CMS bundles payments to outpatient departments, adds quality measures

Medicare officials are seeking to package more hospital outpatient department services into a single payment while also beefing up quality reporting programs in hospitals and ambulatory surgical centers.

The plans are part of the 2014 proposed rule for the Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System, announced July 8 and to be published in the Federal Register on July 19.

Overall, officials at the Centers for Medicare and Medicaid Services (CMS) are proposing a 1.8% payment increase for outpatient departments in 2014. But the agency wants to change the way these hospital departments are paid by bundling more services into a single payment.

Currently, the CMS offers a single payment for a variety of services including anesthesia, surgical supplies, imaging processing services, and implantable biologicals. The proposed rule would add seven new categories of services to that package.

The categories include:

• Drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure.

• Drugs and biologicals that function as supplies or devices when used in a surgical procedure.

• Certain clinical diagnostic laboratory tests.

• Procedures described by add-on codes.

• Ancillary services such as chest x-rays that are assigned the status indicator "X."

• Diagnostic tests on the bypass list.

• Device removal procedures.

The CMS will continue to pay separately for these types of services if they are reported alone on a claim.

Medicare will also continue to pay the average sales price plus 6% for non-pass-through drugs and biologicals that are paid separately under the prospective payment system.

In a change that would have a major impact on hospital emergency departments, the CMS is also seeking to streamline payment for outpatient visit codes. In the rule, the CMS is proposing to replace the current five levels of outpatient visit codes with three Level II Healthcare Common Procedure Coding System (HCPCS) codes representing a single level of payment. A Level II HCPCS code would be available for each type of visit: clinic, type A ED, and type B ED. Rates for the new codes will be based on the total mean costs of the Level 1 through 5 visit codes from 2012 claims data, according to the proposal.

"By collapsing the current five levels of codes to one level, the CMS believes this proposal will remove incentives hospitals may have to provide medically unnecessary services and expend additional, unnecessary resources to achieve a higher level of visit payment," the agency wrote in a fact sheet on the proposal. CMS officials also predicted that the change would reduce administration burden and be able to be easily adopted by hospitals.

The proposed rule would also expand Medicare’s quality reporting programs. The agency is proposing to add five new measures to the Hospital Outpatient Quality Reporting Program.

The new measures include influenza vaccination coverage among health care workers, complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps.

Data collection on the new measures would begin in January 2014, but payments would not be affected until 2016.

Agency officials also want to remove two measures from the program because they are overly burdensome on providers. They propose eliminating the use of the measure on "transition record with specified elements received by discharged ED patients" and a cardiac rehabilitation measure on "patient referral from an outpatient setting."

Ambulatory surgery centers will also be asked to report more quality information next year. The CMS is proposing to add four new measures to the ASC Quality Reporting Program, which are similar to those being proposed for the Hospital Outpatient Quality Reporting Program.

The measures include complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps. The data will be collected in 2014 to determine payments in 2016.

The CMS will accept public comment on the rule until Sept. 6, and a final regulation is expected to be published by November.

[email protected]

Medicare officials are seeking to package more hospital outpatient department services into a single payment while also beefing up quality reporting programs in hospitals and ambulatory surgical centers.

The plans are part of the 2014 proposed rule for the Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System, announced July 8 and to be published in the Federal Register on July 19.

Overall, officials at the Centers for Medicare and Medicaid Services (CMS) are proposing a 1.8% payment increase for outpatient departments in 2014. But the agency wants to change the way these hospital departments are paid by bundling more services into a single payment.

Currently, the CMS offers a single payment for a variety of services including anesthesia, surgical supplies, imaging processing services, and implantable biologicals. The proposed rule would add seven new categories of services to that package.

The categories include:

• Drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure.

• Drugs and biologicals that function as supplies or devices when used in a surgical procedure.

• Certain clinical diagnostic laboratory tests.

• Procedures described by add-on codes.

• Ancillary services such as chest x-rays that are assigned the status indicator "X."

• Diagnostic tests on the bypass list.

• Device removal procedures.

The CMS will continue to pay separately for these types of services if they are reported alone on a claim.

Medicare will also continue to pay the average sales price plus 6% for non-pass-through drugs and biologicals that are paid separately under the prospective payment system.

In a change that would have a major impact on hospital emergency departments, the CMS is also seeking to streamline payment for outpatient visit codes. In the rule, the CMS is proposing to replace the current five levels of outpatient visit codes with three Level II Healthcare Common Procedure Coding System (HCPCS) codes representing a single level of payment. A Level II HCPCS code would be available for each type of visit: clinic, type A ED, and type B ED. Rates for the new codes will be based on the total mean costs of the Level 1 through 5 visit codes from 2012 claims data, according to the proposal.

"By collapsing the current five levels of codes to one level, the CMS believes this proposal will remove incentives hospitals may have to provide medically unnecessary services and expend additional, unnecessary resources to achieve a higher level of visit payment," the agency wrote in a fact sheet on the proposal. CMS officials also predicted that the change would reduce administration burden and be able to be easily adopted by hospitals.

The proposed rule would also expand Medicare’s quality reporting programs. The agency is proposing to add five new measures to the Hospital Outpatient Quality Reporting Program.

The new measures include influenza vaccination coverage among health care workers, complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps.

Data collection on the new measures would begin in January 2014, but payments would not be affected until 2016.

Agency officials also want to remove two measures from the program because they are overly burdensome on providers. They propose eliminating the use of the measure on "transition record with specified elements received by discharged ED patients" and a cardiac rehabilitation measure on "patient referral from an outpatient setting."

Ambulatory surgery centers will also be asked to report more quality information next year. The CMS is proposing to add four new measures to the ASC Quality Reporting Program, which are similar to those being proposed for the Hospital Outpatient Quality Reporting Program.

The measures include complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps. The data will be collected in 2014 to determine payments in 2016.

The CMS will accept public comment on the rule until Sept. 6, and a final regulation is expected to be published by November.

[email protected]

Medicare officials are seeking to package more hospital outpatient department services into a single payment while also beefing up quality reporting programs in hospitals and ambulatory surgical centers.

The plans are part of the 2014 proposed rule for the Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System, announced July 8 and to be published in the Federal Register on July 19.

Overall, officials at the Centers for Medicare and Medicaid Services (CMS) are proposing a 1.8% payment increase for outpatient departments in 2014. But the agency wants to change the way these hospital departments are paid by bundling more services into a single payment.

Currently, the CMS offers a single payment for a variety of services including anesthesia, surgical supplies, imaging processing services, and implantable biologicals. The proposed rule would add seven new categories of services to that package.

The categories include:

• Drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure.

• Drugs and biologicals that function as supplies or devices when used in a surgical procedure.

• Certain clinical diagnostic laboratory tests.

• Procedures described by add-on codes.

• Ancillary services such as chest x-rays that are assigned the status indicator "X."

• Diagnostic tests on the bypass list.

• Device removal procedures.

The CMS will continue to pay separately for these types of services if they are reported alone on a claim.

Medicare will also continue to pay the average sales price plus 6% for non-pass-through drugs and biologicals that are paid separately under the prospective payment system.

In a change that would have a major impact on hospital emergency departments, the CMS is also seeking to streamline payment for outpatient visit codes. In the rule, the CMS is proposing to replace the current five levels of outpatient visit codes with three Level II Healthcare Common Procedure Coding System (HCPCS) codes representing a single level of payment. A Level II HCPCS code would be available for each type of visit: clinic, type A ED, and type B ED. Rates for the new codes will be based on the total mean costs of the Level 1 through 5 visit codes from 2012 claims data, according to the proposal.

"By collapsing the current five levels of codes to one level, the CMS believes this proposal will remove incentives hospitals may have to provide medically unnecessary services and expend additional, unnecessary resources to achieve a higher level of visit payment," the agency wrote in a fact sheet on the proposal. CMS officials also predicted that the change would reduce administration burden and be able to be easily adopted by hospitals.

The proposed rule would also expand Medicare’s quality reporting programs. The agency is proposing to add five new measures to the Hospital Outpatient Quality Reporting Program.

The new measures include influenza vaccination coverage among health care workers, complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps.

Data collection on the new measures would begin in January 2014, but payments would not be affected until 2016.

Agency officials also want to remove two measures from the program because they are overly burdensome on providers. They propose eliminating the use of the measure on "transition record with specified elements received by discharged ED patients" and a cardiac rehabilitation measure on "patient referral from an outpatient setting."

Ambulatory surgery centers will also be asked to report more quality information next year. The CMS is proposing to add four new measures to the ASC Quality Reporting Program, which are similar to those being proposed for the Hospital Outpatient Quality Reporting Program.

The measures include complications within 30 days following cataract surgery requiring additional procedures, improvement in a patient’s visual function within 90 days after cataract surgery, appropriate follow-up interval for normal colonoscopy in average-risk patients, and colonoscopy interval for patients with a history of adenomatous polyps. The data will be collected in 2014 to determine payments in 2016.

The CMS will accept public comment on the rule until Sept. 6, and a final regulation is expected to be published by November.

[email protected]