PAIN MANAGEMENT IN ASC FACILITIES
by Amy Mowles, President Mowles Medical Practice Management
Pain: What was once considered merely an inconvenience to the sufferer has now become recognized as a serious
national problem. Chronic pain, that is pain which lasts at least six months and does not respond to conventional
medical treatments, not only reduces the quality of life for individual sufferers but costs our economy more than 70
billion dollars each year in lost productivity and medical costs.
Pain management is the growing medical discipline that deals with the diagnosis, treatment and rehabilitation of
patients who suffer from the entire range of painful disorders affecting all areas of the body and resulting either from
injury or disease. Because of the diverse nature of this field, pain management is, by definition, a multidisciplinary
subspecialty.
The development of new technologies, such as MRI and CT scanning for accurate, non-invasive diagnosis of pain
disorders, and sophisticated new treatments, such as spinal cord simulation, intraspinal drug therapy and radio
frequency ablation techniques, have greatly increased the number of patients with pain disorders who can enjoy an
improved quality of life. And from an industrial perspective, today’s accurate diagnoses and effective treatments
have been accredited with increased productivity, less down time and lower workforce injury-related costs. As the
science of pain medicine grows in leaps and bounds, the number of painful conditions successfully treated increases
almost daily.
So what does it mean to be a pain management ASC and what do you need to know if you are considering
developing an ASC that focuses on pain management?
Financial benefits for ASCs can be significant. In addition to professional fees, certified ASCs receive a “facility
fee” from Medicare for covered procedures. Although professional fees paid by Medicare to ASCs are typically 20
to 30 percent lower than those paid to an office, this is frequently compensated for by the fact that the additional
facility fee averages 65 to 80 percent of the professional fee.
For additional payors, ASCs also often have an advantage. Managed care payors reimburse an average of 120 to 250
percent of Medicare’s fee schedule for their covered procedures. Similarly, commercial payors and workers’
compensation can pay up to three times Medicare to certified facilities. Furthermore, some states have a set facility
fee schedule for ASCs, eliminating inconsistency or confusion regarding reimbursements.
In short, net incomes for ASCs average 40 percent higher than in offices.
In pain management ASCs most procedures fall into Medicare Payment Group 1, which currently yields an average
national allowance of $333.00. As many pain procedures involve bilateral injections and/or multiple levels, each
procedure can yield two to three facility fees. (Medicare currently pays 100 percent of the highest payment for
multiple procedures in a single session and 50 percent for each additional procedure.) As only a short recovery time
is needed for most pain procedures, it is possible to perform three to four procedures an hour, thus maximizing the
productivity of both the facility and staff.
Of course, there’s no such thing as a free lunch or a free bunch of higher fees. In return for making increased
payments to ASCs, federal and state governments have specific requirements for the physical environment as well as
a whole host of rules and regulations covering procedures performed, staffing and administrative functions. But
before we even get into that, it is important to caution that some states may even prohibit the opening of an ASC
under their Certificate of Need (CON) program. This state regulatory program is intended to balance cost, quality
and access issues and ensure that only needed services and facilities are developed. However, some states do offer
an exemption from their CON program to single specialty facilities, such as a pain management ASC. Also, single
specialty facilities may not require state licensing other than certification from Medicare.
For existing ASCs considering the addition of pain management services, a change to the license status may not be
necessary if the facility is already certified to perform anesthesia services at a higher level than required for IV
conscious sedation.
Once built, the facility overhead for an ASC is usually only 15 to 20 percent of the total overhead, but the per square
foot cost is typically between 10 to 35 percent higher than in an office (depending on the number of operating
rooms, procedure rooms, etc). This additional building cost is caused by greater square footage, higher quality
finishes, fire protection, air quality standards and other requirements necessary to meet states’ Life Safety Codes. As
some of these codes are extremely complicated, it is essential that, when planning an ASC, you work with
consultants, architects and contractors who are experienced with your local area’s medical facility design
regulations.
Sometimes it may appear that the requirements for Medicare certification are unduly onerous, but remember, their
whole purpose is to ensure a safe and effective facility for patients. Once certified, an ASC may even receive lower
liability insurance premiums.
With a little homework, the right guidance and an ongoing commitment to compliance with Medicare’s Standard
Conditions for Coverage, developing and operating a pain management ASC, or adding pain management to your
existing ASC, need not be an intimidating endeavor.