The Impact of The 2022 CMS Rule Changes on Your ASC and How to Navigate the Change.
In recent years, more and more complex surgical procedures have migrated to the ambulatory surgery center (ASC). Advances in technology and surgical technique, strategic patient selection, and payer policy updates have aided in this migration. The recent reversal of several key provisions in the Centers for Medicare and Medicaid Services (CMS) Outpatient Prospective Payment System/ASC Payment system (OPPS) final rulings between CY 2021 and CY 2022, however, could have a negative impact to an ASCs profitability if these and other policy transitions are not managed effectively. As a result, many ASCs are focusing on detailed revenue cycle assessments; engaging specialized partners to ensure compliance with current regulation, and to review current operational processes for growth opportunities.
Overall, the past decade has shown positive forward migration of many complex procedures into the ambulatory surgery center place of service. Calendar years 2015 through 2021 delivered new spine procedure codes to the ASC covered procedure list (ASC-CPL). After sweeping policy change in the CY 2021 final ruling, hundreds of new codes were automatically placed on the ASC-CPL; allowing ASCs to compliantly perform these procedures and be appropriately reimbursed. With the changing of administrations, the CY 2022 final ruling dealt a reversal of many of the key provisions of the previous year, including the removal of spine codes just recently added from the ASC-CPL, with some even being put back on the in-patient only list (IPO).
These dramatic policy changes can leave ASCs vulnerable to loss of potential patient volume, coding errors, and revenue cycle challenges that can impact potential revenue. As such, now is the time to review key processes and areas of operation.
The 2022 CMS Rule’s Impact on Front-end Operations
ASC’s have not been immune to staffing shortages, leaving critical functions unfulfilled and impacting profitability. Now is the right time to review and apply industry best-practices to common front-end processes ensuring clean claims and improved cash. Patient demographics drive claim accuracy and insurance verification ensures that the patient’s coverage is accurate and active. Errors or omissions in either of these steps will lead to claim rejections and denials. Authorization requirements change over time and vary by procedure, payer, region so it’s critical to complete an authorization review for all patients. Price transparency is critical for patient satisfaction and financial success. A 2020 TransUnion Healthcare Survey reported that 60% of the patients surveyed are at least somewhat likely to pay their bill upfront if a cost estimate is offered in advance or at the time of service.
Surgical Coding in Light of the 2022 CMS Rule
Compliant coding is essential to ensure timely payment of claims and protection against recoupments and refunds. Both private payers and CMS recovery audit contract providers (RAC) routinely audit for suspected improper payments, many of them caused by coding errors.
- Stay aware of procedures with high billing error rates which RACs are required to review.
- Conduct internal coding and billing audits. Internal audits ensure clean records and can also reduce the risk of an audit from CMS, private payers, and the IRS.
- If an audit notice is received, responding to the audit and RAC letter by the deadline.
- Appeal discrepancies. Though strict, audits are not always correct. Between 2014 and 2016, the American Hospital Association found through its RACTrac survey that of the 45% of hospital respondents who appealed denials, 27% were successful.
Denials Management – More Important Than Ever
Once a claim is submitted, the job is far from over, this hasn’t changed with the 2022 CMS Rule. Most ASC’s struggle with denials and aging AR resulting from myriad of factors. A revenue cycle assessment will help determine your ASC’s top denial trends, how much money is tied up in denials, and whether you are getting reimbursed correctly for the services your ASC provides. Tracking and trending denials seems like such an easy task, but the ASC revenue cycle is incredibly nuanced. You can’t fix the problem if you don’t know what the problem is. Reviewing the root cause of denials and correcting and refining processes can have a major impact on your ASC’s bottom line.
Managed Care Contracting and Long Term Success
Effectively negotiating managed care contracts will set your facility up for long-term success. Finding a partner with ASC expertise, depth of knowledge in your specialty, and who understands payment methodologies including fee for service, bundled agreements, and risk-based models is most advantageous. The right partner will also have connections with payers in your area and will be able to determine how the payers are communicating with patients and directing their care. The following are best practices for managed care contracting review.
- Assemble complete contracts including crosswalks, fee schedules and amendments.
- Conduct full case analysis to ensure alignment between your costs and reimbursements.
- Train staff to be cognizant of all aspects of your contracts starting with registration.
When assessing the revenue cycle health of your organization, specialization matters. Complex procedures are often attached to complex coding and billing procedures. Re-evaluating front-end operations, ensuring coding specialization and accuracy, tracking AR denials and correcting root causes, and effectively negotiating and applying managed care contracts are key starting points for identifying growth opportunities.
By Kylie Kaczor, MSN-RN, CPCO, CPHRM, CMPE, CASC, CLSSBB, ACHE, Senior Vice President — Clinical and Regulatory Affairs, National Medical Billing Services
Originally published on Becker’s Spine Review, adapted for the National Medical website.
This post was first published March 3, 2022 and was updated May 18, 2022