ASCs could get more Medicare customers, more quality requirements after CMS rule

hospital doctor with patient
The Centers for Medicare & Medicaid Services proposed to expand coverage to ambulatory surgical centers for knee replacements and other procedures, but the decision comes with new questions for the industry. (monkeybusinessimages/Getty Images)

As the Trump administration expands traditional Medicare coverage in ambulatory surgical centers (ASCs), the industry will face new quality requirements and concerns about costs.

The Centers for Medicare & Medicaid Services (CMS) proposed last week that it will extend Medicare coverage to ASCs for total knee replacements and several coronary procedures. The decision follows Medicare Advantage plans that frequently turn to ASCs for knee replacements.  

But the proposal includes new quality reporting requirements for ASCs.

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CMS proposed adding a new measure for its ASC quality reporting program. The new measure would determine whether there is an unplanned hospital visit seven days after a general surgery is performed at an ASC. The measure, which goes into effect in 2022, resembles quality measures such as readmissions that hospitals need to lower or face cuts to Medicare payments.

One expert said that the proposed quality measure could signal ASCs may face the same fate.

“At this point, it is just a reporting mechanism,” said Lyndean Brick, CEO of the healthcare management consulting firm Advis. “They haven’t announced what they are going to do with these data, but I see the hand-writing on the wall.”

She added that quality hasn’t been monitored as consistently as at a hospital.

“Quality is the next frontier for ASCs and there has to be more standardization,” she said. “That is where CMS is starting to dip their toe in.”

Industry members are already bracing for more stringent quality requirements.

“We anticipate that there will be more stringent requirements for tracking both short term and longer-term functional outcomes, not just for joints replacements but for other musculoskeletal procedures, going forward,” according to Vizient, a group health purchasing organization.

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It also remains unclear what rate ambulatory surgical centers will get from Medicare for total knee replacements.

“If you look at the proposed payment on the Medicare fee schedule, and it will vary by market, it is low,” said Bill Prentice, president of the Ambulatory Surgical Center Association. “It is much lower than what surgery centers are receiving in the commercial marketplace for performing those procedures.”

He said that an ASC received approximately 50% of what a hospital outpatient department gets for performing the same procedure on a Medicare beneficiary.

“If Medicare can find ways by finding the right payment to incentivize surgery center sot want to do more Medicare we can save the Medicare system and beneficiaries hundreds of millions if not billions,” Prentice said.

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