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  1. Threats to Our Prosperity Alexander A. Hannenberg, M.D. First Vice President American Society of Anesthesiologists Tufts University School of Medicine Newton-Wellesley Hospital Newton, MA

  2. Median Compensation for Selected Medical Specialties Woo B. N Engl J Med 2006;355:864-866

  3. Areas of Concern • Demographics • Recalibrated Hospital DRG Payments • Rapid Growth Anesthesia Services • Shift to Quality-Based Payment

  4. Unprecedented Lift in Anesthesia Work Value $16.19$55.00 = 29.4% 2008 Best Case Scenario $20.19$55.00 = 36.7%

  5. Sources: Projections of the Population by Age are taken from the January 2004 Census Internet Release. Historical data are taken from "65+ in the United States," Current Population Reports, Special Studies, P23-190 Data for 2000 are from the 2000 Census and 2002 data are taken from the Census estimates for 2002.) Medicare Eligible Population Growth millions

  6. Dependency on Hospital SupportAcademic Anesthesia Departments Tremper KK et al Anesth Analg 2006;102:517–23

  7. Shifting Profit from Surgery to Medicine? Margin Utilization Rebasing Medicare DRGS (Healthcare Advisory Board) Cost

  8. DRG Adjustments2007 IPPS

  9. The Cash Cow of the Hospital

  10. Specialty Supply & DemandResidency Enrollment 1999-2007 JAMA 9/6/2000; 9/5/2007

  11. CRNA Workforce1989-2005 Grogono 2004

  12. On-Call Stipend Support to Many

  13. Medicare One Year Spending Growth2005-2006

  14. Responses to Rapid Growth • Medical Necessity Requirements • Payment Reduction • Less Complex Typical Patient / Service • Advanced Technology / Pharmacology • Non-Coverage Determination • Service-Specific SGR Calculation •  Volume  Annual Update

  15. Growth in Endoscopy AnesthesiaMedicare 2003-2006

  16. Anesthesia for All Endoscopy -2002 Endoscopy volume per CDC -Anesthesia Fee = 5 Base + 3.74 Time Units Medicare CF $17.76 Non Medicare CF $50

  17. Aetna: May 2006 CANCELLED ASA 1-2: No payment in office setting ASA 1-2: Payment at Sedation Service fee in facility ASA 3-4: Base+Time Methodology All: Manual Submission & Review

  18. Shift to Quality-Based Payment • Medicare PQRI 2008: $1.35 Billion • California IHA: $55 Million --> 200 groups • Massachusetts BCBS: $190 Million • Medicaid: 43/50 Programs

  19. Opportunities for P4P Revenue • 1 of 74 PQRI Measures available to anesthesiologists • 2008: 140 Measures • 2 Measures for OR Practice • 2 Measures for ICU Practice

  20. ahannenberg@partners.org

  21. Anesthesiology Medicare:Commercial Ratio2007 Update $16.19$55.00 = 29.4% Bierstein K ASA Newsletter Jul07

  22. Medicare Payment Increase • RUC Recommended 32% Work Value Increase • Work = 77.2% of Anesthesia CF • Maximum Impact --> $4.00 Increase (2008) • 32% x 0.772 x $16.19 • $16.19 --> $20.19 • Other Factors • Budget Neutrality ($0.33) • Practice Expense ($0.19) • SGR Reduction ($1.95) • Expected Range: $20.19 - $17.72

  23. American Society for Gastrointestinal Endoscopy Guidelines for the use of deep sedation and anesthesia for GI endoscopy “The routine assistance of an anesthesiologist for average risk patients undergoing standard upper and lower endoscopic procedures is not warranted and is cost prohibitive.” Gastrointest Endoscopy 56:613, 2002

  24. Anesthesia for Interventional RadiologyMedicare 2005-2006

  25. Peripheral Nerve Block Procedures

  26. Growth in Interventional Pain Procedures

  27. Whither 1.6 Million Cataract Anesthetics? April 2007

  28. California Integrated Healthcare Assn.

  29. Incentive ExplosionBlue Cross Blue Shield of Massachusetts Boston Globe 5/10/06

  30. Fee Increases for Quality Incentives Blue Cross Blue Shield Massachusetts 5/29/06

  31. Medicaid P4P Activity

  32. 2% 40% Variation: Anesthesia for GI Endoscopy Anthem-Wellpoint 2004