On July 3, 2008, the Centers for Medicare & Medicaid Services (CMS) posted a proposed rule for Medicare payment for hospital outpatient services and ambulatory surgical centers for calendar year (CY) 2009. The proposed rules affect hospital outpatient and ASC payments for services paid under the outpatient prospective payment (HOPPS) and ASC systems. The proposed rule includes a 3.0 percent annual inflation update to Medicare payment rates for most services that would be paid under the OPPS. Important Nuclear Medicine, Nuclear Cardiology and Cardiac CTA proposed CMS policies include:
Proposed HOPPS Changes
· CMS proposes to continue bundling payments for ALL diagnostic radiopharmaceuticals and contrast agents in with the APC category (major service procedure). CMS believes these are considered ancillary/supplies. For (new) transitional pass-through diagnostic radiopharmaceuticals (RP) payments, CMS proposes to use the device methodology to estimate radiopharmaceutical offset costs that could reasonably be attributed to the diagnostic RP packaged into APC groups in an effort to avoid duplicate payments.
· Separately payable therapeutic radiopharmaceuticals are proposed to be paid by CMS utilizing voluntary manufacturer-submitted ASP information through the existing ASP process at ASP+4 percent, as the best proxy for therapeutic radiopharmaceutical average acquisition and handling costs. If ASP information is not available, CMS is proposing that payment would be based upon mean costs from hospital claims data. In the rule CMS states, "we are proposing to allow manufacturers to submit ASP information for any separately payable therapeutic radiopharmaceutical for payment purposes under OPPS. However, we are not proposing to compel manufacturers to submit ASP."
Note: Both the House and the Senate have passed a new comprehensive Medicare Bill (H.R. 6331) that would continue the current payment methodology for 18 months based upon individual hospital charges adjusted to cost. This legislation now awaits the President's signature or veto and would supersede the above proposed change in payment methodology.
· Drugs and biologicals are proposed to be paid at 104 percent of the average sales price (ASP+4), rather than the current rate of 106 percent of average sales price (ASP) paid in the office and IDTF setting.
· CMS proposes to pay separately for drugs, biologicals and therapeutic radiopharmaceuticals costing $60 or more per day. Payments for other drugs will continue to be bundled into payments for their associated procedures.
· CMS continues bundling add-on "image processing services" with the costs of the major procedure CPT codes. Examples of bundled CPTs are: 76376, 76377, 78020, 78478, 78480, 78496, and 93325.
· CMS proposes increased packaging for multiple imaging services (an extension of "composites") provided in one session; targeted modalities are Computed Tomography and Cardiac CTA, Magnetic resonance imaging (MRI and MRA) and Ultrasound services. Nuclear Medicine is currently NOT one of the proposed modalities selected in this new policy. CMS states it is proposing this policy to encourage greater efficiency by changing how it pays for imaging services when multiple services are provided in one session. Under the proposal, CMS would make a single payment for multiple services of the identified modalities through five newly created imaging composite APC groups. This new policy is intended to encourage imaging efficiencies, similar to the multiple procedure reduction currently implemented in the physician office and IDTF setting.
· CMS is also proposing changes to the hospital Medicare cost report to improve the accuracy of future cost estimates used to determine payment for drugs and biologicals.
· CMS is proposing to set the payment rates for nuclear medicine procedures based on the 2008 final rule established rate setting methodology using claims that include a charge for a required diagnostic radiopharmaceutical or other radioactive product.
· CMS is proposing to pay for Brachytherapy sources based on median unit costs as calculated from claims data, according to the standard OPPS payment methodology. As noted above the current payment methodology based upon individual hospital charges adjusted to cost may be continued for 18 months pending legislation awaiting Presidential signature or veto.
The proposed rule also updates rates paid under the ASC Prospective Payment System (ASC PPS), which will be in the second year of a four-year transition that aligns ASC rates with the ambulatory payment classification (APC) groups that are used to pay for services in hospital outpatient departments.
The revised ASC payment rates were set to reflect the same relativity of resource use among services as under the OPPS, taking into consideration the lower costs of ASC services and the requirement for budget neutrality in CY 2008, the first year of the revised payment system. Any changes CMS proposes to make to the ASC payment system for CY 2009 will not increase or decrease aggregate Medicare spending. The law does not allow an inflation update to the ASC payment system for CY 2009.
Proposals to Strengthen Ties between Payment and Quality:
The law now requires that the annual OPPS payment inflation update be reduced by 2.0 percentage points for hospitals that do not meet quality-reporting requirements.
· Payment reduction for failure to report quality measures – As required by law, CMS is proposing to reduce the proposed CY 2010 market basket inflation update for those hospitals that fail to successfully report required quality measures beginning in CY 2009 by two percentage points. The proposed reduction would not apply to payments for pass-through drugs and devices, separately payable drugs and biologicals, separately payable therapeutic radiopharmaceuticals, and services assigned to New Technology APCs. CMS is also proposing to reduce the beneficiary co-payment amount for services furnished in hospitals that have not met their reporting requirements so that beneficiaries share in the reduction of payments to these hospitals.
· New quality measures to be reported – CMS is proposing to add four imaging efficiency measures that would be calculated using Medicare claims data, increasing the number of measures that must be reported from 7 in CY 2008 to 11 in CY 2009, in order for hospitals to receive the full market basket updates in CY 2010. For consideration for future OPPS updates, CMS is also seeking public comment on eighteen additional potential quality measures in areas including cancer care, emergency department throughput, screening for fall risk, and management of certain clinical conditions such as depression, stroke and rehabilitation, osteoporosis, asthma, and community-acquired pneumonia.
· Validation of quality reporting – CMS is also proposing to implement a data validation approach for CY 2010 starting with January 2009 encounters. This proposed validation approach would randomly select 800 reporting hospitals and validate the accuracy of reported data by selecting 50 records per selected hospital on an annual basis.
The final rule is now posted on the CMS website at: http://www.cms.hhs.gov/HospitalOutpatientPPS/HORD/list.asp#TopOfPage
For more information on the CY 2009 proposals for the OPPS and ASC payment system, please see the CMS Web site at:
OPPS: http://www.cms.hhs.gov/HospitalOutpatientPPS/
ASC payment system: http://www.cms.hhs.gov/ASCPayment/
The Proposed Rule was placed on display at the Federal Register on July 3, 2008, and will be published in the federal register (date TBD). It would be effective for outpatient and ASC services furnished to Medicare beneficiaries on or after January 1, 2009.
CMS encourages all to submit comments on this proposed HOPPS & ASC notice by September 2, 2008, and a final CY 2009 OPPS/ASC payment rule will be issued by November 1, 2008. Electronic submission at URL: http://www.cms.hhs.gov/eRulemaking/ Docket ID CMS-1404-P
