The much awaited CMS Proposed Rule has been released. The 600 page report has several important programs for orthopaedics. The AANA Committee on Health Policy and Practice and the AAOS are reviewing the Ambulatory Payment Classification (APC) assignments for all orthopaedics including arthroscopy. The Ambulatory Surgery Center (ASC) payment system is now linked to the Outpatient Prospective Payment System (OPPS). The ASC payments will continue to increase over the next three years until the full implemented ASC payments are 65% of the hospital outpatient department payments. This is a significant reimbursement benefit for the ASC compared to the previous "nine grouper" system which was in place until 2007. This program makes some questionable assumptions such as the merit of differential payments for the same services based on the site of service and the refusal to reimburse any outpatient surgery facilities for implant costs. While these basic tenets are objectionable the program is an important step in a positive direction to improve patient care and accessibility.

The two-times rule states that the costs of highest procedure in the APC cannot be more than twice the costs of the lowest procedure. We continue to review the median costs of all the procedures in the orthopaedic APC’s (41 – 64). Building on last year’s proposal we feel that the diversity of the procedure costs warrants more than two arthroscopic APC’s. We have developed a proposal and will request CMS to implement a more responsive arthroscopic APC system that acknowledges the diversity of our procedures relating to facility costs. This proposal incorporates APC’s that are implant intensive and identifies procedures that can be safely performed at the ASC, but have been restricted because the costs are greater than the reimbursement. Once again, acknowledgement and correction of these inequities will improve patient care and access.

The summer is usually a quiet time for our committee and its projects but this summer we are busy with several issues and projects. The summer got off to a bang with the failure of Congress to pass emergency legislation to prevent the 10.6% decrease in payments to physicians through Medicare part B. As a result, CMS stopped processing physician claims for the first ten days of July; the reasoning being that this would not overly burden the system while Congress and the President worked the problem! Upon return from the July Fourth recess, Congress did indeed pass the legislation but included decreases in the Medicare Advantage program that the Democrats do not like and the President thinks is a start at market reform of the Medicare program. The President vetoed this legislation because of the cuts in the Advantage program and the veto was overridden by the Congress thus delaying once again the decrease in our reimbursement.

CMS has also come out with its Notice of Proposed Rulemaking for 2009. Anyone interested in viewing the proposed rules can access the information at: http://www.cms.hhs.gov/physicianfeesched/downloads/CMS-1403-P.pdf. We are still going over the proposed rules and how they may affect our practices, especially in the area of ancillary services.

Our big project for the summer is to reconcile the Global Service Data Book (GSD) and the Correct Coding Initiative (CCI) Edits. The GSD is put out by the AAOS and attempts to give a complete guide to correct coding bundling packages for all musculoskeletal CPT codes. The CCI Edits are put out by The National Correct Coding Initiative as mandated by Congress. The edits list code sets that cannot be reported together at all and those that can be properly coded with a modifier. Both CMS and Managed Care Organizations (MCO) use the edits as a "gold standard" for bundling packages for orthopaedics. Some MCOs recognize the GSD.

The problem for providers is that the GSD and CCI are not completely in agreement and also MCOs tend to view any code that is on the CCI as "bundled" even when the edits list it as reportable with a modifier. This leads to the denial of payment of legitimate surgeon work and an incredible amount of billing office expense for our practices in appealing denials of real, reimbursable work that has been legitimately performed in the care of patients. It results in a decrease in our fees and a tremendous increase in costs as we try to chase payments for services rendered.

Our goal is to review the GSD to ensure that it is correct and complete in its description of bundling packages. Next, we are reviewing the CCI and will attempt the same task. We will then petition the CCI leadership to reconcile the two references. Hopefully, when completed, this will lead to a universally excepted reference for coding that can be used in justifying coding practices which will decrease denials and obviate a lot of the appeals that cost and frustrate our practices.

We have completed a review of the GSD section dealing with hand surgery and have reconciled the book with the Hand Society’s own coding reference. William R. Beach, MD and I have completed a review of the upper and lower extremity arthroscopy codes and the corresponding sections of the CCI dealing with arthroscopy. We hope to have the project completed for the meeting of the Coding, Coverage and Reimbursement Committee in September.