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August 2, 2019

How are Anesthesia Fees Established?

August 2, 2019

Though it seems complicated at first, it’s not rocket surgery! De-mystifying the process by which charges are established for anesthesia services is a worthwhile exercise for everyone involved in the billing process. Surgery is not a yard sale where patients pay what they think is appropriate for services, or anesthesiologists bill what they think they’re worth! The CMS releases a finite set of rules regarding billing for procedures, and it’s important to learn to navigate the codes properly. You are responsible for your own paycheck! Submitting incorrect or inaccurate claims or unusable codes can delay or cancel payments. You and your anesthesia providers have already provided the services - make sure you are reimbursed properly! 

Use Our FREE Calculator to Calculate Your Anesthesia Revenue Now!

In general, here is the golden equation: 

(Base Units + Time Units + Modifying Units) x Conversion Factor = Anesthesia Fees 

Base Units

First, you select a base unit code for your claim. This code reflects the difficulty and skill involved in the procedure. Each CPT code, published yearly by the CMS, is assigned a base value by the ASA. Only one anesthesia code can be reported per claim, so check the list of CPT codes carefully. 

Time Units

Time Units are particularly important for rendered anesthesia services. In some cases, 1 minute represents a unit, ie. 60 units is equal to one hour. In other cases, the total minutes of the service rendered is divided by 15 (¼ of an hour) in order to create whole number time units. Be sure to check with your carrier as some utilize decimals in reimbursement, while some round up to whole numbers. 

Modifying Units

Not all carriers will accept modifying units, but the majority do. These include provisions for patients that have factors that can significantly affect the outcome of the procedure, ie. hypothermia, extreme age, obesity, and the position in which the procedure was performed. 

Conversion Factor

These are specific to each carrier and location where the procedure was performed. The list of conversion factors is published yearly by the CMS. 

Anesthesia Fees

This is the final fee paid for the anesthesia provided during a procedure, either by the patient or by the insurance carrier. Depending on your nature of arrangement with your hospital, you will either receive these fees directly as a contractor, or it will be paid out to your hospital or organization. 

Easy, right? No sliding scale, no abacus. By understanding these simple rules for calculating anesthesia fees, there should be no more mystery surrounding how you get paid. 

Still have questions? Contact us today!

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