UnitedHealthcare has announced it will begin site of service medical necessity reviews for certain surgeries when surgery is performed in an outpatient hospital setting. In California, the reviews will begin Dec. 1.
The site of service policy is not unique to UHC, and Oxford, Cigna Anthem, and others use the same protocol.
The policy limits the circumstances in which UnitedHealthcare will pay for certain surgeries performed in a hospital outpatient setting, determined by the insurer whether or not the site of service for the procedure is medically necessary. Other states that will see reviews starting on or after Dec. 1 are Colorado, Connecticut, New Jersey, and New York. The policy will not apply to providers in Alaska, Kentucky, Massachusetts, Maryland or Texas.
“Medical necessity reviews for the site of service occur during our prior authorization process and are only conducted if the surgical procedure will be performed in an outpatient hospital setting,” UnitedHealthcare said, according to Becker�s Hospital Review. “We utilize our Outpatient Surgical Procedures � Site of Service Utilization Review Guideline to help make our site of service medical necessity determinations. Site of service medical necessity reviews are currently being conducted for certain surgical procedures and will apply to additional surgical procedures beginning on Nov. 1, 2019, for most states.” The number of outpatient facilities jumped from 26,900 to 40,600 (51%) from 2005 to 2016, according to a report from CBRE, a commercial real estate services and investment firm. Along with it, rent has shown a similar trend, setting a record high in the second quarter of 2019, rising 1.4% per year to $22.90 per square foot. Making services more convenient and more affordable is what it comes down to, said Christopher Bodnar, vice chairman of CBRE Healthcare Capital Markets, according to Modern Healthcare. “That strategy moves along the entire continuum of care for providers. It’s front and center for their real estate strategy as well,” Bodnar said. “We are seeing health systems look to decompress their main campus and look to move more services to an outpatient setting.”
Hospital outpatient settings typically cost more, due to their increased overhead as a component of an acute hospital
With the outpatient surgery policy, the insurer said it hopes to reduce healthcare spending by guiding patients toward ambulatory surgery centers, where care may be cheaper when there isn’t a substantial medical reason for the surgery to be performed in a hospital outpatient setting..
Correlating with this emphasis on freestanding ambulatory surgery centers the number of outpatient facilities surges as industry values more convenient, affordable care systems are looking to keep pace with mergers like CVS Health and Aetna and Optum’s continued push into the market, drawing patients away from the hospital into a retail setting, closer to where people live and shop to fulfill the demand of more accessibility. The number of outpatient centers increased by 51% from 2005 to 2016, a trend that shows no sign of slowing. The number of outpatient facilities jumped from 26,900 to 40,600 between 2005 and 2016, according to a new report from commercial real estate firm CBRE. Rents have followed. They reached a record high in the second quarter of this year, rising 1.4% year over year to $22.90 per square foot, driven by areas with low vacancy rates like Louisville, Ky., Seattle, Nashville, Manhattan, and Indianapolis.
It mainly comes down to two things: making services more convenient and more affordable, said Christopher Bodnar, vice chairman of CBRE Healthcare Capital Markets.“Technology is also changing so fast that providers can bring care to the consumer quicker and in a different way,” Mark Lamp, executive managing director of healthcare at CBRE said. “Providers recognize that they need to deliver care differently than they have in the past.”
Some hospitals partner with other real estate ventures to lower cost and add value.