Health Law Update

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On November 10, 2014, the Centers for Medicare and Medicaid Services (CMS) published the Outpatient Prospective Payment System (OPPS) final rule for 2015. The rule updates CMS’s payment rates and policies, value-based purchasing measures and quality measures for services furnished in hospital outpatient departments and ambulatory surgical centers (ASCs) effective as of January 1, 2015. The rule is a final rule with comment period. Comments on many parts of the final rule are due by December 30, 2014.

OPPS Payment Update. OPPS payment rates are estimated to increase by approximately 2.3 percent for CY 2015 (market basket increase of 2.9 percent, less (1) a productivity adjustment of 0.5 percentage points, and (2) a 0.2 percent Affordable Care Act (ACA) adjustment). In addition, the final rule increased outlier payments. CMS estimates that the overall changes made by the rule will increase rates by 3.1 percent for major teaching hospitals and 2.0 percent for other hospitals.

ASC Payment Update. ASC payment rates are increasing by 1.4 percent (CPI update of 1.9 percent less a 0.5 percent productivity adjustment).

Bundled Payments. CMS, in the final rule also continued its movement to bundled payments.
<ul>
	<li>Comprehensive APCs. CMS finalized the Comprehensive-APC (C-APC) policy for 25 out of the proposed 28 C-APCs.</li>
	<li>Ancillary Service Packaging. CMS conditionally packaged ancillary services assigned for APCs with a geometric mean cost of $100 or less for certain ancillary services when they are integral, ancillary, supportive, dependent or adjunctive to a primary service. Ancillary services packaging will not be applied in the case of preventive services, psychiatry-related services and drug administration services. CMS indicated that the procedures to which ancillary service packaging will be applicable is likely to expand in future years.</li>
</ul>
Provider-Based Services Reporting. CMS also announced that it will begin collecting data on services furnished in off-campus, provider-based departments. The data will be collected through the use of a modifier and by requiring physicians and other practitioners to report these services using a new place-of-service code. Data will be voluntary in CY 2015 and mandatory beginning January 1, 2016. This is an area to watch, as CMS’s commentary indicated concern with the rate differential between OPPS rates and physician fee schedule rates in light of the nature of certain hospital outpatient department designations.

Physician Inpatient Certification. The rule also revised physician certification requirements for most inpatient hospital services. Under the rule, a physician order will be required for inpatient admissions. However, the order will not be part of the certification process. In addition, certification will only be required for patients having inpatient stays of 20 days or more and for outlier cases. CMS currently requires a physician certification, including the admission order, for all inpatient admissions.

Physician-Owned Hospitals. CMS made changes to the data sources permitted for expansion requests for physician-owned hospitals under the Stark Law, as modified by the ACA.

Medicare Advantage Plan and Part D Additional Recoupment Authority. CMS established a process, including a three-level appeals mechanism, to recoup overpayments that result from the submission of erroneous payment data by Medicare Advantage (MA) organizations and Part D sponsors where the MA organization or sponsor fails to correct the data.

Quality Measures. Finally, CMS adopted changes to the quality reporting rules, including a new outcome measure for the Outpatient Quality Reporting and Ambulatory Surgical Centers Quality Reporting programs starting in 2018: Facility Seven-Day Risk-Standardized Hospital Visit Rate after Outpatient Colonoscopy. CMS also refines its criteria for determining ‘‘topped-out’’ measures and removed the OP–6 and OP–7 measures due to ‘‘topped-out’’ status.

2015 Medicare OPPS and ASC Final Rule