CMS Pub. 100-02, ch. 15, § 260.2

The ASC facility services are services furnished in an ASC in connection with a covered

surgical procedure that are otherwise covered if furnished on an inpatient or outpatient

basis in a hospital in connection with that procedure. Not included in the definition of

facility services are medical and other health services, even though furnished within the

ASC, which are covered under other portions of the Medicare program, or not furnished

in connection with covered surgical procedures. This distinction between covered ASC

facility services and services which are not covered ASC facility services is important,

since the facility payment rate includes only the covered ASC facility services. Services,

which are not covered ASC facility services such as physicians’ services and prosthetic

devices other than intraocular lenses (IOLs), may be covered and billable under other

Medicare provisions.

Since there is no uniformity among ASCs as to what items and services they include in

their facility fee or charge, the Medicare definition of covered facility services is both

inclusive and exclusive. The regulations specify what are and are not facility services.

Facility services are items and services furnished in connection with listed covered

procedures, which are covered if furnished in a hospital operating suite or hospital

outpatient department in connection with such procedures. These do not include

physicians’ services, or medical and other health services for which payment may be

made under other Medicare provisions (e.g., services of an independent laboratory

located on the same site as the ASC, anesthetist professional services, non-implantable

DME).

Examples of covered ASC facility services include:

Nursing Services, Services of Technical Personnel, and Other Related Services

These include all services in connection with covered procedures furnished by nurses and

technical personnel who are employees of the ASC. In addition to the nursing staff, this

category includes orderlies, technical personnel, and others involved in patient care;

Use by the Patient of the ASC’s Facilities

This category includes operating and recovery rooms, patient preparation areas, waiting

rooms, and other areas used by the patient or offered for use by the patient’s relatives in

connection with surgical services; and

Drugs, Biologicals, Surgical Dressings, Supplies, Splints, Casts, Appliances, and

Equipment

This category includes all supplies and equipment commonly furnished by the ASC in

connection with surgical procedures. See below for certain exceptions. Drugs and

biologicals are limited to those that cannot be self-administered. (See §60.)

Coverage policy for surgical dressings is similar to that followed under Part B. Under

Part B, coverage for surgical dressings is limited to primary dressings; i.e., therapeutic

and protective coverings applied directly to lesions on the skin or on openings to the skin

required as the result of surgical procedures. (Items such as Ace bandages, elastic

stockings and support hose, Spence boots and other foot coverings, leotards, knee

supports, surgical leggings, gauntlets, and pressure garments for the arms and hands are

generally used as secondary coverings and therefore are not covered as surgical

dressings.) Surgical dressings usually are applied first by a physician and are covered as

“incident to” a physician’s service in a physician’s office setting. In the ASC setting,

such dressings are included in the facility’s services.

However, others may reapply surgical dressings later, including the patient or a member

of the patient’s family. When the patient on a physician’s order obtains surgical

dressings from a supplier, e.g., a drugstore, the surgical dressing is covered under Part B.

The same policy applies in the case of dressings obtained by the patient on a physician’s

order following surgery in an ASC; the dressings are covered and paid as a Part B service

by the local A/B MAC (B), included in the definition of facility services.

Similarly, “other supplies, splints, and casts” include only those furnished by the ASC at

the time of the surgery. Additional covered supplies and materials furnished later are

generally furnished as “incident to” a physician’s service, not as an ASC facility service.

The term “supplies” includes those required for both the patient and ASC personnel, e.g.,

gowns, masks, drapes, hoses, and scalpels, whether disposable or reusable.

Diagnostic or Therapeutic Items and Services

These are items and services furnished by ASC staff in connection with covered surgical

procedures. With respect to diagnostic tests, many ASCs perform simple tests just before

surgery, primarily urinalysis and blood hemoglobin or hematocrit, which are generally

included in their facility charges. To the extent that such simple tests are included in the

ASC’s facility charges, they are considered facility services. However, under the

Medicare program, diagnostic tests are not covered in laboratories independent of a

physician’s office, rural health clinic, or hospital unless the laboratories meet the

regulatory requirements for the conditions for coverage of services of independent

laboratories. (See 42 CFR 416.49.) Therefore, diagnostic tests performed by the ASC

other than those generally included in the facility’s charge are not covered under Part B

as such and are not billed to the A/B MAC (B) as diagnostic tests. If the ASC has its

laboratory certified as meeting the regulatory conditions, then the laboratory itself bills

the A/B MAC (B) (or the beneficiary) for the tests performed.

The ASC may make arrangements with an independent laboratory or other laboratory,

such as a hospital laboratory, to perform diagnostic tests it requires prior to surgery. In

general, however, the necessary laboratory tests are done outside the ASC prior to

scheduling of surgery, since the test results often determine whether the beneficiary

should even have the surgery done on an outpatient basis in the first place.

Administrative, Recordkeeping, and Housekeeping Items and Services

These include the general administrative functions necessary to run the facility e.g.,

scheduling, cleaning, utilities, and rent.

Blood, Blood Plasma, Platelets, etc., Except Those to Which Blood Deductible

Applies

While covered procedures are limited to those not expected to result in extensive loss of

blood, in some cases, blood or blood products are required. Usually the blood deductible

results in no expenses for blood or blood products being included under this provision.

However, where there is a need for blood or blood products beyond the deductible, they

are considered ASC facility services and no separate charge is permitted to the

beneficiary or the program.

Materials for Anesthesia

These include the anesthetic itself, and any materials, whether disposable or reusable,

necessary for its administration.

Intraocular Lenses (IOLs)

Effective for services furnished on or after March 12, 1990, ASC facility services include

intraocular lenses approved by the Food and Drug Administration (FDA) for insertion

during or subsequent to cataract surgery.

FDA has classified IOLs into the following four categories, any of which are included:

Anterior chamber angle fixation lenses;

Iris fixation lenses;

Irido-capsular fixation lenses; and

Posterior chamber lenses.

While FDA has approved many IOLs, it still considers some IOLs investigational. The

fact that they are covered under Medicare is an exception to the general policy not to

cover experimental or investigational items or services. The exception is made because

the Congress, recognizing the widespread use of IOLs, directed the FDA to study them

without interfering with availability to patients.

The A/B MAC (B) determines whether the item or service falls into the categories

described in the following section. If it determines the item or service does fall into one

of those categories, it makes payment following the applicable rules for such items and

services found elsewhere in this chapter. If the item or service does not fall into one of

the categories described, the A/B MAC (B) denies the claim.

Covered ASC surgical procedures are those surgical procedures that are identified by

CMS on an annually updated ASC listing. Some surgical procedures covered by

Medicare are not on the ASC list of covered surgical procedures.

Under the revised ASC payment system, Medicare makes facility payments to ASCs only

for the specific ASC covered surgical procedures and covered ancillary services that are

provided integral to a covered ASC surgical procedure.

See chapter 14, section 10 of Pub. 100-04, Medicare Claims Processing Manual for

examples of covered ASC services for which payment is included in the ASC payment

for a covered surgical procedure under 42CFR416.65.

There is a payment adjustment for insertion of an IOL approved as belonging to a class of

NTIOLs, for the 5-year period of time established for that class, as set forth at

42CFR416.200.