NJAASC: State PIP Regulations Will Increase Cost of Care, Damage Profitability of Orthopedic-Driven ASCs
Jeff Shanton, chair of the advocacy and legislative affairs committee of the NJAASC, recently submitted comments to the New Jersey Department of Banking Insurance on the proposed state PIP regulations.
The original regulation was proposed Aug. 1, 2011. Due to the large volume of comments received, the Department of Banking and Insurance decided to make substantive changes, which will trigger a further comment period, ending April 21, 2012.
• A new, separate fee schedule for hospital outpatient departments, the Hospital Outpatient Surgical Facility. Previously ASCs and HOPD were lumped together on the same fee schedule. This new HOSF includes procedures that are not payable if performed at ASCs, and the rates are higher.
• Deletion of 117 procedure codes performed by neuro and spine surgeons from the physician fee schedule. These will now be paid UCR for the professional fee. Some remain on the Outpatient Surgical Facility and HOSF schedules, so the facility would be reimbursed per fee schedule.
• Deletion of WCMCO network language.
• Correction of various errors.
Mr. Shanton asked the department to consider delaying adoption of the proposal until all protocols have been released. He said the process should be open to all stakeholders, particularly surgery centers, and that the new regulations should not be adopted until all stakeholders can view them in their entirety.
Mr. Shanton made the following comments on the proposed regulations:
• He strongly disagreed with the removal of procedures that have historically been performed safely in ASCs. "I of course disagree with the Department's assertion that this is due to Medicare concerns about the safety of the procedure being performed in an ASC setting," he said. "A lot goes into what gets on the [CMS ASC-approved list] and what does not, much more than simply patient safety." He said equating the Medicare population — and, by extension, the CMS list of allowable procedures in an ASC — with New Jersey's auto accident population is flawed.
• Mr. Shanton disagreed overall with the use of Medicare schedules, procedure lists and edits for PIP. "This is a square peg in a round hole," he said. "Medicare rules and guidelines are for Medicare patients, not the general public [and] much less PIP patients, which are generally younger and healthier and suitable for care in an outpatient setting." He said there is no basis for using the Medicare fee schedule, as the statute requires a percentage of market value as the guideline for payment.
• Mr. Shanton pointed out that the removed procedure codes represent a significant number of pain management, spine and orthopedic volume and revenue. "What the deleted codes do represent are lucrative codes in terms of reimbursement, so they can indeed very adversely affect the bottom line for a center," he said. He said there are ASCs that specialize in spinal procedures and depend on those procedures for a large portion of their business; those surgery centers would be adversely affected by the regulations.
• Mr. Shanton pointed out the addition of a HOPD list that only allows for certain procedures to be performed in the ASC setting will increase cost by approximately 43 percent. He said the disparity between ASC and HOPD rates in 2012 was 58 percent, and he disagrees with paying the HOPD more if the procedure can only be performed there. "The patient … does not have the ability to choose a cheaper alternative — the ASC," he says.
Related Articles on the NJAASC:
NJAASC Letter Demands Aetna Stop Patient Re-Direction Among In-Network Centers
New Jersey Bill Focuses on Healthcare Disclosures and Transparency
NJAASC Promotes Colon Cancer Awareness
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