OPPS/ASC 2012 Final Rule Gets Mixed Reviews

The Centers for Medicare & Medicaid Services (CMS) announced in a final rule issued Nov. 1 that Medicare payments in 2012 will increase by 1.9 percent to hospital outpatient departments (HOPDs) and 1.6 percent to ambulatory surgery centers (ASCs).

In addition to establishing 2012 payment rates for HOPDs and ASCs, the final rule with comment period:

Ambulatory Surgical Center CASCC

  • Expands the measures to be reported under the Hospital Outpatient Quality Reporting Program
  • Creates a new quality reporting program for ASCs
  • Addresses Hospital Value-based Purchasing (Hospital VBP) program requirements
  • Establishes an electronic reporting pilot that will allow additional hospitals, including critical access hospitals (CAHs), to report clinical quality measures in 2012 for the purpose of participating in the Medicare Electronic Health Record Incentive Program
  • Provides a payment adjustment for designated cancer hospitals

Provisions Affecting HOPDs

The 1.9 percent increase to HOPDs is based on the projected hospital inpatient market basket percentage increase of 3.0 percent for inpatient services paid under the hospital Inpatient Prospective Payment System (IPPS) minus the multifactor productivity adjustment of 1.0 percentage points and minus a 0.1 percentage point adjustment, both of which are required by the Affordable Care Act.

In other provisions, the final rule will:

  • Establish an independent advisory review process to consider requests that specific outpatient services become subject to a level of supervision other than direct supervision. Under this process, CMS will seek recommendations from the Ambulatory Payment Classification (APC) Advisory Panel about appropriate supervision requirements.
  • Pay for the acquisition and pharmacy overhead costs of separately payable drugs and biologicals, other than new drugs and biologicals that have pass-through status, at the average sales price (ASP) plus 4 percent.
  • Pay for partial hospitalization (PHP) services in hospital-based PHPs and community mental health centers (CMHCs) based on the unique cost-structures of each type of program. For both types of providers, CMS proposes to finalize its proposal to update the four PHP per diem payment rates based on the median costs calculated using the most recent claims data for each provider type.
  • Increase the number of measures for reporting in 2012 and 2013 for purposes of the 2014 and 2015 payment determinations, and modify the process for selecting hospitals for validating reported chart-abstracted measures that was adopted for 2012 in the 2011 Outpatient Prospective Payment System (OPPS) final rule.

Provisions Affecting ASCs

The 1.6 percent increase to ASC payment rates reflects a consumer price index for all urban consumers estimated at 2.7 percent, minus a 1.1 percent productivity adjustment, as required by the Affordable Care Act.

That sounds like good news, but the Ambulatory Surgery Center Association (ASCA) expressed mixed feelings about the ASC payment update. “While we are disappointed that, despite ASCA’s objections, CMS continues to use a flawed measurement (CPI-U) in setting the ASC rates, we are pleased that the anemic 0.9 percent that had been initially proposed has grown to 1.6 percent in the final rule,” the ASCA said.

The final rule also establishes a quality reporting program for ASCs and adopts five quality measures, including four outcome measures and one surgical infection control measure beginning in 2012 for the 2014 payment determination. The final rule also adds two structural measures for reporting beginning in 2013 for the 2015 and 2016 payment determinations—one for safe surgery checklist use, and one for ASC facility volume data on selected ASC surgical procedures.

This news follows CMS’ announcement Oct. 24, regarding the ASC patient rights conditions for coverage (CfC).

In a final rule, CMS said it is adopting the provisions in the Changes for ASC Patient Rights CfC proposed rule with the following revisions:

  • Delete the reference to the timing of the notice of patient rights exception.
  • Change the timing of the notice of patient rights from “in advance of the date of the procedure” to “prior to the start of the surgical procedure.”
  • Specify that the ASC must provide “the patient, the patient’s representative, or the patient’s surrogate” with written notice of a grievance decision. The proposed rule only included the “patient.”
  • Remove the exceptional requirement, which allowed an ASC in the case of an emergency to provide patients rights information in advance of the date of the procedure.

These changes to the ASC Patient Rights CfC are effective Dec. 23, 2011.

Provisions Affecting the Hospital VBP Program

According to the American Hospital Association (AHA), the key provisions in the OPPS/ASC final rule related to the VBP program “are good news for patients who depend on hospital care.”

“We commend CMS for recognizing that this process is important to protect hospitals and their patients from flawed measures that could cause unintended harm to patients or unfairly penalize hospitals,” the AHA said.

Changes include:

  • adding one clinical process measure to guard against infections due to urinary catheters; and,
  • establishing the weighting, performance periods, and performance standards for the clinical process, patient experience, and outcomes measures for 2014.

Download the final rule with comment period for the 2012 OPPS and the ASC payment system for complete details.

The final rule will appear in the Nov. 30, 2011 Federal Register. CMS is accepting comments until Jan. 3, 2012, and will respond to them in the 2013 rule.

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