Contracting for anesthesia services is tricky because you're agreeing to hand over management of one of the most important functions of your operation to an outside party for at least a year. So it's important to hammer out a deal that will give you the flexibility and protection as your business evolves. Here's what to ask for and watch out for when you're negotiating your anesthesia services contract.

1. An anesthesia subsidy? Define how much in collections and how many cases it takes for the anesthesia service provider to break even in your facility. If you're a new center, or if you've had a big dip in volume lately due to departing surgeons, you may need to subsidize the anesthesia group by paying the difference each month between the amount that the anesthesia service provider collected and how much it needs to break even. Keep track of the service's cash collections. Their accountant should send you a monthly report of the firm's billings and collections with the appropriate CPT codes and billed anesthesia units. They should also show how much they collected for those services. Verify this against your facility's monthly billing reports. Your relationship should be as open as possible during this period.

The break-even point could be $100,000 or more per month, depending on how many providers the group sends to your facility. In the beginning, you may have to pay nearly all of that money for them to break even for 3 or 4 months until their collections start rolling in and your subsidy decreases. That's what we did.

Don't worry — you'll get that money back. Once your case volume grows and anesthesia's collections pass the break-even point, your group should start reimbursing your subsidy. For example, let's say you subsidize your anesthesia group for 4 months at $100,000 per month. Your contract should spell out how long the group has to repay the subsidy once it has met its break-even point. If you negotiate a payback period of 6 months, your group would pay you back about $67,000 per month until the $400,000 is repaid.

2. Let them do the billing. There's no sense in you doing the anesthesia billing and then sending a check to the anesthesia service. You're using your resources in order for them to get paid. You're also out the cash during the time that it takes to get reimbursed, which can be several months when claims are denied. When the service does its own billing, there's no risk for charges of inducement for referral on your part. Make sure that your contract says that the anesthesia providers must be in-network for the same third-party payors as your facility. The service provider shouldn't be allowed to send bills for the balance of the anesthesia fee to patients.

3. Bargain for flexibility. Don't get locked into a fixed number of cases. Make sure that the anesthesia service provider can cover your case volume as it changes. Build some flexibility into your relationship so that the service can send you more providers as your case volume grows. For example, our contract calls for the anesthesia service to send 4 providers (an anesthesiologist and 3 CRNAs) twice a week and 3 providers (including 1 anesthesiologist) 3 days a week. Regard-less of the day, we assign the anesthesiologist to the room that will have the least intensive cases so that he can supervise and lend a hand in the other rooms when needed. If we need more CRNAs during a busy period, the service can send another provider based in our area. It's also important to have access to the service's scheduler and cultivate a good relationship with that person so that you get the extra providers when you need them.

4. Give each provider a trial. Don't let the anesthesia service just send whichever providers they choose or have available to your facility. Make sure that you conduct a trial period for each individual provider. Some providers may be slower or less organized than others, or may have personalities that clash with your surgeons and nursing staff. Also, make sure that the providers the service sends have outpatient experience. Anesthes-ia providers who are accustomed to a large hospital setting may not have the sense of urgency needed in a busy outpatient facility, where delayed starts and longer stays in the PACU can cause bottlenecks.

5. Anesthesia leaves when the patients do. Post-op complications can occur just as the patient is getting ready to go home. So don't let the anesthesia providers leave until the last patient has left the building. Get this in writing in your contract. If you contract for supervised CRNAs, make sure that the anesthesiologist is al-ways there as a backup. The anesthesiologist should be the last provider out the door, after the patient has left.

6. Get the track record of the providers. Look into the background of the providers that will be in your building. Require that all providers bring in a copy of their license, certifications and malpractice insurance. If you treat children, the pro-viders should have pediatric certification, too.

Check to see if the providers have any malpractice claims filed against them or other stains on their records. As when you're credentialing your surgeons, check each provider's record on the Web sites of your state boards of medical examiners and nursing. You should also look up each provider on the National Practitioner Data Bank (www.npdb-hipdb.hrsa.gov), sponsored by the U.S. Department of Health and Human Services. Each query will cost $3 or $4 and you'll quickly learn if the provider has any pending lawsuits or complaints filed by patients or other providers.

Also, look at HHS's Office of Inspector General's Web site (www.oig.hhs.gov), where you can see if the provider or the anesthesia group has any fraud reports or if they are on the list of individuals excluded from participating in Medicare or Medicaid programs.

7. Add a non-compete clause. This is especially important if you're in a rural area with very few anesthesia pro-viders. If your anesthesia service becomes too busy with your competitors, your ability to grow your case volume could be hindered, or you may need to close rooms, if the service can't supply enough anesthesia providers.

We negotiated a non-compete clause for our county and surrounding counties within 25 miles. Any new services provided by the anesthesia group in this area have to be approved by our board of directors and the board of the anesthesia group.

8. Have a lawyer look at the contract. Contracts can be full of pitfalls and it's easy to omit or overlook something. So it's important to work with a lawyer who can make sure you're well covered in the contract. But you'll need more than just a contract lawyer. Hire a healthcare attorney who will be familiar with all the nuances of reimbursement and medical liability.

9. Renegotiate every 2 years. Don't let your contract roll over automatically. The way you do things in your facility may have changed as well as your reimbursement rates and your contracts with third-party payors. This means that your anesthesia service provider's break-even rate may have changed, too. Sit down with the service provider and discuss what works and what doesn't.

Also, make sure that you've built in a method of getting out of the contract with 90 days' notice if the relationship is not working well. If the relationship is running smoothly, continue with the anesthesia service provider, but keep your best interest in mind when renegotiating.

10. Hold on to the good ones. Your relationship with your anesthesia service provider should be more than just well-defined on paper. Both parties need to have the same commitment to saving money and figuring out ways to reduce supply and drug costs without compromising patient safety.

Don't worry, it is possible to find such a partner when you're outsourcing. Our anesthesia service providers have saved us a lot of money, so obviously we want to keep them around. It's a win-win situation.