Are reimbursement cuts pushing providers out of anesthesia?

Physicians and leaders often point to the continuous cuts to anesthesia reimbursements as a significant driving factor behind the ongoing anesthesia provider shortage.

CMS anesthesia reimbursements declined 8.2% from 2019 to 2024 — from $22.27 per unit to $20.44, VMG Health said in a May blog post. An additional report from Coronis Health found that if an anesthesia provider generates 10,000 billable units from Medicare, the total revenue potential is only $218,000, assuming that all revenue could be collected.

Private payers are also cutting pay for reimbursements. Anthem Blue Cross Blue Shield’s health plans in Ohio, Missouri, Connecticut, New York, Nevada and Maine will reduce QZ services performed by CRNAs to 85% of the physician fee schedule beginning Nov. 1. Cigna also said in March 2023 it was lowering reimbursements for non-medically directed procedures performed by CRNAs by 15%.

“[CMS’ reimbursement rate] is currently $20.77 per 15 minutes, which is the same whether it is open heart surgery or cataracts. That is less than what CRNA wages are, so in effect, the anesthesiologist makes less than nothing once the case is going,” Mark Destache, MD, an anesthesiologist with Associated Anesthesiologists, P.A., in Plymouth, Minn., told Becker’s.

While anesthesiologist compensation increased by a median 5.6% between 2023 and 2024, inflation also increased by 3.4% last year, according to May 12 data from the Bureau of Labor Statistics. The result is smaller pay increases for more work as the provider pool for anesthesia continues to shrink, resulting in active anesthesia providers experiencing higher levels of burnout and stress.

“Anesthesiologists are under pressure to take more calls, work after hours — evening, nights and weekends — and cover long shifts, and cannot take time off,”  Antonio Hernandez Conte, MD, former president of the California Society of Anesthesiologists, told Becker’s. “This undermines quality-of- life for the specialty, which in turn makes it hard to attract the next generation of anesthesiologists.”

The decline in reimbursement rates can also place increased financial strain on anesthesia providers, particularly in states that have a higher cost of living.

“California has a high cost of living, which means a large portion of the anesthesiology residents and fellows trained in California are choosing to leave the state,” said Dr. Hernandez Conte.  “They are graduating with high levels of student loan debt, high cost of living and lower compensation options in California, and many are choosing to move to a lower-cost state.”