Ambulatory Surgical Centers

Affected Providers

Medicare-certified ambulatory surgical centers (ASCs).

Background

According to the 2024 Medicare Fee-for-Service Supplemental Improper Payment Data, the improper payment rate for ASCs is 14.7%, with a projected improper payment amount of $656.3 million.

An ASC provides outpatient surgical services to Medicare patients and must have an agreement with CMS according to 42 CFR 416 Subpart B. An ASC is either independent (not part of a provider of health care services or any other facility) or run by a hospital (under the common ownership, licensure, or control of a hospital). A hospital-operated facility can choose to be considered by Medicare to be an ASC or a provider-based department of the hospital as defined in 42 CFR 413.65.

Denial Reasons

Insufficient documentation accounted for 58.8% of improper payments for ASCs during the 2024 reporting period, while no documentation (34%) and incorrect coding (7.2%) also caused improper payments.

Preventing Denials

ASC-covered surgical procedures include, but aren’t limited to:

• Nursing, technician, and related services
• Using the facility where the surgical procedures are done (for example, endoscopy, colonoscopy, or arthrocentesis)
• Any lab test done under a Clinical Laboratory Improvement Amendments of 1988 (CLIA) certificate of waiver
• Drugs and biologicals where separate payment isn’t allowed under the hospital Outpatient Prospective Payment System (OPPS)
• Medical and surgical supplies; implanted prosthetic devices, including intraocular lenses and related accessories and supplies; implanted DME and related accessories and supplies not on pass-through status under 42 CFR 419 Subpart G
• Equipment
• Surgical dressings
• Splints, casts, and related devices
• Radiology services where separate payment isn’t allowed under the OPPS and other diagnostic tests or interpretive services that are integral to a surgical procedure
• Administrative, recordkeeping, and housekeeping items and services
• Materials, including supplies and equipment for administering and checking anesthesia
• Operating surgeon supervising anesthetist services

ASC Payment has the complete lists of ASC-covered surgical procedures and ASC-covered ancillary services, the applicable payment indicators, the payment rates for each covered surgical procedure and ancillary service before adjustments for regional wage variations, and wage indices.

Documentation Requirements

The ASC must:

• Keep complete, comprehensive, and correct medical records to make sure patient care is adequate
• Develop and keep a system to properly collect, store, and use patient records
• Keep a medical record for each patient that’s correct, legible, and promptly completed

Medical records must include:

• Patient identification
• Documentation of properly executed informed patient consent
• The patient’s medical history and physical exam (if any) documented before the surgical procedure
• Pre-operative diagnostic studies (entered before surgery), if done
• Pre-surgical assessment including documented allergies and abnormal reactions to drugs and biologicals
  Note: Patients who are admitted must have a pre-surgical assessment completed by a physician who will be doing the surgery or another qualified practitioner who’s allowed to complete the assessment under applicable state health and safety laws, standards of practice, and ASC policy.
• Findings and techniques of the operation, including a pathologist's report on all tissues removed during surgery, except those exempted by the governing body
• Any allergies and abnormal drug reactions
• Entries related to anesthesia administration
• Discharge diagnosis

The patient’s post-surgical condition must be assessed and documented in the medical record by a physician, another qualified practitioner, or a registered nurse with, at a minimum, post-operative care experience under applicable state health and safety laws, standards of practice, and ASC policy.

Discuss post-surgical needs and document them in the discharge notes, and give each patient their discharge notes.