Anesthesia in the News
  • Range of Payments for Anesthesiology Services by Health Plan Type, Provider

    Anesthesiology services are a focal point of policymaking to address surprise medical billing in the No Surprises Act that was folded into the federal Consolidated Appropriations Act of 2021.  However, amounts and charges permitted for anesthesiology services have been understudied due to the specialty’s unique conversion factor (CF) unit of payment and the complex provider structures involving certified registered nurse anesthetists (CRNAs) and anesthesiologists.

    The objective of one study, published in the June 2021 issue of  The American Journal of Managed Care, was to compare payments for common outpatient anesthesiology services by commercial health plans, Medicare Advantage (MA), and traditional Medicare.

    Over 5.4 million claims

    The study sample for analysis included 3.59 million commercial claims and 1.87 million MA claims for the 10 most common professional anesthesiology services in outpatient hospital and ambulatory surgery center settings in 2016-2017 from the Health Care Cost Institute database.  These 10 services represent 62% of anesthesiology services in these settings.

    Researchers excluded inpatient anesthesia services because unreliable or inconsistent reporting of time units on the majority of inpatient claims in their data set prohibited them from accurately deriving allowed amount CFs and charge CFs.  In addition, claims with modifiers for unhealthy patients were also excluded due to potential inconsistency in whether additional units for a patient’s health were incorporated into the reported units on the claims.  All dollar values presented reflect nominal 2016 and 2017 US dollars.

    By the numbers

    Among commercial claims, independent anesthesiologists provided the highest volume of procedures (43.5% of procedures), followed by “independent CRNAs” (38.2%), and anesthesiologist-CRNA supervisory dyads (18.2%).

    Among MA claims, “independent CRNAs” were the most common (48.2%), followed by independent anesthesiologists (27.5%), and anesthesiologist-CRNA supervisory dyads (24.3%).

    Out-of-network anesthesiology services were much more common among MA (41.2%) than commercial (8.3%) patients, but similar across provider structures within plan type.

    The researchers derived allowed amount and charge CFs for commercial and MA claims using the base units assigned to each procedure code, time units, and modifiers.  They then computed the ratio of the allowed amount and charge CFs relative to the traditional Medicare CF, describing these payment measures by provider structure and network status.

    Wide ranging by plan and provider

    Their analysis revealed that mean in-network commercial allowed amount CFs for anesthesiology services ($70) are 314% of the traditional Medicare rate ($22), whereas mean commercial charge CFs ($148) are 659% of the Medicare rate.  Commercial payments vary widely and are higher to anesthesiologists than to CRNAs and higher out of network than in network.  This compares to MA plan payments which align with traditional Medicare with payment parity between CRNAs and anesthesiologists — both in network and out of network.

    Why the deltas?

    Common payment measures for anesthesia services — commercial allowed amounts, charges, or traditional Medicare — are highly divergent.  The study authors hypothesize that MA plans’ relatively low payments likely reflect the cost-containing influence of competition with traditional Medicare and MA’s prohibition on balance billing.

    The findings have implications for out-of-network benchmarks for anesthesia services, such as the “qualifying payment amount” used in the No Surprises Act as a guidepost for arbitrators.

    Review the complete payment differential analyses in, “Commercial and Medicare Advantage payment for anesthesiology services.” Am J Manag Care. 2021 Jun 1;27(6):e195-e200., click here: