Payment and Reimbursement

Table of Contents

• Anesthesia Claim Billing Instructions
• Multiple Anesthesia Procedures
• Multiple CRNAs Same Procedure
• Payment at Personally Performed Rate
• Payment at Medically Directed Rate
• Payment at Nonmedically Directed Rate
• Payment at Medically Supervised Rate
• Payment Rules
• Base Units
• Time Units
• Conversion Factors

Anesthesia Claim Billing Instructions

Claims must be submitted on the CMS-1500 claim form or electronic media claim equivalent.

The following are specific to anesthesia claims submission:

• Item 24D or the electronic equivalent – the appropriate anesthesia CPT code followed by the modifier
• Item 24G or the electronic equivalent – the actual anesthesia time, in minutes

Total time should always be accurately reported in minutes. NGS will convert the minutes which will be shown on your remittance advice as units when your claim(s) is processed.

For example: You submit 95 minutes on claim line Item 24G or the electronic equivalent. NGS will convert the units to 6.3.

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Multiple Anesthesia Procedures

Payment may be made under the fee schedule for anesthesia services associated with multiple surgical procedures or multiple bilateral procedures. Payment is based on the base unit of the anesthesia procedure with the highest base unit value and the total time units based on the multiple procedures with the exception of the new add-on codes.

On the CMS-1500 claim form or the electronic equivalent, report the anesthesia procedure code with the highest base unit value in Item 24D or the electronic equivalent. In Item 24G or the electronic equivalent, indicate the total time for all the procedures performed.

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Multiple CRNAs Same Procedure

If multiple CRNAs perform services in the same operative session, only one can bill (the CRNA that started the anesthesia), with the total time indicated. Records should show when the first CRNA switched over to the second CRNA (and subsequent CRNAs if applicable). This does not apply when an anesthesiologist and CRNA are involved. In this case, the appropriate modifier should be used that allows 50% for each claim.

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Payment at Personally Performed Rate

The fee schedule payment for a personally performed procedure is based on the full base unit and one time unit per 15 minutes of service if the physician personally performed the entire procedure. Modifier AA is appropriate when services are personally performed.

• AA: Anesthesia service personally performed by the anesthesiologist or physician.

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Payment at Medically Directed Rate

When the physician is medically directing a qualified anesthetist (CRNA, anesthesiologist assistant [AA]) in a single anesthesia case or a physician is medically directing two, three, or four concurrent procedures, the payment amount for each is 50 percent of the allowance otherwise recognized had the service been performed by the physician alone.

These services are to be billed as follows:

1. The physician should bill using modifier QY, medical direction of one CRNA by a physician or QK, medical direction of two, three, or four concurrent procedures.
2. The CRNA/AA should bill using modifier QX, CRNA service with medical direction by a physician.

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Payment at Nonmedically Directed Rate

In unusual circumstances, when it is medically necessary for both the anesthesiologist and the CRNA/AA to be completely and fully involved during a procedure, full payment for the services of each provider is allowed. Documentation must be submitted by each provider to support payment of the full fee.

These services are to be billed as follows:

1. The physician should bill using modifier AA, anesthesia services personally performed by anesthesiologist, and modifier 22, with attached supporting documentation.
2. The CRNA/AA should bill using modifier QZ, CRNA/AA services; without medical direction by a physician, and modifier 22, with attached supporting documentation.

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Payment at Medically Supervised Rate

Only three base units per procedure are allowed when the anesthesiologist is involved in rendering more than four procedures concurrently or is performing other services while directing the concurrent procedures. An additional time unit can be recognized if the physician can document s/he was present at induction. Modifier AD is appropriate when services are medically supervised.

• AD: Supervision, more than four procedures

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Payment Rules

The fee schedule allowance for anesthesia services is based on a calculation that includes the anesthesia base units assigned to each anesthesia code, the anesthesia time involved, and appropriate area conversion factor. The following formulas are used to determine payment is to take the time units, add the RVU, also known as base units, and multiply the total allowance per unit (conversion factor). Time units are calculated by the total number of minutes divided by 15. Base units for each anesthesia procedure code are set up in the Medicare computer system as determined by CMS.

• Participating Physician not Medically Directing (Modifier AA)
  (Base Units + Time Units) x Participating Conversion Factor = Allowance
• Participating Physician Medically Directing (Modifier QY, QK)
  (Base Units + Time Units) x Participating Conversion Factor = Allowance x 50%
• CRNA Medically Directed (Modifier QX)
  (Base Units + Time Units) x Participating Conversion Factor = Allowance x 50%
• Nonmedically Directed CRNA (Modifier QZ)
  (Base Units + Time Units) x Participating Conversion Factor = Allowance
• Nonparticipating Physician not Medically Directing (Modifier AA)
  (Base Units + Time Units) x Nonparticipating Conversion Factor = Allowance
• Nonparticipating Physician Medically Directing (Modifier QY, QK)
  (Base Units + Time Units) x Nonparticipating Conversion Factor = Allowance x 50%

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Base Units

Anesthesia base unit values have been assigned to each anesthesia procedure code and reflect the difficulty of the anesthesia services, including the usual preoperative and postoperative care and evaluation. The base unit is used to determine a portion of the reimbursement amount of the anesthesia procedure. Anesthesia services are paid on the basis of a relative value system, which include both base and actual time units. Base units take into account the complexity, risk, and skill required to perform the service.

Note: Base units are automatically calculated and should not be reported on the claim form.

For the most current list of base unit values for each anesthesia procedure code visit CMS' Anesthesiologist Center.

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Time Units

Anesthesia time is defined as the period during which an anesthesia practitioner is present with the patient. It starts when the anesthesia practitioner begins to prepare the patient for anesthesia services in the operating room or an equivalent area and ends when the anesthesia practitioner is no longer furnishing anesthesia services to the patient, that is, when the patient may be placed safely under postoperative care.

Anesthesia time is a continuous time period from the start of anesthesia to the end of an anesthesia service. When counting anesthesia time for services furnished, the practitioner can add blocks of time around an interruption in anesthesia time as long as the anesthesia practitioner is furnishing continuous anesthesia care within the time periods around the interruption.

For anesthesia claims, the elapsed time, in minutes, must be reported. You shall convert hours to minutes and enter the total required minutes for the procedure in Item 24G of the CMS-1500 claim form or electronic media claim equivalent.

Time units for physician, CRNA services—both personally performed and medically directed are determined by dividing the actual anesthesia time by 15 minutes or fraction thereof. Since only the actual time of a fractional unit is recognized, the time unit is rounded to one decimal place.

NGS will quantity bill based on the minutes in 24G. When you receive a remittance advice you will see the appropriate quantity billed converted by NGS.

Time units are not recognized for the following CPT codes:

• 01995 ‒ Regional IV administration of local anesthetic agent or other medication upper or lower extremity
• 01996 ‒ Daily hospital management of epidural or subarachnoid continuous drug administration

Note: An anesthesia claim cannot be date ranged. For instance, if anesthesia began at 11:00 p.m. on 2/5/2024 and ended at 2:00 a.m. on 2/6/2024, only the date anesthesia began should be reported on the claim; in this case, you would use 2/5/2024 as the date of service.

The table shown below illustrates the conversion from minutes to units used by NGS for claims processing.

Remember, you'll need to list the total time in minutes on line Item 24G of the CMS-1500 claim form or electronic media claim equivalent. NGS will convert your minutes to the appropriate quantity billed (QB) units.

Time Units Reference

Extra Minute Time Units

Remember the 15-minute time interval will be divided into the total time indicated on the claim. Total time should always be accurately reported in minutes. Actual time units will be paid; no rounding will be done up to the next whole number – only round to the next tenth.

Example:

95 minutes/15 = 6.33 = 6.3

79 minutes/15 = 5.26 = 5.3

Conversion Factors

The anesthesia conversion factors for each calendar year are listed by payment locality and are effective for the date the service was provided. The participating physician anesthesia conversion factor is listed first, the nonparticipating physician anesthesia conversion factor is second, and the non-medically directed conversion factor is listed in the third column.

The nonparticipating physician conversion factor is computed at 95 percent of the participating physician conversion factor. The limitation in the statute requires that qualified nonphysician anesthetist services not exceed the conversion factor for physicians’ anesthesia services.

The anesthesia conversion factors can be found at CMS Anesthesiologist Center.

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Revised 10/25/2024