Coding Q&A

Updating big changes in Medicare ASC payments


Updating Big Changes in Medicare ASC Payments


Q. I understand that the Centers for Medicare and Medicaid Services (CMS) has authorized a new reimbursement system for procedures performed in ambulatory surgery centers (ASCs). How will this affect retina ASC reimbursement in 2008?

A. The final rule for ASCs was published in the Federal Register on Aug. 2. In the same issue is the proposed rule for OPPS (Outpatient Prospective Payment System) on which the new payment system is based. If you are doing any projections or moving services over to your ASC, use the tables in the OPPS final rule that came out in early November and not the ASC final rule.

There is going to be a bit of a learning curve on this and the all the data that you will need will not be finalized until the final OPPS rule and Physician Fee Schedule. Also, we will have to wait and see if there is a "fix" in the fee calculation like there has been for the past several years.

Meanwhile, here are some highlights to get you started:

Payment rates. Payment rates are based on the OPPS (surgical list found in Addendum AA). Do not use the addendum in the final rule for ASCs.

Modifiers. Modifiers 73 and 74 will continue to be used. The SG modifier is being eliminated. Modifier -52 will be allowed with a payment reduction of 50%.

Riva Lee Asbell is the principal in Riva Lee Asbell Associates, an ophthalmic reimbursement firm in Philadelphia. She can be reached through her Web site at

Coders. In the new system, it is imperative that a coder has mastery of surgical coding, particularly for the more complicated cases. All codes must be captured and placed in proper order. Modifiers, as always, control payment for Medicare. Thus, it behooves the physician to be sure to code all surgeries and be cognizant of the new codes for vitrectomy and retinal detachment repair. Many ASCs do not have surgical coders and even those that do will need new training.

Ownership. Many ASCs are attempting to bring in vitreoretinal procedures as a new source of revenue given the new payment system. Many retina surgeons are being invited to participate in ownership. Expert consultation and evaluation is needed before this decision is made.

Office-based procedures. Be very careful if you plan on moving procedures that were traditionally performed in the office to the ASC now that they are on the ASC list. CMS is concerned about this and most of these procedures have built-in significant reductions (due to the methodology used to calculate payment for these procedures) that will make it financially undesirable to do this. Both the physician and the ASC will receive less reimbursement compared to performing the same procedures in the office. Among the procedures that may be negatively affected are pneumoretinopexy, laser procedures, and intravitreal injections.

Codes. Category I, II, and III codes will be added to the list applicable. The list will be updated quarterly.

Drugs. Specific drugs used in ASC procedures costing more than $60 may be separately reimbursable.

Exclusions. Procedures that are excluded from payment by Medicare are those that pose significant risk to the patient if performed in an ASC and those that require an overnight stay. In addition, ASCs cannot be the site of those procedures excluded by virtue of appearing on the OPPS Inpatient List (65273 Repair of laceration, conjunctiva, by stabilization and rearrangement, with hospitalization), those that are bundled into other procedures on the OPPS list, all unlisted procedure codes (ending in xx999), and those paid on a different fee schedule or not on Medicare fee schedule.

Other insurers. You may want to start to contact your other insurers see what their plans are for their ASC reimbursement policies. Medicare has stated that it will not be updating the current system of price groupers and many insurers use that system, piggybacking on Medicare. Thus, there is no mechanism that is currently in place for them to update their lists or to update their pricing.

CPT codes copyright 2006 American Medical Association. RP