Practice Economics in Anesthesiology: A Framework for Optimization

The practice of anesthesia has seen a dramatic evolution during the first quarter of the 21st century. While anesthesia provider shortages have been a persistent issue for decades, the crisis has now reached an unprecedented peak. The trend is driven by myriad factors, including an aging population, retiring anesthesiologists outpacing residents and an expansion of anesthesia services, particularly in outpatient settings. The American Society of Anesthesiologists (ASA) has reported “The percentage of facilities reporting an anesthesia staffing shortage increased from 35% in early 2020 before the pandemic to 78% in late 2022”.¹

Because of this shortage, practices must optimize their economic models for long-term viability. This article explores the key drivers in this optimization: practice revenue and costs.

OPTIMIZING PRACTICE REVENUE

According to the latest major industry compensation surveys published in 2025, anesthesiologist and CRNA salaries are at an all-time high. As a result, every anesthesia organization, regardless of employment structure, must closely monitor revenue performance to ensure optimized revenue to support recruitment and staff retention. The major driver in this regard: revenue cycle management (RCM) operations.

Front-End RCM. The revenue cycle begins here, making it the most critical point for optimizing reimbursement. This RCM segment gives the most control over a smooth collections process by preventing pre-claim errors and omissions. This begins with accurate and complete reception of all anesthesia case components. When available, the billing platform should integrate with facility electronic medical records (EMRs) for greater efficiency, accuracy, and shorter Days in AR.

• Secure Health Level Seven (HL7) feeds for patient demographics are ideal, as they auto-populate protected health information (PHI) into the billing system, improving efficiency and accuracy while eliminating manual data entry. This ensures patient billing information is as accurate as the data within the facility’s EMR.
• For accurate and compliant billing, clinical anesthesia data should be automated whenever possible. If structured data cannot be ingested by the billing platform, an electronic image of the anesthesia record will often suffice for the medical coder.
• After all patient data is received, full case reconciliation is essential to ensure complete case capture, for both operating room (OR) and out-of-OR cases. This is done by receiving each day’s final surgical schedule, inclusive of add-on cases or cancellations, and comparing patient data received to confirm all anesthesia services provided were received. Out-of-OR services may not be included in the EMR’s schedule received. Therefore, collaboration between the billing operation and facility is required to ensure these services are captured and reported effectively.
• Patient insurance eligibility verification is a crucial step prior to claim submission to prevent denials and payment delays due to inaccurate insurance information. This goes far toward the goal of the cleanest possible claim, minimizing rework on the back-end, where focus can be directed toward proactive AR follow-up.
• Anesthesia-exclusive certified coders are the standard to accurately capture the unique nuances of anesthesia coding. Additionally, remote access by the coder directly into the EMR for the surgeon operative report is highly recommended (if not provided in the transmission) since anesthesia providers do not consistently depict exactly how a surgical procedure is performed. Experienced anesthesia coders can capture additional revenue by confirming complex case elements in operative reports, allowing them to code higher ASA codes. Preventing repetitive coding oversights can prevent substantial annual missed revenue across a practice’s case mix.

Back-End RCM. Once claims are submitted, edited and received by the payer in the correct format, the back-end processing commences. This is where the fruits of the front-end labor are recognized.

• Insurance denials and rejections will continue to happen, though fewer, despite the cleanest frontend processes. Errors must be corrected, and any supplementary patient data provided promptly to meet appeal deadlines and minimize lost revenue. Analyze denial patterns and optimize front-end workflows accordingly to ensure consistent, healthy cash flow.
• Automating patient responsibility follow-up to the extent possible, through text messaging of statements and reminders interspersed between mailed statements can expedite the patient AR process. Increase effectiveness by offering an online payment portal, accessible via a link within text reminders or a QR code on paper statements.
• Automated contractual payment accuracy logic embedded within the billing system should be utilized to rectify insurance underpayments. Insurers’ failure to update adjudication systems after unit reimbursement increases is a leading cause of underpayments. Further, payers may overlook single billable units, like those for physical status or modifying circumstances, even when contractually required to reimburse.

MANAGED CARE CONTRACT NEGOTIATION: OBSTACLES & OPPORTUNITIES

While the No Surprises Act (NSA), effective 1/1/2022, provides patient protection by eliminating balance bills for out-of-network (OON) services, it has also undermined managed care contracting for anesthesia groups. The end of balance billing removed a powerful negotiation tool for groups—terminating a payer contract to seek higher OON payments. This shift has unintentionally empowered payers, making negotiations more challenging. Still, groups must be proactive with their contracting approach.

• Begin renegotiations well in advance of a contract’s renewal, especially for payers representing a substantial portion of the payer mix. Renegotiation is now more difficult and prolonged.
• Conduct thorough market research, leveraging all accessible information, with a regional focus. Public surveys identifying such data for anesthesia are published annually by the ASA Committee on Economics. Understand where your practice sits in relation to this benchmark data. This will give you a sense of the reasonableness of the proposed unit rate.
• Make efforts to renew for three-year terms with annual escalators, which will help offset increasing costs and reduce the administrative burden of yearly negotiations.
• Engage experts. In this challenging managed care contracting climate, these professionals can be invaluable, given their experience and access to data and market trends. This is most warranted when dealing with insurance plans that represent a substantial portion of the payer mix.
• While the above strategies may be less fruitful than pre-NSA, the anesthesia group must still exhaust all options to strive toward healthiest cash flow. When a payer refuses to offer reasonable rates, however, OON is still an option.

NSA and the IDR Process. After the practice has diligently researched market rates for their region and believes the best offer from a payer is below market, or the qualified payment amount (QPA) for that payer, they have the option to go OON. According to federal of the contracted rates recognized by an insurance plan on January 31, 2019, for a similar service provided by similar specialties in the geographic region where the service is furnished, increased for inflation in each subsequent year.² Payers are required to reimburse OON services at this QPA.

• Note, there is no requirement for a payer to disclose their calculated QPA to an anesthesia group who is considering going OON with that payer. The only way to determine the QPA is for the group to be OON and submit a bill to the payer to learn their QPA from the explanation of benefits (EOB) received.
• The anesthesia group may commence the independent dispute resolution (IDR) process if they opt OON, and after viewing the EOB, deem the QPA to be unreasonably low or question the legitimacy of the calculation. During IDR arbitration, an arbiter awards the settlement by selecting one of the payment offers from either the provider or payer, often referred to as “baseball-style arbitration.”
• A trend has emerged where anesthesia groups are successfully navigating the IDR process. When federal arbitrators were used for payment disputes in 2024, they sided with anesthesiologists over 80% of the time, leading to fair payments from insurers (American Society of Anesthesiology, 2025).³

COST OPTIMIZATION

For anesthesia practices, provider compensation is the single greatest cost. The national provider shortage has caused this to reach peak levels. Anesthesia practices have low overhead—typically under 10%, compared to 55 – 65% for surgical and office-based specialties. However, anesthesia collections are unlikely to cover practice expenses when providers’ income is at fair market value. According to widespread industry reports, facility stipends are used to cover this revenue deficit for more than 80% of independent anesthesia practices. To optimize staffing, it is crucial to consider anesthesia locations and hours, case mix and acuity, the historical staffing model and provider availability in the market.

The four most common anesthesia staffing models:

• Physician-only: Anesthesiologists personally performing their own cases.
• Anesthesia care team: Anesthesiologists directing CRNAs or anesthesiologist assistants (CAAs)
• Collaborative: Physicians and CRNAs are part of the same group, but each performs their own cases independently. Modifier QZ is appended to the CRNA’s bill. This model has seen strong growth over the last 10 years driven by provider shortages and rising provider costs.
• CRNA-only: CRNAs manage cases independently without medical direction from an anesthesiologist.

When provider expense is looked at in isolation, the physician-only model carries the highest cost, while the CRNA only model, the lowest. However, cost is only one of many interrelated variables.

Case mix acuity. For facilities with a high acute case mix, maintaining a 4:1 anesthesiologist-to-CRNA ratio is unfeasible. A 3:1 ratio can also be challenging, particularly due to complex, high-risk patients requiring intervention from the anesthesiologist.

Historical staffing and mid-level provider availability. In situations where a physician-only model is in use, even if the case mix suggests a care team ratio of 3:1 or greater is achievable, transitioning to a care team model is often curtailed due to recruitment challenges around CRNA/CAA availability in the market. Often, this is a phased approach, starting with smaller segments of the anesthesia practice, such as ASCs or endoscopy suites. Additionally, CAAs are presently authorized to work in only 22 states.

Rising cost of provider salaries. CRNA cost-effectiveness is diminished as the care team ratio approaches 2:1, especially since CRNA total compensation is now about half that of an anesthesiologist. The consulting firm SullivanCotter reported a 21.9% increase in total cash compensation for CRNAs between 2021 and 2024 in its 2024 Advanced Practice Provider (APP) Compensation and Productivity Survey.⁴

Recent negative insurer trends toward CRNA services. Over the last three years, major insurance companies have imposed reimbursement cuts directly to CRNA’s practicing independently with the QZ modifier. In 2023, Cigna implemented a 15% discount on QZ CRNA services in most states, with seven states being exempted due to state law. In 2024, Anthem imposed the same 15% discount in certain states (NY, OH, MO, CT, ME, NV). Finally, UnitedHealthcare has announced a 15% pay cut to QZ CRNA services, beginning in October 2025 (excluding eight states).

The facility is just as motivated as the anesthesia group to keep stipends manageable when optimizing the staffing model. Collaboration can lead to significant improvements, including optimizing OR efficiency, maximizing block time utilization, reducing delays and cancellations and turnover time. The anesthesia group can provide input for daily schedule adjustments that support these objectives.

THE PATH FORWARD

It is incumbent upon the anesthesia practice to ensure prudent management and effective operation in all aspects of their practice. This involves optimizing RCM by implementing effective strategies to enhance workflow to maximize collections, and strategic managed care contracting to drive the best potential reimbursements.

The group must also manage staffing costs by optimizing its staffing mix while offering competitive market compensation to recruit and retain providers. By methodically optimizing each of these areas, the anesthesia group can justify that its stipend (or

potential stipend request) is not a subsidy for inefficiency, but a data-driven calculation of the remaining financial gap required to deliver essential, high-quality services to the facility and its patients.

¹ American Society of Anesthesiologists (ASA), “Anesthesia Workforce Shortage Poses Threat to Health Care,” news release, June 17, 2024, https://www.asahq.org/about-asa/newsroom/news-releases/2024/06/anesthesia-workforce-shortage-poses-threat-to-health-care

² IRS Notice 2025-8, Internal Revenue Bulletin (IRB); p. 813. February 18, 2025; IRB 2025-08 (Rev. 2-18-2025)

³ American Society of Anesthesiology, Private Payer Policies. August 18, 2025; https://www.asahq.org/advocating-for-you/private-payer-policies

⁴ SullivanCotter, 2024 Advanced Practice Provider (APP) Compensation and Productivity Survey. October 23, 2024

David J. Platt, MPA serves as Senior Vice President for the Coronis Health anesthesia division, responsible for revenue cycle management of Coronis Health anesthesia clients. He has worked exclusively in the anesthesia industry assisting group practices of all employment structures in providing RCM and practice management services for the last 20+ years, also facilitating beneficial relationships between facilities and anesthesia groups. Dave holds a Master of Public Administration (MPA) degree, with certification in Health Care Administration, from West Virginia University. He can be reached at david.platt@coronishealth.com.