Government Public Affairs Update Texas ASC Association Annual

Government & Public Affairs Update —Texas ASC Association Annual Meeting Chris Kelly SVP and General Counsel to Am. Surg Chair, ASCA Government Affairs Committee

ASCA’s Advocacy & Public Affairs Focus – Recent Successes – Research – Legislative Priorities – Regulatory Outreach – Advocacy Involvement

Recent Successes • Conditions for Coverage – Same Day Surgery Eliminated – Radiologist on Staff Modified • Addition of 4 Procedures in 2014 Final Rule – 27415 (Osteochondral knee allograft) – 27524 (Treat kneecap fracture) – 60240 (Removal of thyroid) – 60500 (Explore parathyroid glands) • Delay of Ophthalmic Quality Measure (ASC-11) • Nevada Hospital Association Petition

ASC Payment Updates Compared to Other Providers Payment Updates from 2010 to 2014 2% ASC 1% HOPD 0% Physician Fee Schedule Home Health -1% -2% -3% -4% 2011 2012 2013 2014 Source: Center for Medicare and Medicaid Services *Sequester cuts not included in shown payment updates The Mc. Manus Group 2015

Research • UC-Berkeley Study • OIG Report • Health Affairs Study

UC-Berkeley Study • Top 120 procedures • 2008 -11 - $7. 5 billion savings, with $1. 5 savings for beneficiaries • 2011 - $2. 3 billion in savings • Potential 10 year savings - $57. 6 billion

April 2014 HHS OIG Report – March 2011, at request of ASCA, W&M Subcommittee Chairman Herger requests OIG to examine potential savings from ASCs and implications of hospital acquisitions – OIG found that ASCs saved the Medicare program $7 B from 2007 -11 – ASCs have the ability to save an additional $12 B under the current payment structure between 2012 -17

Health Affairs Study on ASCs • Munnich & Parente study published in Health Affairs May, 2014 • Procedures at ASCs take 31 minutes or 25% less time in ASCs than hospitals – This translates to $363 - $1, 000 savings per case • High-risk Medicare patients treated in an ASC were less likely to visit ER than similar patients for same procedure treated in a hospital • Enactment of ACA and demographic trends require ASCs to accommodate growing demand of outpatient surgery

Federal Legislative Agenda • ASC Quality and Access Act • Electronic Health Fairness Act • Removing Barriers to Colorectal Cancer Screening Act

ASC Quality & Access Act (HR 2500/S 1137) • • • Sen. Ron Wyden & Sen. Mike Crapo Rep. Devin Nunes & Rep. John Larson CPI-U to Hospital Market Basket Authorizes Value Based Purchasing for ASCs Transparency in Procedures List Adds ASC Rep on Advisory Panel on Hospital Outpatient Payment

ASC Quality & Access Act (HR 2500/S 1137) – Cont. • 76 current sponsors/co-sponsors in House • 10 Members of the Texas Delegation • 8 current sponsors/co-sponsors in Senate

H. R. 5556 – Electronic Health Fairness Act • Rep. Diane Black (R-TN) • 2015 – 50 percent threshold for physician “Meaningful Use” and ASC encounters counted • Directs CMS to certify an EHR for the ASC setting • Exemption for patient encounters in ASCs until CMS certifies EHR

H. R. 1070 – Removing Barriers to Colorectal Cancer Screening Act • Rep. Charlie Dent (R-PA) • Medicare preventive screening colonoscopy • Waives co-pays if polyps discovered during the procedure • 129 Co-Sponsors in the House

Membership Participation Critical • Inform and educate your lobbyists • Respond to legislative/regulatory alerts and communicate with policymakers – Ask Reps and Senators to co-sponsor ASC legislation – Submit comments to CMS on ASC rules • Facility Tours – Goal 50 in 2014 • Capitol Fly-ins (2015 tentative dates) – June 16 -17 – September 29 -30 • ASCAPAC/Advocacy Fund

$5, 000 $4, 500, 000 Every two years, the hospital industry contributes OVER $5 MILLION. In the same period, ASCAPAC collects $300, 000. $4, 200, 000 $4, 000 If every ASCA member gave $750 a year, it would total $4. 5 million $3, 500, 000 $3, 000 $2, 500, 000 $2, 000 $1, 500, 000 $1, 000 $500, 000 $0 $759, 000 $378, 000 $300, 000 American Hospital Federation of American Health Ambulatory Surgery Association American Hospitals Insurance Plans Center Association ASCAPAC