There are several challenges that gastroenterologists will be facing in the coming years with regard to reimbursement. The Medicare fee schedule is in flux, and there are pending changes relating to reimbursement in the ambulatory surgery center (ASC) setting. Other critical issues pertain to scrutiny of purchased radiology and pathology service arrangements as well as new techniques for screening for colorectal cancer and other conditions.
The Medicare Fee Schedule
As of this writing, the Centers for Medicare and Medicaid Services (CMS) plans to implement a 4.4% decrease in the Medicare physician fee schedule on January 1, 2006. During November 2005, the Senate passed a resolution toward creating a 2-year moratorium on a decline in the fee schedule, but tying it to a strategy known as “value-based purchasing” or “pay per performance.” However, the House has not included any revision to the fee schedule in their budget recommendations. Hopefully, a joint budget reconciliation process will occur that will lead to a reasonable outcome for organized medicine. Basing one’s practice plan upon this hope, if such a reasonable outcome is not achieved, may result in unfortunate economic and practice viability consequences.
If there is a change in the fee schedule, practicing physicians should be sure to examine the contracts that they have with managed care and insurance companies. If a contract is based on the Medicare fee schedule, then physicians need to find out the date on which the schedule was enacted. If the insurance contract is tied to the fee schedule in effect on January 1 of the calendar year, the physician may find that reimbursement is reduced for the entire year, even if an adjustment to the Medicare fee schedule takes place later in the year.
During 2004, the gastroenterology societies conducted a supplemental practice expense survey. The survey showed that there was an increase in the expense overhead for gastroenterology practices. The results of this survey were submitted to Medicare in 2005.
Unfortunately, Medicare elected not to implement in the 2006 physician fee schedule the recommendations based on this survey. If the CMS had accepted the findings and incorporated them into the fee schedule, there would have been a significant increase in reimbursement for endoscopies performed in an office setting. This would have helped narrow the reimbursement gap for procedures performed in an office setting and those performed in a hospital or ASC setting.
It is likely that the gastroenterology societies will continue pressing Medicare to recognize these supplemental practice expenses. However, if these recommendations are implemented during 2006, physicians should take careful note of their contracts in order to prevent inadvertent disadvantage, as discussed above.
ASC Reimbursement
As most physicians are aware, the Medicare Modernization Act of 2003 froze ASC reimbursement at 2002 levels. The CMS has been charged with creating a new ASC reimbursement methodology to be implemented by 2008. In November 2005, several ASC management companies and trade organizations introduced legislation into Congress to set ASC procedure reimbursement at 75% of the reimbursement for the procedure when performed in the hospital outpatient setting. Although this proposal would be very beneficial for doctors who perform procedures with reimbursement rates that are currently less than 75%, it would have a devastating effect on the field of gastroenterology.
Approximately 30% of all ASC services are gastroenterologic, and ASC reimbursement for endoscopic procedures such as colonoscopy is significantly higher than 75% of the hospital outpatient rate.
The Federated Ambulatory Surgery Association worked with and lobbied members of Congress to introduce their proposed legislation to the Senate and the House during the 2005 congressional session. Prior to this introduction before Congress, none of the three gastroenterology societies or the American Medical Association was allowed the opportunity to provide input on the proposal. While the legislation includes provisions to “mitigate” the impact on procedures with current ASC reimbursement higher than 75% of hospital outpatient, under the proposal ASC reimbursement for gastrointestinal procedures could remain flat for years. The challenge this possibility presents is obvious: how can any practice forgo a raise (including cost-of-living increases) for as long as a decade and continue to provide services to patients without compromising the standards of patient care?
It remains to be seen whether Congress will address this legislation during the 2006 session. What is known is that the Congressional Budget Office has “scored” the impact of this 75% proposal at a cost of over 1 billion dollars. Gastroenterology procedures performed in an ASC setting have been shown to be cost efficient for purchasers while providing appropriate and quality services for patients and beneficiaries. The suggestion that our ASC reimbursement is too high is unfounded.
The finalization of any rate, whatever it may be, will not be good for gastroenterologists, especially those professionals who perform some or all of their services within an ASC setting. Under the proposed legislation, maintaining physician-owned ASCs may become prohibitively costly. Without the practice efficiencies spearheaded by physician ownership within ASCs, efficiency is likely to decrease to levels common to the hospital outpatient department setting. Unless all measures to ensure efficiency are maintained or increased, access to gastroenterology endoscopy services will decrease—widening the gap between the growing patient demand for gastroenterology services and the limited supply of gastroenterologists available to care for patients. Which of the end results is more likely: lengthy waits for gastroenterology evaluation or proposals to enlarge the sphere of endoscopy performance to non-specialty physicians?
Issues Pertaining to Nonoptical Screening for Colon Cancer and Other Techniques
Increasingly, payers are electing to cover computed tomography colonoscopy (CTC) for limited indications. Because fewer than 15% of people over age 50 eligible for colorectal cancer screening have undergone diagnostic evaluation of any kind, the provision for services such as CTC may lead to increased detection of colon cancer pathology, which would then require follow-up with optical colonoscopy for definitive diagnosis. Were colorectal cancer screening universally performed on all eligible patients, an additional 41 million screening procedures would result. If 20% of CTC procedures result in “visible” pathology, this translates to an additional 8.2 million optical colonoscopies each year—a literal doubling of patients presenting for diagnostic (not screening) colonoscopy.
Proponents of CTC as a screening modality cite patient convenience (the procedure is performed without sedation and the patient is able to return to work following CTC) but also acknowledge that the single greatest deterrent to colorectal cancer screening (by colonoscopy or CTC) is the requirement for bowel preparation. Ideally, lesions detected through CTC should be evaluated with optical endoscopy at the time of the initial bowel preparation; however, the current regulatory environment makes advancing this model difficult.
The current Stark regulations prohibit gastroenterologists from offering screening CTC services to patients with whom they do not have a pre-existing doctor-patient relationship. Radiologists, on the other hand, are permitted an exemption under Stark to offer radiology services (such as CTC), to any individual without a pre-existing physician-patient relationship. It is not clear why radiologists continue to receive this exception, particularly since gastroenterologists, as the primary caregivers of digestive health, can perform screening as well as surgery to evaluate premalignant and malignant pathology. Will there be a future opportunity to develop open access CTC within the setting of a gastroenterology practice?
Pathology and Radiology Billing Concerns
Some organizations promote “internalization” of pathology and/or radiology services through formation of “condominium” or “pod” laboratories in which laboratory space and pathologists are subcontracted to a gastroenterology practice and gastroenterology practice and pathology services are billed as if the pathologist were a member of the group and the supporting laboratory were fully owned by the gastroenterology group. Gastroenterologists should be aware that there is likely to be increased scrutiny of such arrangements. The Office of the Inspector General (OIG) released an advisory in December 2004 stating that this type of operation raised significant concerns for both Stark and anti-kickback violations, the penalties for which include significant fines, felony charges, and up to 5 years’ incarceration. Similar arrangements for radiology services have received similar scrutiny. The rationale used to justify these types of purchased-service arrangements has not and will not stand up to scrutiny; nonetheless, they continue to be proposed by some pathology groups and/or demanded by some gastroenterologists as a means of capturing pathology and/or radiology services revenue. Within the coming era of pay-for-performance, increasing patient awareness and demand for quality, and the ever-present litigious society—it is important to recognize and remember that the referring gastroenterologist remains culpable for physician-referred pathology and radiology services.
It would be wise to consider ways in which the field of gastroenterology can be refocused to integrate radiology, pathology, pharmacist services, nutritional services, and other related areas so that we can provide the full array of appropriate services to the patients that we serve. Also, as we move toward this multidisciplinary approach, we should seek out radiologists and pathologists that have a subspecialty in gastrointestinal diseases. We should expect any healthcare professional with whom we work to have the same degree of training and expertise that we have obtained in becoming gastroenterologists, in order to provide the full range of quality digestive health services to patients in the future.
Online Resources
FASA Proposal to Congress:
http://www.fasa.org/HR4042.pdf
FASA Summary of the Ambulatory Surgical Center Medicare Payment Modernization Act:
http://www.fasa.org/ASCPaymentModernizationActSummaryandFacts.pdf
Medicare Physician Fee Schedule for 2006:
Department of Health and Human Services, Office of the Inspector General Advisory Opinion No. 04-17:
http://oig/hhs/gov/fraud/docs/advisoryopinions/2004/ao0417.pdf