Update on Office Based Endoscopy July 15, 2008 Scott Tenner, MD, MPH President, New York Society for Gastrointestinal EndoscopyThe practice of endoscopy in New York is in the process of undergoing a great transformation.Whereas endoscopy is performed throughout the United States in either the hospital (HOPD) orambulatory surgical center (ASC), almost half of all the endoscopic procedures performed in New Yorkare performed in the office setting. For decades, office based endoscopy flourished by combiningconvenience and cost effectiveness. However, in the unregulated environment of the office, quality,infection control, and adherence to guidelines varied.For a variety of reasons, including concern for patient safety and the political desire of the hospitals toincrease outpatient volume, pressure on the Department of Health led to the formation of aCommittee for Public Safety. With no representation from Gastroenterology Societies, and norepresentation from offices that perform these procedures, the Committee drafted legislation toregulate offices by forcing offices to become accreditated. Last year, the Bill requiring accreditationeasily passed the New York State Assembly, and was signed into law by former Governor Spitzer.Over the past 2 years, the NYSGE has been working with our legal team led by Scott Einiger, Esq, theMedical Society for the State of New York (MSSNY) and the Department of Health to facilitate therequirement of accreditation. In order to assist the offices, educational programs were developed,implemented and many more are planned. Members of the NYSGE have become actively involvedwith the Joint Commission, AAAHC, and AAAASF. Multiple meetings with the Department of Healthhave occurred. Information about these meetings have been posted over the last two years on ourWebsite. One of the important aspects to assist with accreditation was the ability to collect a fairpayment. The mandate for accreditation was unfunded. Yet the costs for accreditation remain high.Whereas in the past, offices could cut corners in order to provide endoscopy, accreditation wouldforce the offices to the same standards as the Hospital and/or ASCs. The costs of performingprocedures in the office would increase dramatically. The office would now need to provide patientswith all the aspects of a hospital outpatient department (HOPD), such as recovery room, monitoring,endoscopes, reprocessing equipment, disposable equipment, logs, infection control, and develop andfollow an extensive policy and procedure manual. Yet, unlike the hospitals and ASCs which receive1500-3500 dollar facility payments per procedure, it was unclear whether an office could bill a facilityfee.Several visits to Albany in 2006, meeting with representatives of the Department of Health and theHealth Insurance industry led to the conclusion that an office facility billing a facility fee was legal.By July, 2008, almost 40 Gastroenterology Offices underwent the accreditation process and beganbilling a facility fee. Issues regarding corporate structure were unclear. Payments were received.
These 40 offices thrived in an environment of appropriate reimbursement for providing patients withcare in accreditated facilities, and satisfying the New York State Office Based Surgery Law.Recently, on June 5th, the Department of Health posted on the website for Office Based Surgery(Endoscopy) a list of new FAQs. Within this new list, a variety of statements were made whichquestioned the validity of office based endoscopy (surgery) facility fee billing. Based on this suddenchange in opinion from the Department of Health, I attended a new meeting with the Department ofHealth. At this meeting, held on July 14th, 2008, multiple lawyers were present from a variety of firms,including the NYSGE legal Council, Scott Einiger, Esq, and Donald Moy, Esq, MSSNY. Multiple lawyersfrom the Department of Health were also present, including the DOH lead Council, Tom Conway, Esq.,and the physician in charge of the oversight for office based endoscopy accreditation, John Morely,MD.The meeting was complex. It appears that the Department of Health has mixed feelings about officesbilling a facility fee. Issues regarding corporate structure and NY State Corporate Law appearparamount. However, the final decision appears to be evolving.What We Know: 1. Within one year, by July 14, 2009, all offices that perform endoscopy must become accredited by one of the three accreditation agencies: Joint Commission, AAAHC, or AAAASF. If you plan on performing office based endoscopy and have not begun the process, please note, the process takes months! START THE ACCREDITATION PROCESS NOW! 2. If a complication occurs in your office now, as of January this past year, you must report the complication to the Department of Health (see DOH website for forms). Complications include perforations, post-polypectomy bleeding, or any unexpected transfer of your patient to a hospital (for more details please see the DOH website). You only have one business day to complete the form and notify the DOH. If you do not inform the DOH, you may be reported to the Office for Professional Misconduct and you are at risk for loss of license. Please note, the hospitals are required to report any admissions to the Emergency Department from office based procedures. 3. Offices that perform office based endoscopy in an accredited facility MAY BILL A FACILITY FEE. However, no carrier is required to pay such a fee. 4. The costs for performing procedures in the accredited endoscopy office will (on average) double (expected to be 300 dollars per procedure). 5. Offices cannot bill Medicare or Medicaid for a facility fee (Certificate of Need, Article 28 required). 6. Many offices will be forced to close due to the complexity of accreditation or the costs involved and lack of reimbursement. IF YOU ARE PLANNING ON CLOSING YOUR OFFICE DUE
TO THIS LAW: PLEASE EMAIL ME DrTenner@BrooklynGI.com (we are tracking the effects of the law and this information is important).What We Do Not Know: 1. Will the number of offices closing create an access issue for colorectal cancer screening and other endoscopy procedures? 2. Can the hospitals (HOPD) and ASCs absorb the number of patients from the offices that close? 3. Will the Department of Health support facility fee billing in which an appropriate professional corporate structure (eg PC, PLLC) is created? 4. Will insurance carriers have the wisdom to pay offices a “facility fee” in order to provide a fair payment, in order to prevent offices from closing, in order to prevent case migration from a less expensive office facility to the more expensive hospital facility (HOPD). 5. Will the DOH relax the CON rule. Most other states have far more ASCs where gastroenterologists can practice endoscopy and receive a facility payment. In Maryland, there are 500 ASCs, Florida 400, California 500, etc. In NY, the approval of ASCs is based on committees controlled by the Hospitals. This profoundly limits ASCs in NY. As of today, there are less than 60 ASCs in NY State that perform endoscopy.The future of office based endoscopy in New York, which accounts for half of all endoscopicprocedures in the State, is unclear. The hospital lobby may succeed in forcing the closure of many, oreven most office facilities over the next several years by combining the accreditation costs andlimiting the ability of the offices to receive a facility payment. At present, with the appropriatecorporate structure, an accredited office may bill a facility fee. However, many questions remainregarding the appropriate codes, forms, etc. More important, it remains unclear whether carriers willpay. Many carriers have simply made it policy not to pay accredited offices a facility fee. All officesthat choose accreditation and to bill a facility payment must obtain legal advice and develop a planthat satisfies the current concerns of the Department of Health. But I stress, this appears to be amoving target in evolution. The future of office based endoscopy will be dependent on our ability to“lobby” our ideal for a fair payment for an accredited office based facility. Influencing legislators inAlbany, educating them about our problem, may be one method. Formation of a large Endoscopy IPAto collectively bargan for payment may also be effective. At this time, the NYSGE is working closelywith our legal team, Scott Einiger and Associates, to develop a plan to achieve success.More to follow ….As always, please feel free to contact me if there are any questions.
Scott Tenner, MD, MPHPresident, New York Society for Gastrointestinal Endoscopy