As they do each October, the American Society of Anesthesiologists (ASA) recently released their ASA Commercial Payer Survey results for 2017. Overall, the 2017 national average conversion factor was $78.57, ranging between $70.87 and $83.38 across participating practices’ top five commercial plans. This represents an increase from 2016, when the average commercial conversion factor was $71.02 nationwide, ranging between $68.33 and $74.36.
By way of comparison, the 2017 national Medicare conversion factor for anesthesia services was $22.0454, or about 28.1 percent of the average commercial factor. In 2016, the Medicare conversation rate was $21.9935, which is about 30.9 percent of the 2016 overall mean commercial conversion factor.
The survey is disseminated each June, asking providers to report conversion factors of their top five commercial contracts, the percentage of total patient volume each contract represents, and basic demographic information. In 2017, 221 practices representing 42 states responded. Those practices reported on a total of 919 managed care contracts, a 13.6 percent increase over the 809 managed contracts reported on in 2016.
Of the responding practices, demographic information was provided by 173, which employ or contract with the following: 5,027 full-time equivalents physician anesthesiologists, 5,379 FTE nurse anesthetists, and 553 FTE anesthesiologist assistants. As well, those practices work with the following additional staff not directly employed by them: 1,040 FTE nurse anesthetists and 38 FTE AAs.
A few other interesting findings from the survey:
- 883 contracts used a 15-minute unit, nine used a 12-minute unit, 19 used a 10-minute unit, and 8 used an 8-minute unit.
- In 2017, 114 of the 221 groups, or 51.6 percent, negotiated at least one flat fee contract, down from 57.4 percent in 2016.
- More than 44 percent of the respondents have flat fee contracts for labor and delivery.
- When dividing the US into four regions, the average conversion factors are (in order from highest to lowest): East – $80.93; South – $80.49; Midwest – $77.34; West – $73.05.
- The average commercial factor in Indiana is $88.34, higher than the average for all states in MGMA’s “Eastern Midwest” region, whose average commercial factor was $72.29 in 2017, up from $65.00 in 2016.
- Every region and nearly every contract category had a conversion factor high of at least $112.07.
- The highest conversion factor reported was $280.00.
This data about commercial fees is more than just interesting. It becomes most meaningful when you use it to help manage your anesthesia practice. As we’ve recommended in past years, here are three ways to use this data in your own practice:
Compare your own reimbursement to these numbers, particularly your top five payers. The full report breaks down the numbers by region and state. How do you compare to other practices in your region?
Armed with the data about how you compare with other practices in your region, approach your commercial payer representatives to begin renegotiating your contracts. For payers that are reimbursing at lower rates compared to your own payer mix, provide redacted reports showing how they compare with other major payers in your area.
Not only do these conversion factor averages help you negotiate for greater reimbursement from your contracted plans, they can also help you ensure your chargemaster is in line with industry averages. When is the last time you evaluated or updated your per unit charge amount? What about flat fee procedures? Don’t leave money on the table by undercharging for your services.
Curious to learn more about how you can harness the power of payer information to improve your bottom line? Contact CIPROMS today to discuss more options.
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