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Fee for service becoming a 'steady march to the bottom'; What's next for ASCs?

Physicians are clinging to fee-for-service payment to avoid the proverbial "race to the bottom" of bundled payments, which often cut pay rates.

But fee-for-service contract rates haven't been much better.

"A careful review of reimbursement shows that fee-for-service is a steady march to the bottom without a foreseeable end," said Adam Bruggeman, MD. "We are working hard to be at the forefront of musculoskeletal care by participating in provider-friendly bundles with an ultimate goal of managing population health from nonoperative care through any surgical interventions and postoperative care."

ASC administrators are seeing CMS and commercial insurers offer slight increases on fee-for-service contracts that aren't keeping up with the cost of providing care. Rising supply and staffing costs are squeezing ASCs, which typically operate on a tight margin. Insurers do want ASCs to continue operations as a high quality and lower cost setting than the hospitals, but continue to narrow pay policies and ratchet down rates on procedures they do pay for.

"I see payers as opportunistic," said Joe O'Brien, MD, a spine surgeon with OrthoBethesda in Maryland, and medical director of minimally invasive orthopedic spine surgery at Virginia Hospital Center in Arlington, Va. "They will deny care when they can, they will deny payment when they can, and they will provide poor contracts when they can. I'd love to see a future model where the payers were true partners with the patients and doctors."

What will the next iteration of pay models hold? While there isn't a clear answer, Dr. Bruggeman said he thinks the surgeon should be front-and-center for care coordination for a healthcare system that incentivizes keeping patients healthy and cared for in the most appropriate setting.

"Future payment models will continue to recognize the importance of the physician in making [site of care] decisions and reward physicians for selecting the best clinical and economic pathway for patients," he said. "All of this requires significant understanding of data, analytics and metrics, which we are aggressively pursuing."

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