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CMS Announces CY 2009 Proposed Rule for OPPS and ASC Payment System


Email Alert

July 8, 2008
By Alex M. Hendler*

On July 3, 2008, the Centers for Medicare and Medicaid Services (CMS) announced its proposed rule for the calendar year (CY) 2009 Hospital Outpatient Prospective Payment System (OPPS) and the Ambulatory Surgical Center Prospective Payment System (ASC PPS).

The rule was placed on display at the Office of Federal Register on July 3, 2008.

Access the accompanying addenda and tables.

The rule is scheduled to be published in the July 18, 2008, edition of the Federal Register, and comments are due by 5 p.m. on September 2, 2008.

OPPS Proposals

CMS is proposing a 3.0 percent increase over the CY 2008 market basket conversion factor, resulting in total projected OPPS payments of $28.7 billion in CY 2009, an increase from projected payments of $26.9 billion in CY 2008. Among other changes, the rule also proposes changes in quality measurement, ambulatory payment classifications (APCs), and payment for certain services:

  • Proposed Hospital Outpatient Quality Data Reporting Program (HOP QDRP) changes include:
    • For CY 2010, reducing by 2.0 percentage points a hospital's market basket update for failure to report CY 2009 outpatient hospital quality measures;
    • Adding to the seven existing quality measures four imaging-related quality measures—more specifically, MRI of the lumbar spine for lower back pain, mammography follow-up rates, abdominal CT with contrast (split into four sub-groups), and thorax CT with contrast; and
    • Beginning with CY 2010 payment determinations, randomly selecting 800 outpatient hospital departments per year to review fifty cases each—note that hospitals could be selected in consecutive years.

    CMS is also soliciting comments on possibly creating a new reimbursement adjustment under the OPPS for preventable conditions (proposed to be called "Healthcare-Associated Conditions") analogous to the "hospital-acquired condition" (HAC) preventable condition payment adjustments that are applicable under the inpatient prospective payment system.

  • Proposed APC changes include:
    • Adding four APCs for "Type B" emergency departments (departments not open twenty-four hours a day, seven days a week) to reflect data gathered from CY 2007; and
    • Adding five "composite imaging" APCs to implement a multiple imaging procedure payment reduction similar to the Medicare Physician Fee Schedule for three "families" of imaging modalities: ultrasound, CT and CTA, and MRI and MRA procedures.
  • Proposed changes for other services include:
    • For CY 2009, terminating pass-through status for established device categories and certain drugs and biologicals;
    • Reconfiguring drug administration APCs;
    • Continuing to use the CY 2008 methodology for setting CY 2009 payment rates for APCs that include nuclear medicine procedures;
    • Altering the reimbursement methodology for certain drugs, biologicals, and therapeutic radiopharmaceuticals;
    • For certain brachytherapy sources, implementing prospective payment for CY 2009 based on CY 2007 claims data;
    • For implantable biologicals without pass-through status, packaging payment for the biological into the payment for the associated surgical procedure;
    • Instituting two separate partial hospitalization program (PHP) rates: one for days on which three services are provided to a beneficiary, and another for days on which four or more services are provided to a beneficiary; and
    • Implementing adjustments to beneficiary co-payments.

    CMS is also soliciting comments on status indicators, APC assignments, and payment rates for HCPCS codes implemented in April and July of 2008.

ASC PPS Proposals

For the ASC PPS, CY 2009 will be "the second year of a four-year transition that aligns ASC rates with the [APC] groups that are used to pay for services in hospital outpatient departments." CMS is proposing no inflation-based adjustment to ASC PPS rates, although it is expecting total ASC reimbursement to increase from $3.5 billion in CY 2008 to $3.9 billion in CY 2009. Although CMS is statutorily authorized to implement quality reporting for ASCs, CMS is not proposing to do so in CY 2009.

Among other changes, CMS is:

  • Soliciting comments on payment indicators and payment rates for CPT and HCPCS codes for ancillary services that were added to the ancillary services list effective April and July 2008;
  • Proposing to add nine surgical procedures to the list of procedures for which CMS will pay when the procedures are performed in an ASC; and
  • Proposing to designate five new procedures as "office-based."

View the CMS press release and fact sheet that accompanied the rule's release.

*We would like to thank Alex M. Hendler (Washington, DC) for providing this email alert.

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