NOT SEEING EYE TO EYE Wills Eye says its 4 inpatient beds would account for 17% of its cases.

A bitter battle over what constitutes an ASC and what constitutes a hospital has broken out in Philadelphia, where CMS and a world-renowned eye clinic and hospital are engaged in a war of words and a high-stakes legal skirmish.

Wills Eye Hospital, which added 4 inpatient beds as part of a $6.5 million renovation project 3 years ago, insists that it should now be licensed as a hospital and entitled to hospital-level reimbursements for all procedures. If successful, it would be reimbursed $1,745 for each cataract surgery, versus the current $976.

But CMS, which makes such determinations on a case-by-case basis, says the percentage of inpatient business at Wills is too small to justify hospital licensure. Wills has said in court documents that if filled every day, the facility's 4 beds would account for 17% of its cases.

Effective Nov. 1, Wills Eye Hospital will be terminated from the Medicare program unless it agrees to cease all inpatient care at the hospital and unless it completes a re-survey to prove to CMS that it ended those services, says Kevin Feeley, a Wills spokesperson.

Wills would then seek to obtain an ambulatory surgical center license, says Mr. Feeley. Under that lesser license, Wills Eye could not perform surgery longer than 4 hours, could not have patients recover longer than 4 hours, could not treat patients who have co-morbidities such as diabetes or cardiac issues, and could not treat infants with cancer who are under 6 months of age. "In short," says Mr. Feeley, "the patients who most need our services could no longer receive them."

Wills CEO Joseph P. Bilson tells the Philadelphia Inquirer that the effort isn't about reimbursement. It added the beds, he says, because Philadelphia's Thomas Jefferson University Hospitals, its academic affiliate, was increasingly concentrating on neurological procedures and "[doesn't] even have all of the equipment that it would need to take care of the breadth of patients that we have." The goal of the expansion, he says, was to be able to provide world-class care for those patients.

Wills has twice appealed the denial and lost. It can still appeal to federal court.

"I respectfully submit that cataclysmic results would occur if CMS were required to open the door to Wills Eye and certify them as a Medicare hospital," a CMS lawyer has said during legal proceedings. "Cataclysmic results would occur if CMS were required to offer any [ASC] that wanted to get more in reimbursement and become a hospital by adding a few inpatient beds."

Is CMS being capricious? Stephen K. Klasko, chief executive of Thomas Jefferson University, appears to think so. "With all the problems in health care, do we really believe that Wills' 4 beds are an issue?" he asks the Inquirer rhetorically.

Jim Burger