The Growth Channel

3 things to know about CV ambulatory changes for 2020

by Julie Bass

Editor's note: This blog post previously ran on Cardiovascular Rounds.

CMS recently finalized its proposal to add three coronary interventions and three supplemental codes to the ambulatory surgery center (ASC) Covered Procedures List for 2020. This is the first time CMS will reimburse PCI procedures in ASCs and CV leaders have questions on how—and if—this should change their ambulatory strategy.

Here are three big takeaways from this new policy.

1. Reimbursement rates are (unsurprisingly) lower in ASCs, but the difference in magnitude varies by service

For many (but not all) CV services, payment rates decline the farther the service shifts outpatient. Although there are exceptions, procedures performed in ASCs are reimbursed lower than in hospital outpatient department (HOPDs)—which is how CMS expects to save $15 million in Medicare payments even if just 5% of these newly allowed PCI procedures migrate from the HOPD to the ASC.

CMS payment rates for some CV procedures, like EP implants, aren't as significantly different across sites of service compared to other services. For example, the 2020 Medicare ASC payment rate for insertable cardiac monitors, also called implantable loop recorders, is only 13% lower than the HOPD rate.

But that isn't the case for all CV procedures. 2020 Medicare payment for diagnostic cath in ASCs is 52% lower than in HOPDs, and the three new coronary interventions are 38-39% lower in ASCs.

2. Some states will witness the shift sooner than others

While there is increasing interest in ASCs, the market impact across the country is uneven. Some states are under more ambulatory pressure than others. For example, Florida has 426 Medicare-certified ASCs compared with Vermont's one Medicare-certified ASC. These discrepancies are based on a range of market factors, such as the prevalence of independent physician practices or the extent of payer steerage to lower-cost sites.

State legislation is another factor that can have a significant impact on how fast this shift will happen. Programs in states with more restrictive certificate of need (CON) laws may have a more difficult time gaining approval for new facilities or facility expansion—including ASCs. There are also states that either restrict PCI in centers without on-site cardiac surgery or enforce distance requirements to surgical centers, which will almost certainly also apply to ASCs. And then there are length of stay time limits. Most states do not allow overnight stays in ASCs, which may preclude PCI for many hospitals that have average lengths of stay greater than 24 hours.

3. You have time to prepare. Outpatient shift typically happens slower than expected.

The outpatient shift actually happens much more slowly and gradually than many programs expect, particularly for procedures shifting from the inpatient or HOPD settings to the ASC setting. For example, take partial knee arthroplasty (PKA), which was removed from the inpatient only list in 2002 and approved by CMS for the ASC setting in 2008. Five years after it was approved for the HOPD setting, only 8% of all PKA cases were being performed in the HOPD. Similarly, five years after PKA became ASC-eligible, just 8% of cases had shifted there.

For a CV-specific example, we looked at the shift of pacemaker and ICD implants from HOPDs to ASCs across the past decade. The shift for these services has actually happened at an even slower rate than PKA. While pacemakers and ICD implants were approved by CMS for the ASC setting the same year as PKA, a decade later the percent of procedures performed in ASCs is still relatively low. Just 6% of outpatient ICD implants were performed in ASCs and 7% of pacemaker implants in 2018. However, the number of these procedures in ASCs has steadily grown over the past few years. That said, it's important to note that those values only represent Medicare fee-for-service claims, and don’t account for commercial patients where the steerage threat is stronger.

Part of the reason EP implants may have been slower to take off is that it didn't make sense for CV programs to invest in ASCs when EP implants and low-acuity vascular procedures were the only approved services. Now that diagnostic cath and PCI are approved, this may be the critical mass of procedures necessary to make ASC investment a more realistic conversation for CV leaders than it has been in the past.

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