Doctor concerned with health care law

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Health Law Daily, November 10, 2014

CMS finalizes $5.1B OPPS payment increase, updates quality reporting programs

By Bryant Storm, JD

CMS has issued a Final rule with comment period to update Medicare's outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for calendar year (CY) 2015. In addition to updating the OPPS and ASC payment rates, the Final rule updates requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program. The Final rule, which will take effect on January 1, 2015, includes a comment period, which will last 60 days and begin running on the date that the Final rule is published (Final rule, 79 FR 66770, November 10, 2014).

OPPS. The Final rule increases payment rates under the OPPS by an Outpatient Department (OPD) fee schedule increase factor of 2.2 percent. The rate increase is calculated by taking the hospital inpatient market basket percentage increase of 2.9 percent, for inpatient services paid under the hospital inpatient prospective payment system (IPPS), and subtracting from that increase the multifactor productivity (MFP) adjustment of 0.5 percentage point and the 0.2 percentage point adjustment required by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). The changes are expected to bring an increase of $5.1 billion over CY 2014 payments (see CMS projects OPPS payments for 2014 to increase by 9.5 percent, December 10, 2013).

ASC. For CY 2015, the ASC payment rates are being increased by 1.4 percent. The increase is based on a projected a consumer price index update for all urban consumers (CPI–U) of 1.9 percent, minus a 0.5 multifactor productivity adjustment required by the ACA. The rate increase is estimated to increase ASC payments by $236 million when compared to CY 2014 Medicare payments.

Adjustments. CMS is going to continue to implement the statutory 2.0 percentage point reduction in payments for hospitals that fail to meet the hospital outpatient quality reporting requirements. The Final rule continues the adjustment of 7.1 percent in OPPS payments to certain rural sole community hospitals (SCHs), including essential access community hospitals (EACHs). CMS will also continue to adjust payments to cancer hospitals so that the payment-to-cost ratio for each cancer hospital will be 0.89. Additionally, under the Final Rule, CMS will continue paying for non-pass-through drugs and biologicals that are payable separately under the OPPS at the average sale price plus 6 percent.

Packaging. The Final rule is expanding the packaging policies under the OPPS by conditionally packaging certain ancillary services when they are integral, ancillary, supportive, dependent, or adjunctive to a primary service. The services that are considered packaged under this ancillary service policy are those assigned to ambulatory payment classifications (APCs) having an APC geometric mean cost of less than or equal to $100. The Final rule is moving forward with the policies for comprehensive APCs (C-APCs) that were set out in the CY 2014 OPPS Final Rule. The C-APC policy treats all the services provided in the course of a hospital stay that are related to a primary service as a single primary service for the purposes of Medicare payment. CMS is establishing a total of 25 C-APCs for CY 2015 (see OPPS payments would increase $5.2 billion under 2015 proposed rule, July 14, 2014).

OQR program. The Final rule is adding one claims-based quality measure under the OQR program to take effect in CY 2018 instead of CY 2017, as CMS had proposed. Additionally, the Final rule refines criteria for “topped-out” measure status and removes two measures because they are “topped-out.” CMS is updating several other measures and excluding one payment determination measure for 2016 and making it optional for CY 2017. The Final rule also updates validation procedures, including procedures that allow hospitals to submit validation data electronically.

ASCQR program. The Final rule adopts a new quality measure for CY 2018 for the ASCQR program. CMS indicates that the measure will be computed using already available Medicare claims data and will not impose any additional burden on ASCs. CMS is excluding a measure for CY 2016 payment determination and is making it voluntary for CY 2017. The Final rule also creates a measure removal process, defines data collection timeframes, explains submission deadlines, and clarifies how the extraordinary circumstance extensions process works.

MainStory: TopStory FinalRules ReimbursementNews AgencyNews CMSNews CoverageNews PaymentNews QualityNews OPPSNews ASCNews

Health Law Daily

Introducing Wolters Kluwer Health Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.

A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.