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Proposed FY2020 Outpatient Prospective Payment System Rule

Tuesday, July 30, 2019   (0 Comments)
Posted by: TCAA Staff
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Increasing Price Transparency of Hospital Standard Charges

On June 24, 2019, the President signed an Executive Order on Improving Price and Quality Transparency in American Healthcare to Put Patients First noting that it is the policy of the Federal Government to increase the availability of meaningful price and quality information for patients. The Executive Order directed the Secretary of Health and Human Services (HHS) to propose a regulation, consistent with applicable law, to require hospitals to publicly post standard charge information.


The proposed rule includes:

  • Proposed Definition of ‘Hospital’
  • Proposed Definition of ‘Standard Charges’
  • Proposed Definition of Hospital ‘Items and Services’
  • Proposed Requirements for Making Public All Standard Charges for All Items and Services
  • Proposals for Monitoring and Enforcement

Doubling Down on Past Policies

Authority on Clinic Visits used in FY19 – affects grandfathered sites too

Method to Control for Unnecessary Increases in Utilization of Outpatient Services

  • CMS is completing the two-year phase-in of a method to reduce unnecessary utilization in outpatient services by addressing payments for clinic visits furnished in the off-campus hospital outpatient setting.
  • This proposed change would result in lower copayments for beneficiaries and savings for the Medicare program and taxpayers estimated to be a total of $810 million for 2020. For example, for a clinic visit furnished in an excepted off-campus provider-based department, average beneficiary cost sharing is currently $16 in CY 2019, but would be $23 absent this policy.
  • With the completion of the two-year phase-in, that cost sharing would be reduced to $9, saving beneficiaries an average of $14 each time they visit an off-campus department for a clinic visit in CY 2020.

ASC Covered Procedures List

For CY 2020, CMS is proposing to add Total Knee Arthroplasty (TKA), Knee Mosaicplasty, and three additional coronary intervention procedures to the ASC CPL. CMS is soliciting comment on whether there should be any additional limitations on the provision of TKA or other procedures in the ASC setting. Additionally, CMS is soliciting comments on how the agency could redesign the role of the ASC-CPL to improve physicians’ ability to determine the setting of care as appropriate for a given beneficiary situation.

 

Addressing Wage Index Disparities  

For CY 2020, CMS is proposing to use the FY 2020 hospital Inpatient Prospective Payment System (IPPS) post-reclassified wage index for urban and rural areas as the wage index for the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount. Therefore, any adjustments for the FY 2020 IPPS post-reclassified wage index, including, but not limited to, any proposed policies finalized under the IPPS to address wage index disparities between low and high wage index value hospitals would be reflected in the final CY 2020 OPPS wage index beginning on January 1, 2020.

  • In the FY 2020 IPPS proposed rule, CMS proposed a number of policies to address wage index disparities between high and low wage index value hospitals. CMS proposed to increase the wage index for hospitals with a wage index value below the 25th percentile and decrease the wage index for hospitals above the 75th percentile so that Medicare spending does not increase as a result of the proposal described above. If CMS finalizes these policies in the FY 2020 IPPS final rule, these wage index policies would be reflected in the final OPPS wage index for at least 4 years starting in CY 2020.
  • In the FY 2020 IPPS proposed rule, CMS also proposed changes to the wage index “rural floor” calculation. If CMS finalizes this policy in the FY 2020 IPPS final rule, this wage index policy would be reflected in the final OPPS wage index starting in CY 2020.
  • In addition, in the FY 2020 IPPS proposed rule, to mitigate payment decreases due to these proposals, CMS proposed a 5-percent cap on any decrease in a hospital’s wage index from its final wage index for FY 2019.

Double down on 340B policy and now includes biosimilars

Finally, we solicit comments on an appropriate remedy in litigation involving our OPPS payment policy for 340B-acquired drugs, which would inform future rulemaking in the event of an adverse decision on appeal in that litigation.

 

340B-Acquired Drugs:

  • We are proposing to continue to pay ASP-22.5 percent for 340B-acquired drugs including when furnished in non-excepted off-campus PBDs paid under the PFS.
  • The court ruled that the Secretary exceeded his statutory authority by adjusting the Medicare payment rates.
  • CMS is taking the steps necessary to craft an appropriate remedy in the event of an unfavorable decision on appeal.
  • We are soliciting public comments on the appropriate OPPS payment rate for 340B-acquired drugs, including whether a rate of ASP+3 percent could be an appropriate payment amount for these drugs, both for CY 2020 and for purposes of determining the remedy for CYs 2018 and 2019.
  • In addition to comments on the appropriate payment amount for calculating the remedy for CYs 2018 and 2019 and for use for CY 2020, we also seek public comment on how to structure the remedy for CYs 2018 and 2019.
  • In the event of an adverse decision on appeal, we would anticipate proposing the specific remedy for CYs 2018 and2019, and, if necessary, to the CY 2020 rates, in the next

Reference the Proposed FY2020 Outpatient Prospective Payment System Rule fact sheet here. 


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