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Home E-Weekly November 7, 2017

Lower-Than-Expected Medicare Payment Increases for ASCs and HOPDs in 2018

Published: November 6, 2017

JOINT MOVEMENT Surgery centers are a step closer to getting paid for performing total knee replacements on Medicare beneficiaries.

CMS's newly released 2018 Final Payment Rule is a mixed bag of short-term frustration and long-term promise. Here's what to expect when the new rule goes into effect on Jan. 1:

  • Payment rate updates. Surgery centers and hospital outpatient departments will receive lower-than-expected increases in reimbursements. Surgery centers will receive a 1.2% bump to payments, less than the 1.9% increase noted in the proposed rule that was published in July. CMS based the final figure on a projected 1.7% rate of inflation minus a 0.5% productivity adjustment as required by the Affordable Care Act (ACA).

    Hospital outpatient departments will receive a 1.35% increase, which is also lower than the 1.75% jump that was floated in the proposed rule. CMS used a 2.7% market basket update minus a 0.6% adjustment for economy-wide productivity and a 0.75% adjustment required by the ACA to come up with the final increase.

    "Yet again, ASC payments fall farther behind those of hospital outpatient departments because CMS continues to use an inflation factor — the CPI-U — that doesn't focus on the costs of goods and services in the healthcare market," says Bill Prentice, CEO of the Ambulatory Surgery Center Association. "CMS insists on waiting for a perfect replacement to the CPI-U while a good one, the hospital market basket, is available."

  • Total knees no longer inpatient only. CMS finalized the removal of total knee replacement from the inpatient-only list. However, knee arthroplasty was not added to the list of ASC payable procedures. Although CMS did not remove total ankle, total hip and partial hip replacements from the inpatient-only list, the agency is considering further discussion about doing so and will revisit the topic in the future.

    "While fee-for-service Medicare cases will not be reimbursed in the ASC setting in 2018, it is our understanding that there are some Medicare Advantage plans reimbursing for these cases when performed in ASCs," says Kara Newbury, JD, regulatory counsel for the ASC Association. "The removal of total knee arthroplasty from the inpatient-only list is an important step to seeing this procedure covered in the ASC setting in the future."

  • New procedures added. CMS will now reimburse ASCs for the following CPT codes: 22856 (total artificial disc arthroplasty); 22858 (second level total artificial disc arthroplasty); and 58572 (total hysterectomy for uterus greater than 250 g).
  • OAS CAHPS pushed back. CMS has delayed requiring ASCs to participate in the Consumer Assessment of Healthcare Providers and Systems Outpatient and Ambulatory Surgery Survey (OAS CAHPS), which is a program designed to gather data gathered from Medicare beneficiaries about the care they receive at surgery centers. CMS proposed making the program mandatory beginning next year, but those plans have been shelved.

    Ms. Newbury says the ASC Association supports having a patient experience of care survey in both the ASC and hospital outpatient settings, but appreciates that the agency has delayed the implementation of the program. That delay, she says, will give policymakers time to assess the direct costs associated with the survey process, the best methods for collecting the data and the ideal number of survey questions that would lead to the highest rate of patient feedback and the compiling of meaningful information.

  • "We continue to encourage CMS to keep the survey voluntary until there is an electronic option and the survey is shortened, both of which would significantly reduce the cost burden to our facilities and make it easier for our patients to complete," comments Ms. Newbury.

Daniel Cook

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