2020 Hospital Regulatory Update

2020 Hospital Regulatory Update BY TERI BEDARD, BA, RT(R)(T), CPC he Hospital Outpatient Prospective finalized CF. To determine this payment rate, ASCs to be approximately $4.96 billion, an Payment System (OPPS) is one of the CMS utilized data released in the inpatient increase of approximately $230 million from T Medicare payment systems that prospective payment system (IPPS) final rule CY 2019 payments. applies to facility-based settings, which for FY 2020, which had a 3 percent increase CMS finalized to continue applying a wage include, hospitals, ambulatory surgical for inpatient services, slightly lower than index of 1.000 for frontier state hospitals centers (ASCs), critical access hospitals proposed, and minus 0.4 percent for the (Montana, Wyoming, North Dakota, South (CAHs) and excepted off-campus provid- multifactor productivity (MFP) adjustment. Dakota, and Nevada), this policy has been in er-based departments. As indicated in the CY Due to wage index changes, a budget place since CY 2011. This ensures that lower 2019 OPPS final rule, the overarching goal of neutrality factor of 0.9981 was also applied population states are not “penalized” for the Centers for Medicare & Medicaid Services for CY 2020. reimbursement due to the low number of (CMS) is “to make payments for all services CMS is maintaining the rural adjustment people per square mile when compared to under the OPPS more consistent with those of factor of 7.1 percent to OPPS payments to other states. CMS also finalized for CY 2020 a prospective payment system and less like certain rural sole community hospitals to continue additional payments to cancer those of a per-service fee schedule, which pays (SCHs), including essential access commu- hospitals. The payment-to-cost ratio (PCR) is separately for each coded item.” To accom- nity hospitals (EACHs) for CY 2020 and applied as an additional payment and equal plish this, over the last several years CMS has subsequent years, until data support to the weighted average PCR for the other continued to package more ancillary services application of a different factor. This OPPS hospitals using the most recently into what are considered primary services, payment adjustment will continue to submitted or settled cost report data. CMS establishing reimbursement for the primary exclude separately payable drugs, biologicals, finalized to use a target PCR of 0.89 to service only. Another approach to control and devices paid under the pass-through determine the CY 2020 cancer hospital spending pursued by CMS is implementation payment policy. payment adjustment to be paid at cost of policies to make payments site-neutral so CMS estimates the increase to the OPPS report settlement. that the same service is reimbursed similarly will result in increases of 2.7 percent and 2.8 regardless of the setting in which it was percent for urban hospitals and rural APC Two-Times Rule performed—hospital, physician office, or ASC. hospitals, respectively. Comparing those Exceptions CMS projects CY 2020 OPPS expenditures hospitals that are classified as teaching CMS identified several ambulatory payment to be approximately $79 billion, an increase versus nonteaching, CMS estimates minor classifications (APCs) in violation of the of approximately $6.3 billion compared to teaching hospitals will experience an two-times rule for CY 2020. The two-times projected CY 2019 OPPS payments. The increase of approximately 2.9 percent, major rule does not allow codes to be assigned to agency finalized an increase of payment teaching hospitals 2.4 percent, and non- an APC where the highest cost code is more rates under the CY 2020 OPPS of 2.6 percent teaching hospitals 2.8 percent increase. than two times that of the lowest cost code. to the conversion factor of CY 2019, which is For ASC payments CY 2019 through CY If a two-times rule violation is identified, slightly lower than proposed. The CY 2020 2023, CMS has updated its policy for using a CMS and the advisory panel on Hospital conversion factor is finalized at $80.784; market basket update. For CY 2020 ASCs will Outpatient Payment (HOP) will reassign however, hospitals that fail to meet the see an increase of 2.6 percent for centers that codes or create a new APC. When determin- Hospital Outpatient Quality Reporting (OQR) meet quality reporting under the ASCQR ing if there is a two-times rule violation, CMS Program requirements will continue to be program, slightly lower than proposed. CMS only considers HCPCS codes that are penalized with a 2 percent reduction to the projects expenditures for beneficiaries in significant based on the number of claims. OI | January–February 2020 | accc-cancer.org 11 Within the final rule, CMS was able to For CY 2019, CMS finalized a site-neutral In the CY 2020 final rule, CMS responded remedy two of the APC violations but reimbursement methodology for code that it will be working to ensure affected identified an additional oneAPC 5593 (Level G0463. In any setting considered off-campus, 2019 claims for clinic visits are paid in a 3 Nuclear Medicine and Related Services). i.e., more than 250 yards from the main manner consistent with the court’s order, After consideration of comments and data, buildings of the hospital, either excepted or but the agency did not agree that it was CMS is making exceptions to 17 of the APC nonexcepted, CMS set a site-neutral payment appropriate at this time to make a change to two-times rule violations. This means no rate. This means that in excepted or the second year of the two-year phase-in adjustments or movement of codes to other nonexcepted off-campus locations, in CY policy. Within the CY 2020 final rule, CMS APCs to balance the highest and lowest 2019 the reimbursement for code G0463 was expressed the agency’s belief that the U.S. costing codes. This exception included the 40 percent of the on-campus outpatient Department of Health and Human Services two APCs related to oncology services APC reimbursement amount. Because this was a (HHS) Secretary does have the authority to 5612 (Level 2 Therapeutic Radiation high rate change, CMS implemented this make changes as a means of controlling Treatment Preparation) and APC 5691 (Level site-neutral payment approach over a unnecessary increases in the volume of 1 Drug Administration). two-year period, rather than all at once. outpatient department services. Specifically, CMS argues, the agency has the authority to Standardizing APC Payment For CY 2019, reimbursement for code remove potential reimbursement incentives Weights G0463 was set at 40 percent of the OPPS or differences that may unnecessarily APCs group services that are considered payment rate—a decrease of 60 percent. increase the volume of services provided clinically comparable to each other with However, to phase-in this payment reduc- based on location or setting. Implementing a respect to the resources utilized and the tion, the decrease was split in half so that in site-neutral payment policy for clinic visits associated cost. Ancillary services or items CY 2019 the reimbursement rates for G0463 will, CMS believes, appropriately and are necessary components of the primary in all off-campus provider-based depart- effectively impact and adjust any unneces- service and are packaged into the APC rates ments decreased by 30 percent, not the full and are not separately reimbursed. CMS 60 percent. For CY 2020 CMS finalized the sary services or continued increases in instructs providers to apply current remaining 30 percent decrease, so that in services due to higher reimbursement in a procedure-to-procedure edits and then 2020 the overall total reimbursement particular setting. report all remaining services on the claim reduction aimed at achieving site neutrality Based on evaluation of all the comments, form. CMS will only pay for services that are will reach 60 percent (or 40% of the OPPS legal action, and recommendations by the HOP, as indicated above, for CY2020 CMS is considered not packaged into another rate). This decision is not without consider- moving forward with the reduction. This service. able push-back and potential controversy. means that the full reduction in payments CMS will continue using HCPCS code Due to a lawsuit filed by the American will be applied (i.e., a 60 percent reduction to G0463 (Hospital outpatient clinic visit for Hospital Association challenging CMS’ the on-campus reimbursement for code assessment and management of a patient) authority to make this payment reduction, G0463) for those services provided in in APC 5012 (Level 2 Examinations and many commenters argued that the Sept. 17, off-campus excepted provider-based Related Services) as the standardized code 2019, decision by the U.S. District Court for departments. These departments will also for the relative payment weights. A relative the District of Columbia, to vacate the bill services with modifier PO to identify the payment weight of 1.00 will continue to be portion of the CY 2019 OPPS proposed rule assigned to APC 5012 (code G0463). CMS will classification of setting. CMS will continue to related to the volume control method for use the factor of 1.00 and then divide the monitor the services and volumes provided, clinic visits, did not support the decision by geometric mean cost of each APC by the as well as the ongoing litigation and judicial CMS to move forward with the second-year geometric mean cost of APC 5012 to derive decisions. implementation in payment reduction. CMS the unscaled relative payment weight for filed an appeal in late September 2019, but each APC. Changes to Supervision the motion to modify and request for stay CY 2020 will mark the second and final of Therapeutic Outpatient adjustment year based on CY 2019 finalized was denied.

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