Article

Make your practice “declining reimbursement proof”

When considering the cost of performing complex surgeries, leverage data, control as many variables as possible and constantly look to diversify offerings.

With the postponement of elective surgery, including cataract extraction, we will see a rebound need for surgeons to be as busy as ever. However, the new decreased reimbursement of cataract surgery may play a major factor.

Discussions already arose in the past year: Is cataract surgery worth it in the light of payment? Now with COVID-19 causing chaos to practice’s bottom line, this becomes even more important. Surgeons are already concerned with the impact of COVID-19 on their practice’s financial health. Will they choose to do more surgery at a lower rate? Or will some decline operating in light of similar or better reimbursement with less stress caring for other ophthalmic conditions?

Cataract surgery is ophthalmology’s most commonly performed outpatient procedure as well as the most commonly performed outpatient procedure overall.1 As such, it sports a big bulls-eye when CMS considers where to aim reimbursement cuts. Cataract surgeons practicing in the 1980s will remember those days fondly — at least when it comes to CMS payments. Since that time, reimbursement for cataract surgery has incrementally fallen to about one-third of the amount paid four decades ago.2 For 2020, CMS further cut payment per the proposed rule: non-complicated cataract surgery (CPT code 66984) went from $654 to $557, and complex cataract surgery (CPT code 66982) fell from $813 to $766. This represents a 15% and 6% reduction in payment, respectively.

The downward pressure on reimbursement, coupled with a looming shortage of surgeons to care for a rapidly increasing number of cataract age patents, poses critical questions.3 The future cannot be known, of course, but it is likely that cataract surgery reimbursement will decline further. In the face of shrinking payments — and in an environment where surgeons commonly report that cataract surgery is often done at a financial loss — will fewer surgeons be willing to take on difficult cases? How can surgeons mitigate reimbursement cuts and come out ahead in this equation?

THE SET-UP: BURDEN

Cost of complex cases

Even though it is reimbursed at a higher rate, much of the complex surgery performed in ASCs or practices is done at a loss, says Denise Visco, MD, in practice in York, Pa. “Even a skilled surgeon who is ‘fast’ may take twice as long to do a complex cataract vs. a regular case. If you’re a 10-minute cataract surgeon, it might take you 20 minutes to do a complex case. If you’re a 20-minute cataract surgeon, it might take you 40 minutes.”

The facility loses revenue on complex cases due to decreased throughput and increased variable cost per case with the extra use of viscoelastic, trypan blue and other devices. “We may need to use femtosecond laser to emulsify the lens in these cases or employ a tool like miLOOP [Zeiss],” Dr. Visco says. “These are costs we absorb, along with the added time spent by the surgeon, facility and staff. My partner and I do complex cases as charity.”

Aging surgeons, aging patients

Many ophthalmic surgeons are aging out of the workforce just as the coming tsunami of baby boomers will need cataract surgery,3 Dr. Visco says. “The surgeon deficit outpaces the rate at which new surgeons are entering practice. Currently, a small number of very experienced, skilled surgeons perform the bulk of complex cases — the volume of which is continuing to increase.”

Cathleen McCabe, MD, agreed that those cases can “be a bigger part of your volume than you may like. When you become known for doing complex surgery in your community, the word spreads. Even in my own practice, colleagues will give me their complicated cases.” Dr. McCabe is the chief medical officer of Eye Health America and the medical director of The Eye Associates in Bradenton, Fla. With the reimbursement decreasing for both standard and complex surgery, this is a challenge.

It is foreseeable that patients will continue to be more challenged in finding surgeons willing to take on complex cases. “The definition of ‘complicated case’ is going to become even more restrictive in terms of certain parameters like cost per case and quality of outcomes. Private equity might look at it as ‘return on investment for time spent.’ There will be increasing pressure on surgeons to not take on these cases,” Dr. McCabe adds.

BSM Consulting’s principal and senior consultant, Elizabeth Monroe, COE, CPSS, PHR, believes the surgeon shortage presents a greater obstacle to patients getting needed care than decreasing reimbursement. “We have not invested in the infrastructure from the residency and fellowship programs to be producing enough surgeons to accommodate the number of patients that are going to need care,” she notes. “We have not grown those programs to a point where we’re going to have enough physicians to manage the aging population. This will hit rural areas the most, as these are places where patients are under-supported by medicine in general.”

WHY AND HOW

Value and personal satisfaction

Sadly, CMS slashing reimbursement sends a message to surgeons that “our skills are not valued,” says Dr. Visco. “As colleagues, however, we tell each other how much value we have.” Validation comes from patients, too, of course. “In particular, patients with comorbidities who may have traveled to see a highly recommended surgeon are extremely grateful,” she adds. “There is enormous personal satisfaction in performing complex procedures.”

You have to have somewhat of an altruistic attitude about it, Dr. McCabe says. “I feel like my job is to provide the best care I can to the extent of my ability and my skills. In that quest to always do the best I can for the patient, I want to be able to manage complicated cases and all unexpected situations.”

Lobbying opportunities

It’s also worthwhile for ophthalmic groups not to give up that fight. The AAO and ASCRS could study the volume of complex cataract surgery relative to the number of surgeons overall and the number who perform complex procedures, Dr. Visco suggests. “There may be value to quantifying this information and then coordinating efforts to bring more attention to the reimbursement and surgeon disparities. It would also benefit facility managers to bring this to legislators’ attention.”

Dr. McCabe agrees that a mechanism would be welcome for surgeons who perform complex cases to get increased reimbursement, in a sort of à la carte fashion, for additional effort and tools that were required. She notes, however, that this would require an “unbundled type of mentality” as opposed to the current bundling of costs.

Outside-the-box thinking

Another approach to handling the volume and cost of complex surgery could be the creation of “centers of excellence.” Dr. Visco suggests that these facilities could employ expert surgeons who specialize in complex cases, operating under strictly controlled protocols, as a way of cost containment. “Future models of reimbursement are changing,” Dr. McCabe adds, “and more and more we are asked to maintain quality of outcomes within an environment of cost containment.”

Medical schools could consider adding additional programs for surgeons specializing in complex cataract surgery. “I think there needs to be some thinking outside the box, because the box we’re in now doesn’t have a solution,” Dr. Visco warns.

Five considerations to ensure a thriving practice

Eimi A. Rodriquez Cruz shared these five tips that helped her facility adapt to the current state of reimbursement:

  1. Focus on premium services. Generate case revenue that is not dependent on CMS. Be methodical about setting 6-month and 1-year goals. Make sure staff, in addition to the physicians, are well educated and can communicate effectively to patients the benefits of premium options that will enhance their everyday quality of life. In additional to premium lenses, other services can be offered in the cataract package to meet patients’ visual expectations.
  2. Expand dry eye management. Dry eye diagnosis and treatment have evolved a great deal during the past 5 years, with many options now available. Treatment of the ocular surface is crucial to the overall visual outcome for refractive and cataract surgery. These complementary services enhance surgical results and offer an avenue for additional revenue.
  3. Consider technology efficiency. This refers to products that can be used during surgery. Some drugs can help reduce case time. Consider technology that helps all surgeons regardless of their generation, skill set or comfort level. The continued evolution of postoperative medications and the increase in drugs with pass-through status are a game changer from an operational standpoint. Such products greatly reduce the number of hours that staff members spend on postoperative calls regarding medication. This time can then be reallocated.
  4. Evaluate OR utilization. OR utilization and efficiency is important to the bottom line. Adding real estate is not always the answer to space constraints. Before making the financial investment of adding exam rooms or providers, ensure each room is maximized. Have a benchmark and track data to figure out how often exam rooms should turn over per day. Look to eliminate redundancies and add more cases.
  5. Leverage collaborative care. Collaborative care helps practices maximize resources. Many groups have cataract surgeons who are in the clinic more than they are in the OR. Instead, add optometrists and partner them with cataract surgeons. This will increase volume per surgeon.

STAYING THE COURSE OR MAKING CHANGES?

Don’t just react

Lobbying efforts aside, reimbursement cuts are one of the constants that surgeons will always have to navigate, says Ms. Monroe. “It’s important to measure the financial impact of reimbursement cuts in terms of the practice’s volume and case types,” she says. “Surgeons understandably want to offer state-of-the-art care within the ASC and should look to mitigate expenses. When it comes to making drastic practice changes, however, we stress to our clients that they make sure ‘the tail is not wagging the dog.’”

What you can control

The best advice is simple: Run a very good business. “If physicians run their business in a thoughtful, strategic way, they increase their changes of being successful,” Ms. Monroe says. “When the cuts were announced at the end of last year, I received a lot of calls from clients asking, ‘Should I start an optical? Do I offer more premium procedures or beef up my dry eye practice?’ I advise them to bring it back to the basics.”

To that end, Ms. Monroe advises physicians to ask themselves the following:

  • What’s your mission?
  • What are your core values for your group, for your staff?
  • How do you want to position yourself in your market?
  • What are your long-term objectives and goals?

Then, if the physician determines that the practice has a tremendous opportunity to offer something in the market, that becomes the answer, Ms. Monroe says.

Practice leaders — physicians and administrators — should stay focused on what is in their span of control and approach their business planning in a proactive and disciplined, not reactive, manner.

EXAMPLE PRACTICE

Shift revenue streams

“One of the things that I’ve learned over the past 20 years is that, as an administrator, you have to accept that there are some things you just don’t have control over, like CMS,” says Eimi A. Rodriguez Cruz, practice administrator for UCHealth Sue Anschutz-Rodgers Eye Center in Aurora, Colo. “My energy is better spent on navigating ways to create solutions to help minimize the negative implications to some of these larger changes.”

She does this by being ready to shift focus to other revenue streams. “If things change again for the better, it’s a win-win. I’ve already evolved my practice to survive and be lucrative. I am in a practice with all subspecialties, so I have to be up to speed on everything that’s happening from the front to the back of the eye. I try to think 5 or 10 years in the future.”

An eye to adaptation

The question practices should ask is, “What am I doing now to be prepared for the future?” The decline in cataract surgery reimbursement is just one of many ways that ophthalmology is changing, Ms. Rodriguez Cruz says. “For a practice to be resilient to the financial environment, it has to be ready to adapt.” And in the COVID-19 pandemic, this has never been truer. (For more on what her institution has done to thrive, see “Five considerations to ensure a thriving practice”.)

CONCLUSION

Financial uncertainty is nothing new in ophthalmology, a specialty that depends so heavily on CMS reimbursement fluctuations. However, no one expected all elective surgery to come to a halt in 2020. With an aging population that includes skilled surgeons and patients in need of cataract surgery, we will see a large rebound in cases. Each decision a practice makes is more fraught than ever. The basic tenets of running a solid business, however, continue to hold true and adhering to those strategies will help practices stay on solid footing in times of change.

“At the end of the day, taking care of all of our patients, routine or complex, is an obligation we have as physicians, and really just as human beings, to give back to our community and our profession,” says Dr. McCabe. OM

REFERENCES

  1. Moriarty A. Top 10 outpatient procedures at surgery centers and hospitals. Definitive Healthcare. Oct. 3, 2016; updated May 22, 2019. https://blog.definitivehc.com/top-10-outpatient-procedures-at-ascs-and-hospitals . Accessed April 3, 2020.
  2. Lichter PR. Payment data and the “me” in Medicare. Ophthalmology. 2014;121:1849-1851.
  3. U.S. Department of Health and Human Services Health Resources and Services Administration. Bureau of Health Professions. October 2006. Physician supply and demand: Projections to 2020. http://bhpr.hrsa.gov/healthworkforce/supplydemand/medicine/physician2020projections.pdf . Accessed April 3, 2020.