GI Reimbursement:

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Reimbursement for gastrointestinal (GI) procedures is taking a serious nosedive in some settings. These looming changes are leaving the specialty reeling — and in debate as to what alternatives to launch to keep the once-lucrative business afloat.

In fact, the Centers for Medicare & Medicaid Services (CMS) final rule — slated for release this spring — threatens a 62 percent reimbursement rate for ambulatory surgery centers. That is, 62 percent of the hospital outpatient department (HOPD) rate. This is below the recommendations made by the ambulatory surgery center (ASC) community of 75 percent and below Wall Street expectations of 65 percent to 70 percent.?

In addition, beginning in 2008, the basis for payments made to ASCs is proposed to change from ASC grouper payments to the 221 ambulatory patient classification (APC) groups utilized by HOPDs under the outpatient prospective payment system (OPPS). More interestingly, the CMS rulings also are predicted to have a particularly detrimental effect on certain specialties, should it pass as it is currently written. This has many specialists on edge, and rightfully so. The gastroenterology specialty, for example, is expected to take the hardest hit of all from the “potentially disastrous” rule, as coined by the American Gastroenterological Association (AGA).

John Poisson, executive vice president of Doylestown, Penn.-based Physician’s Endoscopy (PE), a company that specializes in the development and management of single-specialty endoscopic ASCs, says their member centers will see “between a 20 and 22 percent reduction in Medicare reimbursement,” according to an internal analysis of seven of PE’s operating centers; based on real historical volumes. (See his accompanying article for reimbursement survival tips.)

GI, for some reason, appears to be the victim of some measure of bullying within the healthcare sector. Last year, two incidents in particular would make one question gastroenterology’s standing in its ability to influence reimbursement rates.

Last March, a group of gastroenterology-related specialty organizations and associations joined forces to request a permanent voting position for gastroenterology on the American Medical Association’s (AMA) Relative Value Update Committee (RUC). In 1991, the AMA RUC was formed to make recommendations to CMS on the relative values to be assigned to new or revised codes in physicians’ current procedural terminology (CPT). Recommendations and decisions made by the RUC have significant impact on the annual updates to the physician work relative values. The group, in their request for a seat, cited that gastroenterology meets the RUC seat criterion and should be granted the spot; however, the group was denied the seat.

The fact that Medicare endoscopic payments have dropped by 30 percent to 40 percent in the last 10 years may also signify a need for a stronger voice. But, this past summer, CMS released its much anticipated proposed rule on the five-year review of resource-based relative value scale (RBRVS), and it reflects no relief for the gastroenterology specialty. While payments are not necessarily going down, they also are not going to increase, so there will be “no marked modification of current rates.”

A statement released by the American College of Gastroenterology last June reads, “The five-year review is a competitive battle as each specialty tries to secure a larger piece of the payment pie. In the budget-neutral environment of Medicare, the gains for one specialty require reductions for others, so staying relatively even is a reasonably good outcome.”

This may not be the case for ASCs providing endoscopic procedures. The comment period for the CMS proposed rule on reimbursement ended last November, and you can be sure that CMS received piles of letters that commented both for and against its plight. From the ASC perspective, the percentage of reimbursement to that of the HOPDs is unfair, and has rightly grabbed the most attention — and the most ferocious response.

As for the hospital environment, as far as outpatient procedures are concerned, the outlook isn’t all that bad. Hospitals would receive an estimated $32.5 billion in 2007 under the proposed final rule. The rule will affect outpatient services furnished by general acute care hospitals, inpatient rehabilitation facilities, inpatient psychiatric facilities, long-term acute care hospitals, children’s hospitals, and cancer hospitals. As provided by statute, the rule includes a 3.4 percent market basket update to Medicare payment rates for services paid under the hospital OPPS for 2007. After taking into account other factors that affect the level of payments, CMS estimates that hospitals will receive an overall average increase of 3 percent in Medicare payments for outpatient department services in 2007.

“The march to the new payment system is definitely topic number one,” says Eric Zimmerman, a partner with healthcare law firm McDermott Will & Emery LLP. “I think the surgery community might be interested in watching what’s happening to other payment systems, including hospital inpatient PPS, and some of the specific changes that CMS has proposed for specialty hospitals. Anybody in the industry needs to be involved in the process. There is a lot on the table right now and there is a tremendous amount at stake.”

Looking to the Future of GI

The looming threat of decreased reimbursement will leave many practices — freestanding or otherwise — with no other choice but to become creative in its offerings or to utilize traditionally lower-paid staff for procedures the “higher-paid” staff commonly perform.

For example, in the December/January issue of EndoNurse magazine, the topic of nurse practitioner-led screening colonoscopies was broached. Claudia Christensen, FNP, CGRN, nurse endoscopist and colorectal screening coordinator in the surgery services department of the Alaska Native Medical Center, has performed over 1,200 screening colonoscopies over the past three years; prior to which (also for three years) she performed flexible sigmoidoscopies.

Christensen is a rarity, of course, but this may just be the wave of the future. She performs nearly 600 colonoscopies a year —in addition to the ones the surgeons do. The screening rates are better in the community (up from 15 percent to 50 percent in the three-year timeframe — 20 percent of which is directly related to Christensen), but more important to the bottom line is the fact that Alaska Native Medical Center has 600 more cases being billed each year.

“Clearly the role of the GI proceduralist physician will continue to evolve over time and it certainly wouldn’t be unforeseen that mid-level providers may at some point be used in an ASC to do routine cases,” Poisson adds. “That’s clearly not the norm today, but as they continue to have reimbursement pressures and a variety of other factors impacting the GI physicians, there will be multiple pathways they will pursue to continue to evolve with the market.”


According to the American Gastroenterological Association, the future outlook on GI practice should include:

  • Gastroenterologists need to be aware that technological developments in the area of gastroenterological imaging and testing, especially related to colorectal cancer (CRC) screening, are liable to make obsolete some common endoscopic procedures currently performed by trained gastroenterologists.
  • Given that such procedures – especially CRC screening – constitute a large portion of gastroenterology practice revenues, if this happens, the economic consequences would be considerable for both community and academic practice, which would be further exacerbated by continuing downward pressures on reimbursement.
  • To maintain their practices, gastroenterologists may need to look into offering other services such as obesity treatment, Natural Orifice Translumenal Endoscopic Surgery (NOTES; which uses a natural orifice approach to intra-abdominal surgery) and gastroenterological cancer chemotherapy, among others. Furthermore, increased utilization of nurse practitioners and physician’s assistants will be necessary.
  • Philosophically, gastroenterologists may need to position themselves as the coordinator or manager of all digestive health care a gastroenterology patient needs.
  • AGA should continue advocacy and public policy efforts to work toward increased reimbursement for nonprocedural services.
  • Gastroenterological training, through gastrointestinal fellowship programs and continuing medical education for those already in practice, will need to be revised to reflect the new directions in practice.

The most common GI procedures performed in endoscopy centers are colonoscopy, esophagogastroduodenoscopy (EGD), endoscopic retrograde cholangiopancreatography (ERCP) and endoscopic ultrasonography (EUS).

Source: Endoscopy Intellimarker 2006, InforMed Healthcare Media

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