Contact Us

January 14, 2021

Anesthesia Billing 101: Everything You Need to Know

January 14, 2021

Anesthesia billing is more complicated than billing for most other specialties. Between coding specifications and the differences in time billed, it can be challenging for facilities to understand how to leverage these complexities to maximize eligible revenue. In breaking this down into “Anesthesia 101,” we’ve highlighted some of the unique features of anesthesia billing in a way that is easier to understand. 

General Billing Considerations

Appropriate and accurate documentation is essential to anesthesia billing compliance, reimbursement, and any medical-legal issues. Like with many healthcare practices, if it’s not documented, it didn’t happen. Failure to document the services provided -- or correctly document the services provided -- could result in denied claims and lost revenue. Educating your facility practitioners and staff on the documentation requirements is an essential first step in ensuring validated anesthesia services. 

Secondly, it’s essential to understand the facility payer mix and payer guidelines for care delivery and documentation. Since the percentage of patients with government-issued and private insurance coverage drives healthcare facilities’ financial strategies, it’s important to understand any relevant guidelines that would affect the anesthesia services and subsequent billing. Facilities can find these insights by reviewing payer Local Coverage Determinations (LCDs).

Get A FREE Guide On Maximizing Your Healthcare Facility's Revenue Now!

How Healthcare Facilities Can Maximize Revenue Download

How Anesthesia Charges Are Calculated

Anesthesia services are calculated based on the following criteria: 

  • Difficulty of the procedure 
  • Time 
  • Modifying factors (such as the health of the patient) 

The general formula for calculating anesthesia charges is:

(Base units + Time units + Modifying units) x Conversion factor = Anesthesia charge

Base Units: Each procedure has an assigned code with a base unit value. Procedures that are more difficult and require a higher skill level have a higher base unit. 

Time Units: A time unit is usually 15 minutes in length, but can vary depending on the location. 

Modifying Units: Emergencies and certain conditions in a patient’s health are considered as modifying units. 

Conversion factor: Specific to the anesthesia provider’s location, this is a cost assigned to each unit.

Calculate Your Anesthesia Revenue FREE of Charge!

Time Definition

Time units can be broken down even further, as anesthesia time must be very carefully calculated and precise. 

Anesthesia time begins when the anesthesia practitioner starts physically preparing the patient for anesthesia services, which occur in the operating room or equivalent area. This definition does not count time spent with the patient beforehand, such as reviewing medical history, because this is bundled into the base units. Administration of pre-anesthesia sedation, the start of an IV, or the placement of monitors are a few examples of actions that can trigger the start time. 

Anesthesia time ends when the patient is admitted to the Post-Anesthesia Care Unit (PACU), and the practitioner transfers care to another qualified professional. PACU time is billable until the patient is fully and safely transferred to post-anesthesia care. This must be documented to confirm the anesthesia end time. 

Discontinuous time, such as the time between IV placement and the surgery, must be documented, as well as any provision of relief that occurs between providers. As with the pre-evaluation, the post-evaluation is not considered billable time. Lastly, do not round time up or down. Document the exact number of hours and minutes from start to finish. 


Modifiers are two-character indicators used to either modify payments or identify relevant details on a claim. Your coder or biller should be aware of several common and applicable modifiers, as well as how to use them to ensure proper claims payments. For example, modifiers should be added if the patient has a systemic disease, and the two-character indicator will change based on the degree of severity.

These modifiers help eliminate the appearance of duplicate billing and unbundling (using multiple CPT codes, either due to misunderstanding or to increase payment). Modifiers are used to increase accuracy in reimbursement and coding consistency, and to capture payment data.

Billing Expertise

Most importantly, to maximize eligible revenue from your anesthesia services, you will want to hire an expert in both anesthesia billing and coding. Whether this is in-house or outsourced, it will ensure you get the most out of your claims and reduce overhead expenses in the process. For specific questions about anesthesia billing, these experts will be your best resource. 

At Medical Business Management, we are in the business of making our clients’ anesthesia billing process more manageable by handling its various complexities and reducing errors. Our expertise helps you get the most revenue back from your anesthesia services, and it saves you time and money. For a free consultation, contact us

1025 Montgomery Hwy Suite 100
Birmingham, AL 35216
info@mbmps.comNewsletter Signup
Phone: 205-979-5882
Toll-Free: 800-477-4544
Fax: 205-979-1248
Client PortalPrivacy Policy
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram