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Following an update of California's workers' compensation payment system in 2004, an investor group retained Sinaiko to estimate the potential impact the changes, which were based on a Medicare payment system model for outpatient services, would have on ambulatory surgery centers (ASCs).
The work involved assessing the patterns of coding and billing for a group of
ASCs and educating the client on the elements of the new payment system,
which now relied on appropriate and thorough coding with much greater intensity
than it had in the past. To identify potential coding inaccuracies, Sinaiko
reviewed a sampling of the top 20 percent of cases making up 80 percent of
the ASCs' business. Additionally, the actual codes billed-as well as Sinaiko's
corrected version of codes with relevant volume data-were run through a
payment analysis based on the newly adopted payment model to forecast future
payments.
Sinaiko's findings indicated areas of weakness in codes extracted from the medical records representing the top 20 percent of the ASCs' business.
Although Sinaiko's analysis uncovered areas of opportunity for improved coding, findings from the assessment of estimated future payments indicated a severe negative impact to reimbursement based on the regulatory changes adopted by the state (even with optimizing all opportunities for coding improvement). These findings assisted the client in developing their investment strategy, which ultimately including exploring options outside of California ASCs.
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