The anesthesia conundrum

ASCs are facing major obstacles to secure anesthesia as the provider shortage increases and reimbursements decline.

“Today’s shortage of anesthesia providers has been compounding for years and has turned into an incredible challenge for all,” Andrew Lovewell, CEO of Columbia (Mo.) Orthopaedic Group, told Becker’s. “Not only is it difficult to find anesthesia coverage, finding coverage that understands and embraces the priorities and workflow of an ASC are seemingly impossible.”

Many providers are feeling the effects. Portland, Ore.-based Providence Portland Medical Center and Providence St. Vincent Medical Center had to cancel several hundred surgeries in November due to a shortage of anesthesia providers during the groups’ transition to an anesthesia staffing firm.

Anesthesiologist shortages are a major piece of the puzzle. From 2021 to 2022, more than 2,872 anesthesiologists left the workforce, according to a report from Definitive Healthcare. And in 2021, the Association of American Medical Colleges predicted a shortage of 12,500 anesthesiologists by 2033.

Another puzzle piece is the decline of reimbursements.

Medicare’s average anesthesia rate for 2023 was $21.88, a 5.5% decline from 2019, according to an analysis by Coronis Health. Another analysis, from VMG Health, found that Medicare reimbursements for anesthesia services decreased from $22.2730 per unit in 2019 to $21.1249 in 2023 under CMS’ final rule.

This issue will likely be exacerbated as the number of Americans covered by Medicare increases. Currently, around 18% of Americans are covered by Medicare, according to Coronis Health, and this number is expected to increase as the population ages.

Additionally, CMS’ No Surprises Act and its independent dispute resolution process have created obstacles to secure reimbursements, according to the VMG Health report. The IDR process has been used by payers to “reduce reimbursement by refusing to go in network with anesthesia providers,” according to the report.

Some groups are taking action against CMS’ reimbursement policy for anesthesiologists. Four anesthesia practices sued CMS and HHS, among other parties, in December, alleging CMS’ methodology for calculating reimbursements is illegal in its inclusion of costs associated with nonphysician practitioners.

The issue has also been compounded by an increase in procedures moving to the outpatient setting, which has changed the way that providers can receive reimbursements.

“The shift of inpatient to outpatient cases is a given, but this trend may be slowed by the abysmal Medicare reimbursement for anesthesia cases,” Mr. Lovewell told Becker’s in August. “When salaries, wages and benefits are higher for an outpatient total joint than the anesthesia reimbursement, we have a problem. This is a double-edged sword as the case migration needs to happen to save Medicare money on the facility side, but they [Medicare] have to step up the anesthesia reimbursement if this is going to work.”

ASC leaders are looking for new models to adapt to these changes. Mr. Lovewell and his team have moved to a fully integrated model where the anesthesia staff are employed through the group practice.

Erin Vitale, RN, director of Nursing at Hoffman Estates (Ill.) Surgery Center, told Becker’s her team is considering switching its cataract cases from monitored anesthesia care to local anesthesia.

“This way, we can increase our cataract volume while also freeing up our anesthesia for our growing volume of general and orthopedic programs at our center,” she said.

John Brady, CEO at Geneva, Ill.-based Fox Valley Orthopedics, is looking to other models, including CRNA-only models.

“Ensuring clinical quality and patient safety should be the priorities, but as more ASCs shift to this type of model, they should be able to better control overall costs and avoid or minimize costly management stipends charged by anesthesia groups,” he told Becker’s.