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17 Steps to Take When a Payor Changes Payment System From Medicare-Grouper to APC-Based

The following article is written by I. Naya Kehayes, MPH, managing principal & CEO of EVEIA HEALTH.


What should you do when a payor notifies you that it is changing its payment system from a Medicare-grouper methodology to an APC-based methodology? Here are 17 steps your ambulatory surgery center should take.


1. Do not sign an amendment or agree to the proposed change in methodology until you have analyzed and understand the revenue implications. It may warrant negotiation if the value of the new methodology results in a loss.


2. Verify the year of the APCs and the publication date to ensure accuracy in reimbursement modeling.


3. Verify if the payor is using area adjustments or national weights.


4. Request from the payor a copy of its CPT ASC-allowed code list so that there is a clear understanding of the CPT codes that map to the APC payment methodology that will be used for the new contract.


5. Ask the payor how it will compensate for CPT codes that are not on the mapping and are considered non-APC-grouped codes for ASCs.


6. Make sure payment for non-grouped codes is addressed in the language of the payment provisions, under the new methodology, so that you do not lose access to business.


7. If you are paid for implants separately as a carve-out on a Medicare-grouper based methodology, clarify the payment provisions on implants when you move to the new methodology.


8. If the payor intends to include payment for implants in the APC rate as a global allowed amount, then ensure you have completed a reimbursement analysis to determine if the APC rate is high enough to cover your cost of surgery plus the implant. In addition, ensure there is no value loss when compared to the total reimbursement allowed under the Medicare-grouper based methodology with the additional payment on the implant.

9. Verify the payment methodology for multiple procedures and request that it is consistent with CMS. CMS allows for multiple procedures for specified codes at 100 percent of the full value, which is common amongst device-intensive procedure classed codes under the APC methodology. Ensure you are capturing this same level of reimbursement in accordance with the CMS logic for multiple procedure payments.

10. Compare and contrast volume by CPT code of current rates to proposed new rates on the new methodology.

11. Evaluate and understand the impact by specialty so you can understand the opportunities and threats of moving to the new payment system.

12. If you have a significant loss realized in a specific specialty which is a direct result of the change in methodology, seek carve-outs with the payor or modifications to the conversion factor for a specified group of codes, if there is a sizable volume that is resulting in an overall loss.

13. If the payor is not using 2011 fully implemented APCs, make sure you understand when the payor will update the year.

14. Changes in the year may warrant adjustments to conversion factors and or percentages of the base payment.

15. If the contract change in methodology proves to result in a loss, the contract is in need of negotiation with the new methodology change.

16. If the requested change in the payment system comes at the time of an annual renewal, and you are in negotiations, factor in the percentage increase targets you need on the new methodology.

17. If you perform surgery that is not on the approved list under the APC methodology that previously had coverage on the old contract under a non-grouped provision or carve-out provision, seek a carve-out and/or non-grouped provision that will enable your ASC to continue performing these cases.


Learn more about EVEIA HEALTH.


Read more from EVEIA HEALTH:


- Eveia Health Adds Four New Senior Associates to Leadership Team


- ASC Managed Care Contracting Best Practices by Specialty


- 7 Considerations For An Out-of-Network Surgery Center Moving In-Network

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