Orthopedic trauma surgery reimbursements have been dropping. According to a study in the Journal of Orthopaedic Trauma, reimbursement for trauma surgery has dropped by almost one-third over the past 20 years [1].

For insight, using CMS data, Healthcare Finance News examined trends around the 20 most commonly billed surgical procedure codes ranging from 2000 to 2020 and adjusted the changes for inflation based on the Consumer Price Index (CPI). The majority of these procedures were traumatic bone fractures that required surgical repair using hardware — internal fixation. Over that time period, the CPI increased by 52.8% while at the same time, Medicare reimbursement for the 20 trauma surgery procedures only rose by 4.9% [2].

This trend has left many professionals asking how to deal with the issue in the face of growing patient volumes and increasing costs.

Why This is a Problem in Orthopedic Billing
The result, after correcting to 2020 dollar values, is an average decline in reimbursement of 1.5% per year. Here’s how these decreases break down by individual procedures:

  • Foot and ankle procedures: 42.6%
  • Hip fracture surgery: 31.9%
  • Lower extremity long bone procedures: 30.9%
  • Shoulder and upper extremity procedures: 23.7%

As you can see, the drop in reimbursement happens across a range of procedures — a serious issue as the American population continues to age and the need for orthopedic trauma surgery and fracture care can be expected to increase. But it’s not just the elderly.

We’re seeing an increase in planned knee and hip replacement procedures in younger Americans. A BCBS review of medical claims ranging from 2021 to 2017 found that knee replacements increased by 17% and hip replacements by 33%. This type of planned surgery made up 47% of all orthopedic spending — a 44% increase over that period.

How Orthopedic Billers Should Respond
CMS is pushing for a move to less expensive ASC settings with the phasing out of the inpatient only (IPO) list over the next three years. In the meantime, orthopedic billing professionals will need to maintain solid billing practices to maximize reimbursement.

Focus on Accuracy
Even with all the shifts in orthopedic services, accurate coding will always be key to maintaining healthy practice revenues and maximizing physician reimbursement. A lack of orthopedic claim documentation and inaccurate coding can be a contributor to billing inefficiency and reduced compensation. It’s been estimated that a lack of documentation from the physician report leads to 6% of performed procedures being uncoded [3]. At the same time, even if codes are properly included from a procedure list, add-ons and modifiers that are crucial for reimbursement can be left out.

Teach Physicians the Language
When physicians use coding language instead of describing the procedure as a narrative, there is decreased risk of inaccuracy, which results in improved revenues. If physicians are familiar with the codes commonly used in their procedures they can better communicate with coders, improving clinical documentation and contributing to improved billing.

Watch Out for Medical Devices
Medical devices have become increasingly common and will only become more so in the future, complicating billing. Many manufacturers give advice to providers on how to code procedures when using their devices. While this can be helpful in some cases, there is also a risk that the advice they’re giving is inaccurate. The result can be reduced reimbursement or confusion that leads to an audit. When billing and coding for medical devices, your staff should do their own research of Medicare guidelines and look up FDA approval status themselves.

Understand Your Particular Challenges
While general trends provide a starting point, there will always be challenges and opportunities that are particular to your practice. Your billers and coders might have accuracy issues around certain procedures or be prone to missing certain modifiers.

One of the most obvious clues to this type of issue can be found by looking at your common denials. You might have a high incidence of denials for outpatient doctor visits, new patients, or therapeutic exercises. By identifying these patterns and looking for root causes, you can increase accuracy and improve reimbursements.

Don’t Forget the Front End
Sometimes, accuracy issues start before a procedure happens. Make sure that your front desk staff are diligent about insurance verification and that they’re getting accurate information from your patients. This will be increasingly important as the COVID-19 pandemic has increased instability in employment and your patients are more likely to have seen changes in their plans and coverage.

Consider a Partner
CMS is making some significant shifts, many of which have deep impact on orthopedic billing practices. It will be critical that you keep internal knowledge and practices up to date through efforts like updated training. But in many cases, the changes might be too much for you to keep up with in-house. Don’t write off the potential of accessing the wisdom and focus of an outsourced partner. To learn more about your potential in that type of relationship, feel free to contact us.

[1] J. M. Haglin, A. Lott, D. N. Kugelman, S. R. Konda and K. A. Egol, “Declining Medicare Reimbursement in Orthopaedic Trauma Surgery: 2000-2020,” Journal of Orthopaedic Trauma, vol. 35, no. 2, pp. 79-85, February 2021.
[2] J. Lagasse, “Medicare reimbursement rates for orthopedic trauma have fallen sharply,” Healthcare Finance, 22 September 2020. Available: https://www.healthcarefinancenews.com/news/medicare-reimbursement-rates-orthopedic-trauma-have-fallen-sharply.
[3] L. Dyrda, “5 Tips for Increased Accuracy in Orthopedic Practice Coding,” Becker’s Healthcare, 10 August 2010. Available: https://www.beckersspine.com/orthopedic-spine-practices-billing-coding/item/1783-5-tips-for-increased-accuracy-in-orthopedic-practice-coding?oly_enc_id=2015F8566689G4V.

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