Spine surgeons, and physicians across the entire field of healthcare, are experiencing rising overheads and increasing pressure to achieve adequate reimbursement. Here are five reimbursement issues for spine surgeons to watch in 2014.
1. SGR cuts. In November, the Centers for Medicare and Medicaid Services announced the final payment rule for physicians, which would cut reimbursement by 24 percent. But, in late December after passing through the House and Senate, the Bipartisan Budget Act of 2013 was signed into law by President Barack Obama. The 24 percent payment cut has been delayed. Instead, physicians will receive a 0.5 percent payment bump through March 2014. Lawmakers now have additional time to either replace or repeal the SGR.
Cuts to physician payment are directed at the ultimate goal of lowering the price of healthcare. Yet, many in the medical community argue that narrowing in on decreasing reimbursement will lead to greater financial pressure for physicians without lowering overall costs.
In a study published The Spine Journal, researchers from The Johns Hopkins University School of Medicine department of neurosurgery analyzed current trends in hospital and surgeon fee distribution for lumbar laminectomy. Surgeon professional fee billing was $6,889±$2,882 and collection was $1,848±$1,422 — 28 percent overall, 30 percent for private insurance and 23 percent for CMS.
Hospital billing on average for the inpatient stay, with surgeon professional fees subtracted, was $14,766±$7,729 and average collection was $13,391±$7,256 — 92 percent overall, 91 percent for private insurance and 85 percent for CMS. The researchers concluded that focusing only on physician reimbursement as cost savings strategy would not lead to a substantial drop in overall costs.
2. The new patient market. The insurance exchanges mandated by the Patient Protection and Affordable Care Act have launched, though the full impact remains to be seen. The launch was not a smooth one, but people are signing up and gaining healthcare coverage. The jury is still out on whether or not exchange premiums will skyrocket or reach lower rates through competition and transparency. Regardless, spine surgeons will face a new patient market, comprised of both the newly insured and increasingly baby-boomers seeking a panacea for the pains of aging.
High deductible plans are becoming common in healthcare and patients are reluctantly taking on more and more responsibility for the cost of care. Payers may still approve surgery for patients with these high deductible plans, but spine surgeons need to have a plan upfront with patients to improve collections. Patients could be responsible for up to 30 to 50 percent of the bill. Transparent conversations with patients will increase the likelihood of achieving payment in full.
3. Payer policy. Spine surgery is a field of complex, and as a result, often expensive procedures. Payers are increasing the complexity and time required to complete the preauthorization process, especially for more expensive procedures such as spinal fusions. Denials are on the rise and surgeons are forced to spend more and more time fighting to gain approval.
"It is not uncommon for my scheduler to spend eight hours per case trying to get approval. If you do the math, you figure out I am losing money trying to be able to take care of my patients," said David W. Polly Jr., MD, during the North American Spine Society Annual Meeting.
Payers may also change their policies without warning. Spine surgeons could begin receiving denials for surgeries and procedures that were previously covered without a hitch. For example, new biografting materials, previously covered, are now classified as non-covered services. Closely monitor insurance company websites for any policy changes.
Insurance companies in several states are developing protocols that demand specific treatment pathways for spine care, denying reimbursement to care not within these bounds. These programs often call for patients to begin the course of care with a non-operative specialist.
4. Increased documentation requirements. Payers are requiring more documentation, including data on non-surgical treatment and appropriate diagnostic and imaging studies. As the Oct. 1, 2014 deadline for ICD-10 implementation approaches, accurate documentation becomes even more imperative. Coders should prepare surgeons to give the level of specificity that will be needed to navigate the new code set.
Documentation can affect reimbursement even after gaining approval. RAC audits are increasing in frequency. If an auditor finds that the proper documentation is missing after a surgery has been performed and reimbursement received, the auditor can retroactively deny coverage and request a refund.
5. Value-based care. Quality, low-cost healthcare is the lynch pin of healthcare reform and it is causing a major shift in how care is delivered. Value-based care is taking precedent over the fee-for-service model. Providers are working towards bundling payments and increased price transparency. A recent study shows that the market for healthcare price transparency is expected to grow 55 percent by 2016, according to a Healthcare Finance News report.
In an effort to achieve the goals of value-based care, accountable care organizations and integrated clinical networks are forming across the country. This paradigm shift in healthcare creates a certain amount of risk and the question of who will shoulder it.
"The concept that is being most aggressively explored right now is the concept of shared savings between payers and healthcare systems. This is sort of like gain sharing at a mega scale and if we can find a way to generate a savings through some innovation or process of care, that savings should be allocated between the people who are contracting and the people who are generating the savings," said Dr. Polly during the NASS Annual Meeting.
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