3 Ways ASCs Can Incorporate 2021 CMS Updates

As the inpatient only (IPO) list is phased out over the next three years, Ambulatory Surgery Center (ASC) leaders face increasing pressure to adapt and make solid decisions that balance financial health, patient needs, and provider expectations.

CMS implemented changes including removing 298 musculoskeletal related services — all 1,700 on the IPO list are scheduled to be phased out and open to be performed in the outpatient setting (when clinically appropriate) by 2024. We've seen the list of payable procedures expand to include services such as total hip arthroplasty, implantation or replacement of carotid sinus baroreflex activation devices, and autologous chondrocyte knee implantations, among others.

To adapt and ensure that centers are positioned to take advantage of emerging opportunities, leaders should be prepared to make adjustments in three key areas. These changes mean a new normal for ASCs and the need to rethink how they approach multiple areas including:

Long-term capital and labor planning

How does your current approach make room for growth and expansion? Who will be involved in these decisions and do you have the relationships, technical resources, and expertise in place to make smart decisions?

Financial impact

The next three years kick off a period of complex financial challenges. Do you have the software and personnel needed to perform budgeting and forecasting so that you continue to meet and exceed financial goals? If not, what changes need to be made today to prepare and plan?

Coding and training needs

As CMS continues to roll out additions to the list of procedures that are payable in the ASC setting, billers and coders will need to be trained on proper use of new codes, payor requirements, and appeal processes.

For example, beginning on Jan 1, 2021, CMS has exempted procedures removed from the IPO list from denials and audits including RAC reviews for “patient status" and site-of-service claim denials under Medicare Part A. The agency is also continuing to apply the "two-midnight" rule or case-by-case exceptions.

ASC supplier relationship management

To adapt to the potential volume and types of services offered, most ASCs will benefit from rethinking their approach to procuring outpatient supplies. This will entail evaluating their supplier relationships to prioritize flexibility, clinical insights, and identifying the organizations that can best support operational excellence through change.

Developing patient and provider awareness

Building and managing awareness of the shifts in the procedures offered by your ASC will be critical in attracting talent, supporting your current physician relationships, and ensuring your patients have the information they need to make the best decisions possible as modern healthcare consumers.

Much of the work here will involve dispelling myths about the end of the IPO list across multiple stakeholder groups.

  • Patients will need to understand that procedures performed in the ASC are no less safe and no lower in quality than those performed in inpatient settings.
  • Surgeons may need clear discussions to understand that their fee is still billed to part B, leaving their payment independent of the site of service.
  • Internal hospital teams will need to have clear discussions about how the shift of volumes from inpatient to outpatient will impact operations, training, capital planning, cash flows, etc.

Planning for expanded service

All of this will hinge on how the list of expanded services will be applied at an individual ASC and how to best support strategic goals based on the shift in services that are offered. This will require the alignment of budgeting with strategic planning to support ongoing assessment of clinical and financial performance through the phasing out of the IPO and beyond. This initiative should rest on solid benchmarking and key performance indicators (KPIs), establishing baselines as quickly as possible, and choosing the best technology to support the shift.

The next few years are going to be a time of endless questions for ASCs, but also a time to evolve along with the industry. To learn more about how to identify the answers that best serve your centers' needs, start here.


Be sure to join us for the upcoming Becker's webinar with experts from Cardinal Health, as we discuss insights on building and opening a new ASC

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