Provider Payment Adjustment Passes House
Ambulatory surgery centers may finally be granted a small payment rate increase if a bill that passed through the House of Representatives on June 28 becomes law. Many industry experts feel, however, that this is only the first step in reimbursing ASCs more fairly.

The regulation is part of a comprehensive Medicare prescription drug benefit and provider payment bill. The drug benefits package is not expected to pass the Senate, but the change in ASC payments appears to stand a good chance of remaining once the Senate returns the budget portion of the bill to the House.

Under the terms of the payment plan, reimbursements to ASCs would revert to a "cost of living" increase for the first time in five years. The figure is calculated as the annual consumer price index (CPI). In recent years, the CPI has generally been about 2 percent. This meant that inflationary adjustments for ambulatory surgery centers have been virtually nil. In 1997, temporary cost-cutting legislation was passed to provide inflationary adjustments of the CPI minus two percent. The current bill would simply not renew the 1997 legislation and, thus, payments would revert to the CPI rate

Even if the provider adjustments pass both the House and the Senate, the changes will take not effect until 2003 and will not be retroactive to cover the period 1997-2002.

Michael Romansky, Esq., legal counsel for the American Association of Ambulatory Surgery Centers (AAASC), expressed guarded optimism about the proposed adjustments. "With the current Senate, you can never be sure of about what will pass, because they have been very tight-lipped. However, I don't foresee any major push not to restore ambulatory surgery centers a CPI-based increase."

He adds, however, that while the increased facility payments would be helpful, there remains much work to be done on Capitol Hill. Says Mr. Romansky, "We lobbied to get a viable and meaningful cost-of-living adjustment for ambulatory surgery centers, so we would be pleased if Congress passes a bill with a provision for it. However, it pales in comparison to some of the bigger issues that our industry needs. We need to get the ASC procedure list updated and get ASC payment rates re-based across the board on a fair and equitable basis."

Kathy Bryant, the executive director of the Federated Ambulatory Surgery Association (FASA), concurs with Mr. Romansky. "There has been a five year struggle to get rid of the 1997 legislation. So assuming the bill not include an extension, we're very pleased. But this is just one battle in a larger struggle to level the playing field for ambulatory surgery centers."

Concludes Arthur Balin, MD, owner of the Sally Balin Medical Center in Media, Pa., "Every little bit helps. Our costs go up every year, so we've been essentially losing money each year. Is it a make-or-break amount of money? No. But over the course of several years of not getting a cost of living adjustment, it adds up. It's only fair that facility fees be increased in proportion to our costs. It should have been that way all along."