CMS Releases The 2019 OPPS And ASC Payment System Final Rule

Miranda A Franco is Senior Policy Advisor in Holland & Knight's Washington D.C. office

HIGHLIGHTS:

The Centers for Medicare & Medicaid Services (CMS) has issued the Calendar Year (CY) 2019 Final Rule that updates payment rates and policy changes in the Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System. Significant finalized policies include a proposal to expand Medicare reimbursement cuts for drugs purchased through the 340B discount program to certain hospital off-campus provider-based departments (PBDs), as well as a policy focusing on site-neutral payments for clinic visits at off-campus PBDs. CMS is not finalizing its proposal regarding the expansion of clinical families of services at excepted hospital outpatient departments. The Centers for Medicare & Medicaid Services (CMS) on Nov. 2, 2018, issued the Calendar Year (CY) 2019 Final Rule that updates payment rates and policy changes in the Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System. It is scheduled to be published in the Nov. 21, 2018, issue of the Federal Register and will become effective on Jan. 1, 2019.

Visit the CMS website for the OPPS and ASC Payment System Fact Sheet.

Among significant policies:

340B Drug Payment Policy Applied to Non-Excepted Off-Campus Provider-Based Departments (PBDs): CMS finalized a proposal to expand Medicare reimbursement cuts for drugs purchased through the 340B discount program to certain hospital off-campus departments, focusing Medicare cuts on non-grandfathered hospital outpatient departments (HOPDs) - equal to the 22.5 percent reductions (77.5 percent of Average Sales Price rather than 106 percent of Average Sales Price). Critical Access Hospitals (CAHs), Rural Sole Community Hospitals (SCHs), Children's Hospitals and PPS-Exempt Cancer Hospitals remain excluded from the payment adjustment. Site-Neutral Payments for Clinic Visits at Off-Campus PBDs: CMS finalized a policy to "control unnecessary increases in the volume of covered HOPD services" by paying the Medicare Physician Fee Schedule (MPFS)-equivalent for the clinic visit services when provided at an off-campus PBD paid under the OPPS. This reduction in payment will now be phased in over two years. CY 2019 will see a 30 percent payment reduction for clinic visit G0463 (at all off-campus HOPDs), with an additional 30 percent reduction set for 2020. The American Hospital Association (AHA) and other hospital groups are likely to bring forward another lawsuit on this issue, but it may take years to see any resolution, not unlike what hospitals are facing with the 340B issue. Expansion of Clinical Families of Services at Excepted Off-Campus HOPDs: CMS is not finalizing its proposal regarding "clinical families of services" but will continue to monitor the expansion of services in excepted off-campus PBDs. It is clear that CMS is interested in further payment equalization between HOPDs and physician offices, increasing the likelihood of further reductions for off-campus HOPDs in the future.

Additional Highlights

HOPD Payment Updates: CMS finalized a 1.35 percent increase in the OPPS conversion factor (CF), higher than the 1.25 percent increase in the proposed rule. CMS anticipates that the CY 2019 CF update, along with changes in enrollment, utilization and case-mix, will result in total payments of approximately $74.1 billion to HOPD providers, an increase of approximately $5.8 billion from CY 2018 payment estimates. HOPDs failing to meet quality-reporting requirements will continue to receive a 2.0 percent reduction in payments for OPPS services.

ASC Payment Updates...