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Category: Industry News

OPPS Proposed Rule – CY 2019

CMS-1695-P drafted on 7/25/2018; Published in the Federal Register on 7/31/2018

On July 25, 2018, the Centers for Medicare & Medicaid Services (CMS) proposed changes to ensure that seniors can access the care they need at the site of care that they choose and to lower drug prices as outlined in the President’s Blueprint. The proposed policies in the CY 2019 Medicare Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System proposed rule would help lay the foundation for a patient-driven healthcare system.

To increase the sustainability of the Medicare program and improve quality of care for seniors, CMS is moving toward site neutral payments for clinic visits (which are essentially check-ups with a clinician). Clinic visits are the most common service billed under the OPPS. Currently, CMS often pays more for the same type of clinic visit in the hospital outpatient setting than in the physician office setting.  If finalized, this proposal is projected to save patients about $150 million in lower copayments for clinic visits provided at an off-campus hospital outpatient department. CMS is also proposing to close a potential loophole through which providers are billing patients more for visits in hospital outpatient departments when they create new service lines.

As part of active efforts to reduce the cost of prescription drugs, CMS is issuing a Request for Information to solicit public comment on how best to leverage the authority provided under the Competitive Acquisition Program (CAP) to get a better deal for beneficiaries as part of a CMS Innovation Center model. CMS believes a CAP-based model would allow the program to introduce competition to Medicare Part B, the part of Medicare that pays for medicines that patients receive in a doctor’s office.

In 2018, CMS implemented a payment policy to help beneficiaries save on coinsurance on drugs that were administered at hospital outpatient departments and that were acquired through the 340B program-a program that allows hospitals to buy certain outpatient drugs at a lower cost. Due to CMS’s policy change, Medicare beneficiaries are now benefiting from the discounts that 340B hospitals enjoy when they receive 340B-acquired drugs. In 2018 alone, beneficiaries have saved an estimated $320 million on out-of-pocket payments for these drugs. For 2019, CMS is expanding this policy by proposing to extend the 340B payment change to non-excepted off-campus departments of hospitals that are paid under the Physician Fee Schedule.

CMS is also seeking comment through a Request for Information asking whether providers and suppliers can and should be required to inform patients about charge and payment information for healthcare services and out-of-pocket costs, what data elements would be most useful to promote price shopping, and what other changes are needed to empower healthcare consumers.

Overall, the proposed rule is projected to result in an estimated decrease of $610M (or -0.1%) in payments to providers, ranging from 3.4% decreases for hospitals in the New England region up to 2.1% increases for non-teaching, non-DSH urban hospitals.

For more information regarding this Proposed Rule, see below:

Fact Sheet Link

Federal Register Link

Medicare OPPS Base Rates

CMS is proposing a base rate increase of 1.25% for hospitals that submit OQR quality data and 2.0% for ASCs that submit ASCQR quality data.

APC Changes

As expected, CMS is proposing weighting changes to APC weights for CY2019, along with new APC codes and new HCPCS codes. Below is a listing of the largest changes in weighting between CY2018 and CY2019 APCs:
 
Click here for a table of the full APC weighting comparison between CY2018 and CY2019.
 
Click here for a table of the new HCPCS codes effective 7/1/2018.
Other APC Changes
CMS has proposed to create three new comprehensive APCs (C-APCs) for ears, nose, and throat (ENT) and vascular procedures. CMS also proposes to remove two procedures from the inpatient-only list and add one procedure to the list.
Click here for a table of the changes to the inpatient-only procedures.

Changes to Quality Reporting

CMS is proposing several changes to the Outpatient Quality Reporting (OQR) in an effort to reduce burdens on hospitals, including the removal of 10 measures from the OQR (1 from CY2020 and 9 from CY2021). CMS also proposes to remove the three recently revised pain communication questions, starting with services on Jan. 1, 2022, to address concerns that providers might feel pressure to offer opioids in order to raise survey scores.
Click here for a table of the 10 OQR measures proposed to be removed.
 
Click here for a table of the 26 OQR measures required for CY 2020 and here for a table of the 15 ASCQR measures required for CY2020.

Off-Campus Payment Policy Changes

CMS remains concerned with the shift of services from freestanding physician offices to hospital provider-based departments (PBDs). As a result, they are proposing several significant changes that will negatively impact OPPS reimbursement for these facilities:
Expansion of PFS Rate for All Clinic Visits: CMS will extend the reduced Physician Fee Schedule (PFS) rate for clinic visits (HCPCS code G0463) to all off-campus PBDs, even those excepted under Section 603. (Note: The PFS payment rate is approximately 40% less than the OPPS rate.)CMS estimates that the impact of this change is expected to reduce reimbursement to hospitals by $760M.
Restricting “Clinical Families of Services”: CMS is also proposing to require that if an excepted off-campus PBD furnishes services from any clinical family of services from which it did not furnish and bill during the period from 11/1/2014 to 11/1/2015, such items and services would be paid at the reduced PFS rate applied to non-excepted off-campus PBDs. New items or services within a clinical family of service would continue to be paid under OPPS, as this would be considered a “service expansion.” For mid-build providers, CMS proposes a 1-year baseline period beginning on the first date the off-campus PBD furnished the service under OPPS.
Click here for a table of the clinical families of services.
New “ER” Modifier: Finally, CMS also plans to require a new “ER” modifier to identify services in off-campus ER departments. This is meant to address the MedPAC recommendation for CMS to assess the extent to which OPPS services are shifting to off-campus ER departments. (Critical access hospitals would be exempt from this reporting requirement.)

Changes to Drug Payment Policy 

In response to the President’s Commission on Combating Drug Addiction and the Opioid Crisis, CMS proposes to change the packaging policy for certain drugs. CMS is also proposing to change the payment for separately payable drugs for non-excepted off-campus PBDs to the same lower ASP minus 22.5% (or 77.5% of ASP) that excepted off-campus PBDs receive. Currently these non-excepted departments receive 106% of ASP for these drugs. SCHs, Children’s, and Cancer hospitals would be exempt.
 
Click here for a table of the drugs and biologicals with pass-through status expiring on 12/31/2018.

CMS Request for Information

CMS is seeking feedback as to how providers may safely and effectively transition EHR among other providers and thereby improve interoperability.

CMS is also interested in continuing the discussion as to how hospitals might improve access to charge information across providers in order to help patients understand their financial liability, including out-of-pocket costs.

Finally, CMS is soliciting comments on key designs for developing a potential model that would test private market strategies and introduce competition to improve quality of care for beneficiaries, while reducing both Medicare expenditures and beneficiaries’ out-of-pocket spending.  They are seeking feedback that would accelerate the move to a value-based healthcare system building upon the Competitive Acquisition Program (CAP) for Part B drugs.

For additional information, please contact Ron Knapp at ron.knapp@toyonassociates.com.

Other Recently Published Proposed Rules  

CY 2019 HHA PPS Proposed Rule [CMS-1689-P]
(FR Publish Date 7/12/2018)
  • Expected 2.1% increase in payments to HHAs in CY 2019
  • Rural add-on payment extended for CYs 2019 through 2022 with new methodology
  • Cost of remote patient monitoring will be allowable costs on the Medicare cost report
CY 2019 ESRD PPS and DMEPOS Proposed Rule [CMS-1691-P]
[FR Publish Date 7/19/2018)
  • Proposed ESRD
  • Updates to ESRD QIP measures and codifying several previously finalized requirements
  • Changes to the DMEPOS Competitive Bidding Program (CBP)
Physician Fee Schedule, Quality Programs, and Medicaid Interoperability Proposed Rule [CMS-1693-P]
(FR Publish Date 7/27/2018)
  • Updates to PFS RVUs, including an increase in the conversion factor of 0.13% to $36.0463
  • Elimination of payment distinction and documentation requirements E&M visit levels 2
    through 5
  • 50% multiple procedure payment adjustment when E&M visits and procedures with global periods are furnished together
  • Moving forward with Appropriate Use Criteria (AUC) using a Clinical Decision Support Mechanism (CDSM)
    >Effective 1/1/2020, physicians and other practitioners who order advance diagnostic
    imaging must consult with AUC and report the consultation information on the claims.
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Hospitals are Throwing Out Organs & Denying Transplants to Meet Federal Standards

From: STAT – 8/11/16

Article Excerpt:

Hospitals across the United States are throwing away less-than-perfect organs and denying the sickest people lifesaving transplants out of fear that poor surgical outcomes will result in a federal crackdown.

As a result, thousands of patients are losing the chance at surgeries that could significantly prolong their lives, and the altruism of organ donation is being wasted.

“It’s gut-wrenching and mind-boggling,” said Dr. Adel Bozorgzadeh, a transplant surgeon at UMass Memorial Medical Center in Worcester, Mass.

He coauthored a recent study that showed a sharp uptick in the number of people dropped from organ transplant waiting lists since the federal government set transplant standards in 2007. These standards are tied to federal hospital ratings and Medicare funding, which is the main payer for transplants and a key source of income for hospitals. And hospitals’ ability to meet those standards helps determine their reputation within the medical community. Surgeries involving imperfect organs and extremely ill patients are more risky, so hospitals that do many of them run the risk of poor outcomes that may hurt their performance on the standards.

Soon after the study was published in April, the Centers for Medicare and Medicaid Services changed its benchmarks to give hospitals — and surgeries — more leeway to fail. But patients and doctors are still uneasy about the erosion of one of transplantation’s fundamental principles: the sicker you are, the higher you move up the waiting list for donated organs.

“This has been a nightmare, a very expensive nightmare,” said Kathy Barnes, whose husband, James, has been denied a liver transplant by three hospitals, but who is on the waiting list at UMass Memorial.

“Why won’t they do it?” she asked. “It seems like some of them are just looking for an excuse to say no, and I don’t understand that.”

The study by Bozorgzadeh, published by the American College of Surgeons, found that the increasing reluctance to perform transplants on the sickest patients is directly tied to the onset of the standards enforced by CMS.In the first five years after adoption of the standards, more than 4,300 transplant candidates were removed from waiting lists by hospitals.That’s up 86 percent from the 2,311 patients delisted in the five years prior to the regulation.

Bozorgzadeh said the federal regulations are turning transplantation into a numbers game that makes it harder to help patients who deserve a fighting chance.

“If you have young guy who has a 100 percent chance of dying, but only a 30 percent chance of dying with a transplant, you would say, ‘What the hell, give the guy a chance,’” even if the operation might be risky, he said. “But if I make an argument like that, I will be under pressure from all these other stakeholders who would penalize me.”

The number of organs being tossed out has also increased because of concerns that their imperfections could lead to bad outcomes. Last year, 3,159 donated kidneys were discarded, up 20 percent from 2007, according to federal data.

“To me, it just doesn’t make any sense,” said Howard Nathan, chief executive of a Gift of Life Donor Program based in Philadelphia. “We have hundreds of thousands of people on dialysis. And you have these kidneys available that would work … but transplant centers are afraid to use them because they might pull their results down.”

The trend also has a financial impact — not just on the patients, but on American taxpayers.

As federal regulators have noted, it costs the Medicare program more in the long run to keep patients with ailing kidneys on dialysis than to give them organ transplants. Transplant patients also tend to live longer and have a better quality of life.

Read more…

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Mississippi Medical Center Hit with $2.75M Fine for Privacy Breach

From: The Hill – 7/25/16

The Department of Health and Human Services hit the University of Mississippi Medical Center (UMMC) with a $2.75 million fine over a health data breach, its second major privacy action in a week.

The HHS Office for Civil Rights (OCR) is penalizing UMMC for a series of alleged privacy and security violations of the Health Insurance Portability and Accountability Act, also known as HIPAA. The settlement relates to a password-protected laptop that went missing from the hospital’s intensive care unit in March 2013. After an investigation, the medical center determined the computer was likely stolen by a visitor who had asked to borrow it.

According to the Office of Civil Rights, the hospital’s network was easily accessed with a “generic” username and password, granting access to the protected health information of 10,000 patients. UMMC said the laptop was assigned to the unit, and while accessing the network required individual log-ins, accessing the patient record database did not.

The settlement also called for a three-year corrective action plan that addresses the deficiencies the agency found in its investigation. Specifically, officials alleged that the medical center failed to install physical safeguards for workstations containing protected data, failed to implement tracking features for users accessing electronic health information and failed to notify all individuals affected by the breaches. The medical center did not admit liability in the settlement.

In a statement, they admitted to some of the shortcomings but said that there is no evidence that any protected data were accessed.

“In the last several years, UMMC has initiated substantial improvements in its information security program,” the statement reads. “Among other initiatives, the Medical Center is requiring that all laptop computers have encryption software installed, restructured the role and reporting relationships of its Chief Information Security Officer, and brought in an outside firm for a complete assessment and overhaul of its IT security program.”

On July 18, the Office of Civil Rights settled another HIPAA case with Oregon Health & Science University (OHSU) for $2.7 million after four breaches in 2012 and 2013 compromised the data of more than 3,000 individuals. In those cases, two unencrypted laptops and one unencrypted thumb drive were lost or stolen. Government officials also said the hospital failed to implement a required security agreement with a cloud service provider where health data were stored.

The university agreed to a three-year corrective action plan to address the alleged shortcomings in its security procedures, but the hospital did not admit liability in the settlement. The university said there have been no reports that the data have been mishandled and that it had expanded computer encryption software across its network.

The recent string of settlements highlights the OCR’s intention to step up enforcement as health data breaches continue to make headlines. On June 29, OCR announced its first HIPAA settlement with a business associate, or contractor, that handles medical data for organizations like hospitals and insurance companies.

The fines come as the agency kicks off its highly anticipated second phase of HIPAA audits, after a long delay following its pilot program in 2012. On July 11, OCR notified 167 healthcare organizations — or covered entities, as they’re known under HIPAA — of their selection for the probe’s desk audit portion. The agency eventually plans to initiate on-site audits.

Read more:

Mississippi Medical Center Hit with $2.75M Fine for Privacy Breach

 

 

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