ASC Industry Awareness
ASC Appeal
ASCs/OBSs/OBLs and all of their standalone relatives continue their preferred choice march as they steadily grow their status among patients, providers, and payers. What is not to like about personalized care, high patient satisfaction, efficiency, predictable scheduling, and cost savings? Success is creating momentum as new procedures are expected to migrate and cardiology becomes one of ASC’s next big things. ASCs are realizing previously unseen opportunities, a great example of which are the shifting strategies of medtech and medical device companies as more physicians open freestanding surgery centers.
ASC Ascent
Sixty-two new ASCs of a various stripes, specialties, and ownership models are now underway as of Q3 2022. Five new cardiology ASCs are opening in 2022, reflecting procedure moves to outpatient settings, making cardiology the fastest- growing ASC specialty. With over 6,000 ASCs in the US, annual ASC growth rate now stands at 2.5%. ASC growth is not uniform or unidirectional, making it a consistently safe haven for independent ownership, even in eras of consolidation. Seventy percent of freestanding ASCs are independently owned and 84% have four or fewer operating rooms. Orthopaedics is the most common ASC specialty for several reasons. Orthopaedics benefits from relatively high reimbursements and high volume compared with many specialties, making it a backbone of financial stability for ASCs.
Healthcare Industry/Trends
National Retailers Make Moves in Healthcare
Large national retailers have struggled to get a toehold in the US healthcare market, but the opportunities are so large they keep at it. In July, Amazon bought OneMedical, a 200-office primary-care service, to control a sliver of healthcare space. Now Amazon, CVS, and UHC are all using primary care investments to remake portions of US healthcare. These same groups were among the bidders for home health firm, Signify Health, perhaps indicating that home is the next clinical battlefront. Not to be outdone, Walmart just launched its Healthcare Research Institute to improve care for underserved communities. Discounter, Dollar General, is also developing health services for its rural clientele.
2022 a Tough Year for Hospital Staff and Finances
Since the COVID-19 pandemic began in March 2020, US hospitals have experienced intense pressure on services that is now resulting in diminished staff levels, suppressed margins, and reduction of services. Hospital expenses have increased 23% in less than a decade. Declining patient volumes, rising expenses, and staffing difficulties are among the most cited reasons these ten hospitals faced closure this year. For some hospitals, pressures are growing significantly enough to implement layoffs and curtail services in an attempt to resuscitate finances. Low reimbursement rates are also a contributing factor to hospital downsizing and closures, particularly in rural communities.
Healthcare Digital Transformation Watch
Telehealth Transitions
What happens to telehealth when the public health emergencies end and it is taken off federal government support? The answer is by no means certain. While telehealth reduced costs and expanded access to care during the pandemic, the HHS Office of Inspector General has flagged significant Medicare telehealth integrity risks. In a small survey this summer, three quarters of large employers said that virtual care is here to stay, but 84% believe that a combination of virtual and in-person healthcare services will generate the best results. Telehealth also creates greater flexibility for patients and physicians, which can keep both happy and healthy as the number of healthcare providers ticks downward.
Healthcare M&A, Valuation, Revenue Cycle
ASC Management Company Deals, Contentious Merger Completed, Moody’s Downgrades Envision
CVS Health acquired home health company, Signify Health, for $8 billion. Tenet Healthcare acquired 100 percent of USPI’s voting shares. HCA has expanded its network of ASCs to 153, as it continues to divest itself of hospitals and add ASCs. Captiva Spine just announced its strategic partnership with REMEX Medical for enhanced spine navigation and robotics capabilities. Change Healthcare and Optum officially merged October 3, following a September 19 court decision that ended the Department of Justice’s attempt to stop the originally announced January 5 merger. Private equity drove 70% of 2021 physician deals, which is up 145% from 2020. Envision/AmSurg has been embroiled in legal disputes with UHC for years and how faces a credit rating downgrade to C, with Moody’s citing the potential for an Envision bankruptcy.
Out-of-Network Watch
Renewed Challenge to IDR within the NSA
On August 19, HHS and The Department of Labor (DOL) released the NSA Final Rule , which is set to take effect on October 25, 2022. The final rule allows for better reporting of a downcoded service code, the advent of a fuller independent dispute resolution (IDR) process, and a written explanation of IDR payment determinations with rationales to all concerned parties. The end goal of the final rule is to help providers more meaningfully inform the offers they submit to certified independent entities to resolve claim disputes. The final rule IDR portion of the No Surprises Act is undergoing a new challenge from the Texas Medical Association, arguing that the IDR still does not level the playing field between providers and payers in keeping with the initial intent of the NSA.
Legal
Update on the No Surprise Act
From the office of Jon Sistare, JD, Attorney at Law
Medical providers are putting all their eggs in one basket by moving to support a federal lawsuit filed in Texas against the Biden administration’s No Surprises Act rule on settling payment disputes.
The Texas Medical Association (TMA), one doctor, and a hospital sued the US Department of Health and Human Services in the US District Court for the Eastern District of Texas on Sept. 22.
Medical providers and health insurers and employers (that foot much of America’s healthcare bill) have been battling in court to try to ensure that the 2020 law, designed to protect patients from many high out-of-network bills, is implemented by arbitrators in a way that favors their side. The law is meant to prevent providers from billing patients in emergencies and in situations where patients have procedures at network facilities but are served by providers, such as anesthesiologists, who are not in their insurance network.
Rules implementing the law required arbitrators to select the amount closest to the median in-network rate in settling payment disputes between insurers and certain out-of-network health-care providers. Providers argue that relying on median contract rates gives insurers too much power, while payers say that allowing arbitrators to weigh many factors equally could inflate healthcare costs.
The lawsuit challenges the government’s August 2022 final rule regarding the No Surprises Act’s independent dispute resolution process. It is the second time in less than a year that the TMA has challenged federal agencies related to the same rulemaking.
If the Texas court rules against the most recent rule on how payment disputes should be decided, some fear the guardrails would come off the arbitration process, and that the arbitration process would become more inflationary. Payers worry that out-of-network providers would further use arbitration to get higher out-of-network prices.
The law intends for insurers and providers to work out rates through negotiation, with dispute resolution being used as a backup. The danger is that IDR could be used to garner higher out-of-network reimbursements, even when the circumstances do not warrant it.
In August, The Department of Labor reported that disputing parties had more than 46,000 initial disputes through the federal independent dispute resolution portal, substantially more than what federal agencies had expected for an entire year.
At a Glance
Contego Solutions an RCM Company to Know in 2022
Appears for Fifth Straight Year in Becker’s Healthcare RCM List
Confusion with Health Insurance Terms Reigns Supreme
Even When Subscribers Are Relatively Happy with Their Plans
Penguin Gets Fitted for Orthopaedic Shoes
San Diego Zoo Treats One of Their Own for Foot Condition
Healthcare Compliance Will Be a Challenge in Post PHE World
Set to Expire Oct. 15 but another 90 Days Expected
Tough Long Covid Coverage Decisions Ahead for Insurers
Biomarkers and MRI Scans Prove Long Covid Exists
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