This Just In

50 Percent of Covered Charges
Blue Cross Blue Shield Curbing Reimbursement to Illinois ASCs
Blue Cross Blue Shield of Illinois has informed the state's 120 outpatient surgery centers that it's doing away with carveouts and capping payments to providers at 50 percent to 60 percent of covered charges, not to exceed an all-inclusive rate of $1,200 to $1,400 per case.

BCBSIL sent a standard-form contract amendment in June informing administrators of the reimbursement limits. One such letter states that "reimbursement for outpatient surgery shall be reimbursed at fifty percent ... of Covered Charges not to exceed $1,200 per case."

BCBSIL says HIPAA's requirement for standardized billing codes is behind the renegotiations, as well as its inability to sustain the "extra time and staffing needed" to manually process items carved out of the standard agreement. Others view the lowered reimbursements as the giant insurer's leveraging an oversupply of surgical providers to deliver an ultimatum. As one administrator put it, "Perform outpatient surgery for $1,200 or less or get out of the network."

Letters accompanying the amendment stated compliance with the document will "assure continued participation in the applicable BCBSIL networks," and failure to do so, "constitutes Notice of Cancellation of your organization's Ambulatory Surgical Care Facility Agreement."

While the letters do not indicate the cap is negotiable, some facilities have rejected the amendment and realized BCBSIL is willing to talk individually. One doctor reported $1,700 as the largest cap negotiated by an ASC.

"Our goal is to simplify administration of the contracts," says Joseph Arango, vice president of provider relations for BCBSIL. He claims he does not fully know the letters' terms because he did not write them. Beth Bender, a senior manager no longer with BCBS, signed the documents.

For the record, Mr. Arango claims no policies have been cancelled; he says once centers receive a letter of cancellation, dialogue ensues between BCBSIL and the facility. But provider-carrier talks are a possibility and not a guarantee. "We don't have the resources to handle drawn-out negotiations," says Mr. Arango. "We've made what we consider a fair offer, and we have been generous payers to ASCs in the past."

Which, he says, has gotten BCBSIL in hot water with hospital providers. He claims they are upset with higher fees paid to ASCs for the same procedures that pay less to hospitals.

Aside from complying with HIPAA, the goal of reeling in costs with what BCBSIL considers an excess of ASCs seems likely. "Our members have adequate access to surgery centers in the state," says Mr. Arango, "and that will not be negatively affected by the loss of any particular center."

So ASC administrators have three choices: agree to the limits and remain in-system, reject the limits and let their BCBSIL relationship end, or reject the limits and try to open negotiations.

"As small business owners, we have to ask ourselves what's going on. Our margins are disappearing," says Annamarie Carey-York, executive director of Kendall Pointe Surgery Center in Osweto, Ill. Ms. Carey-York's facility has stopped performing costly surgeries on BCBSIL patients because the cap does not make it feasible.

Mr. Arango says these concerns are valid but overblown: "There is a fixation by our providers on the relatively infrequent occurrence of expensive cases and failure to look at the overall relationship, in which they make a good profit."

Mr. Arango says he doesn't know what other insurance carriers are planning or if the limit on ASC reimbursement will be implemented by BCBS nationwide.

- Daniel Cook

Unlicensed Practice of Medicine
Police: Woman Administered Anesthesia, Assisted Surgeries Without Nursing License
The woman who police say administered anesthesia and assisted in surgeries without a medical license worked for a surgeon whose medical license is now restricted after Florida health officials charged him with gross malpractice in the death of a cosmetic surgery patient.

Michelle Lynn Lawrence, 40, turned herself in to deputies and was released without bail last month, say police. Ms. Lawrence was charged with practicing healthcare without a license, a felony. She worked for Kurt Dangl, MD, at the Cosmetic Surgery Center of Sarasota, the Florida clinic where Julie Rubenzer, 38, lapsed into a coma while under anesthesia for breast enhancement in September 2003 and later died.

Bruce Crow, CST, who was the surgical tech for Ms. Rubenzer's surgery, was surprised to learn that the person he thought was a licensed nurse was not. "Dr. Dangl introduced her as ?My nurse, Michelle.' I really assumed that she was a nurse since sometimes she gave anesthesia in his office," says Mr. Crow, who used to work part-time at the surgery center, in a telephone interview. "If [Dr. Dangl] couldn't find anybody to administer anesthesia, she was called in. I witnessed her pushing IV narcotics at least three times."

It was during Ms. Rubenzer's case that Mr. Crow realized Ms. Lawrence wasn't a trained healthcare professional.

"Dr. Dangl called her into the OR when Julie was crashed on the table. ?See if you can get a pulse,' he told her," recalls Mr. Crow. "That's when we found out she wasn't a nurse. She applied two thumbs to the patient's radial artery. We both hollered, ?No, not there, and not with your thumbs.'"

Messages left for Ms. Lawrence and her lawyer, Derek Byrd, were not returned. In addition to Mr. Crow, several former employees witnessed Ms. Lawrence administering anesthesia to patients, according to the arrest warrant. Cosmetic Surgery Center records obtained by the state Department of Health list Ms. Lawrence as an anesthesia provider and say she administered Ketamine and fentanyl. Investigators found no record that she had a nursing license in any state, the arrest warrant says.

When asked about her background by staff, she gave vague answers about her medical training and professional status, the warrant says, alluding to being an LVN (a term used to refer to vocational or student nurses).

An emergency order from the health department says Dr. Dangl committed gross malpractice and failed to adequately administer, monitor and record anesthesia given to Ms. Rubenzer during the surgery. Dr. Dangl also didn't have an anesthesiologist in the operating room, violating state standards. The death resulted in several investigations of Dr. Dangl, a dentist by training who doesn't have hospital-admitting privileges, and renewed questions about Florida's licensing of doctors to perform cosmetic surgery on an outpatient basis.

Ms. Lawrence's arrest warrant lists her occupation as "patient care coordinator." The felony charge of unlicensed practice of medicine carries a maximum sentence of five years in prison, and a mandatory sentence of one year in jail if she's convicted.

- Dan O'Connor

Nurse-administered Sedation
GI Groups Clarify Roles of Docs And RNs Who Administer Sedatives
The American Society for Gastrointestinal Endoscopy and the Society of Gastroen-terology Nurses and Associates have issued a statement to clarify the roles of physicians and RNs who administer sedatives. It applies to RNs administering propofol for moderate or deep sedation, says Douglas O. Faigel, MD, chair of the ASGE Standards and Practices Committee and director of endoscopy at the Oregon Health & Science University in Portland, Ore. The statement doesn't cover propofol for anesthesia where patients are unresponsive to painful stimuli. Here are the highlights:

• Pre-op screening. Review the H&P, current medications and drug allergies, and assess cardiopulmonary status and airway. The physician should determine candidacy for sedation. Either a nurse or physician may administer the drugs.
• Patient monitoring. The GI nurse should monitor and record vital signs, comfort and clinical status. With moderate sedation, the nurse may perform interruptible tasks such as assisting with biopsy. For deep sedation, she should have no other responsibilities. The physician must be immediately available through recovery.
• Establishing a policy. Specify each staffer's responsibilities. Physicians and nurses should be adequately trained in many areas, including levels of sedation, pharmacology of sedative and reversal agents and recognizing complications, with extra training for deep sedation.

- Kristin Royer

Disaster Management
Is Your Facility Prepared For a Large-scale Event?
In the event of a large-scale event - be it terrorist attack or natural disaster - ambulatory and office-based surgery centers may be used as triage units or vaccination-distribution areas if community hospitals' emergency resources are stretched thin, says a new federal policy.

"Our goal is to have state-wide databases of healthcare workers who can be mobilized if a hospital is overburdened," says Tres Brooke, a bio-terrorism coordinator in Michigan.

The Health Resources and Services Administration and the Centers for Disease Control and Prevention have allocated federal dollars to each state for hospitals' and EMS systems' disaster-management preparedness. These cooperative agreements provide training, pharmaceutical caches, personnel protective equipment, decontamination equipment and air-filtration systems to facilities willing to participate.

If you're unaware of this call to arms - and the federal money that's available - you're not alone. Not every state's leadership has taken action. Mr. Brooke recommends engaging your local public health department and hospitals to see if any steps are being taken. "Right now, everything is on the government's dime," says Mr. Brooke, "but the money won't be around forever." The cooperative agreements expire Aug. 31, 2007.

- Daniel Cook

Inside The Numbers
Payment by Specialty

• 17.94% - Percentage increase in compensation in 2003 from 2002 for ophthalmologists
• $300,000 - Median compensation for ophthalmologists in 2003
• 9.53% - Percentage increase in compensation in 2003 from 2002 for gastroenterologists
• $351,614 - Median compensation for gastroenterologists in 2003
• 9.63% - Percentage increase in compensation in 2003 from 2002 for orthopedic surgeons
• $397,059 - Median compensation for orthopedic surgeons in 2003
• 11.61% - Percentage increase in compensation in 2003 from 2002 for CRNAs
• $123,166 - Median compensation for CRNAs in 2003

SOURCE: Medical Group Management Association, 2004 Physician Compensation and Production Survey