Position Statement

Fee "Unbundling" and Uniform Definitions for Surgical Procedures

This Position Statement was developed as an educational tool based on the opinion of the authors. It is not a product of a systematic review. Readers are encouraged to consider the information presented and reach their own conclusions.

Trends indicate that global billing for surgical procedures will increase as the Medicare program adopts a physician fee schedule. The lack of uniform definitions for surgical procedures has led to confusion about what group of services, or global service package, should be considered part of a given procedure for billing and payment purposes. This confusion has resulted in fee "unbundling" by some surgeons. Fee "unbundling" occurs when the charge for a specific procedure remains the same, but one or more components of the procedure are separated from the global service package and given a separate, additional fee.

The American Academy of Orthopaedic Surgeons (AAOS) believes it is unethical for orthopaedic surgeons to separate from the global service package services which are a necessary part of the surgical procedure and to then bill individually for those services.

While the specific surgical methods used by different orthopaedic surgeons performing a given procedure may vary, the basic operative approach and sequence of events are typically similar enough to be included under a single global service package. The package should encompass all the steps which are necessary for the successful completion of the procedure, provided that complications do not arise which require the orthopaedic surgeon to add more demanding and time-consuming components to the procedure. Other procedures which are an integral part of the main operation should be considered as necessary adjuncts, not separate entities for which additional fees are justified. Only those services which represent procedures with clearly different indications should be billed and paid for separately.

The AAOS strongly encourages all third party payers, peer review organizations and others to adopt appropriate uniform payment policies regarding which services should be included in the global service package.

The lack of uniform definitions for surgical procedures has led some third party payers, peer review organizations, and others to adjust those components which are included in the global service package.

Through a consensus process and with nationwide input from orthopaedic surgeons, the AAOS has prepared a book containing intraoperative global service data for orthopaedic surgery; this model document fully incorporates the guidelines described in this Position Statement.

December 1990 American Association of Orthopaedic Surgeons. Retained December 2007.

This material may not be modified without the express written permission of the American Association of Orthopaedic Surgeons.

Position Statement 1108

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