Medicare’s Revised Attitude Towards Single-Use Blades By Richard J. Ruckman, M.D. & Kevin J. Corcoran, COE, CPC, FNAO “Medicare’s new regulations for ASCs that were implemented in mid-2009 came as a big surprise.  With essentially no warning, no preparatory guidance and no grace time period we’ve had to scramble to revise and implement our protocols to comply. This has required us to revisit many of our purchasing decisions for supplies, medications and devices. Frequently, the economic consequences have been very significant, not to mention terribly inconvenient.  Nonetheless, we’re taking this very seriously.  These are tough rules and regulations with very little flexibility for interpretation. – Stephen S. Lane, MD”  In order to receive Medicare or Medicaid payment, ambulatory surgery centers (ASCs) are required to be in compliance with the Federal requirements set forth in the Medicare Conditions for Coverage (CfC). The text of the CMS regulations was published on November 18, 2008 in the Federal Register (73 FR 68502) and contains changes to the Code of Federal Regulations (42 CFR 416.2-416.52). These revisions represent the most significant change in the ASC CfCs since they were originally published August 5, 1982. The regulations took effect on May 18, 2009. Compliance with these new ASC CfCs is mandatory. ASCs should ensure that they have completed an extensive review of the regulatory changes and have updated their policies and procedures. CMS plans to send government surveyors to approximately 1,200 ASCs within a year to check for compliance with the CfCs. The CMS State Operations Manual (Publication 100-07) contains Appendix L which provides detailed guidance for surveyors of ASCs concerning the CfCs. The ASC CfC addresses surgical services in §416.42 which states: “Surgical procedures must be performed in a safe manner…”. The Statement of Deficiencies Report and Plan of Correction (Form CMS-2567) is the official document that communicates the determination of compliance or noncompliance with Federal requirements. This form asks the surveyor if single-use devices are: 1) never reprocessed and used again, or 2) approved by the FDA for reprocessing, and 3) if they are reprocessed by an FDA-approved reprocessor. ASCs that formerly re-used certain surgical items to save money will have to revisit their policies and procedures in light of the CfCs or risk censure by the surveyor, or worse. As a practical matter, there are several options for complying with CMS’ new instructions concerning single-use items. They are: 1) Dispose of single-use items after a single use 2) Contract with an FDA-approved agent for reprocessing eligible items 3) Upgrade the ASC’s sterilization facilities to comply with FDA’s reprocessing standards 4) Switch to multi-use items as approved by the manufacturer With the risk of sanctions being implemented for off-label practices it is time to evaluate cost effective alternatives that comply with CMS’ guidelines for surgical blades and more specifically ophthalmic blades. There are currently two classes of devices to consider: single use and reusable. Within the reusable class there are three alternative types of ophthalmic blades. Most facilities will find that there is one or two of these that will fit their needs and the needs of the surgeons quite well. These changes will also give facilities an opportunity to evaluate and implement sharps safety practices, as required by the Needlestick Safety and Prevention Act. This law was passed by the US Congress in 2001 and is enforced by OSHA via the revised Bloodborne Pathogens Act (29 CFR 1910.1030). Single use is the first class; this class is supplied sterile and marked with an encircled 2 with a line through it, indicating single use only. For ophthalmic blades these devices are typically stainless steel with some type of plastic handle. Some manufacturers produce these knives with sharps safety features. For the purpose of brevity we will not address the quality issue with regard to the designs, manufacturing process or the incision they make. Price structure for these devices correlates with these features. For example: a coined stainless steel blade in a sharps safety handle will be significantly higher than a ground blade in a standard plastic handle with no safety protection. Determining cost effectiveness with this class is made simply by negotiating the best price for the device of choice. The fact that it can only be used once negates any possible savings from reuse. However, the amount of time saved in not having to reprocess and re-sterilize does contribute to cost reductions in relationship to OR time and personnel costs. The second is the reusable class which is typically supplied non-sterile and includes validated directions for reuse. This class can be further broken down into three sub-classes based upon the potential amount of times they can be reused. These knives incorporate sharps safety features as a standard. The first sub-class would be diamond knives which have the potential to be reused indefinitely. The second sub-class would be knives made of any material that would lose its edge with repeated usage. This sub-class would include black diamond (CVD), sapphire or other semi-precious stones. The third sub-class would be stainless steel blades designed for limited reuse. Diamonds have been the gold standard in ophthalmic knives for many years. With the current CMS position on the practice of reuse it can be more cost effective to move to diamonds than to single use blades. There are several factors that should be considered. The first is the initial outlay of capital; the average cost of a diamond knife is somewhere between $2000.00 to 3000.00, with economy side port blades for as little as $750.00 and keratomes for as much as $3200.00. A facility will need multiple sets of knives to ensure adequate time for reprocessing, thus creating a situation where savings will be realized only over a year or more of use. Repair costs can also be a significant factor; if the knives are not properly cared for or are damaged in use the costs can add up, resulting in a decrease in your overall return on investment. The most important factor in determining the cost effectiveness of investing in diamond knives is the number of surgeries in which they will be used. A surgery unit doing 4,000 cases a year and owning 2 sets of diamond knives with an upfront cost of $8,000.00 would have an amortized cost of $2.00 per case the first year. In the second year, if you factor in 2 repairs at a cost of $ 2,000.00 the cost would be $0.50 per case. However if the surgical volume is 400 cases a year the saving would not be as attractive. Using the same numbers and doing 400 cases would yield a $20.00 cost per case in the first year and a $5.00 in the second year. Additional cost factors to keep in mind are costs associated with reconfiguring the diamond to a different size as incisions become smaller. Facilities that employ a large number of surgeons may need to keep multiple sizes of diamond knives on hand to suit each surgeon’s preferences. There are also additional costs associated with the personnel needed to clean and sterilize the knives between cases. You may also need to run more sterilization cycles if you don’t have the same number of diamond knife sets to run with your instrument trays. The second sub-class would include black diamond (CVD), sapphire, or other semi-precious stones. This sub-class makes up a relatively small portion of the US market. The costs associated with acquiring these types of knives is somewhere in the range of $150.00 to 1,250.00. The quality of the blades and the number of times that they can be reused is dependent on the material as well as the care. Harder materials like CVD can be produced with more precise edges and will hold an edge longer then the softer materials such as sapphire. Because of the variability in materials, cost and usage it would be difficult to come up with a reliable cost per case dollar amount. They also have the same additional cost factors associated with diamond knives. The third sub-class is stainless steel blades designed for limited reuse. This sub-class, like the ones above, includes a sharps safety feature and directions for reuse. They can be supplied either sterile or non-sterile but are currently only available non-sterile for reuse. Diamatrix is the only manufacturer that produces this sub-class at this time. The cost per case is between $2.56 and $3.71 with the average being $3.14. These figures are based upon using a keratome and a side-port blade a maximum of 15 times, as recommended by the company. These costs are not affected by the number of surgeries per year or the additional cost factors associated with the first and second sub-class. This makes them attractive in centers · Where a limited number of procedures are preformed · A wide variety of blade sizes are required to suite each surgeon’s preferences · A near term change in phacoemulsification units or lens injectors (which would necessitate a change in incision size) is possible, or · In cases where care of more expensive instruments might be a problem. Conclusion: These alternatives meet both the cost efficiency and sharp safety issues associated with CMS’s current position on the reuse of single use class ophthalmic blades. It is ultimately the surgeon’s choice as to what surgical blade to use and with today’s technological advances in manufacturing of ophthalmic knives, quality should not be an issue. It is in the best interest of the patient, physician and the facility to find a cost effective solution to meeting government guidelines - guidelines that are intended for the safety and efficacy of all. Contributor Information: Authors: Richard J. Ruckman, MD Medical Director and CEO of The Center For Sight in Lufkin, Texas. Dr. Ruckman has no affiliation or financial interest in any commercial entity mentioned in this article. lufkin@thecenterforsight.com Kevin J. Corcoran, COE, CPC, FNAO president of Corcoran Consulting Group a practice management consulting firm specializing in coding and reimbursement issues. Mr. Corcoran has no affiliation or financial interest in any commercial entity mentioned in this article. kcorcoran@corcoranccg.com Quote: Stephen S. Lane, MD, Managing Partner Associated Eye Care and Adjunct Clinical Professor at the University of Minnesota. Dr Lane has no affiliation or financial interest in any commercial entity mentioned in this article. sslane@AssociatedEyeCare.com Technical Data, Photos and Costs; Ronald E. Dykes, BFA, COMT, CRA president, Diamatrix Ltd a division of International Science and Technology The Woodlands Texas, diamatrix@diamatrix.com