The Centers for Medicare and Medicaid Services (CMS) released the calendar year (CY) 2020 hospital outpatient prospective payment system (OPPS) final rule (fact sheet) addressing payments to hospital outpatient departments and ambulatory surgery centers (ASCs). Of note, the much anticipated hospital price transparency provisions that appeared in the CY 2020 OPPS proposed rule have been stripped from this final rule, and will be published in a separately moving rule, which currently remains pending review at the Office of Management and Budget (OMB).
- What it is. This final rule affects payments to approximately 3,800 facilities paid under the OPPS, including hospital outpatient departments (OPDs), as well as ASC payments beginning on Jan. 1, 2020.
- Why it’s important for you. Despite recent court determinations that CMS exceeded its regulatory authority in previous rulemaking, the agency continues with the implementation of controversial payments cuts to hospitals for clinic visit services furnished at certain off-campus provider-based departments (PBDs) and for certain separately payable drugs or biologicals that are acquired through the 340B program. Specifically, CMS completes the two-year phase in of a 60 percent cut in reimbursements to PBDs and finalizes the continuance of the reduced rate of Average Sale Price (ASP) minus 22.5 percent for 340B drugs, noting that it intends to pursue appeals. Additionally, the rule finalizes its revisions to the Hospital Outpatient and ASC Quality Reporting Programs, revises certain requirements for Organ Procurement Organizations, and announces the availability of residency slots for redistribution following the closure of two teaching hospitals.
Proposals that would require all U.S. hospitals to publicly post their standard charge information – including negotiated rates for “shoppable” items and services – are not addressed in the final rule, and will be released instead through a separate rule pending review.
- Potential next steps. The final rule is effective on January 1, 2020. Comments are invited by December 2, 2019 on certain provisions addressing the payment classifications assigned to the interim ambulatory payment classification (APC) assignments and/or status indicators of new or replacement Level II HCPCS codes.
For CY 2020, CMS updates OPPS payment rates by a factor of +2.6 percent (+$6.3 billion) compared with CY 2019 payments. This update factor is based on the projected hospital market basket increase of +3.0 percent minus a -0.4 percentage point adjustment for Multi-Factor Productivity (MFP) required by the Affordable Care Act (ACA).
For the ASC payment system, CMS updates payments by +2.6 percent (+3.0 percent market basket increase minus the -0.4 percentage point adjustment for MFP). The agency estimates that total payments to ASCs (including beneficiary cost-sharing and estimated changes in enrollment, utilization, and case-mix) for CY 2020 will be approximately $4.96 billion, (+$230 million over CY 2019 payments). CMS says this policy will help to promote site-neutrality between hospitals and ASCs and encourage the migration of services to the lower cost setting.
Our full summary is attached.