the anesthesia community's attention as completely and for as long as endoscopy and the value of anesthesia services for GI procedures. The consensus of opinion now favors active participation by qualified anesthesia providers to enhance the safety and efficiency of endoscopy care.

This perspective inspired the Centers for Medicare and Medicaid Services (CMS) policy, issued a few years ago, to encourage regular screenings for Medicare patients. Removing the patient's responsibility for deductible and co-payment for anesthesia services provided a significant incentive for Medicare subscribers to receive these important screenings.

Virtually all health plans followed suit, agreeing to pay for anesthesia services for colonoscopy. Across the country, endoscopy became the clinical bandwagon for many practices.

That was then. As Table 1 below indicates, the average ABC client saw an increase of 15 percent in the volume of endoscopic cases. However, the table also shows that the increase in cases did not result in an increase in revenue. What we are seeing is the impact of the law of supply and demand. As the supply of a service increases, the price inevitably falls.

Table 1: Impact of Endoscopy Services on a Sample of ABC Clients

​Payment policy for endoscopic anesthesia has evolved through three phases over the past four years. The first was the CMS policy change, which was positive. Then the AMA changed the codes and the ASA changed the basic values, which was somewhat of a negative. And now we are entering a third phase, which threatens to further undermine the revenue potential of this service line.

The CMS policy established the importance of identifying cases that had been booked as screening colonoscopies. If a case was booked as a screening and the result was a normal colon, the patient had no responsibility for a deductible or co-payment. If it was booked as a screening but a polyp was removed, the deductible was still waived but the patient was responsible for a 20 percent co-payment for anesthesia services. This approach seemed to confirm the value of anesthesia for endoscopy, and most payers followed suit.

Effective January 1, 2018, the AMA rolled out new anesthesia codes for endoscopy (shown in Table 2). The two codes became five. While the basic value of all endoscopic cases had been five units, the units now varied based on the procedure's location. Of special note is the fact that the AMA and CMS did not agree on the value of a screening colonoscopy. The AMA and the ASA set the value at 4 units while CMS dropped it to three.

The financial impact of the new codes can be seen in Table 1. The average units per case dropped from 8.1 to 7.5, or 7 percent. For a typical practice, the percentage of Medicare patients covered also increased, and the overall average yield per unit also dropped. Although volume increased, practices saw an overall net loss of 4 percent.

Now we are seeing some interesting developments on the part of individual insurance plans. Many plans had not adequately budgeted for the impact of the increase in patient volume. Two individual plans on opposite sides of the country, the UCLA Medical Group in Los Angeles and Harvard Pilgrim in Boston, have introduced new endoscopy policies that require patient pre-authorization for anesthesia. If certain medical criteria are not met (ASA I and II patients), the plans will not pay for anesthesia, and these costs are the patient's responsibility.

It is impossible to tell at this point which other plans will modify their policies, but the handwriting is on the wall. ABC is monitoring payer denials for endoscopy cases closely. In some cases plans are implementing stricter medical necessity guidelines and limiting payment to certain diagnoses, but the denial patterns are inconsistent. We will have to see how this plays out.

If you are interested in how your revenue may be impacted, please contact your ABC account executive, who will be happy to perform the necessary analysis.

We want to hear from you. Do you have a topic you would like to see covered in an ABC eAlert? Please send your suggestions to info@anesthesiallc.com.