Wednesday,

May 4, 2005

Part IV

Department of 

Health and Human 

Services

Centers for Medicare & Medicaid Services 

42 CFR Part 416

Medicare Program; Update of Ambulatory 

Surgical Center List of Covered 

Procedures; Interim Final Rule

23690 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 416 

[CMS–1478–IFC] 

Medicare Program; Update of 

Ambulatory Surgical Center List of 

Covered Procedures

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS.

ACTION: Interim final rule with comment 

period. 

SUMMARY: This interim final rule with 

comment period revises the list of 

procedures that are covered when 

furnished in an ambulatory surgery 

center (ASC) in accordance with section 

1833(i)(1) of the Social Security Act. We 

published our proposed deletions and 

additions in the Federal Register on 

November 26, 2004. 

In this interim final rule, we respond 

to public comments and make final 

additions to and deletions from the 

current list of Medicare approved 

ambulatory surgical center (ASC) 

procedures.

DATES: Effective date: These regulations 

are effective on July 5, 2005. 

Comment date: To be assured 

consideration, comments must be 

received at one of the addresses 

provided below, no later than 5 p.m. on 

July 5, 2005.

ADDRESSES: In commenting, please refer 

to file code CMS–1478–IFC. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (FAX) 

transmission. 

You may submit comments in one of 

three ways (no duplicates, please): 

1. Electronically. You may submit 

electronic comments on specific issues 

in this regulation to http://

www.cms.hhs.gov/regulations/

ecomments. (Attachments should be in 

Microsoft Word, WordPerfect, or Excel; 

however, we prefer Microsoft Word.) 

2. By mail. You may mail written 

comments (one original and two copies) 

to the following address ONLY: Centers 

for Medicare & Medicaid Services, 

Department of Health and Human 

Services, Attention: CMS–1478–IFC, PO 

Box 8017, Baltimore, MD 21244–8017. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By hand or courier. If you prefer, 

you may deliver (by hand or courier) 

your written comments (one original 

and two copies) before the close of the 

comment period to one of the following 

addresses. If you intend to deliver your 

comments to the Baltimore address, 

please call telephone number (410) 786–

7195 in advance to schedule your 

arrival with one of our staff members. 

Room 445–G, Hubert H. Humphrey 

Building, 200 Independence Avenue, 

SW., Washington, DC 20201; or 7500 

Security Boulevard, Baltimore, MD 

21244–1850. 

(Because access to the interior of the 

HHH Building is not readily available to 

persons without Federal Government 

identification, commenters are 

encouraged to leave their comments in 

the CMS drop slots located in the main 

lobby of the building. A stamp-in clock 

is available for persons wishing to retain 

a proof of filing by stamping in and 

retaining an extra copy of the comments 

being filed.) 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

received after the comment period. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT:

Dana Burley, (410) 786–0378.

SUPPLEMENTARY INFORMATION: 

Submitting Comments: We will 

consider comments from the public 

regarding the addition of procedures to 

the ASC list, deletion of procedures 

from the ASC list, and the ASC payment 

group assignment for newly-added 

procedures that are identified with an 

asterisk in Addendum A to signify that 

the procedure was not proposed for 

addition or deletion in the November 

26, 2004 rule. You can assist us by 

referencing the file code CMS–1478–IFC 

and the specific ‘‘issue identifier’’ that 

precedes the section on which you 

choose to comment. 

Inspection of Public Comments: All 

comments received before the close of 

the comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. We post all electronic 

comments received before the close of 

the comment period on its public 

website as soon as possible after they 

have been received. Hard copy 

comments received timely will be 

available for public inspection as they 

are received, generally beginning 

approximately 3 weeks after publication 

of a document, at the headquarters of 

the Centers for Medicare & Medicaid 

Services, 7500 Security Boulevard, 

Baltimore, Maryland 21244, Monday 

through Friday of each week from 8:30 

a.m. to 4 p.m. To schedule an 

appointment to view public comments, 

phone 1–800–743–3951. 

I. Background 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘Background’’ at the beginning 

of your comments.] 

A. Legislative History 

Section 1832(a)(2)(F)(i) of the Social 

Security Act (the Act) provides that 

benefits under the Medicare 

Supplementary Medical Insurance 

program (Part B) include payment for 

facility services furnished in connection 

with surgical procedures we specify and 

which are performed in an ambulatory 

surgical center (ASC). To participate in 

the Medicare program as an ASC, a 

facility must meet the standards 

specified in section 1832(a)(2)(F)(i) of 

the Act; in 42 CFR 416.25, which sets 

forth general conditions and 

requirements for ASCs; and, in 42 CFR 

416, subpart C, which provides specific 

conditions for coverage for ASCs. 

There are two primary elements in the 

total cost of performing a surgical 

procedure—the cost of the physician’s 

professional services in performing the 

procedure and the cost of items and 

services furnished by the facility where 

the procedure is performed (for 

example, surgical supplies and 

equipment and nursing services). This 

interim final rule with comment period 

addresses the second element, the 

coverage and payment of facility fees for 

ASC services under the current payment 

system. As we note below, section 

626(b) of the Medicare Prescription 

Drug, Improvement, and Modernization 

Act of 2003 (MMA) (Pub. L. 108–173, 

enacted on December 8, 2003) requires 

that we develop a revised payment 

system for ASC facility services that 

would be implemented no earlier than 

January 1, 2006. This interim final rule 

addresses additions to and deletions 

from the list of Medicare approved ASC 

procedures before the implementation 

of that revised payment system. 

Under the current ASC facility 

services payment system, the ASC 

payment rate is a standard overhead 

amount established on the basis of our 

estimate of a fair fee that takes into 

account the costs incurred by ASCs 

generally in providing facility services 

in connection with performing a 

specific procedure. The report of the 

Conference Committee accompanying 

section 934 of the Omnibus Budget 

Reconciliation Act of 1980 (OBRA) 

(Pub. L. 96–499), which enacted the 

ASC benefit in December 1980, states 

that this overhead factor is expected to 

be calculated on a prospective basis 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23691

using sample survey and similar 

techniques to establish reasonable 

estimated overhead allowances, which 

take account of volume (within 

reasonable limits), for each of the listed 

procedures. (See H.R. Rep. No. 96–1479, 

at 134 (1980)). 

To establish those reasonable 

estimated allowances for services 

furnished before implementation of the 

revised payment system mandated by 

the MMA, section 626(b)(1) of the MMA 

amended section 1833(i)(2)(A)(i) of the 

Act to require us to take into account 

the audited costs incurred by ASCs to 

perform a procedure, in accordance 

with a survey. Payment for ASC facility 

services is subject to the usual Medicare 

Part B deductible and coinsurance 

requirements, and the amounts paid by 

Medicare must be 80 percent of the 

standard fee. 

Section 1833(i)(1) of the Act requires 

us to specify, in consultation with 

appropriate medical organizations, 

surgical procedures that can be safely 

performed in an ASC and to review and 

update the list of ASC procedures at 

least every two years.

Section 141(b) of the Social Security 

Act Amendments of 1994 (SSAA 1994) 

requires us to establish a process for 

reviewing the appropriateness of the 

payment amount provided under 

section 1833(i)(2)(A)(iii) of the Act for 

intraocular lenses (IOLs) for a class of 

new-technology IOLs. That process was 

the subject of a separate final rule 

entitled ‘‘Adjustment in Payment 

Amounts for New Technology 

Intraocular Lenses Furnished by 

Ambulatory Surgical Centers,’’

published on June 16, 1999 in the 

Federal Register (64 FR 32198). 

B. Summary of Updates of the ASC List 

Section 934 of the Omnibus Budget 

Reconciliation Act of 1980 amended 

sections 1832(a)(2) and 1833 of the Act 

to authorize the Secretary to specify 

surgical procedures that, although 

appropriately performed in an inpatient 

hospital setting, can also be performed 

safely on an ambulatory basis in an 

ASC, a hospital outpatient department, 

or a rural primary care hospital. The 

report accompanying the legislation 

explained that the Congress intended 

procedures currently performed on an 

ambulatory basis in a physician’s office 

that do not generally require the more 

elaborate facilities of an ASC not be 

included in the list of covered 

procedures (H.R. Rep. No. 96–1167, at 

390, reprinted in 1980 U.S.C.C.A.N. 

5526, 5753). In a final rule published 

August 5, 1982 in the Federal Register

(47 FR 34082), we established 

regulations that included criteria for 

specifying which surgical procedures 

were to be included for purposes of 

implementing the ASC facility benefit. 

Subsequently, in accordance with 

§ 416.65(c), we published an update of 

the ASC list in the Federal Register on 

March 28, 2003 (68 FR 15268). 

During years when we do not update 

the list in the Federal Register, we 

revise the list to be consistent with 

annual calendar year changes in codes 

established by the American Medical 

Association (AMA) Current Procedural 

Terminology (CPT), removing from the 

ASC list codes that are deleted by CPT 

and adding new codes that replace 

codes already on the ASC list. These 

annual CPT updates are implemented 

through program instructions to carriers 

who process ASC claims. 

C. Regulatory Requirements 

1. Sections 416.65(a), (b), and (c) 

Section 416.65(a) specifies general 

standards for procedures on the ASC 

list. ASC procedures are those surgical 

and medical procedures that are—

• Commonly performed on an 

inpatient basis but may be safely 

performed in an ASC; 

• Not of a type that are commonly 

performed or that may be safely 

performed in physicians’ offices; 

• Limited to procedures requiring a 

dedicated operating room or suite and 

generally requiring a post-operative 

recovery room or short term (not 

overnight) convalescent room; and 

• Not otherwise excluded from 

Medicare coverage. 

Specific standards in § 416.65(b) limit 

ASC procedures to those that do not 

generally exceed 90 minutes operating 

time and a total of 4 hours recovery or 

convalescent time. If anesthesia is 

required, the anesthesia must be local or 

regional anesthesia, or general 

anesthesia of not more than 90 minutes 

duration. 

Section 416.65(c) excludes from the 

ASC list procedures that generally result 

in extensive blood loss, that require 

major or prolonged invasion of body 

cavities, that directly involve major 

blood vessels, or that are generally 

emergency or life-threatening in nature. 

2. Criteria for Additions To or Deletions 

From the ASC List

In April 1987, we adopted 

quantitative criteria as tools for 

identifying procedures that were 

commonly performed either in a 

hospital inpatient setting or in a 

physician’s office. Collectively, 

commenters responding to a notice 

published on February 16, 1984 in the 

Federal Register (49 FR 6023) had 

recommended that virtually every 

surgical CPT code be included on the 

ASC list. Consulting with other 

specialist physicians and medical 

organizations as appropriate, our 

medical staff reviewed the 

recommended additions to the list to 

determine which code or series of codes 

were appropriately performed on an 

ambulatory basis within the framework 

of the regulatory criteria in § 416.65. 

However, when we arrayed the 

proposed procedures by the site where 

they were most frequently performed 

according to our claims payment data 

files (1984 Part B Medicare Data 

(BMAD)), we found that many codes 

were not commonly performed on an 

inpatient basis or were performed in a 

physician’s office the majority of the 

time, and, thus, would not meet the 

standards in our regulations. Therefore, 

we decided that if a procedure was 

performed on an inpatient basis 20 

percent of the time or less, or in a 

physician’s office 50 percent of the time 

or more, it would be excluded from the 

ASC list. (See Federal Register, April 

21, 1987 (52 FR 13176).) 

At the time, we believed that these 

utilization thresholds best reflected the 

legislative objectives of moving 

procedures from the more expensive 

hospital inpatient setting to the less 

expensive ASC setting without 

encouraging the migration of procedures 

from the less expensive physician’s 

office setting to the ASC. We applied 

these quantitative standards not only to 

codes proposed for addition to the ASC 

list, but also to the codes that were 

currently on the list, to delete codes that 

did not meet the thresholds. 

The trend towards performing surgery 

on an ambulatory or outpatient basis 

grew steadily, and by 1995, we 

discovered that a number of procedures 

that were on the ASC list at the time fell 

short of the 20 percent and 50 percent 

thresholds even though the procedures 

were obviously appropriate in the ASC 

setting. The most notable of these was 

cataract extraction with intraocular lens 

insertion, very few cases of which were 

being performed on an inpatient basis 

by the early 1990s. The thresholds 

would also have excluded from the ASC 

list certain newer procedures, such as 

CPT code 66825, Repositioning of 

intraocular lens prosthesis, requiring an 

incision (separate procedure), that were 

rarely performed on a hospital inpatient 

basis but that were appropriate for the 

ASC setting. Strict adherence to the 

same 20 percent and 50 percent 

thresholds both to add and remove 

procedures did not provide latitude for 

minor fluctuations in utilization across 

settings or errors that could occur in the 

23692 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

site-of-service data drawn from the 

National Claims History File that we 

were then using, replacing BMAD data, 

for analysis. 

In an effort to avoid these anomalies 

but still retain a relatively objective 

standard for determining which 

procedures should comprise the ASC 

list, we adopted in the Federal Register

notice published on January 26, 1995 

(60 FR 5185) a modified standard for 

deleting procedures already on the list. 

We deleted from the list only those 

procedures whose combined inpatient, 

hospital outpatient, and ASC site of 

service volume was less than 46 percent 

of the procedure’s total volume and that 

were either performed 50 percent of the 

time or more in the physician’s office or 

10 percent of the time or less in an 

inpatient hospital setting. We retained 

the 20 percent and 50 percent standard 

to determine which procedures would 

be appropriate additions to the ASC list.

D. Office of the Inspector General 

Recommendations, January 2003 

In January 2003, the Office of the 

Inspector General (OIG) issued the 

results of a study entitled ‘‘Payments for 

Procedures in Outpatient Departments 

and Ambulatory Surgical Centers’’

(OEI–05–00–00340). The objective of 

that study was to determine the extent 

to which Medicare payments for the 

same procedures continue to vary 

between hospital outpatient 

departments and ambulatory surgical 

centers and to assess the effect of this 

variance on the Medicare program. 

The OIG concluded, as a result of its 

study, that there should be a greater 

parity of payments for services 

performed in an outpatient setting and 

those performed in ASCs. The OIG 

based this conclusion both on its belief 

that the Congress intended Medicare to 

be a prudent purchaser of services and 

to pay only for those costs that are 

necessary for the efficient delivery of 

needed health services and on its 

finding that disparities in Medicare 

payment amounts for the same services 

furnished in ASCs and hospital 

outpatient departments resulted in an 

estimated $1.1 billion in additional 

Medicare program payments. The OIG 

also found that our failure to remove 

certain procedure codes from the list of 

ASC-approved procedures resulted in 

an estimated $8 to $14 million in 

additional Medicare program payments. 

The OIG recommended that we—

• Seek authority to set rates that are 

consistent across sites and reflect only 

the costs necessary for the efficient 

delivery of health services; 

• Conduct surveys and use timely 

ASC survey data to reevaluate ASC 

payment rates; and 

• Remove the procedure codes that 

meet our criteria for removal from the 

ASC list of covered procedures. (In its 

final report, the OIG included a list of 

72 CPT codes that it found, based on its 

analysis of calendar year 1999 data, met 

our criteria for deletion from the ASC 

list.) 

In our response to the OIG’s 

recommendations, we indicated that we 

would consider the OIG’s first 

recommendation as we develop future 

legislative proposals. In response to the 

second recommendation, we indicated 

our concerns about using survey data as 

the basis for setting ASC payment rates 

and that we were considering how to 

implement the survey requirement. 

(Enactment of section 626(b) of the 

MMA repealing the survey requirement 

and mandating implementation of a 

revised payment system in accordance 

with certain requirements set forth in 

the MMA supersedes our earlier 

response to this OIG recommendation.) 

E. Current ASC Payment Rates 

Procedures on the ASC list are 

assigned to one of nine payment groups 

based on our estimate of the costs 

incurred by the facility to perform a 

procedure. Payment groups 1 through 8 

were first implemented in September 

1990, based on a survey of ASC costs 

conducted in 1986 (55 FR 4539). 

Payment group 9 was added on 

December 31, 1991 (56 FR 67666) to 

establish a payment rate for 

extracorporeal shockwave lithotripsy 

(ESWL). There is no clinical consistency 

among the procedures in a payment 

group. Rather, assignment to a payment 

group is based solely on an estimate of 

facility costs associated with performing 

the procedures. 

In a proposed rule published on June 

12, 1998 in the Federal Register (63 FR 

32290), we proposed a new ratesetting 

methodology based on ambulatory 

payment classification (APC) groups 

that were proposed for the new hospital 

outpatient prospective payment system 

(OPPS). We used data from a survey of 

ASC costs collected in 1994 as the basis 

for the APC payment rates in the June 

12, 1998 proposed rule. The Balanced 

Budget Refinement Act of 1999 (BBRA) 

(Pub. L. 106–113) required us to phase 

in full implementation of the proposed 

ASC rates over a 3-year period. The 

Medicare, Medicaid, and SCHIP 

Benefits Improvement and Protection 

Act of 2000 (BIPA) (Pub. L. 106–554) 

prohibited implementation of a revised 

prospective payment system for ASCs 

before January 1, 2002 and required 

that, by January 1, 2003, ASC rates be 

rebased using data from a 1999 or later 

Medicare survey of ASC costs. 

We discuss in the final rule published 

on March 28, 2003 in the Federal 

Register (68 FR 15270) the reasons why 

we did not implement the requirements 

set forth in BBRA and BIPA with regard 

to rebasing ASC payment rates. The 

March 28, 2003 final rule with comment 

period implemented additions to and 

deletions from the ASC list that had 

been proposed in the June 12, 1998 

proposed rule, but did not implement 

any of the other proposed changes, 

including the proposed ratesetting 

methodology. We indicated that we 

were studying approaches to ratesetting, 

some of which may require legislative 

changes.

Section 626(b) of MMA repeals the 

requirement that we conduct a survey of 

ASC costs as the basis for rebasing ASC 

rates and requires us to implement a 

revised payment system between 

January 1, 2006 and January 1, 2008, 

that takes into account 

recommendations in the report to the 

Congress that was to be submitted by 

January 1, 2005 by the Comptroller 

General of the United States. Since 

section 626(b)(1) amends section 

1833(i)(2) of Act, we are required to base 

payment for ASC services on survey 

data before implementation of the 

revised payment system. Therefore, the 

additions to the ASC list in this interim 

final rule are assigned to one of the 

existing nine ASC payment groups and 

rates that are derived from data 

collected in the 1986 survey of ASC 

costs, updated for inflation. The 

payment group for each addition to the 

ASC list in this interim final rule is 

based on the payment group to which 

procedures currently on the list, which 

our medical advisors judged to be 

similar in terms of time and resource 

inputs, are assigned. As of April 1, 2004, 

in accordance with the requirements in 

section 626(a) of MMA and instructions 

that we issued to our contractors who 

process ASC claims in Transmittal 51, 

Change Request 3082, on February 6, 

2004, the ASC payment rates are the 

following:

Group 1 ... $333 

Group 2 ... $446 

Group 3 ... $510 

Group 4 ... $630 

Group 5 ... $717 

Group 6 ... $826 ($676 plus $150 for IOL) 

Group 7 ... $995 

Group 8 ... $973 ($823 plus $150 for IOL) 

Group 9 ... $1339 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23693

F. Summary of the Provisions of the 

Proposed Rule 

In the November 26, 2004 proposed 

rule, we proposed to delete 54 

procedures from the ASC list based on 

the OIG recommendations. An 

additional 46 deletions were proposed 

based on data that indicated that either 

the physician office or the inpatient 

setting was the predominant site of 

service or based on recommendations 

from specialty organizations that there 

were beneficiary safety concerns 

associated with furnishing the 

procedure(s) in the ASC. 

We also proposed to add to the list 25 

procedures that were recommended by 

commenters and other interested 

parties. 

II. Analysis of and Responses to Public 

Comments Received on the November 

26, 2004 Proposed Rule and Provisions 

of This Interim Final Rule With 

Comment Period 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘ANALYSIS OF AND 

RESPONSES TO PUBLIC COMMENTS 

RECEIVED ON THE NOVEMBER 26, 

2004 PROPOSED RULE AND 

PROVISIONS OF THIS INTERIM FINAL 

RULE WITH COMMENT PERIOD’’ at 

the beginning of your comments.] 

A. General Comments 

Summaries of the public comments 

and our responses to those comments 

are set forth in the various sections of 

this preamble under the appropriate 

headings. 

We received a number of general 

public comments on our proposed 

changes to the ASC list. 

Comment: The comments we received 

expressed opposition to our proposed 

deletions. Although we received many 

comments requesting that we not delete 

specific procedures, we also received 

many from individual physicians, ASCs, 

professional and trade associations, and 

medical societies and organizations 

expressing their belief that our proposed 

deletion of 100 procedures from the 

ASC list was misguided. The 

overwhelming response from the public 

was that there are many beneficiaries for 

whom the ASC setting is the safest and 

most appropriate setting for a number of 

surgical procedures. The commenters 

were especially concerned about our 

proposals to delete procedures based on 

either the OIG recommendations or high 

physician office utilization. 

They stated that there were several 

detrimental effects that would likely 

result from deletion of the codes as 

proposed. They believe that deleting the 

procedures will result in beneficiaries’

decreased access to the most 

appropriate care, increased costs for the 

Medicare program and for beneficiaries 

because the procedures will have to be 

furnished in the more costly hospital 

outpatient department if the ASC is not 

an option, and creation of incentives to 

perform procedures in inappropriate 

settings. 

Response: As will be discussed in 

more detail in other sections of this 

interim final rule, we recognize the 

validity of the arguments and clinical 

evidence that was provided to us by 

commenters. As a result, we will delete 

fewer procedures from the ASC list than 

we proposed.

Comment: We also received a number 

of comments that expressed 

disappointment that we have not 

adopted new criteria for determining 

which procedures are to be included on 

the ASC list. The commenters stated 

that the current criteria are obsolete and 

are in need of updating to account for 

new clinical practices and technological 

advances. Furthermore, many 

commenters objected to having an ASC 

list of procedures. They believe that we 

should adopt an exclusionary list 

instead. 

Response: We are embarking on 

development of a new payment system 

as mandated by section 626 of the 

MMA. As part of that process, we will 

review the criteria for determining 

which procedures are eligible for 

inclusion on the ASC list. 

Comment: We received several 

comments that expressed doubt about 

our proposals for ASC list additions and 

deletions based on reimbursement. The 

commenters believe that we are 

overstepping our authority in 

considering payment levels before we 

add codes to the ASC list. Specifically, 

they use as an example our decision to 

exclude from the ASC list procedures 

that would be paid significantly more by 

Medicare under the ASC payment 

system than they are currently being 

paid under the hospital outpatient 

prospective system. 

Response: As discussed in our March 

28, 2003 final rule (68 FR 15270), we do 

not add procedures to the lowest ASC 

payment group that would be paid 

significantly more in an ASC than the 

same procedure is paid in the hospital 

outpatient department. We believe that 

our process is consistent with the law 

and its intent. The legislative history of 

section 934 of the Omnibus 

Reconciliation Act of 1980 (Pub. L. 96–

499), which created the ASC benefit, 

indicates congressional intent to 

encourage performance of surgery in 

lower cost settings. Thus, we believe it 

is antithetical to the statutory mandate 

to create incentives which could shift 

those procedures to an ASC setting for 

increased Medicare payment. Similarly, 

we try not to add procedures to the list 

that would be significantly underpaid in 

the highest ASC payment group. 

In the June 1998 proposed rule, we 

proposed the addition of CPT code 

50590, Extracorporeal shock wave 

lithotripsy to what would have been the 

highest payment group. The American 

Lithotripsy Society disagreed with the 

addition payment rate and, through 

litigation, avoided that addition. We 

now are embarking on development of 

a new payment system for ASCs, and so 

are not adopting any revisions to our 

rate-setting method before that 

development. At this time, we are 

updating the list of procedures on the 

ASC list, and it is beyond the scope of 

this rule to create payment groups that 

would provide payments closer to the 

costs of procedures that are either much 

more costly or much less costly than the 

existing highest and lowest ASC 

payment group. 

In the November 26, 2004 ASC 

proposed rule, we proposed to delete 

100 procedures from the ASC list, most 

of which were being performed in the 

office setting in more than half the 

number of cases. We also proposed to 

add 25 new procedures to the ASC list. 

Comments on the proposed rule 

indicate that the ASC cases for codes 

proposed for deletion from the ASC list 

will migrate to the outpatient hospital 

setting rather than to the physician 

office setting because the procedures 

performed in ASCs involve patients 

who need anesthesia, or who have 

significant comorbidities or anatomic 

abnormalities, or who require a sterile 

operating room. 

Based in part on the convincing 

arguments and clinical evidence 

submitted by commenters, we are 

deleting only five procedures from the 

ASC list out of the original 100 

procedures that we proposed to delete. 

We have noted minimal shifts among 

ambulatory sites of service over the past 

decade even though most of the codes 

that we proposed to delete have been on 

the ASC list throughout that period. In 

other words, the availability of these 

procedures in ASCs has not induced 

substantial shifts in the site of service. 

We are also adding 67 procedures to the 

ASC list, based on commenters’

recommendations. 

Over the past several years, the 

number of small, physician-owned 

specialty hospitals specializing in 

surgical and orthopedic services has 

grown rapidly. We have investigated 

this set of hospitals as part of our 

23694 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

research in support of a report to the 

Congress mandated by section 507(c) of 

the MMA. Among other findings, we 

discovered that the surgical and 

orthopedic hospitals that billed the 

program in 2003 had an average daily 

census of 4.5. The predominant services 

in these hospitals appeared to be 

outpatient services rather than inpatient 

services. We speculate that physicians 

may be participating in the ownership 

of small hospitals rather than ASCs 

partly in order to take advantage of 

payment differences: Under Medicare’s 

current payment systems, outpatient 

services in many instances receive 

higher payments under the outpatient 

prospective payment system than under 

the ASC fee schedule.

Section 626 of the MMA requires and 

sets parameters for a revision to the ASC 

fee schedule. The existing fee schedule 

is comparatively crude, with only nine 

payment rates used for approximately 

2500 different surgical procedures. 

Consequently, each payment cell spans 

a broad set of clinically heterogeneous 

services. In addition, the basic structure 

of rates has not been updated since 

1990. This combination of factors has 

resulted, among other things, in 

incentives to perform procedures in a 

hospital outpatient setting rather than 

an ASC, or the converse, when payment 

rates for particular procedures diverge 

significantly from the resources 

consumed in connection with the 

procedures. Reforming the ASC fee 

schedule can materially reduce these 

divergences and mitigate inappropriate 

incentives from this quarter that favor 

proliferation of specialty hospitals. 

The MMA requires that the new 

payment system be implemented after 

December 2005 and not later than 2008. 

GAO has prepared and is about to 

conduct a survey to determine the 

relative costs associated with 

procedures performed in ASCs as part of 

a report to Congress required under the 

MMA. We are to take into account the 

recommendations contained in the GAO 

report. Given the need to collect and 

analyze data and to complete full 

notice-and-comment rulemaking, we 

plan to implement the ASC payment 

reform January 1, 2008. Flowing from 

the MMA requirement that the GAO 

compare the relative costs of procedures 

furnished in ASCs to the relative costs 

of procedures furnished in hospital 

outpatient departments, we are 

exploring relating the ASC fee schedule 

to the outpatient prospective payment 

system, using the same or very similar 

ambulatory payment classifications. 

Linking the two systems could provide 

a mechanism for automatic updates of 

weights in the ASC system and reduce 

divergences between the two payments 

to an average percentage value. 

B. Proposed Deletions 

In accordance with the statutory 

requirement that we review and update 

the ASC list at least every 2 years, we, 

in consultation with our medical 

advisors, reviewed the current ASC list 

against the criteria. In this review, we 

also considered deletions recommended 

by medical specialty societies and other 

commenters. Further, we reviewed the 

codes that the OIG recommended for 

deletion from the ASC list. In most 

cases, our medical advisors agreed that 

the procedures recommended by the 

OIG for deletion no longer met the 

criteria for ASC procedures, and we 

proposed to delete most of them from 

the ASC list. We removed the following 

seven procedures recommended for 

deletion by the OIG from the ASC list: 

CPT codes 21920, 42104, 51725, 56405, 

56605, 62367, and 62368. 

However, there were 11 procedures 

the OIG recommended for deletion that 

our medical advisors determined, for 

health and safety reasons, should be 

retained on the list:

TABLE 1.—PROCEDURES OIG RECOMMENDED FOR DELETION NOT

PROPOSED FOR DELETION

CPT code Short descriptor 

30802 ...... Cauterization, inner nose. 

31525 ...... Diagnostic laryngoscopy. 

31570 ...... Laryngoscopy with injection. 

45305 ...... Proctosigmoidoscopy w/bx. 

46050 ...... Incision of anal abscess. 

51710 ...... Change of bladder tube. 

51726 ...... Complex cystometrogram. 

51772 ...... Urethra pressure profile. 

52285 ...... Cystoscopy and treatment. 

67031 ...... Laser surgery, eye strands. 

67921 ...... Repair eyelid defect. 

We received no comments about this 

proposal, and we are making final our 

proposal to retain these procedures on 

the ASC list.

Based on our review of other 

procedures on the ASC list, we 

proposed to delete from the ASC list 

those listed in Table 2, for the reasons 

specified. 

Rationale for deletion is indicated as 

follows: 

1. Procedure is performed in 

physician’s office more than 50 percent 

of the time. 

2. Medical specialty organizations 

recommended deletion because of safety 

concerns. 

3. Procedure is performed 

predominantly in the inpatient setting. 

4. OIG recommended for deletion and 

CMS medical advisors concur.

TABLE 2.—PROPOSED DELETIONS FROM THE ASC LIST

CPT code Short descriptor Rationale 

11404 ......................... Removal of skin lesion ................................................................................................................................ 4 

11424 ......................... Removal of skin lesion ................................................................................................................................ 4 

11444 ......................... Removal of skin lesion ................................................................................................................................ 4 

11446 ......................... Removal of skin lesion ................................................................................................................................ 4 

11604 ......................... Removal of skin lesion ................................................................................................................................ 4 

11624 ......................... Removal of skin lesion ................................................................................................................................ 4 

11644 ......................... Removal of skin lesion ................................................................................................................................ 4 

12021 ......................... Closure of split wound ................................................................................................................................. 4 

13100 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13101 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13120 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13121 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13131 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13132 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13150 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13151 ......................... Repair of wound or lesion ........................................................................................................................... 4 

13152 ......................... Repair of wound or lesion ........................................................................................................................... 4 

14000 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

14020 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

14021 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23695

TABLE 2.—PROPOSED DELETIONS FROM THE ASC LIST—Continued

CPT code Short descriptor Rationale 

14040 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

14041 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

14060 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

14061 ......................... Skin tissue rearrangement ........................................................................................................................... 4 

15732 ......................... Muscle-skin graft, head/neck ....................................................................................................................... 2 

15734 ......................... Muscle-skin graft, trunk ............................................................................................................................... 2 

15738 ......................... Muscle-skin graft, leg ................................................................................................................................... 2 

15740 ......................... Island pedicle flap graft ............................................................................................................................... 4 

19100 ......................... Bx breast percut w/o image ......................................................................................................................... 4 

20670 ......................... Removal of support implant ......................................................................................................................... 4 

21040 ......................... Removal of jaw bone lesion ........................................................................................................................ 1 

21050 ......................... Removal of jaw joint .................................................................................................................................... 2 

21206 ......................... Reconstruct upper jaw bone ........................................................................................................................ 1 

21210 ......................... Face bone graft ........................................................................................................................................... 1 

21249 ......................... Reconstruction of jaw .................................................................................................................................. 1 

21325 ......................... Treatment of nose fracture .......................................................................................................................... 1 

21355 ......................... Treat cheek bone fracture ........................................................................................................................... 1 

21440 ......................... Treat dental ridge fracture ........................................................................................................................... 1 

21485 ......................... Reset dislocated jaw ................................................................................................................................... 1 

22305 ......................... Treat spine process fracture ........................................................................................................................ 4 

23600 ......................... Treat humerus fracture ................................................................................................................................ 4 

23620 ......................... Treat humerus fracture ................................................................................................................................ 4 

24576 ......................... Treat humerus fracture ................................................................................................................................ 1 

24670 ......................... Treat ulnar fracture ...................................................................................................................................... 4 

25505 ......................... Treat fracture of radius ................................................................................................................................ 1 

26605 ......................... Treat metacarpal fracture ............................................................................................................................ 4 

27520 ......................... Treat kneecap fracture ................................................................................................................................ 4 

27760 ......................... Treatment of ankle fracture ......................................................................................................................... 4 

27780 ......................... Treatment of fibula fracture ......................................................................................................................... 4 

27786 ......................... Treatment of ankle fracture ......................................................................................................................... 4 

27808 ......................... Treatment of ankle fracture ......................................................................................................................... 4 

28400 ......................... Treatment of heel fracture ........................................................................................................................... 4 

30801 ......................... Cauterization, inner nose ............................................................................................................................. 4 

30915 ......................... Ligation, nasal sinus artery .......................................................................................................................... 2 

30920 ......................... Ligation, upper jaw artery ............................................................................................................................ 2 

31233 ......................... Nasal/sinus endoscopy, dx .......................................................................................................................... 4 

31235 ......................... Nasal/sinus endoscopy, dx .......................................................................................................................... 4 

31237 ......................... Nasal/sinus endoscopy, surg ....................................................................................................................... 4 

31238 ......................... Nasal/sinus endoscopy, surg ....................................................................................................................... 4 

38505 ......................... Needle biopsy, lymph nodes ....................................................................................................................... 4 

40700 ......................... Repair cleft lip/nasal .................................................................................................................................... 2 

40701 ......................... Repair cleft lip/nasal .................................................................................................................................... 2 

40814 ......................... Excise/repair mouth lesion .......................................................................................................................... 4 

41009 ......................... Drainage of mouth lesion ............................................................................................................................ 1 

41010 ......................... Incision of tongue fold ................................................................................................................................. 1 

41112 ......................... Excision of tongue lesion ............................................................................................................................. 4 

41520 ......................... Reconstruction, tongue fold ......................................................................................................................... 1 

41800 ......................... Drainage of gum lesion ............................................................................................................................... 1 

41827 ......................... Excision of gum lesion ................................................................................................................................. 1 

42000 ......................... Drainage mouth roof lesion ......................................................................................................................... 1 

42107 ......................... Excision lesion, mouth roof ......................................................................................................................... 1 

42200 ......................... Reconstruct cleft palate ............................................................................................................................... 2 

42205 ......................... Reconstruct cleft palate ............................................................................................................................... 2 

42210 ......................... Reconstruct cleft palate ............................................................................................................................... 2 

42215 ......................... Reconstruct cleft palate ............................................................................................................................... 2 

42220 ......................... Reconstruct cleft palate ............................................................................................................................... 2 

42409 ......................... Drainage of salivary cyst ............................................................................................................................. 1 

42425 ......................... Excise parotid gland/lesion .......................................................................................................................... 3 

42860 ......................... Excision of tonsil tags .................................................................................................................................. 1 

42892 ......................... Revision pharyngeal walls ........................................................................................................................... 3 

52000 ......................... Cystoscopy .................................................................................................................................................. 4 

52281 ......................... Cystoscopy and treatment ........................................................................................................................... 4 

53850 ......................... Prostatic microwave thermotx ..................................................................................................................... 1 

55700 ......................... Biopsy of prostate ........................................................................................................................................ 4 

58820 ......................... Drain ovary abscess, open .......................................................................................................................... 3 

60000 ......................... Drain thyroid/tongue cyst ............................................................................................................................. 1 

64420 ......................... N block inj, intercost, sng ............................................................................................................................ 4 

64430 ......................... N block inj, pudendal ................................................................................................................................... 1 

64736 ......................... Incision of chin nerve ................................................................................................................................... 1 

65800 ......................... Drainage of eye ........................................................................................................................................... 1 

65805 ......................... Drainage of eye ........................................................................................................................................... 4 

67141 ......................... Treatment of retina ...................................................................................................................................... 4 

23696 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

TABLE 2.—PROPOSED DELETIONS FROM THE ASC LIST—Continued

CPT code Short descriptor Rationale 

68340 ......................... Separate eyelid adhesions .......................................................................................................................... 1 

68810 ......................... Probe nasolacrimal duct .............................................................................................................................. 4 

69145 ......................... Remove ear canal lesion(s) ......................................................................................................................... 4 

69450 ......................... Eardrum revision .......................................................................................................................................... 2 

69725 ......................... Release facial nerve .................................................................................................................................... 1 

69740 ......................... Repair facial nerve ....................................................................................................................................... 2 

69745 ......................... Repair facial nerve ....................................................................................................................................... 2 

69840 ......................... Revise inner ear window ............................................................................................................................. 1 

As displayed in Table 2, among the 

codes we proposed to delete from the 

ASC list were CPT codes 52000, 

Cystourethroscopy, 52281, 

Cystourethroscopy, with calibration 

and/or dilation of urethral stricture or 

stenosis, with or without meatotomy, 

with or without injection procedure for 

cystography, and 55700, Biopsy, 

prostate; needle or punch, single or 

multiple, any approach. We proposed 

deletion of these codes from the list in 

response to the recommendations of the 

OIG. The study recommended that 

Medicare be a prudent purchaser of 

services and only pay for those that are 

necessary for the efficient delivery of 

needed health services. The OIG found 

that discrepancies in the payment 

amounts between services furnished in 

the ASC and in the hospital outpatient 

setting resulted in additional and 

unnecessary program payments. The 

OIG also asserted that retention of these 

codes was inconsistent with our criteria 

for procedures that are appropriately 

performed in an ASC. Based on their 

study findings, the OIG recommended 

that procedures be removed from the 

ASC list with the expectation that those 

deleted services would then be 

furnished in the physician office setting 

at a lower cost to Medicare. 

These procedures have been on the 

list of Medicare-approved ASC 

procedures since its inception. 

However, in our review of the 

procedures on the ASC list for the 

biennial update, we found that the 

codes did not satisfy our criteria for 

inclusion on the list and, in addition, 

the OIG’s report recommendation made 

it clear that we should propose removal 

of the procedures. 

Comment: We received several 

hundred comments from the public 

opposing the deletion of these three 

codes. The commenters provided a 

number of arguments for retaining the 

codes on the ASC list. They asserted 

that there are circumstances when 

clinically compelling reasons require 

that these procedures be performed in a 

facility setting rather than in the 

physician office. Examples of those 

circumstances include the need for 

general anesthesia and the need for 

access to more highly qualified staff and 

a full spectrum of emergency equipment 

for patients with various comorbidities. 

Many Medicare beneficiaries have 

diabetes, prior myocardial infarctions, 

renal insufficiency or urological 

malignancies, any of which may 

indicate performance of the procedure 

in a facility setting. 

The commenters also questioned our 

estimated cost savings as a result of the 

deletions. They stated that the 

procedures would not shift from the 

ASC to the physician office as assumed 

by the OIG, but would instead shift to 

the hospital outpatient department in 

most cases. Further, they asserted that 

deletion of the codes from the ASC list 

will impose a barrier to access for those 

beneficiaries with limited access to a 

hospital outpatient facility. They 

asserted that the deletion of these codes 

would actually result in additional costs 

for the Medicare program. 

Response: We have considered the 

comments and conclude that CPT codes 

52000, 52281, and 55700 should be 

retained on the ASC list. We find the 

clinical arguments contained in the 

comments to be compelling, and we 

believe that protecting patient safety 

and access to appropriate care is our 

primary responsibility. 

We examined Medicare site of service 

data for the past 10 years and found that 

the pattern for the site of service for the 

procedures generally was stable. 

Consistently, the physician office is the 

predominant service setting even 

though the procedures were included on 

the ASC list. As exhibited in Table 3 

below, in 1992, 70 percent of 

cystourethroscopies (52,000) were 

furnished in the physician office, 17.5 

percent in the outpatient department 

and 3.3 percent in the ASC. The change 

in distribution across sites of service for 

this procedure from 1992 through 2003 

is minimal. Generally, the data show a 

trend of decreasing volume in the 

hospital outpatient department 

accompanied by an increased volume in 

the physician office. With the exception 

of CY 2000, volume in the ASC setting 

has remained significantly less than 10 

percent of the total cases.

TABLE 3.—SITE OF SERVICE FOR CYSTOURETHROSCOPIES (CPT 52000), 1992–2003 

Year Office Percent

(total) OPD Percent(total) ASC Percent(total) Total 

1992 ............................. 563,548 70.0 140,805 17.5 26,369 3.3 804,683 

1995 ............................. 581,672 72.1 133,024 16.5 41,990 5.2 807,302 

2000 ............................. 618,984 74.1 102,109 12.2 79,116 9.5 835,669 

2003 ............................. 725,000 80.1 92,981 10.3 55,543 6.1 904,860 

We found similar patterns in the 

Medicare site of service data for the 

other two high volume urology 

procedures, CPT codes 52281 and 

55700, that we proposed to delete. We 

believe that the relative stability of the 

utilization and site of service is 

evidence that the inclusion of the codes 

on the ASC list has not influenced the 

physician’s selection of setting for 

performance of the procedures and 

provides strong evidence that there is a 

small but consistent population of 

beneficiaries for whom the ASC setting 

is the most appropriate for these 

procedures. 

In light of the evidence presented to 

us in the comments, we agree with 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23697

commenters that these procedures 

should be retained on the ASC list in 

spite of the high percentage of cases 

performed in the physician office 

setting. Moreover, in light of our plans 

to develop and implement a new 

payment system for ASCs by 2008 and 

our expectation that the criteria for 

inclusion on the ASC list will be 

reviewed as part of developing the new 

payment system, we believe that 

deleting these codes at this time could 

cause undue confusion and hardship for 

many beneficiaries. 

If we accept the commenters’

assertions that many of the procedures 

currently furnished in the ASC must be 

performed in a facility setting, as we 

have, we must reconsider the cost 

savings estimates that we assumed 

when we proposed deletion of these 

codes. If a significant portion of the 

procedures will migrate to the hospital 

outpatient department rather than to the 

physician office, then we may have 

diminished cost saving estimates 

compared to those included in our 

proposed rule, with resultant increased 

payment by the Medicare program 

rather than savings. See section IV of 

this interim final rule for a full 

discussion of cost savings estimates. 

Comment: In addition to the 

comments requesting that we not delete 

the three procedures, CPT codes 52000, 

52281, and 55700, we received about 

100 comments requesting that we not 

delete CPT codes 11404 through 15740, 

as listed in Table 2. These commenters 

made many of the same points 

discussed above regarding deletion of 

this range of procedure codes. The same 

concerns regarding patient safety and 

access to appropriate care were 

consistently raised. 

The commenters presented equally 

compelling clinical arguments opposing 

deletion of these procedures. They 

assert that it is often difficult to 

schedule these non-emergent 

procedures in outpatient departments 

but that the need for sterile conditions 

for the procedures requires a facility 

setting rather than the physician office. 

Many patients require heavy sedation or 

general anesthesia because of the 

delicate nature of many of the 

procedures, and need a facility setting 

due to Medicare patient comorbidities. 

Further, commenters cited a number of 

CPT coding definitions that make it 

impossible to identify important 

information about specific procedures 

that are performed. That is, one code 

describes a number of different 

procedures, some of which are 

significantly more complex than others 

reported using the same CPT code. For 

example, CPT code 31233, Nasal/sinus 

endoscopy, diagnostic with maxillary 

sinusoscopy (via inferior meatus or 

canine fossa puncture), describes a 

procedure that may be accomplished by 

either of two distinct approaches, one of 

which may require no anesthesia while 

the other (requiring insertion of a 

trochar through the roof of the patient’s 

mouth) does require sedation in a 

facility setting. 

Further, they assert that the deletion 

of the codes as proposed will not result 

in cost savings for the Medicare program 

but will result in diminished beneficiary 

access to appropriate care and to cost 

increases because the cases currently 

performed in the ASC will shift to 

hospital outpatient departments. 

Response: We find the commenters’

arguments convincing. We examined 

the site of service for these procedures 

over the past 5 years, and, as was the 

case for the urology codes, we found 

that the patterns for provision of these 

services were generally unchanged 

during that time. In light of the clinical 

evidence presented in the comments 

and our finding that the percent of 

procedures that are being performed in 

the ASC today is no greater than it was 

in 1999, we conclude that these 

procedures should be retained on the 

ASC list, and we will not make final our 

proposal to delete them.

Further, we believe that the estimated 

cost savings included in the proposed 

rule may have been over-stated. 

Therefore, we performed cost analyses 

using predicted site of service 

distribution changes that we believe are 

more realistic than those we used in the 

proposed rule. A full discussion of the 

cost estimates is presented in section V 

of this rule. 

Comment: We received comments 

opposing the deletion of almost every 

procedure we proposed to delete in the 

proposed rule. The reasons provided 

were generally the same as those 

presented by the commenters regarding 

the urology and skin codes discussed 

above: that there is a portion of the 

Medicare patient population who, due 

to clinical characteristics or due to 

limitations on access, is best served by 

having access to these procedures in an 

ASC. 

Response: We have examined the 

comments, the site of service data, and 

the list of proposed deletions, and we 

have decided that the evidence supplied 

by the commenters regarding the three 

urology procedures and the skin 

procedures, combined with the 

impending implementation of a new 

payment system in 2008 argue against 

making major changes in the ASC list at 

this time. Maintaining a degree of 

stability in the ASC list until the new 

payment system is implemented will 

minimize the risk of limiting beneficiary 

access to needed services as well as 

unintended incentives that could result 

in significant shifts of procedures to the 

generally more costly hospital 

outpatient setting. 

Therefore, we will delete only the five 

codes about which we received no 

comments. CPT codes 21440, 23600, 

and 23620 are all procedures that are 

performed in the office setting more 

than half of the time. CPT code 69725 

is performed as an inpatient procedure 

100 percent of the time. The resources 

required to perform CPT code 53850 

significantly exceed the highest ASC 

payment group. Therefore, we are 

making final our proposal to delete the 

five codes listed in Table 4.

TABLE 4.—FINAL LIST OF CODES

DELETED FROM THE ASC LIST

CPT code Descriptor 

21440 ...... Treat dental ridge fracture. 

23600 ...... Treat humerus fracture. 

23620 ...... Treat humerus fracture. 

53850 ...... Prostatic microwave thermotx. 

69725 ...... Release facial nerve. 

C. Proposed Additions

1. Additions Recommended by 

Commenters and Other Interested 

Parties 

In response to public comments and 

our medical staff review, we proposed 

to add the procedures displayed in 

Table 5 to the list of Medicare-approved 

ASC procedures.

TABLE 5.—PROPOSED ADDITIONS RECOMMENDED BY COMMENTERS AND OTHER INTERESTED PARTIES

HCPCS code Short descriptor 

Proposed

payment

group 

15001 ......................... Skin graft add-on ......................................................................................................................................... 1 

15836 ......................... Excise excessive skin tissue ....................................................................................................................... 3 

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TABLE 5.—PROPOSED ADDITIONS RECOMMENDED BY COMMENTERS AND OTHER INTERESTED PARTIES—Continued

HCPCS code Short descriptor 

Proposed

payment

group 

15839 ......................... Excise excessive skin tissue ....................................................................................................................... 3 

21120 ......................... Reconstruction of chin ................................................................................................................................. 7 

21125 ......................... Augmentation, lower jaw bone .................................................................................................................... 7 

29873 ......................... Knee arthroscopy/surgery ............................................................................................................................ 3 

30220 ......................... Insert nasal septal button ............................................................................................................................ 3 

31500 ......................... Insert emergency airway ............................................................................................................................. 1 

31603 ......................... Incision of windpipe ..................................................................................................................................... 1 

35475 ......................... Repair arterial blockage ............................................................................................................................... 9 

35476 ......................... Repair venous blockage .............................................................................................................................. 9 

36834 ......................... Repair AV aneurysm ................................................................................................................................... 3 

37205 ......................... Transcatheter stent ...................................................................................................................................... 9 

37206 ......................... Transcatheter stent add-on ......................................................................................................................... 9 

37500 ......................... Endoscopy ligate perf veins ........................................................................................................................ 3 

42665 ......................... Ligation of salivary duct ............................................................................................................................... 7 

44397 ......................... Colonoscopy w/stent ................................................................................................................................... 1 

45327 ......................... Proctosigmoidoscopy w/stent ...................................................................................................................... 1 

45341 ......................... Sigmoidoscopy w/ultrasound ....................................................................................................................... 1 

45342 ......................... Sigmoidoscopy w/us guide bx ..................................................................................................................... 1 

45345 ......................... Sigmoidoscopy w/stent ................................................................................................................................ 1 

45387 ......................... Colonoscopy w/stent ................................................................................................................................... 1 

57288 ......................... Repair bladder defect .................................................................................................................................. 5 

62264 ......................... Epidural lysis on single day ......................................................................................................................... 1 

67343 ......................... Release eye tissue ...................................................................................................................................... 7 

Comment: We received many 

comments in support of the proposed 

additions to the ASC list. However, we 

received one comment that opposed the 

additions of CPT codes 37205, 37206, 

35475, and 35476. The commenter 

stated that these procedures were not 

appropriate for the ASC setting and 

would allow for potential substandard 

care. 

Response: Our medical staff’s 

reconsideration of these procedures led 

to our decision not to add them to the 

ASC list. The procedures involve major 

vessels and therefore do not meet our 

criteria for inclusion on the ASC list. 

CPT code 31500, Insert emergency 

airway, also will be removed from the 

list of additions to be made final. We 

will not add this procedure to the ASC 

list because it would be significantly 

overpaid even in the lowest ASC 

payment group. As discussed in our 

March 2003, final rule (68 FR 15270), 

our policy is not to add procedures for 

which significant overpayments would 

result. 

However, we will make final our 

proposal to add the other codes in Table 

5. The final list of all procedures to be 

added to the ASC list is in section II, 

Table 7. 

Comment: We also received a number 

of comments requesting higher payment 

levels than those proposed for some of 

the codes. Table 6 provides a summary 

display of the procedure codes and the 

proposed payment group assignments 

and the commenter-requested payment 

group assignments for the codes for 

which a specific group was identified. 

For several procedures, there was 

variation among commenters regarding 

payment group requests and so more 

than one payment group is identified.

TABLE 6.—PAYMENT GROUP ASSIGNMENTS PROPOSED AND AS REQUESTED BY COMMENTERS

HCPCS code Short descriptor 

NPRM

payment

group 

Requested

payment

group 

15836 ......................... Excise excessive skin tissue ........................................................................................... 3 5 

15839 ......................... Excise excessive skin tissue ........................................................................................... 3 5 

29873 ......................... Knee arthroscopy/surgery ................................................................................................ 3 4 

37500 ......................... Endoscopy ligate perf veins ............................................................................................ 3 N/A 

44397 ......................... Colonoscopy w/stent ........................................................................................................ 1 3 

45327 ......................... Proctosigmoidoscopy w/stent .......................................................................................... 1 3 

45341 ......................... Sigmoidoscopy w/ultrasound ........................................................................................... 1 2, 3 & 9 

45342 ......................... Sigmoidoscopy w/us guide bx ......................................................................................... 1 2, 3 & 9 

45345 ......................... Sigmoidoscopy w/stent .................................................................................................... 1 2, 3 & 9 

45387 ......................... Colonoscopy w/stent ........................................................................................................ 1 3 

57288 ......................... Repair bladder defect ...................................................................................................... 1 9 

62264 ......................... Epidural lysis on single day ............................................................................................. 1 N/A 

Response: We considered each of 

these requests and believe that the 

payment groups that we proposed are 

appropriate. In making the proposed 

assignments, we considered the 

assignments of codes already on the 

ASC list that the proposed additions 

most closely resembled in terms of 

clinical work and resource inputs such 

as equipment, supplies, and time 

required in the operating suite. To the 

extent possible, we assigned the 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23699

additions to the list to the same 

payment groups to which comparable 

procedures are currently assigned. We 

will make no changes at this time and 

will make final the payment groups as 

proposed. 

D. Procedures Requested for Addition in 

Comments 

We also received a large number of 

comments requesting that we add 

procedures to the ASC list in addition 

to those we proposed to add in the 

November 26, 2004 proposed rule. 

Following is a discussion of each of 

those requests. 

Comment: We received a comment 

requesting that we add CPT codes 

10061, Incision and drainage of abscess, 

complicated or multiple, and 10081, 

Incision and drainage of pilonidal cyst, 

complicated, to the Medicare list of 

procedures covered in the ASC.

Response: We reviewed the site of 

service data for these procedures and 

discussed the request with our medical 

staff. CPT codes 10061 and 10081 are 

performed most of the time in the 

physician office, and we believe that 

they are most appropriately performed 

there and do not believe that they are 

procedures that should be added to the 

ASC list. 

Comment: Several commenters 

requested that we add CPT code 61795 

(stereotactic computer assisted 

volumetric (navigational) procedure). 

The commenters stated that this 

procedure is reported with other 

procedures on the list and is already 

reimbursed by most commercial payors 

in most settings, including ASCs. They 

stated that Medicare also reimburses 

this technology in both the inpatient 

and outpatient setting and that it is 

appropriate for an ASC. 

Response: CPT code 61795 is for 

coding the use of equipment, is not a 

surgical procedure, and is therefore, not 

an appropriate addition to the ASC list. 

We will not add this to the ASC list of 

covered procedures. 

Comment: Many commenters 

requested that we add CPT code 30220 

(insertion, nasal septal prosthesis) to the 

ASC list. They stated that it was 

clinically appropriate for the ASC 

setting. 

Response: This procedure meets our 

criteria for inclusion on the ASC list. 

We agree that it is appropriate for the 

ASC list and are adding this procedure 

to payment group 3. 

Comment: We received a request to 

add CPT code 31040 (pterygomaxillary 

fossa surgery). The commenters stated 

that it is clinically similar to CPT code 

30920, Ligation arteries: internal 

maxillary artery transantral, a procedure 

already on the list and meets our criteria 

for inclusion on the ASC list. 

Response: Our medical staff do not 

agree that these two codes are 

comparable. CPT code 30920 is 

furnished as an inpatient procedure 61 

percent of the time and was proposed 

for deletion from the list in the 

November 26, 2004 proposed rule. CPT 

code 31040 is predominantly an office 

procedure (66 percent of the time). We 

do not believe that CPT code 31040 is 

an appropriate addition to the ASC list 

at this time. 

Comment: Many commenters 

requested that we add CPT code 31545 

(Laryngoscopy, direct, operative, w/

operating microscope or telescope, w/

submucosal removal of non-neoplastic 

lesion of vocal cord, reconstruction 

local tissue flap); and CPT code 31546 

(Laryngoscopy, direct, operative, w/

operating microscope or telescope, w/ 

submucosal removal of non-neoplastic 

lesion of vocal cord, reconstruction with 

graft (incl. obtaining autograft)). They 

stated that these procedures are 

clinically similar to the procedures in 

the CPT codes 31615 through 31656 

range, many of which are currently on 

the list. 

Response: Our medical staff agrees 

that CPT codes 31545 and 31546 are 

clinically similar to some endoscopic 

lesion removal and skin flap or grafting 

procedures that are already on the list. 

We are adding both of these procedures 

to the ASC list in payment group 4. 

Comment: We received a few requests 

to add CPT code 40812 (Excision of 

lesion of mucosa and submucosa, 

vestibule of mouth; with simple repair). 

Response: We are not adding the 

procedure to the ASC list. This is 

primarily an office procedure. Data 

show that the procedure does not meet 

our criteria for office volume percentage 

and does not typically require the 

resources of a facility setting. For the 

small percentage of times that a facility 

setting is warranted, the procedure 

could be furnished in the hospital 

outpatient department.

Comment: A few commenters 

requested that we add CPT codes 42842 

(Radical resection, tonsil, tonsillar 

pillars, &/or retromolar trigone; w/o 

closure); and 42844 (Radical resection, 

tonsil, tonsillar pillars, &/or retromolar 

trigone; closure w/loca). The 

commenters stated that these 

procedures meet our criteria and are 

appropriate for an ASC. 

Response: Clinically, these 

procedures typically require the 

resources of the hospital inpatient 

setting. While these procedures are also 

performed on an outpatient basis, the 

risks of complication require the ability 

to initiate an immediate inpatient 

response making these procedures 

inappropriate in the ASC setting. 

Comment: We received several 

comments requesting that we add CPT 

code 43761, Repositioning of the gastric 

feeding tube, any method, through the 

duodenum for enteric nutrition, to the 

Medicare ASC list. The commenters 

believe that the addition is warranted in 

order to provide more latitude to 

physicians and patients to choose the 

site of service for performance of this 

procedure. 

Response: This procedure is most 

often performed in the inpatient 

hospital setting, and our medical staff 

do not believe that CPT code 43761 is 

an appropriate procedure for the ASC 

setting. 

Comment: Several commenters 

requested that the following eight CPT 

codes be added to the Medicare ASC 

list. 

• 45300 Proctosigmoidoscopy, rigid; 

diagnostic, with or without collection of 

specimen(s) by brushing or washing 

• 45303 Proctosigmoidoscopy, rigid; 

diagnostic, with dilation (for example, 

balloon, guide wire, bougie) 

• 45330 Sigmoidoscopy, flexible; 

diagnostic, with or without collection of 

specimen(s) by brushing or washing 

• 46604 Anoscopy, diagnostic, with 

or without collection of specimen(s) by 

brushing or washing, with dilation (for 

example, balloon, guide wire, bougie) 

• 46614 Anoscopy, diagnostic, with 

or without collection of specimen(s) by 

brushing or washing, with control 

bleeding (for example, injection, bipolar 

cautery, unipolar cautery, laser, heater 

probe) 

• 46900 Destruction of lesion(s), 

anus, simple; chemical 

• 46910 Destruction of lesion(s), 

anus, simple; electrodesiccation 

• 46916 Destruction of lesion(s), 

anus, simple; cryosurgery 

The commenter believes the codes 

should be added to the ASC list to 

afford more latitude to patients and 

physicians with regard to choice of site 

of service. They point out that although 

these procedures are usually performed 

in the physician office, there are 

circumstances under which a facility 

environment that is sterile and in which 

administration of general anesthesia is 

safe, is required. They believe that the 

ASC should be one of the options 

available. 

Response: With the exception of CPT 

code 45303, all of these procedures are 

performed in the physician office more 

that half of the time, and we do not 

believe that adding them to the ASC list 

is appropriate. 

23700 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

Comment: We received a number of 

comments requesting that we add CPT 

codes 47562, Laparoscopic 

cholecystectomy; 47563, Laparoscopic 

cholecystectomy with cholangiography; 

and 47564, Laparoscopic 

cholecystectomy with exploration of the 

common bile duct. The commenters 

believe that these procedures qualify for 

performance in the ASC setting because 

the procedures usually take less than 60 

minutes and the recovery time is 

usually less than 2 hours. The 

commenters say that laparoscopic 

cholecystectomies are substantially 

similar to laparoscopic cholangiograpy 

(CPT codes 47561 and 47562), that are 

on the ASC procedure list.

Response: After consultation with our 

medical staff, we decided that 

laparoscopic cholecystectomies are not 

appropriate for addition to the Medicare 

list of procedures for performance in an 

ASC. There is a substantial risk that the 

laparoscopic approach will not be 

successful and that an open procedure 

will have to be performed instead. If an 

open procedure is required, the patient 

will have to be transported to a hospital 

for the procedure and subsequent 

hospital admission. The potential 

jeopardy to the beneficiary resulting 

from undergoing an emergency transfer 

is significant and far outweighs any 

benefit of covering these procedures in 

ASCs. For this reason we believe that 

laparoscopic cholecystectomies should 

continue to be performed in a hospital 

setting (either inpatient or outpatient) as 

is the current practice. 

Comment: We received several 

comments requesting that we add CPT 

codes 46221, Hemorrhoidectomy, by 

simple ligature; 46946, Ligation of 

internal hemorrhoids, multiple 

procedures; and 46947, 

Hemorrhoidopexy by stapling, to the 

Medicare list of ASC procedures. The 

commenters stated that these 

procedures are commonly performed on 

non-Medicare beneficiaries in the ASC 

setting. Further, they write that, 

although the procedures often are 

performed in the physician office 

setting, there are circumstances under 

which a facility setting is warranted. For 

example, for patients with certain 

comorbidities, it may be best to perform 

the surgery in a setting where anesthesia 

can be safely administered and 

emergency response capabilities are 

available and so should be performed in 

a facility. The physician and patient 

should have more latitude to make site 

of service determinations. 

Response: The most common site of 

service for hemorrhoidectomy by simple 

ligature (CPT code 46221) and ligation 

of internal hemorrhoids (CPT code 

46946) is the physician office, and we 

do not believe that there is a clinical 

basis for adding either of these codes to 

the ASC list. Hemorrhoidopexy by 

stapling is a new procedure for 2005, 

and our medical staff believe that the 

procedure is of a complexity 

substantially similar to other procedures 

(for example, CPT code 46257, 

hemorrhoidectomy, internal and 

external, with fissurectomy) assigned to 

payment group 3, and so we will add 

CPT code 46947 to the ASC list and will 

assign it to payment group 3. 

Comment: We received a comment 

requesting that we add CPT codes 

45391, Colonoscopy with endoscopic 

ultrasound guidance; and 45392, 

Colonoscopy with transendoscopic U.S. 

guided intramural or transmural fine 

needle aspiration/biopsy, to the ASC 

list. These are new codes for 2005, and 

the commenter believes that the 

procedures are appropriate for 

performance in the ASC setting. 

Response: Colonoscopy CPT codes 

45378 through 45387 are included on 

the list for ASCs. We believe that the 

new codes are comparable to the 

colonoscopy procedures currently 

included on the list, and so we will add 

CPT codes 45391 and 45392 as well. We 

will assign these two codes to payment 

group 2. 

Comment: We received a comment 

requesting that we add CPT code 46230, 

Excision of external hemorrhoid tags 

and/or multiple papillae, to the ASC 

list. The commenter believes that this 

code is appropriate for the ASC list 

because its performance is consistent 

with the criteria we have set for 

inclusion on the ASC list.

Response: Examination of the site of 

service data reveals that this procedure 

is performed 48 percent of the time in 

the physician office and 41 percent of 

the time in the outpatient department. 

We believe that it is comparable to CPT 

code 46220, Papillectomy or excision of 

single tag, anus, which is included in 

the ASC list. We agree with the 

commenter that this is an appropriate 

addition to the list. Therefore, we will 

add it and assign it to group 1. 

Comment: One commenter requested 

that we add CPT code 46706, Repair of 

anal fistula with fibrin glue, to the list 

because the aspects associated with 

performance of the procedure are 

consistent with the criteria for inclusion 

of the procedure on the ASC list. 

Response: The site of service data for 

this procedure show that it is performed 

86 percent of the time in the outpatient 

department and only 1 percent of the 

time in the physician office setting. We 

agree with the commenter that this 

procedure is appropriate for addition to 

the ASC list. We will add the procedure 

and will assign it to payment group 1. 

Comment: One commenter requested 

that we add CPT code 49419, Insertion 

of intraperitoneal cannula or catheter, 

with subcutaneous reservoir, 

permanent, to the ASC list. The 

commenter stated that since CPT codes 

49420, Insertion of intraperitoneal 

cannula or catheter for drainage or 

dialysis; temporary, 49421, Insertion of 

intraperitoneal cannula or catheter for 

drainage or dialysis; permanent, and 

49422, Removal of permanent 

intraperitoneal cannula or catheter, are 

on the ASC list, CPT code 49419 should 

also be included. 

Response: We agree with the 

commenter that CPT code 49419 should 

also be added to the ASC list. We will 

add it to the list in payment group 1 

with CPT codes 49420, 49421 and 

49422. 

Comment: Several commenters 

requested that we add CPT code 52301, 

Cystourethroscopy; with resection or 

fulguration of ectopic ureterocele(s), 

unilateral or bilateral, to the ASC list. 

They stated that, due to patient 

discomfort, the procedure should be 

offered in the ASC where general 

anesthesia can be administered. They 

also noted that the procedure meets the 

ASC list criteria since it takes only 60 

minutes of intra-operative time, 45 to 60 

minutes of recovery time, involves only 

minimal blood loss and is similar to at 

least one other procedure that is on the 

ASC list, CPT code 52214, 

Cystourethroscopy, with ejaculatory 

duct catheterization, with or without 

irrigation, instillation or duct 

radiography, exclusive of radiologic 

service. 

Response: We agree with the 

commenter that this procedure is very 

similar to other cystoscopic procedures 

on the ASC list and that it be added to 

the list. We will add it to the list and 

assign it to payment group 3. 

Comment: We received a comment 

requesting that we add CPT code 52402, 

Cystourethroscopy with transurethral 

resection or incision of ejaculatory 

ducts, to the ASC list. 

Response: This is a new code for 2005 

but we believe that it is similar enough 

to other existing procedures that we can 

make a decision about adding it to the 

list. Our medical staff believes that it is 

an appropriate procedure for inclusion 

on the list, and we will add it and assign 

it to payment group 3. 

Comment: We received a few 

comments requesting that we add CPT 

code 57287, Removal or revision of sling 

for stress incontinence, to the ASC list. 

Response: This is an open surgical 

procedure and our medical staff believes 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23701

that more than 4 hours are needed for 

recovery time. Therefore, we do not 

believe that this is an appropriate 

addition to the ASC list.

Comment: We received a comment 

requesting that we add CPT code 51992, 

Laparoscopy, surgical; sling operation 

for stress incontinence, to the ASC list. 

The commenter believes that it meets 

our criteria for addition. 

Response: This procedure is 

performed most of the time in the 

hospital setting, either inpatient or 

outpatient, and our medical staff believe 

that it is an appropriate procedure for 

inclusion on the ASC list. We will add 

it to the ASC list and assign it to 

payment group 5. 

Comment: We received comments 

requesting that we add CPT codes 

64517, Injection, anesthetic agent; 

superior hypogastric plexus; and 64681, 

Destruction by neurolytic agent, with or 

without radiologic monitoring; superior 

hypogastric plexus, to the ASC list. The 

commenter stated that these CPT codes 

were established in 2004 to add more 

specificity to the coding and that before 

that they were included on the ASC list 

under CPT code 64520, Injection, 

anesthetic agent; lumbar or thoracic 

(paravertebral sympathetic). The 

commenter stated that CPT codes 64517 

and 64681 should be included on the 

list as is CPT code 64520. 

Response: We do not have site of 

service data for these two procedures 

but agree with the commenter that they 

are similar to CPT code 64520 for which 

site of service data indicate that it is 

appropriately included on the ASC list. 

Therefore, we will add both of these 

codes to the list and will assign them to 

payment group 2. 

Comment: We received several 

comments requesting that we add CPT 

codes 62290, Injection procedure for 

discography, lumbar, and 62291, 

Injection procedure for discography, 

cervical or thoracic, to the Medicare 

ASC list. The commenters state that CPT 

codes 62290 and 62291 are similar to 

CPT codes 62287, Aspiration or 

decompression procedure, 

percutaneous, of nucleus pulposus of 

intervertebral disk; and 62294, Injection 

procedure, arterial, for occlusion of 

arteriovenous malformation, which are 

included on the ASC list. The 

commenters wrote that in both 

procedures the physician places a 

needle into the intervertebral disk while 

the patient is under conscious sedation. 

The procedures typically involve X-ray 

to guide the needle placement, and most 

physician offices are not equipped for 

these services. Although most Medicare 

patients (about 65 percent) go to the 

outpatient hospital setting for the 

procedures, most non-Medicare patients 

are able to have the procedures in ASCs. 

They believe that Medicare beneficiaries 

should have the same treatment options. 

Response: We consider the 

procedures coded 62290 and 62291 to 

be integral to radiologic studies and are 

never performed alone and, as such, are 

not appropriate for addition to the ASC 

list. Radiologic studies that do not 

include an intervention are not 

considered surgical procedures and are 

not included on the list of ASC 

procedures. The procedures that are 

currently included on the ASC list that 

the commenters have chosen for 

comparison, CPT codes 62287 and 

62294, are interventional procedures 

and are, therefore, not valid 

comparatives for this purpose. 

Comment: Several commenters 

requested that CPT codes 62367, 

Electronic analysis of programmable 

implanted pump for intrathecal or 

epidural drug infusion, without 

reprogramming; and 62368, Electronic 

analysis of programmable implanted 

pump for intrathecal or epidural drug 

infusion, with reprogramming, be added 

to the ASC list. They stated that because 

the procedures require X-ray imaging 

and because most physician offices are 

not adequately equipped for the 

services, Medicare beneficiaries 

typically go to the hospital for these 

services. They believe that Medicare 

beneficiaries should have the same site 

of service options as does the nonMedicare population. 

Response: Our data show that more 

than 75 percent of these services are 

provided to Medicare beneficiaries in 

the office setting. We believe that this is 

appropriate. These are not surgical 

procedures and are not of a level of 

complexity to warrant addition to the 

ASC list. 

Comment: We received one comment 

requesting that CPT codes 64561, 

Percutaneous implantation of 

neurostimulator electrodes, sacral nerve; 

64581, Incision for implant of 

neurostimulator electrodes, sacral nerve; 

and 95972, Intra-operative programming 

of implanted neurostimulator, be added 

to the ASC list. The commenter stated 

that these codes should be included 

because CPT code 64590, Insertion or 

replacement of peripheral 

neurostimulator pulse generator or 

receiver, direct or inductive coupling, is 

on the list.

Response: We agree with the 

commenter that CPT codes 64561 and 

64581 are appropriate additions to the 

ASC list. We will add them to the list 

and assign them to payment group 3. 

We do not agree that CPT code 95972 

is an appropriate addition because it is 

an analysis of the implanted device and 

is not a surgical procedure, and 

therefore, does not meet the criteria for 

the ASC list of procedures. 

Comment: A number of commenters 

requested that we add CPT code 31040, 

Pterygomaxillary fossa surgery, to the 

ASC list. They believe that the 

procedure is similar to CPT code 30920, 

Ligation internal maxillary artery, 

transantral, which is included on the 

list, and that beneficiaries and their 

physicians should have ASCs as an 

option for site of service. 

Response: According to our data, the 

site of service for these two procedures 

is very different. Pterygomaxillary fossa 

surgery is performed in the physician 

office 66 percent of the time and on an 

inpatient basis 19 percent of the time 

compared to only 2 percent in the 

physician office and 61 percent in the 

inpatient setting for ligation of internal 

maxillary artery, transantral. We will 

not add CPT code 31040 to the list at 

this time because it is primarily an 

office-based procedure. 

Comment: We received several 

comments requesting that we add CPT 

Level II code G0289, Arthroscopy, knee, 

surgical, for removal of loose body, 

foreign body, debridement/shaving or 

articular cartilage (chondroplasty) at the 

time of other surgical knee arthroscopy 

in a different compartment of the same 

knee, to the ASC list of procedures. The 

commenters believe that the additional 

time (at least 15 minutes) represented by 

this code should be recognized for 

payment in the ASC setting. 

Response: By definition, the 

procedure represented by CPT Level II 

code G0289 is part of another procedure 

and is never furnished as a separate 

procedure. For this reason, we will not 

add it to the ASC list. 

Comment: We received a number of 

comments requesting the addition of 

CPT codes 21030, Excision of benign 

tumor or cyst of maxilla or zygoma by 

enucleation and curettage; 21031, 

Excision of torus mandibularis; and 

21032, Excision of maxillary torus 

palatinus, to the ASC list. The 

commenters stated that although these 

procedures are often furnished in the 

physician office, occasionally a facility 

setting is required for a patient who 

requires a deeper level of anesthesia or 

monitoring or whose condition warrants 

a sterile environment. 

Response: Our data indicate that these 

services are furnished in the physician 

office more than 80 percent of the time, 

and therefore we will not add these to 

the list at this time. 

Comment: We received a number of 

comments requesting that we add CPT 

codes 22520, Percutaneous 

23702 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

vertebroplasty, one vertebral body, unior bi-lateral injection; thoracic; 22521, 

Percutaneous vertebroplasty, one 

vertebral body, uni- or bi-lateral 

injection; lumbar; and 22522, 

Percutaneous vertebroplasty, one 

vertebral body, uni- or bi-lateral 

injection; each additional thoracic or 

lumbar vertebral body, to the ASC list. 

The commenters stated that the 

procedures require about one hour per 

vertebra, that the recovery time also is 

about 1 hour and that the procedures 

can be safely furnished in the ASC. 

Response: Our medical staff reviewed 

these procedures and determined that 

there is often an overnight stay required 

for patients who undergo vertebroplasty 

procedures. We believe that the 

recovery period usually is longer than 4 

hours and so will not add these to the 

list of ASC procedures at this time. 

Comment: We received several 

comments requesting that CPT code 

27096, Injection procedure for sacroiliac 

joint, arthrography and/or anesthetic 

steroid, be added to the Medicare ASC 

list. The commenters stated that the 

procedure is typically required to 

ensure proper placement of the needle 

into the sacroiliac joint and that most 

physician offices do not have the 

appropriate equipment for this, forcing 

Medicare beneficiaries to go to hospital 

outpatient departments, whereas nonMedicare patients may go to ASCs for 

this service. 

Response: This is a radiological 

service that is furnished in the 

physician office setting more than half 

the time. We do not believe that it is an 

appropriate addition to the ASC list. 

Comment: A number of commenters 

requested that we add CPT codes 27412, 

Autologous chondrocyte implantation, 

knee; and 27415, Osteochondral 

allograft, knee, open, to the ASC list 

because these new procedure codes 

meet our clinical procedure criteria for 

addition. 

Response: The CPT codes 27412 and 

27415 are new in 2005, and we have no 

site of service data on which to base our 

decision. However, our medical staff 

believes that these are still 

predominantly inpatient procedures and 

should not be added to the ASC list at 

this time. Therefore, we will not add 

these to the ASC list.

Comment: Several commenters asked 

that we add new CPT codes 29866, 

Arthroscopy, knee, surgical; 

osteochondral autograft(s); 29867, 

Arthroscopy, knee, surgical; 

osteochondral allograft; and 29868, 

Arthroscopy, knee, surgical; meniscal 

transplantation (includes arthrotomy for 

meniscal insertion), to the Medicare 

ASC list. The commenters stated that 

these procedures meet our clinical 

criteria for inclusion on the list and that 

they are similar to other knee 

arthroscopy procedures that currently 

are included on the list. 

Response: The CPT codes 29866, 

29867, 29868 are new in 2005, and, 

therefore, we have no site of service data 

on which to base our decisions. Our 

medical staff believes that the 

procedures are most often performed in 

the inpatient setting, however, and as 

such are not appropriate for addition to 

the ASC list. Therefore, we will not add 

these procedures to the ASC list. 

Comment: We received one comment 

requesting that we add a number of CPT 

codes to the ASC list. For one of the 

codes, CPT code 63030, we received 

several requests for addition to the list. 

The requested additions are as follows:

CPT code Descriptor Percent

inpatient 

.

63001 ......................... Laminectomy with exploration &/or decompression of spinal cord &/or cauda equina, w/o facetectomy, 

foraminotomy, or diskectomy, 1 or 2 vertebral segments; cervical.

97 

63003 ......................... Laminectomy with exploration &/or decompression of spinal cord &/or cauda equina, w/o facetectomy, 

foraminotomy or diskectomy, 1 or 2 vertebral segments; thoracic.

98 

63005 ......................... Laminectomy with exploration &/or decompression of spinal cord &/or cauda equina, w/o facetectomy, 

foraminotomy, or diskectomy, 1 or 2 vertebral segments; lumbar, except for spondylolisthesis.

95 

63011 ......................... Laminectomy with exploration &/or decompression of spinal cord &/or cauda equina, w/o facetectomy, 

foraminotomy, or diskectomy, 1 or 2 vertebral segments; sacral.

98 

63020 ......................... Laminotomy, (hemilaminectomy), w/decompression of nerve root(s), incl partial factectomy, 

foraminotomy &/or excision of herniated intervertebral disk; one interspace, cervical.

88 

63030 ......................... Laminotomy, (hemilaminectomy), w/decompression of nerve root(s), incl partial factectomy, 

foraminotomy &/or excision of herniated intervertebral disk; one interspace, lumbar (incl. Open or 

endoscopically-assisted approach).

84 

63035 ......................... Laminotomy, (hemilaminectomy), w/decompression of nerve root(s), incl partial factectomy, 

foraminotomy &/or excision of herniated intervertebral disk; each additional interspace, cervical or 

lumbar.

93 

63040 ......................... Laminotomy, (hemilaminectomy), w/decompression of nerve root(s), incl partial factectomy, 

foraminotomy &/or excision of herniated intervertebral disk; reexploration, single interspace, cervical.

94 

63042 ......................... Laminotomy, (hemilaminectomy), w/decompression of nerve root(s), incl partial factectomy, 

foraminotomy &/or excision of herniated intervertebral disk; reexploration, single interspace, lumbar.

93 

63045 ......................... Laminotomy, (hemilaminectomy), factectomy and foraminotomy (uni- or bi-lateral w/decompression of

spinal cord, cauda equina &/or nerve root(s)), single vertebral segment, cervical.

96 

63046 ......................... Laminotomy, (hemilaminectomy), factectomy and foraminotomy (uni- or bi-lateral w/decompression of

spinal cord, cauda equina &/or nerve root(s)), single vertebral segment, thoracic.

97 

63047 ......................... Laminotomy, (hemilaminectomy), factectomy and foraminotomy (uni- or bi-lateral w/decompression of

spinal cord, cauda equina &/or nerve root(s)), single vertebral segment, lumbar.

94 

63048 ......................... Laminotomy, (hemilaminectomy), factectomy and foraminotomy (uni- or bi-lateral w/decompression of

spinal cord, cauda equina &/or nerve root(s)), single vertebral segment, each additional segment, 

cervical, thoracic or lumbar.

96 

The commenter asserted that, 

although these are usually furnished as 

inpatient procedures, the commenter 

believes that they meet the criteria for 

inclusion on the ASC list because they 

do not involve major or prolonged 

invasion of a body cavity, do not 

involve major blood loss, intra-operative 

time is less than 90 minutes, and 

recovery time is only 60 minutes.

Response: As displayed, the 

procedures that the commenter has 

requested as additions to the ASC list 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23703

are performed predominantly as 

inpatient procedures. Even CPT code 

63030, the procedure for which addition 

was requested by several commenters, is 

performed in the outpatient department 

only 14 percent of the time and is 

otherwise performed on an inpatient 

basis. We do not believe that any of 

these is appropriate for addition to the 

ASC list. 

Comment: We received comments 

requesting that we add CPT code 65820, 

Goniotomy, to the Medicare ASC list. 

The commenters believe that addition of 

this procedure to the list is appropriate 

so that beneficiaries who require an 

inpatient setting due to comorbid 

conditions or the need for general 

anesthesia will have the ASC as a choice 

for the procedure setting. 

Response: The site of service data 

indicate that this procedure is furnished 

in the physician office 40 percent of the 

time, in the outpatient department 25 

percent of the time, and in the ASC 34 

percent of the time. We believe that 

adding it to the Medicare ASC list is 

appropriate at this time. We will assign 

CPT code 65820 to payment group 1. 

Comment: We received a few requests 

that we add CPT code 65771, Radial 

keratotomy, to the ASC list. 

Response: Radial keratotomy is not a 

Medicare-covered procedure and will 

not be added to the Medicare ASC list. 

Comment: We received a number of 

comments requesting that we add to the 

list the following laser procedures that 

treat some of the most common forms of 

vision loss and blindness in elderly 

Americans:

65855 Trabeculoplasty by laser surgery 

66711 Ciliary body destruction; 

cyclophotocoagulation endoscopic 

66761 Iridotomy/iridectomy by laser 

surgery 

67028 Intravitreal injection of a 

pharmacologic agent 

67105 Repair retinal detachment, 

photocoagulation 

67110 Repair retinal detachment by 

injection of air or other gas 

67145 Prophylaxis of retinal 

detachment, photocoagulation 

67210 Destruction of retinal lesions, 

photocoagulation 

67220 Destruction of localized lesion 

of choroid; photocoagulation 

67221 Destruction of localized lesion 

of choroid, photodynamic therapy 

67228 Destruction of extensive or 

progressive retinopathy, 

photocoagulation

The commenters stated that these 

procedures should be added to the list 

because they meet the criteria for 

inclusion. The intra-operative time is 15 

to 20 minutes, recovery time is 40 to 60 

minutes, no major blood vessels are 

encountered during the procedures, and 

anesthesia is rarely required. Further, 

commenters stated that, because CPT 

code 66821, Discission of secondary 

membranous cataract, laser surgery, is 

on the list, the other laser procedures 

should be included as well. 

Response: We reviewed these codes 

and, with the exception of new CPT 

code 66711, all of these codes usually 

are performed in the physician office. 

The new CPT code 66711 is a procedure 

that has been included on the ASC list 

as part of CPT code 66710, Ciliary body 

destruction, cyclophotocoagulation, 

until January 2005 when CPT code 

66710 was redefined and CPT code 

66711 was implemented. For the other 

procedures the commenter listed, except 

for CPT code 66761, the physician office 

is the site of service for the procedures 

more than 80 percent of the time. The 

predominant site of service for CPT 

code 66761 also is the office, with 68 

percent of procedures furnished in that 

setting. Therefore, we will add only 

66711 to the ASC list at this time. 

Comment: A number of commenters 

requested that we add CPT code 67445, 

Orbitotomy with bone flap or window, 

with removal of bone for 

decompression, to the Medicare ASC ist. 

Response: The procedure is 

performed 58 percent of the time in the 

outpatient department and is virtually 

never performed in the physician office. 

We agree with the commenter and will 

add CPT code 67445 to the ASC list and 

will assign it to payment group 5. 

Comment: We received a comment 

requesting that we add CPT code 67570, 

Optic nerve decompression, to the ASC 

list. 

Response: The procedure is 

performed 66 percent of the time in the 

outpatient department and is virtually 

never performed in the physician office. 

We agree with the commenter and will 

add CPT code 67570 to the Medicare 

ASC list and will assign it to payment 

group 4. 

Comment: Several commenters 

requested that we add CPT codes 67810, 

Biopsy of eyelid; 67825, Trichiasis, 

epilation by other than forceps; 67840, 

Excision of lesion of eyelid without 

closure or with simple direct closure; 

and 67850, Destruction of lesion of lid 

margin, to the Medicare ASC list.

Response: These codes are performed 

in the physician office 88 to 95 percent 

of the time. Because these procedures 

are seldom performed in any other 

setting, we will not add them to the ASC 

list. 

Comment: Several commenters 

requested that we add CPT code 67912, 

Correction of lagophthalmos, with 

implantation of upper eyelid load, to the 

Medicare ASC list. They stated that the 

procedure is commonly performed to 

treat paralyzed upper eyelids that are 

sometimes the result of cardiovascular 

accidents (stroke). The procedure 

should be performed in a sterile 

environment and, although general 

anesthesia is rarely used, performance 

of the procedure in an operating room 

is preferable in many cases. 

Response: This was a new code for 

2004, but using CPT code 67911, 

Correction of lid retraction, as a 

comparative, we examined the site of 

service data. We discovered that CPT 

code 67911 is performed in the 

physician office only 8 percent of the 

time; the rest of the time it is performed 

in outpatient settings. For this reason, 

we believe that CPT code 67912 should 

be added to the ASC list, and we will 

assign it to payment group 3. 

Comment: A few commenters wrote to 

request that we add CPT codes 68100, 

Biopsy of conjunctiva; and 68110, 

Excision of lesion, conjunctiva, to the 

Medicare ASC list. 

Response: These two procedures are 

performed in the physician office more 

that 50 percent of the time and so will 

not be added to the ASC list. 

Comment: We received a few requests 

to add CPT codes 68400, Incision, 

drainage lacrimal gland; 68420, 

Incision, drainage of lacrimal sac; and 

68530, Removal of foreign body or 

dacryolith, lacrimal passages, to the 

Medicare ASC list. 

Response: These procedures are 

performed in the physician office more 

than 80 percent of the time and so will 

not be added to the ASC list. 

Comment: We received one comment 

requesting that CPT codes 65780, Ocular 

surface reconstruction; amniotic 

membrane transplantation; 65781, 

Ocular surface reconstruction; limbal 

stem cell allograft; and 65782, Ocular 

surface reconstruction; limbal 

conjunctival autograft, be added to the 

Medicare ASC list. 

Response: These were new codes in 

2004 and, based on the site of service 

data for other corneal procedures and 

the judgment of our medical staff, we 

believe that these procedures should be 

included on the Medicare ASC list, and 

we will assign them to payment group 

5. 

Comment: We received a comment 

requesting that we add CPT code 68371, 

Harvesting conjunctival allograft, living 

donor, to the ASC list. 

Response: This code was new for 

2004, and we have no site of service 

data to use in our decision-making. Our 

medical staff determined, however, that 

this procedure is appropriate for 

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addition to the ASC list, consistent with 

other procedures currently on the list, 

CPT codes 68360, Conjunctival flap; 

bridge or partial; and 68362, 

Conjunctival flap; total. We will add it 

to the ASC list and assign it to payment 

group 2. 

Comment: We also received 

comments requesting that several other 

ophthalmology codes be added to the 

list. These are: CPT codes 66990, Use of 

ophthalmic endoscope; 21386, Open 

treatment of orbital floor blowout 

fracture; periorbital approach; 21390, 

Open treatment orbital floor blowout 

fracture; periorbital approach, with 

alloplastic or other implant; 21406, 

Open treatment of fracture of orbit; 

except blowout; without implant; and 

21407, Open treatment of fracture of 

orbit; except blowout; with implant. The 

commenters asserted that these 

procedures are not performed in the 

physician office and that they qualify as 

procedures suitable for the ASC.

Response: CPT code 66990 does not 

represent a surgical procedure, and we 

do not believe that it is an appropriate 

addition to the ASC list. The code is 

used to recognize the use of equipment 

that is integral to surgical procedures. 

The three CPT codes, 21390, 21406, and 

21407, are performed predominantly in 

the hospital setting. Our medical staff 

believes that these procedures require 

more than 4 hours of recovery time and 

that the hospital site of service is the 

most appropriate. Therefore, we will not 

add them to the list. 

Comment: We received one comment 

requesting that we add the following 

procedures to the Medicare ASC list:

CPT code Short descriptor 

Percent

furnished as

an in-patient

procedure 

33206 ......................... Insertion of heart pacemaker ....................................................................................................................... 81.4 

33207 ......................... Insertion of heart pacemaker ....................................................................................................................... 85.6 

33208 ......................... Insertion of heart pacemaker ....................................................................................................................... 86.7 

33212 ......................... Insertion of pulse generator ......................................................................................................................... 43.4 

33213 ......................... Insertion of pulse generator ......................................................................................................................... 40.3 

33214 ......................... Upgrade of pacemaker system ................................................................................................................... 68.5 

33215 ......................... Reposition pacing-defib lead ....................................................................................................................... 77.3 

33216 ......................... Insert lead pace-defib, one .......................................................................................................................... 73.3 

33217 ......................... Insert lead pace-defib, dual ......................................................................................................................... 76.7 

33233 ......................... Removal of pacemaker system ................................................................................................................... 47.4 

33234 ......................... Removal of pacemaker system ................................................................................................................... 79.6 

33235 ......................... Removal pacemaker electrode .................................................................................................................... 84.3 

The commenter requested that we add 

these codes and create a new payment 

group to accommodate the costs for 

these procedures. 

Response: With the exception of CPT 

codes 33212, 33213, and 33233, we do 

not believe that these codes are 

appropriate for the ASC setting because 

they are performed predominantly on an 

inpatient basis. However, our medical 

staff agrees that the procedures coded as 

CPT codes 33212, 33213, and 33233 are 

appropriate for inclusion of the ASC 

list. We will add these codes and will 

assign CPT codes 33212 and 33213 to 

payment group 3 and CPT code 33233 

to payment group 2. 

Comment: We received one comment 

requesting that we add the following 

codes to the Medicare ASC list:

CPT code Short descriptor 

Percent

furnished as

an in-patient

procedure 

35470 ......................... Repair arterial blockage ............................................................................................................................... 67.5 

35471 ......................... Repair arterial blockage ............................................................................................................................... 57.3 

35472 ......................... Repair arterial blockage ............................................................................................................................... 60.8 

35473 ......................... Repair arterial blockage ............................................................................................................................... 54.2 

35474 ......................... Repair arterial blockage ............................................................................................................................... 56.2 

35490 ......................... Atherectomy, percutaneous ......................................................................................................................... 59.5 

35491 ......................... Atherectomy, percutaneous ......................................................................................................................... 78.9 

35492 ......................... Atherectomy, percutaneous ......................................................................................................................... 69.7 

35493 ......................... Atherectomy, percutaneous ......................................................................................................................... 66.2 

35494 ......................... Atherectomy, percutaneous ......................................................................................................................... 53.1 

35495 ......................... Atherectomy, percutaneous ......................................................................................................................... 67.2 

36200 ......................... Place catheter in aorta ................................................................................................................................ 45.7 

36215 ......................... Place catheter in artery ............................................................................................................................... 46.7 

36216 ......................... Place catheter in artery ............................................................................................................................... 47.2 

36217 ......................... Place catheter in artery ............................................................................................................................... 59.1 

36218 ......................... Place catheter in artery ............................................................................................................................... 55.0 

36245 ......................... Place catheter in artery ............................................................................................................................... 55.5 

36246 ......................... Place catheter in artery ............................................................................................................................... 51.5 

36247 ......................... Place catheter in artery ............................................................................................................................... 57.7 

36248 ......................... Place catheter in artery ............................................................................................................................... 60.5 

The commenter believes that the 

listed procedures are appropriate for 

performance in an ASC setting because 

they meet the clinical criteria for 

inclusion. 

Specifically, the commenter stated 

that CPT codes 35470, 35471, 35473, 

and 35474 are less invasive than CPT 

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codes 37205, Transcatheter placement 

of an intravascular stent(s), (except 

coronary, carotid, and vertebral vessel) 

percutaneous, initial vessel; and 37206 

Transcatheter placement of an 

intravascular stent(s), (except coronary, 

carotid, and vertebral vessel) 

percutaneous, each additional vessel, 

which we proposed to add to the ASC 

list in the November 26, 2004 proposed 

rule. The commenters also stated that 

CPT codes 35490, 35491, 35492, 35493, 

35494, and 35495 should be added if we 

are making final our proposal to add 

CPT codes 35475, Transluminal balloon 

angioplasty; brachiocephalic trunk or 

branches; and 35476, Transluminal 

balloon angioplasty; venous, to the list. 

Response: We are reluctant to add 

CPT codes 35470, 35471, 35473, 35474, 

35490, 35491, 35492, 35493, 35494, or 

35495 to the ASC list. The procedures 

are performed in either the outpatient or 

inpatient departments of the hospital; 

and the distribution between the two 

settings is about even although most are 

performed somewhat more frequently 

on an inpatient basis. There is almost no 

utilization of the ASC or physician 

office settings. We believe that this is 

indicative of a level of clinical 

complexity that requires immediate 

access to the facilities available in the 

hospital and are not available in either 

the office or ASC settings. These 

procedures require more than 4 hours of 

recovery time and involve major blood 

vessels and do not meet our clinical 

criteria for inclusion on the ASC list. 

We will not add these procedures to the 

ASC list at this time. Furthermore, as 

explained in section II above, we 

reevaluated our proposal to add CPT 

codes 35475, 35476, 37205, and 37206 

to the ASC list and have determined 

that they are more appropriately limited 

to the hospital outpatient and inpatient 

settings at this time.

Similarly, based on their clinical 

judgment and site of service data, our 

clinical staff considers all of the other 

procedures on this list to be 

predominantly inpatient procedures and 

not appropriate for addition to the ASC 

list. 

Comment: We received a comment 

requesting that we add new CPT codes 

36475, Endovenous ablation therapy of 

incompetent vein, extremity, inclusive 

of all imaging guidance and monitoring, 

percutaneous, radiofrequency; first vein, 

36476, Endovenous ablation therapy of 

incompetent vein, extremity, inclusive 

of all imaging guidance and monitoring, 

percutaneous, radiofrequency; second 

and subsequent veins in single 

extremity, each through separate access 

sites; 36478, Endovenous ablation 

therapy of incompetent vein, extremity, 

inclusive of all imaging guidance and 

monitoring, percutaneous, laser; first 

vein; and 36479, Endovenous ablation 

therapy of incompetent vein, extremity, 

inclusive of all imaging guidance and 

monitoring, percutaneous, laser; second 

and subsequent veins treated in a single 

extremity, each through separate access 

sites, to the ASC list. The commenter 

believes that the thermal ablation 

procedures are appropriate for 

performance in the ASC. 

Response: The codes represent a new 

technology, and we do not have site of 

service data for these codes or 

comparable codes to use to support our 

decision to add them to the list of 

procedures on the ASC list. Based on 

clinical information and indications for 

use of the procedures, our medical staff 

believes that these codes are appropriate 

for the ASC setting and recommends 

that we add them to the ASC list. We 

will assign the codes to payment group 

3 consistent with other procedures with 

similar clinical indications. 

Comment: We received one comment 

requesting that we add CPT codes 

36100, Introduction of needle or 

intracatheter, carotid or vertebral artery; 

36120, Introduction of needle or 

intracatheter; retrograde brachial artery; 

36140, Introduction of needle or 

intracatheter; extremity artery; and 

36145, Introduction of needle or 

intracatheter; arteriovenous shunt 

created for dialysis, to the Medicare 

ASC list. The commenter believes that 

these procedures satisfy our criteria for 

inclusion on the list because they are 

integral to the surgical procedures for 

stent placement and other surgeries. The 

commenter believes that these 

procedures should receive separate 

payment in the ASC. 

Response: These codes represent 

procedures that are components of other 

procedures and are not typically 

performed alone. As components of 

other procedures, they do not qualify as 

appropriate additions to the ASC list. 

Similar to the OPPS, the ASC payment 

system does not recognize for separate 

payment procedures that are integral to 

the performance of the primary surgical 

procedure. 

Comment: We received one comment 

requesting that we add CPT Level III 

code 0020T, Extracorporeal shock wave 

therapy for plantar facsitits, to the ASC 

list. The commenter stated that this 

procedure was recently approved by the 

CPT Editorial Panel to be changed to a 

Category I code in 2006 and therefore, 

we should add the new code, CPT code 

2825X, to the ASC list. The commenter 

believes that because the equipment 

necessary to perform this treatment is 

expensive, the service is not typically 

available in physician offices and is 

more common in the ASC setting. 

Response: Although there will be a 

Level I CPT code for this service in 

2006, there is not one now and so, we 

will not add this procedure to the list. 

Comment: A commenter requested 

that we add CPT code 28108, Excision 

or curretage of bone cyst or benign 

tumor, phalanges of foot, to the ASC list 

because all of the other related CPT 

codes (28106 28107, 28110, etc.) are on 

the list. The commenter believes that 

CPT code 28108 is like the codes that 

are already on the list. 

Response: We agree with the 

commenter that CPT code 28108 is very 

similar to other CPT codes in that group, 

and we will add it to the list in payment 

group 2. 

Comment: One commenter requested 

that we add CPT codes 28230, 

Tenotomy, open, tendon flexor; foot, 

single or multiple tendon(s); and 28232, 

Tenotomy, open, tendon flexor; toe, 

single tenson, to the list because they 

are comparable to CPT code 28234, 

which is on the list. 

Response: CPT codes 28230 and 

28232 are components of other 

procedures and are not comparable to 

CPT code 28234, which is a separate, 

stand-alone procedure. Because the 

procedures are components of other 

procedures, we do not believe it is 

appropriate to add these codes to the 

ASC list for separate payment. 

Comment: We received a few 

comments requesting that we add CPT 

code 58565, Hysteroscopy, with 

bilateral fallopian tube cannulation to 

induce occlusion by placement of 

permanent implants, to the ASC list. 

This is a new code for 2005 and was 

created to allow for more coding 

specificity.

Response: Our medical staff 

determined that this code is an 

appropriate addition to the ASC list 

based on the other hysteroscopy codes 

currently included on the list. We will 

add it to the ASC list and assign it to 

payment group 4. 

Comment: We received one comment 

requesting that we add a number of 

urologic and gynecologic codes. The 

codes requested for addition are 

displayed in the table below:

23706 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

CPT code Descriptor 

51741 ......................... Complex uroflowmetry. 

51784 ......................... Electromyography studies (EMG) of anal or urethral sphincter, other than needle. 

51795 ......................... Voiding pressure studies (VP); bladder voiding pressure 

51797 ......................... Voiding pressure studies; intrabdominal voiding pressure (AP). 

58260 ......................... Vaginal hysterectomy, for uterus < 250 gms. 

58262 ......................... Vaginal hysterectomy, w/removal of tube(s), &/or ovary(s). 

58263 ......................... Vaginal hysterectomy, w/removal of tube(s), &/or ovary(s), w/repair enterocele. 

58267 ......................... Vaginal hysterectomy, w/colpo-urethrocystopexy with or w/o endoscopic. 

58270 ......................... Vaginal hysterectomy, w/repair enterocele. 

58275 ......................... Vaginal hysterectomy, w/total or partial vaginectomy. 

58280 ......................... Vaginal hysterectomy, w/total or partial vaginectomy, w/repair enterocele. 

58290 ......................... Vaginal hysterectomy, for uterus > 250 gms. 

58291 ......................... Vaginal hysterectomy for uterus > 250 gms w/removal of tube(s) &/or ovary(s). 

58292 ......................... Vaginal hysterectomy for uterus > 250 gms w/removal of tube(s) &/or ovary(s), w/repair of enterocele. 

58293 ......................... Vaginal hysterectomy for uterus > 250 gms, w/colpo-urethrocystopexy with or w/o endoscopic control. 

58294 ......................... Vaginal hysterectomy for uterus > 250 gms, w/repair of enterocele. 

58356 ......................... Endometrial cryoablation w/ultrasonic guidance, including endometrial curettage. 

58552 ......................... Laparoscopy surgical, w/vaginal hysterectomy, for uterus ≤ 250 gms, w/removal of tube(s) &/or ovary(s). 

58553 ......................... Laparoscopy surgical, w/vaginal hysterectomy, for uterus ≥ 250 gms. 

58554 ......................... Laparoscopy surgical, w/vaginal hysterectomy, for uterus ≤ 250 gms, w/removal of tube(s) &/or ovary(s). 

Generally, the commenter believes 

that the listed codes should be added to 

the ASC list because the physician 

should be allowed to select the most 

appropriate setting for performance of 

procedures. The commenter identified a 

few codes that are included on the ASC 

list that the commenter believes are 

comparable to several of the codes for 

which addition is being solicited. For 

example, the commenter indicates that 

because CPT code 58550, Laparoscopy 

surgical, with vaginal hysterectomy for 

uterus 250 grams or less, is included on 

the list, CPT codes 58552, 58553, and 

58554 also should be included and that 

the inclusion of CPT code 51772, 

urethral pressure profile studies is an 

indication that CPT code 51741 should 

be added to the list. 

Response: We do not believe that any 

of the codes listed is appropriate for 

addition to the ASC list. CPT codes 

51741, 51784, 51795, and 51797 are 

performed in the physician office setting 

80 percent or more of the time and so 

do not meet our criteria for inclusion on 

the ASC list. The other listed 

procedures are furnished as inpatient 

procedures most of the time and require 

more than 4 hours of recovery time and 

so do not meet the criteria for inclusion 

on the ASC list. We do not believe that 

addition to the ASC list is appropriate 

for these codes at this time. 

Comment: We received one comment 

requesting the addition to the ASC list 

of the following procedures:

CPT code Descriptor 

58970 ......................... Follicle puncture for oocyte retrieval. 

58974 ......................... Embryo transfer, intrauterine. 

58976 ......................... Gamete, zygote, or embryo intrafallopian transfer, any method. 

The commenter believes that the 

physician should have the freedom to 

select the most appropriate site of 

service for performance of these 

procedures. 

Response: These procedures are 

performed predominantly in the 

outpatient department, and we believe 

that they satisfy the criteria for 

inclusion on the ASC list. We will add 

the procedures to the list and assign all 

of them to payment group 1. 

Comment: We received a comment 

requesting that we add CPT code 64435, 

Injection, anesthetic agent; paracervical 

(uterine) nerve, to the ASC list. 

Response: This is a procedure that is 

predominantly performed in the 

physician office and as such is not 

appropriate for inclusion of the ASC 

list. 

Comment: We received several 

comments asking us to add 

brachytherapy codes:

CPT code Descriptor 

13153 ......................... Repair, complex, eyelids, nose, ears and/or lips;each additional 5cm or less. 

19295 ......................... Image guided placement, metallic localization clip, percutaneous, during breast biopsy. 

19296 ......................... Placement of radiotherapy afterloading balloon catheter into the breast for interstitial radioelement application following 

partial mastectomy, includes imaging guidance; on date separate from partial mastectomy. 

19297 ......................... Placement of radiotherapy afterloading balloon catheter into the breast for interstitial radioelement application following 

partial mastectomy, includes imaging guidance; concurrent with partial mastectomy. 

19298 ......................... Placement of radiotherapy afterloading brachytherapy catheters into the breast for interstitial radioelement application 

following partial mastectomy, includes imaging guidance. 

57155 ......................... Insertion of uterine tandems and/or vaginal ovoids for clinical brachytherapy. 

58346 ......................... Insertion of Heyman capsules for clinical brachytherapy. 

Response: Procedures represented by 

CPT codes 13153, 19295, and 19297 are 

‘‘add-on’’ procedures that are included 

in another procedure and are not 

performed on their own. We do not 

typically approve this type of procedure 

for addition to the ASC list as the 

facility costs for the additional work 

included in the procedure is not usually 

Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 23707

significant. That is, the resources 

required to perform a procedure with or 

without also performing an ‘‘add-on’’

procedure are not significantly different. 

Time in the operating suite, supplies, 

and other resources that Medicare pays 

for in the ASC, are not significantly 

increased by performance of the 

additional procedure. Therefore, under 

the current rate-setting method, we 

cannot accurately identify a separate 

price for ‘‘add-on’’ procedures. We will 

not add CPT codes 13153, 19295, or 

19297 to the ASC list. 

However, we agree with the 

commenters that CPT codes 19296, 

19298, 57155, and 58346 meet our 

criteria and should be added to the ASC 

list. We also agree that uterine and 

breast brachytherapy are appropriate 

services for the ASC setting. While we 

are adding these procedure codes to the 

list, these codes alone do not comprise 

a brachytherapy procedure. Similar to 

the performance of prostate 

brachytherapy, the codes for uterine and 

breast brachytherapy are among several 

procedures that may be furnished in the 

performance of uterine or breast 

brachytherapy and do not include the 

application of seeds. 

We are currently trying to resolve a 

number of payment options related to 

the performance of prostate 

brachytherapy and the extent to which 

those services could be paid for when 

furnished in an ASC under existing 

regulations related both to ASCs and 

other payment systems such as the 

Medicare physician fee schedule. The 

issues are very complex, and we are still 

exploring various options. Until we 

address them comprehensively through 

national instructions, payment for 

uterine or breast brachytherapy 

performed in an ASC is determined by 

local carriers. 

Comment: We received one comment 

requesting that we place CPT code 

50590, Extracorporeal Shock Wave 

Lithotripsy, on the list of approved ASC 

procedures. 

Response: We had proposed to add 

this code in our June 1998 proposed 

rule with a proposed payment of $2,107. 

The American Lithotripsy Society 

opposed the $2,107 payment rate. In 

American Lithotripsy Society v. 

Sullivan, 785 F. Supp. 1035 (D.D.C. 

1992), the District Court ordered that we 

‘‘publish the data and other information 

we are relying on in setting a 

(lithotripsy) rate and allow time for 

comment before issuing a final notice 

* * *.’’ The data and other information 

that we would rely on in setting a 

payment rate for ESWL are part of the 

ratesetting methodology that we 

proposed in the June 1998 proposed 

rule. Because we are not making that 

ratesetting methodology final at this 

time, we might not be in compliance 

with the District Court order if we were 

to add CPT code 50590 to the ASC list 

in this interim final rule under the 

current payment rate structure. 

Therefore, we are not adding CPT code 

50590 to the ASC list at this time. 

BILLING CODE 4120–01–P 

Table 7: Final Additions to the ASC 

List, Effective July 2005 

BILLING CODE 4120–01–P

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BILLING CODE 4120–01–C

III. Collection of Information 

Requirements 

This document does not impose 

information collection and 

recordkeeping requirements. 

Consequently, it need not be reviewed 

by the Office of Management and 

Budget under the authority of the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 35). 

IV. Waiver of Proposed Rulemaking 

We ordinarily publish this list and 

propose payment amounts for new 

items and propose deletions of items in 

a notice of proposed rulemaking, subject 

to public comments. We published such 

a notice in November 2004. In response 

to the proposed rule, we received and 

acted upon a large number of public 

comments. Commenters requested the 

addition of a number of procedures to 

the list; we have added a number of 

procedures to the list, and we have 

assigned them to payment groups. 

Despite the fact that we view these 

additions as logical outgrowths of our 

proposed rule, we have decided to 

provide an opportunity for public 

comment on the procedures and 

payment group assignments which were 

not contained in the proposed rule. 

Nonetheless, payment will be made, 

beginning July 5, 2005, based on the list 

and payment groups contained in this 

rule. 

With respect to the procedures added 

to the ASC list since the proposed rule, 

we are waiving our usual notice and 

comment process. Those procedures 

will be used effective July 5, 2005 as 

though they had been included in the 

proposed rule. We believe that waiving 

the notice and comment process with 

respect to those procedures is in the 

public interest. If notice and comment 

were not waived, we could not add the 

procedures suggested by public 

comments to the list of procedures that 

may be performed in ASCs. This result 

could be detrimental to beneficiaries, 

who might be unable to receive the 

procedures in an ambulatory setting. 

Therefore, we find good cause to waive 

notice and opportunity for comment 

with regard to the changes being made 

to the ASC list which were not 

published in the proposed rule. 

V. Regulatory Impact Statement 

[If you choose to comment on issues 

in this section, please include the 

caption ‘‘REGULATORY IMPACT 

STATEMENT’’ at the beginning of your 

comments.] 

A. Overall Impact 

We have examined the impact of this 

rule as required by Executive Order 

12866 (September 1993, Regulatory 

Planning and Review), the Regulatory 

Flexibility Act (RFA) (September 16, 

1980, Pub. L. 96–354), section 1102(b) of 

the Social Security Act, the Unfunded 

Mandates Reform Act of 1995 (Pub. L. 

104–4), and Executive Order 13132. 

Executive Order 12866 directs 

agencies to assess all costs and benefits 

of available regulatory alternatives and, 

if regulation is necessary, to select 

regulatory approaches that maximize 

net benefits (including potential 

economic, environmental, public health 

and safety effects, distributive impacts, 

and equity). A regulatory impact 

analysis (RIA) must be prepared for 

major rules with economically 

significant effects ($100 million or more 

in any 1 year). Our actuary has prepared 

a fiscal impact estimate. As shown in 

the table below, for fiscal years 2005 

through 2009, the estimated effect on 

Medicare program expenditures that 

result from the additions to and 

deletions from the ASC list made final 

in this rule are estimated to have zero 

impact in 2005, increasing to $5 million 

savings per year for 2006 through 2009. 

We expect the estimated savings to 

result from approximately 10 percent of 


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the procedures proposed for addition 

moving to a less costly ASC setting from 

the hospital. This interim final rule will 

not have a major impact on the 

Medicare budget.

FY Cost (Tens of 

$ millions) 

2005 ...................................... 0 

2006 ...................................... ¥5 

2007 ...................................... ¥5 

2008 ...................................... ¥5 

2009 ...................................... ¥5 

The RFA requires agencies to analyze 

options for regulatory relief of small 

businesses. For purposes of the RFA, 

small entities include small businesses, 

nonprofit organizations, and 

government agencies. Most hospitals 

and most other providers and suppliers 

are small entities, either because of their 

nonprofit status or because they have 

revenues of $6 million to $29 million in 

any 1 year. According to small business 

associations, approximately 73 percent 

of all ASCs are considered small entities 

because they have revenues of $11.5 

million or less. Individuals and States 

are not included in the definition of a 

small entity. 

Section 1102(b) of the Act requires us 

to prepare a regulatory impact analysis 

if a final rule may have a significant 

impact on the operations of a substantial 

number of small rural hospitals. This 

analysis must conform to the provisions 

of section 604 of the RFA. For purposes 

of section 1102(b) of the Act, we define 

a small rural hospital as a hospital that 

is located outside of a Metropolitan 

Statistical Area and has fewer than 100 

beds. This interim final rule does not 

have a significant impact on the 

operations of small rural hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule that may result in expenditure in 

any 1 year by State, local or tribal 

governments, in the aggregate, or by the 

private sector, of $110 million. This rule 

will not have an effect on the 

governments mentioned, and the private 

sector costs will be less than the $110 

million threshold. 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a final 

rule that imposes substantial direct 

requirement costs on State and local 

governments, preempts State law, or 

otherwise has Federalism implications. 

This rule will not have a substantial 

effect on State or local governments. 

B. Anticipated Effects 

The entities affected by this interim 

final rule are Medicare certified ASCs, 

physician offices and clinics, hospitals, 

and beneficiaries. No other providers 

are affected. This rule will not affect 

State or local governments. There are 

more than 4,000 ASCs currently 

certified by Medicare, nearly threequarters of which fit the definition of a 

‘‘small entity’’. 

This interim final rule revises the 

ASC list by adding 67 procedures and 

deleting five. Professional societies, 

physicians, ASC administrators, and 

ASC associations recommended most of 

the codes proposed for addition to the 

ASC list. Currently, the procedures that 

we propose to add to the ASC list are 

performed predominantly in a hospital 

outpatient setting. Our medical advisors 

agree that the proposed additions meet 

the criteria for ASC procedures that are 

discussed in section II of this preamble 

and that they can be safely and 

appropriately performed in an ASC. 

Currently, if a physician performed 

one of the 67 procedures before the 

effective date of this rule, Medicare 

would not allow payment to the ASC. 

Addition of these procedures to the ASC 

list may benefit ASCs because it will 

allow Medicare to pay the facility fee to 

the ASC when the procedures are 

furnished there. Further, the additional 

procedures may increase the number of 

beneficiaries to whom the ASC can offer 

its services.

Beneficiaries may benefit from the 

additions to the ASC list because they 

will have an additional service setting 

that they and their physicians may 

consider for elective surgical procedures 

and the copayment amounts for services 

furnished in the ASC setting may be 

lower than in the hospital outpatient 

department where many of these 

procedures currently are furnished. 

We estimate that approximately 25 

percent of the newly-added procedures 

that are currently furnished in the 

physician office will migrate to an ASC 

setting. This may increase Medicare 

program spending and beneficiary 

copayment amounts because the ASC 

facility fees for these procedures often 

exceed changes in the physician office 

setting. 

To the extent that hospital outpatient 

utilization decreases and ASC 

utilization increases, the Medicare 

program will realize a savings because 

the ASC facility fee for most of the 

proposed additions to the ASC list is 

lower than the payment rate for the 

same procedures under the OPPS. 

Because hospitals perform a much 

higher volume of ambulatory surgeries 

overall than are performed in ASCs, we 

do not expect significant hospital 

revenue losses from procedures 

proposed for addition to the ASC list 

shifting to the ASC setting. 

In addition, we are deleting five 

procedures from the existing ASC list. 

We proposed to delete these codes 

based on recommendations from 

physicians or specialty societies because 

the procedures do not meet our criteria; 

however, they do not represent a 

significant volume of procedures 

furnished in ASCs and so deleting them 

from the list will have no negative effect 

on ASCs or beneficiaries. As we 

explained above, three of the codes that 

we are proposing to delete are 

procedures that are being performed 

primarily in a physician office setting 

and do not require the more elaborate 

resources of an ASC to be safely 

performed, and one is furnished 100 

percent of the time as an inpatient 

procedure. Therefore, we do not believe 

that deleting these procedures from the 

ASC list will limit beneficiary access or 

compromise patient safety. For the 

above reasons, we are not preparing 

analyses for either the RFA or section 

1102(b) of the Act because we have 

determined, and we certify, that this 

interim final rule would not have a 

significant economic impact on a 

substantial number of small entities or 

a significant impact on the operations of 

a substantial number of small rural 

hospitals. 

C. Alternatives Considered 

We are issuing this interim final rule 

to meet a statutory requirement to 

update the list of approved ASC 

procedures biennially. We last updated 

the ASC list effective July 1, 2003. We 

implement the biennial update of the 

list through notice in the Federal 

Register and give interested parties an 

opportunity to comment on proposed 

additions to and deletions from the ASC 

list. If we do not update the ASC list by 

July 2005, we would be out of 

compliance with the statute, and we 

would be denying beneficiary access to 

surgical procedures in the ASC setting 

that meet our criteria and are safely and 

appropriately performed in an ASC. 

In accordance with the provisions of 

Executive Order 12866, this regulation 

was reviewed by the Office of 

Management and Budget.

Authority: (Catalog of Federal Domestic 

Assistance Program No. 93.774, Medicare—

Supplementary Medical Insurance Program)

23712 Federal Register / Vol. 70, No. 85 / Wednesday, May 4, 2005 / Rules and Regulations 

Dated: April 15, 2005. 

Mark B. McClellan, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: April 28, 2005. 

Michael O. Leavitt, 

Secretary.

Addendum—List of Medicare 

Approved ASC Procedures With 

Additions and Deletions 

‘A’ indicates that the procedure is being 

added to the ASC list, as proposed 

‘A*’ indicates that the procedure is 

being added to the ASC list in 

response to comment and was not 

proposed. These additions are open 

for comment. 

‘D’ indicates that the code is being 

deleted from the ASC list, as proposed 

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[FR Doc. 05–8875 Filed 4–29–05; 4:04 pm] 

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