The CY 2019 Outpatient PPS/ASC Payment System Proposed Rule August - - PowerPoint PPT Presentation

The CY 2019 Outpatient PPS/ASC Payment System Proposed Rule

August 14, 2018

CY 2019 OPPS/ASC Proposed Rule Timeline

• Proposed rule released July 25
• Published in July 31 Federal Register
• Comments due by Sept. 24
• Final Rule will be issued around Nov. 1
• Effective on Jan. 1, 2019

Agenda

• Proposed Expansion of Site-neutral Payment Policies for CY 2019
• Other Outpatient Prospective Payment System (OPPS) Payment

Policy Proposals

• Hospital Outpatient Quality Reporting (OQR) Program Proposed

Changes

• Ambulatory Surgical Center (ASC) Payment System Proposed

Changes

• ASC Quality Reporting (ASCQR) Program Proposed Changes
• Inpatient Quality Reporting HCAHPS Pain Questions
• Requests for Information

Site-neutral Payment Policy Background

• Sec. 603 of BiBA mandated site-neutral payment for non-

ED services in certain “new” off-campus provider-based departments (PBDs) – those that first were paid under OPPS after Nov. 2, 2015.

• For 2017: “Non-excepted” (non-grandfathered) services paid under the

Physician Fee Schedule (PFS) at 50% of OPPS rate.

• For 2018, non-excepted services paid at 40% OPPS rate
• For 2019, CMS proposes to continue to pay for non-

excepted services at 40% OPPS rate.

Additional “Site-neutral” Payment Cuts Proposed

• For 2019, CMS proposes to:
• Reduce payment for hospital outpatient clinic visits in

excepted off-campus PBDs

• Reduce payment for new families of services furnished in

excepted off-campus PBDs

• Reduce payment for 340B-acquired drugs in non-excepted
• ff-campus PBDs
• CMS announces a data collection for all services in off-

campus emergency departments (EDs)

Proposed Cut for Clinic Visits in Excepted Off-campus PBDs

• Would pay for clinic visits (G0463) in excepted off-campus

PBDs at “PFS-equivalent” rate of 40% of OPPS amount

• Cites authority under SSA 1833(t)(2)(F) to propose “a method for controlling

unnecessary increases in volume of covered OPD services”

• Claims OPPS spending growth was “unnecessary” because it resulted from

differences in payment between settings rather than from patient acuity.

• No change in billing would be required – clinic visits still would be considered

“excepted” service (billed using “PO” modifier), but paid at reduced rate.

• Proposed NOT to be budget-neutral
• CMS requests comment on how to expand this proposal to more

items and services with “unnecessary” increases in PBD utilization. Estimated Impact: -$760 million in CY 2019

AHA View on Proposed Clinic Visit Cut

• CMS misinterprets Congressional intent by cutting

excepted off-campus PBDs that are explicitly protected from site-neutral cuts in law.

• Fails to recognize critical role PBDs play in providing access for most

vulnerable patients

• Ignores other factors outside of hospitals’ control driving increases in

OPPS expenditures.

Site-neutral Cuts for Expanding “Families of Services” in Excepted Off-campus PBDs

• CMS says allowing service line expansion in excepted off-campus

PBDs is inconsistent with intent of Sec. 603

• So, for 2019, excepted services would ONLY include services in

“clinical families of service” that the excepted off-campus PBD billed during a baseline period of Nov. 1, 2014-Nov. 1, 2015 (i.e. the year prior to Sec. 603 enactment).

• Any services billed in 2019 that fall outside the clinical families of

service that the off-campus PBD billed during baseline period would be non-excepted (“PN” modifier) and paid under the PFS at the site-neutral rate of 40% of the OPPS amount.

• Would require excepted off-campus PBDs to identify the clinical

families of services they billed during baseline period. Estimated Impact: TBD

19 Proposed Clinical Families of Service

Clinical Families APCs

Airway Endoscopy 5151-5155 Blood Product Exchange 5241-5244 Cardiac/Pulmonary Rehabilitation 5771; 5791 Diagnostic/Screening Test and Related Procedures 5721-5724, 5731-5735, 5741-5743 Drug Administration and Clinical Oncology 5691-5694 Ear, Nose, Throat (ENT) 5161-5166 General Surgery and Related Procedures 5051-5055; 5061; 5071-5073; 5091-5094; 5361-5362 Gastrointestinal (GI) 5301-5303; 5311-5313; 5331; 5341 Gynecology 5411-16 Major Imaging 5523-5525; 5571-5573; 5593-5594 Minor Imaging 5521-5522; 5591-5592 Musculoskeletal Surgery 5111-16; 5101-02 Nervous System Procedures 5431-5432; 5441-5443; 5461-5464; 5471 Ophthalmology 5481; 5491-5495; 5501-5504 Pathology 5671-5674 Radiation Oncology 5611-5613; 5621-5627; 5661 Urology 5371-5377 Vascular/Endovascular/Cardiovascular 5181-5184; 5191-5194; 5200; 5211-5213, 5221-5224; 5231-5232 Visits and Related Services 5012; 5021-5025; 5031-5035; 5041; 5045, 5821-5823

AHA View on Proposed “Families of Services” Policy

• CMS misinterprets Congressional intent by cutting

excepted PBDs that are explicitly protected from site- neutral cuts in law.

• We are disappointed that CMS has resurrected the expansion of

services policy the agency previously rejected.

• Policy would penalize off-campus PBDs that offer new kinds of services

to their communities and would prevent them from accommodating the changing needs of their patients.

340B Policy: Expansion to Non-excepted Off-campus PBDs

• Would expand current policy reducing payment for most 340B-

acquired drugs to non-excepted off-campus PBDs, beginning in CY 2019.

• Rationale: CMS believes the payment differential between excepted

and non-excepted PBDs could incentivize hospitals to move drug administration services for 340B drugs to non-excepted PBDs.

• Rural sole community hospitals, children’s hospitals and PPS-

exempt cancer hospitals would remain exempt. Estimated Impact: -$48.5 million in CY 2019

AHA View on Proposed Expansion of 340B Cut

• The stepped up assault on 340B hospitals that serve vulnerable

communities will harm a significant number of additional hospital outpatient departments.

• These proposed cuts – like the previous cuts – are made to a

program that requires no federal contributions but instead relies

• n discounts required of drug companies.
• Like the previous cuts, this proposal exceeds CMS’s

statutory authority and remain subject to legal challenge.

Services in Off-campus EDs: Data Collection

• Starting Jan. 1, 2019, CMS will be collecting data to assess

whether OPPS services are shifting to off-campus provider-based EDs.

• HCPCS modifier “ER” must be reported with every claim line for

services furnished in an off-campus ED.

• Cites MedPAC concerns that the growth in the number of off-

campus provider-based EDs may be a result of:

• Higher Medicare payment rates for services in provider-based EDs

compared to similar services in physician offices or urgent care centers.

• Section 603’s exemption of services furnished in provider-based EDs.
• Sets the stage for possible new site-neutral proposals in the future.

AHA Advocacy Strategy on Site-neutral Proposals

Oppose Further Proposed Cuts!

• Analysis of the Medicare data
• Review specific statutory authorities CMS cites for flaws
• Member outreach, including engaging AHA’s Advocacy Alliance

for Coordinated Care

• Engage congressional allies to weigh in with CMS and potential

follow-up legislative solution

• Continuing to pursue our litigation on 340B

CY 2019 Payment Update

• Proposed payment update of 1.25 percent for CY 2019 OPPS.
• Proposed payment update of -0.75 percent for hospitals that do not

meet the Outpatient Quality Reporting program reporting requirements

• With this update and all other changes in the rule, hospitals

would see a net decrease of 0.1 percent in OPPS payment, or about $80 million in CY 2019.

Comprehensive APCs

• CMS proposes to create 3 new comprehensive APCs (C-

APCs).

• C-APC 5163 (Level 3 ENT Procedures)
• C-APC 5183 (Level 3 Vascular Procedures)
• C-APC 5184 (Level 4 Vascular Procedures).
• This would increase the total number of C-APCs to 65.

• Would remove two services from the inpatient-only list:
• CPT code 31241 (Nasal/sinus endoscopy, surgical; with ligation of

sphenopalatine artery), and

• CPT code 01402 (Anesthesia for open or surgical arthroscopic

procedures on knee joint; total knee arthroplasty).

• Would add one service to the inpatient-only list:
• HCPCS code C9606 (Percutaneous transluminal revascularization of

acute total/subtotal occlusion during acute myocardial infarction, coronary artery or coronary artery bypass graft, any combination of drug-eluting intracoronary stent, atherectomy and angioplasty, including aspiration thrombectomy when performed, single vessel).

Proposed Change to the Inpatient-only List

Payment for Drugs, Biologicals and Radiopharmaceuticals

• Would increase drug packaging threshold to $125 per day
• Drugs costing more than $125/day separately paid under own APC;

those costing less than $125 per day are packaged.

• Exception for certain “policy-packaged” drugs
• Costs packaged regardless of cost per day
• Separately paid drugs (other than 340B-acquired drugs)

proposed to be paid at the rate of ASP plus 6%.

Cut in Payment for New Drugs Before ASP Data Available

• Would reduce payment for new separately paid Part B drugs

and biologicals (that are not acquired under the 340B program) to WAC plus 3%, rather than WAC plus 6%, in 2019.

• Similar to proposal in PFS proposed rule
• Consistent with recommendations in President’s Budget and MedPAC report
• Would not apply to “single source drugs” that are required under law

to be paid at 106 percent of the lesser of ASP or WAC.

Continuation of Payment Cut for 340B-acquired Drugs

• Would continue to pay for 340b-acquired separately

payable drugs and biologicals at ASP minus 22.5%

• Clarifies that 340B payment cut also applies to drugs that are priced

using either WAC or Average Wholesale Price (AWP).

• Proposes to pay for 340B-acquired separately paid biosimilars

at ASP minus 22.5% of the biosimilar’s own ASP instead of the biosimilar’s ASP minus 22.5% of the reference product’s ASP.

• Intended to prevent a more significant reduction in payment for 340B-

acquired biosimilars than warranted.

New Technology APCs Payment for Low-volume Procedures

• Would apply a “smoothing methodology” to establish more

stable payment rate for low volume services assigned to New Technology APCs.

• Would use 4 years of claims data to establish rates, instead of 1 year.
• Would calculate costs using 3 different methodologies: geometric mean

cost, median costs, and arithmetic mean.

• Would exclude services assigned to New Technology APCs

from being packaged into C-APC procedures.

• Would ensure adequate claims data available for these low-volume

procedures assigned to New Technology APCs.

Proposed Changes to Device-Intensive Procedures

• Would modify the device-intensive criteria to allow procedures

that involve single-use devices, regardless of whether or not they remain in the body, to qualify as device-intensive procedures.

• Would allow procedures with a device offset percentage of

greater than 30% (rather than current 40%) to qualify as device- intensive procedures.

Hospital Outpatient Outlier Payments

• Would increase the fixed-dollar threshold for outliers to

$4,600 in 2019 ($450 more than 2018).

• To be eligible for an outlier payment, the cost of a service would have

to exceed 1.75 times the APC amount (the percentage threshold), and at least $4,600 more than the APC amount.

• Outlier payment is 50% of the amount by which the cost of furnishing

the service exceeds 1.75 times the APC payment rate.

Partial Hospitalization Program (PHP) Payment

• Proposed Payment for PHP Services in 2019
• Changes to the Revenue-Code-to-Cost Center Crosswalk
• For 2019 and beyond, hospital-based PHPs would follow a new Revenue-Code-to-

Cost-Center crosswalk that only applies to hospital-based PHPs

• PHP Service Utilization
• CMS will continue to monitor frequency of individual therapy in PHPs and PHPs use
• f days with only 3 services

Cancer Hospital Adjustment

• Would continue to provide additional OPPS payments to each
• f the 11 “exempt” cancer hospitals so that each hospital’s

payment-to-cost ratio (PCR) is equal to the weighted average PCR for all other OPPS hospitals.

• 21st Century Cures Act provision requires weighted average PCR be

reduced by 1.0 percentage point.

• CMS proposes a target PCR of 0.88 to determine the CY 2019

payment adjustment.

• The cancer hospital adjustment is applied at cost report settlement.

Rural Adjustment for Sole Community Hospitals

• Would continue current policy of increasing payments to rural

SCHs, including essential access community hospitals, by 7.1% for all services paid under the OPPS in 2019

• Exception does not apply to drugs, biologicals, services paid under the

pass-through policy, and items paid at charges reduced to costs.

• The adjustment is budget neutral to the OPPS and applied before

calculating outliers and coinsurance.

Hospital Outpatient Quality Reporting (OQR) Program Proposed Changes Caitlin Gillooley

Outpatient Quality Reporting Program (OQR)

• Measure Removal & Updates
• Program Updates
• Inpatient HCAHPS Pain Questions

CMS’s Meaningful Measures Initiative

Updates to Measure Removal Factors

• Factor 1: Measure performance among providers is so high and unvarying that meaningful

distinctions in improvements in performance can no longer be made (measure is “topped out”).

• Factor 2: Performance or improvement on a measure does not result in better patient outcomes.
• Factor 3: The measure does not align with current clinical guidelines or practice.
• Factor 4: A more broadly applicable measure (across settings, populations, or conditions) for the

particular topic is available.

• Factor 5: A measure that is more proximal in time to desired patient outcomes for the particular topic

is available.

• Factor 6: A measure that is more strongly associated with desired patient outcomes for the particular

topic is available.

• Factor 7: Collection or public reporting of a measure leads to negative unintended consequences
• ther than patient harm.
• Factor 8: the costs associated with a measure outweigh the benefit of its continued use in the

program.

Measures Proposed for Removal

Measure Number Measure Title Rationale for Removal OP-27 Influenza Vaccination Coverage among Healthcare Personnel Costs to use NHSN outweigh benefits of measure OP-5 Median Time to ECG Costs outweigh benefits; little variation; NQF endorsement removed OP-9 Mammography Follow-up Rates Not in line with recently updated clinical practices OP-11 Thorax Computed Tomography (CT) Use of Contrast Material Topped out OP-12 The Ability for Providers with HIT to Receive Laboratory Data Electronically Directly into Their Qualified/Certified EHR System as Discrete Searchable Data Does not directly assess quality or patient outcomes; not NQF- endorsed

Measures Proposed for Removal, cont.

Measure Number Measure Title Rationale for Removal OP-14 Simultaneous Use of Brain Computed Tomography (CT) and Sinus CT Topped out OP-17 Tracking Clinical Results between Visits Does not directly assess quality or patient outcomes; NQF endorsement removed OP-29 Endoscopy/Polyp Surveillance: Appropriate Follow- up Interval for Normal Colonoscopy in Average Risk Patients Costs outweigh benefits; measure available in MIPS OP-30 Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a History of Adenomatous Polyps-Avoidance of Inappropriate Use Costs outweigh benefits; measure available in MIPS OP-31 Cataracts: Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery Costs outweigh benefits; low reporting rates

Other OQR Updates

• Extension of Reporting Period for Facility 7-Day Risk-

Standardized Hospital Visit Rate after Outpatient Colonoscopy (OP-32, ASC-12)

• Measure would be based on three years of data instead of one
• Frequency of OQR Specifications Manual Release
• CMS could release every 6-12 months instead of every 6 months
• Notice of Participation Form
• Form would no longer be required

Ambulatory Surgical Center (ASC) Payment System Proposed Changes Roslyne Schulman

ASC Payment Update

• For CYs 2019 through 2023, would update the ASC payment

using the hospital market basket update instead of CPI-U.

• Intention is to incentivize migration of services to the ASC
• CMS seeks comments on ASC cost structure and whether hospital

market basket update is an appropriate proxy

• Using this methodology, for CY 2019, CMS would increase

payment rates under the ASC payment system by 2.0 percent (for ASCs that meet the ASCQR requirements.)

Expansion of “Surgery” Definition for ASC-covered Surgical Procedures

• Proposes definition of “surgery” for ASCs include certain

“surgery-like” procedures with codes outside the CPT surgical range

• Would include procedures that directly crosswalk or are clinically

similar to procedures in the Category I CPT surgical range

• Procedures would need to meet the existing criteria for ASC coverage
• Using revised definition of surgery, CMS proposes to add

12 cardiac catheterization procedures (CPT codes 93451- 93462) to the ASC list.

Payment for Non-opioid Pain Management Drugs

• CMS proposes to provide separate payment (“unpackage”), at

ASP plus 6%, for non-opioid pain management drugs that function as a supply when used in a surgical procedure performed in an ASC.

• This is in response to a recommendation from President’s Commission
• n Combating Drug Addiction and the Opioid Crisis and intended to

encourage use of non-opioid pain management drugs rather than prescription opioids.

• This proposal would only currently apply to one drug, Exparel.
• CMS does not propose to pay separately for these drugs in

hospital outpatient departments.

Proposed Changes to: ASC Quality Reporting (ASCQR) Program & IQR HCAHPS Pain Questions Caitlin Gillooley

ASC Quality Reporting Program (ASCQR)

• Measure Removal & Updates
• Possible Future Measure Validation

Measures Proposed for Removal

Measure Number Measure Title Rationale for Removal ASC-8 Influenza Vaccination Coverage among Healthcare Personnel Costs to use NHSN outweigh benefits of measure ASC-1 Patient Burn Topped Out; NQF endorsement removed ASC-2 Patient Fall Topped Out; NQF endorsement removed ASC-3 Wrong Site, Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant Topped Out; NQF endorsement removed ASC-4 All-Cause Hospital Transfer/Admission Topped Out; NQF endorsement removed

Measures Proposed for Removal, cont.

Measure Number Measure Title Rationale for Removal ASC-9 Endoscopy/Polyp Surveillance: Appropriate Follow- up Interval for Normal Colonoscopy in Average Risk Patients Costs outweigh benefits; measure available in MIPS ASC-10 Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a History of Adenomatous Polyps- Avoidance of Inappropriate Use Costs outweigh benefits; measure available in MIPS ASC-11 Cataracts: Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery Costs outweigh benefits; low reporting rates

Possible Future Validation of ASCQR Measures

• ASCQR measure data currently not validated
• Measure Validation of chart-abstracted data to determine if data was

abstracted correctly

• CMS requests public comment on whether to adopt OQR

validation methodology

• Selects random sample of facilities and additional facilities based on

certain criteria (e.g. failed validation or outlier value)

• Could start with just one measure (ASC-13)

IQR HCAHPS Pain Questions

• CMS previously replaced pain management questions in

HCAHPS with “Communication about Pain” questions

• Stakeholders continue to voice concerns regarding inadvertent

pressure to prescribe opioids for pain

• CMS proposes to remove questions beginning with Jan. 2022

discharges

• Can’t do it earlier: agency needs time to make “necessary updates”
• Still wants to collect data on impact of questions to inform future

program changes

Requests for Information Molly Smith Diane Jones

Requests for Information

• Promoting Interoperability and Electronic Health

Care Information Exchange Through Possible Revisions to the CMS Patient Health and Safety Requirements for Hospitals and Other Medicare Participating and Medicaid-Participating Providers and Suppliers

• Price Transparency: Improving Beneficiary

Access to Provider and Supplier Charge Information

• Leveraging the Authority for the Competitive

Acquisition Program (CAP) for Part B Drugs and Biologicals for a Potential CMS Innovation Center Model

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RFI: Condition of Participation to Promote Interoperability

CMS is interested in a new or revised CoP, CfC and RfP to advance electronic exchange of health information. Questions include:

• Is a CoP/CfC/RfP necessary to ensure patients or residents and their

providers routinely receive relevant electronic health information on a timely basis?

• Do stakeholders believe this would improve routine electronic health

information exchange and patient and resident care and safety?

• Are there fundamental barriers to interoperability and health information

exchange?

RFI: Price Transparency

Similar questions to what was included in inpatient and physician fee service rules:

• How to define “standard charges”
• Types of information that would be most beneficial patients and whether
• ut-of-pocket cost estimates should be provided in advance
• How cost information can better support patient choice and decision-

making

• The impact of Medigap
• Role of state-specific requirements or programs to help educate

Medigap patients about costs

RFI: Competitive Acquisition Program for Part B Drugs

• CMS is interested in developing a CMMI demo to test competitive acquisition of

some Part B drugs

• The model is based in part on the previous CAP program, as well as MedPAC’s

“Drug Value Program” model

CAP

• Voluntary
• Physicians placed orders with CAP vendor
• Vendor acquired & distributed drugs to

physicians

• Vendor billed Medicare & collected patient

cost-sharing

• HOPDs excluded

DVP

• Voluntary, but non-participating providers

subjected to reduction in ASP add-on over time

• Vendors could use negotiation tools not

allowed under the CAP program (e.g., formularies, prior authorization)

• Vendor would establish pricing but not

handle drug supply

• Shared savings for participating providers

RFI: Competitive Acquisition Program for Part B Drugs

• Which providers and suppliers should be eligible to

participate?

• Which drugs and biologicals should be included in the

program?

• What value-based purchasing strategies should CMS

require vendors to use?

• What beneficiary protections should be put in place?
• What selection criteria should CMS use to identify

vendors?

• How should CMS pay vendors?
• How can CMS incentivize manufacturer participation?
• Can the model be structured so that other payers can

participate?

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Questions?

Roslyne Schulman rschulman@aha.org Erik Rasmussen erasmussen@aha.org Caitlin Gillooley cgillooley@aha.org Molly Smith mollysmith@aha.org Diane Jones djones@aha.org

Today’s presentation will be available at: www.aha.org/opps