Last summer, California became the 15th state to opt out of federal Medicare and Medicaid requirements for physician supervision of CRNAs. This 2001 rule was created to give states “flexibility to improve access to anesthesia services without the burden associated with duplicative regulatory oversight,” said Jeffrey Kang, MD, then director of the Centers for Medicare & Medicaid Services (CMS) Office of Clinical Standards and Quality.

State governors can invoke the federal opt-out rule by simply writing a letter to CMS certifying three conditions: that they had consulted with the state boards of medicine and nursing; that the action is in the best interest of the state’s citizens; and that it is consistent with state law. CMS is required to accept the letter “at face value” and without independent analysis or scrutiny. The opt-out becomes effective on submission.

Against the Law?

The California lawsuit challenges the legality of Mr. Schwarzenegger’s action by claiming, among other things, that the governor did not properly consult with the state boards and that exempting CRNAs from physician oversight violates California law. “For us, the primary precondition is that the opt-out must be consistent with state law,” said William E. Barnaby Sr., JD, an attorney with the Sacramento law firm of Barnaby & Barnaby, which is representing the CSA. “We are contending that in California, it is not consistent with the law.”

Appearing to bolster that argument are opinions from the governor’s own medical board and the state’s Legislative Counsel Bureau, which advises state lawmakers. “State law does not authorize a certified registered nurse anesthetist to perform anesthesia services without supervision by a physician,” concluded a Nov. 6, 2009, opinion letter from Diane F. Boyer-Vine, state legislative counsel. Barb Johnston, executive director of the Medical Board of California, advised officials in a March 2, 2009, letter that nurse anesthetists appear to require physician supervision, based on a review of state laws and the Board of Registered Nursing’s own scope and practice requirements.

Richard Figueroa, a health care adviser to Mr. Schwarzenegger, told Anesthesiology News that the purpose of the opt-out decision was to reduce pressures on and increase access to services at small and rural hospitals. “The intent was not to give one profession higher status than others,” Mr. Figueroa said. “All this does is give hospitals greater flexibility; it doesn’t mandate they do anything one way or the other. It’s up to the hospitals and their critical care staffs how they best deploy their anesthesiological resources.”

But once a facility chooses to waive supervision, all patients must be treated the same way, said Kenneth Y. Pauker, MD, chair of the CSA Legislative and Practice Affairs Division.

“In opt-out states, wherein nurse anesthetists may care for Medicare patients without physician supervision, Medicare rules require that within one institution, all patients be treated in an equivalent way, such that if there is no supervision of Medicare patients, all other patients must also be cared for in an unsupervised way,” Dr. Pauker said. Private insurers are likely to follow the Medicare determination, he added.

Mr. Schwarzenegger’s action reinvigorates the controversy of state opt-outs. Fourteen states, mostly in the Midwest and West, exercised physician supervision opt-out from 2001 to 2005. This was followed by a four-year hiatus until California’s action last year.

While the American Society of Anesthesiologists (ASA) opposes Medicare opt-outs, “we leave it up to the state associations to deal with this issue,” said Sarah Paff Byun, the society’s manager of governmental and political outreach.

An ASA position paper from March 2009 cited studies showing anesthesia care is improved when physicians are involved in procedures, and that in nonacademic settings, Medicare anesthesia payments are the same regardless of which—or how many—providers are involved. “When an anesthesiologist medically directs a nurse anesthetist, the fee is divided equally between the two providers,” the ASA statement said.

The American Association of Nurse Anesthetists (AANA) supports California’s decision to opt out of what it calls “unnecessary” federal physician supervision. “There is no evidence that patient safety has been compromised one iota in the 14 states that opted out previously,” said AANA President James Walker, CRNA, DNP. “Opt-outs enable hospitals to organize their anesthesia services in the most safe and cost-effective arrangement for their patients. Anesthesia continues to be delivered safely in California, just as it is in the other 14 states that have exercised their right to opt out from this rule.”

There are 1,412 AANA members in California, making it the organization’s ninth-largest state (Pennsylvania is the largest, at 3,231 members). California has the largest number of anesthesiologists in the United States, at 5,400, of whom 4,000 are CSA members, according to the group.

Peggy Broussard Wheeler, vice president for Rural Healthcare and Governance of the California Hospital Association, said small and rural hospitals appreciate being able to opt out of the CMS anesthesiologist oversight requirement.

Some hospitals, Ms. Broussard Wheeler said, had been forced to curtail anesthesia services because they could not afford to meet the CMS requirements. The opt-out rule “will allow facilities that used to offer some anesthesia services the ability to offer them again,” she said.