Medicare

Need for Consistent National Payment Policy for Special Anesthesia Services Gao ID: HRD-91-23 March 13, 1991

Pursuant to a legislative requirement, GAO reviewed Medicare's anesthesia payment system, focusing on the: (1) extent to which carriers used modifier units to allow extra payments for factors such as patient age, physical status, or unusual risk circumstances; and (2) appropriateness of such payments.

GAO found that: (1) before 1989, Medicare payments for anesthesia modifiers and special monitoring procedures differed among carriers, causing some anesthesiologists to be paid more than others for identical services; (2) in fiscal year 1988, 33 of 52 surveyed Medicare carriers paid an estimated $43 million to $72 million in anesthesia modifiers for which other carriers did not reimburse; (3) carriers' payment policies for special monitoring procedures were inconsistent and inequitable; (4) the Health Care Financing Administration (HCFA) discontinued separate modifier payments and required carriers to adjust payment conversion factors to compensate providers for the value of those modifiers; (5) HCFA required individual carriers to continue existing payment policies for special monitoring procedures despite its concern about nonuniform payment policies; (6) discontinuation of separate modifier payments failed to eliminate but rather perpetuated the payment inconsistencies and inequalities; and (7) HCFA allowed problems with special monitoring procedure payments to continue by requiring carriers to maintain prior practices.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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