Tefra: Defining Medical Direction
Congress enacted the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) to, among other provisions, control escalating Medicare costs for hospital-based services including anesthesiology, pathology, and radiology. Among the many cost concerns that TEFRA addressed was a need to ensure that an anesthesiologist provided specified services when billing Medicare for medical direction when a CRNA was administering the anesthesia. Before enactment of TEFRA, an anesthesiologist could bill for services in conjunction with supervision of hospital-employed CRNAs, without demonstrating that the anesthesiologist had provided specific services to qualify for such payment.
In 1983, the HCFA published the final rules implementing TEFRA relative to payment for anesthesiology physician services, limiting medical direction payment to an anesthesiologist to no more than four concurrent procedures administered by CRNAs. The rules implemented seven conditions that an anesthesiologist must satisfy in each case to obtain reimbursement for medical direction (U.S. Department of Health and Human Services [USDHHS], 1983). Interestingly, the TEFRA regulations also increased health care costs by providing incentives for the additional involvement of anesthesiologists in cases that could otherwise be provided by a CRNA as non-medically directed. Medicare Part B did not require the involvement of anesthesiologists in CRNA services, except to the extent than an anesthesiologist submits a claim for medical direction.
In the early 1990s, in the course of the Physician Payment Review Commission (PPRC) study of anesthesia payments (which was intended to examine ways to reduce anesthesia team payments in cases involving both anesthesiologists and CRNAs), government-related study groups and individual research studies reported the need for changes in TEFRA. The 1992 Center for Health Economics Research (CHER) report to the PPRC recommended the following: “Refinements to the TEFRA provisions should be considered in view of the reductions in payments to the anesthesia care team. In particular, opportunities for increasing the flexibility of role functions should be reviewed. … [W]ith the implication of a capped payment, the HCFA should consider whether to review the TEFRA requirements to see if modifications of the TEFRA rules would permit greater efficiencies without decreasing the quality of care” (PPRC, 1993). The PPRC concluded that “the use of the anesthesia care team seems to be determined by individual preferences for that practice arrangement. There appears to be no demonstrated quality of care differences between the care provided by the solo anesthesiologist, solo CRNA, and the team.” No longer could anesthesiologists argue that medical direction of CRNAs by anesthesiologists and the TEFRA conditions under which medical direction is provided represent any safer or higher standard of care than the care provided by a CRNA practicing alone or an anesthesiologist practicing alone. The final conclusion reached by PPRC on anesthesia payment represented a milestone in the recognition of anesthesia services provided by nurse anesthetists. A single payment methodology for anesthesia services was recommended by PPRC and adopted by Congress, which resulted in a policy that the payment for anesthesia services—whether provided by a CRNA-anesthesiologist team, by a solo anesthesiologist, or by a solo CRNA providing non-medically directed services—would be the same. In the case of medically directed services, the payment would be split so that each practitioner received 50% (PPRC, 1993).
In 1998, the AANA initiated a regulatory advocacy program to revise the TEFRA medical direction conditions. In a joint meeting in 1998 with the ASA, AANA, and HCFA, proposals were advanced by both AANA and ASA for revisions in the seven conditions of payment for physician medical direction. The ASA and AANA reached consensus on a revised recommended set of medical direction requirements. However, a publication entitled “Anesthesia Answer Book—Action Alert” (1998) indicated that the ASA had second thoughts about the agreed-on revisions. The HCFA’s response to the concerns posed by ASA membership and several state anesthesiologist societies was to retain the current requirements established in 1983 (USDHHS, 1998b). The HCFA did decide that the medically directing physician must be present at induction and emergence for general anesthesia and present as indicated in anesthesia cases not involving general anesthesia, and that the medically directing anesthesiologist alone must attest in any claim for Medicare reimbursement of medical direction to having performed the seven medical direction tasks in each case (USDHHS, 1998b). The HCFA announced plans to study the medical direction issue further, welcomed comments, and suggested that it might propose changes in the future (USDHHS, 1998b). The AANA’s influence on the development of medical direction policy helped secure the following:
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