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What reimbursement issues are costing ASCs the most?

From prior authorization to payer consolidation, ASCs have long faced obstacles in securing reimbursements.

Seven ASC leaders spoke with Becker's ASC Review about the reimbursement issues costing their ASCs the most money.

These interviews were edited for clarity and brevity.

1. Payer consolidation

Jarett Landman. CEO of The Orthopedic Surgical Center of the North (Peabody, Mass.) The consolidation of payers has become an issue and should be a major concern. Economies of scale exist to create leverage. Exerting additional downward pressure on physicians and outpatient facilities already operating on thin margins will have a significant impact on the long-term viability of ASCs that operate independent of hospital affiliations.

2. Payer contract challenges

Lori Martini, CASC. Administrator of SOG Surgery Center (Tupelo, Miss.) As a fairly new, independent ASC opened in 2019, negotiations with certain commercial payers have been a challenge. We are not yet in network with three major commercial payers, despite the substantial savings they would recognize by contracting with the ASC. We have had to provide explanations of benefits from hospital outpatient department cases in order to negotiate fair contract rates. 

3. Implant costs

Trina Cole. Administrator of Saint Luke's Surgicenter Lee's Summit (Mo.) One of the issues that affects our ASCs is implant coverage being nonexistent or too low with managed-care contracts. We utilize contract negotiations with our joint-venture hospital partner. Although a great asset, there are only a few ASCs in the health system. This can be injurious to our reimbursement at times.

4. Deductibles and copayments

Glen Silverman. CEO of U.S. Orthopedic Partners and Mississippi Sports Medicine and Orthopaedic Center. Without a doubt, our biggest challenge is handling deductibles and copayments. Both through value-based care arrangements and the continued industry-wide shift of risk to the consumer, our ASC continues to be burdened with significant out-of-pocket expenses.

5. CMS policy

John Stewart. CEO and founder of Physician Advisors and Total Spine & Wellness. The same cutting-edge technology and care that patients receive and desperately need from our ASCs is the biggest reimbursement issue affecting revenue. Many of our procedures and surgeries have CPT codes that do not have a Medicare allowable in an outpatient ASC, so some third-party administrators and payers underpay or deny these surgeries.

6. Patient out-of-pocket costs 

Tracy Helme. Administrator at Seven Hills ASC (Las Vegas). Revenue issues that affect many ASCs revolve around the reduced amount of cash that patients have on hand at this time. They are not always able to pay coinsurance and deductibles up front. This can pinch cash flows for ASCs. High deductible plans are also very confusing for patients, as they are not always aware of the high out-of-pocket amounts that are their responsibility before they receive benefits.

7. Prior authorization:

Jason Richarson. CEO of Gastroenterology of the Rockies (Louisville, Colo.) For us, the biggest reimbursement issue is procedure authorization issues. The administrative burden on authorization of services delays care, adds costs and adds no value to the patient experience.   

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